Cyprus Soars Ahead: Outpacing Euro Area Growth in 2023

Apr 28, 2023 | Cyprus Economy

According to the European Commission, Cyprus is expected to outpace the growth of the Euro area this year, with a projected Gross Domestic Product (GDP) growth rate of 4.4%. The Euro area is expected to grow by 4.2% in 2023.

“Cyprus is projected to see a solid economic recovery in 2023, supported by a rebound in private consumption, investment and exports,” said the European Commission.
The positive outlook
This positive economic outlook is largely due to the effective management of the COVID-19 pandemic, which allowed the country to reopen its tourism sector earlier than many other European countries.

Tourism is a significant contributor to the Cypriot economy, accounting for nearly 20% of the country’s GDP. The reopening of the sector is expected to have a positive impact on employment, with the creation of new jobs in the hospitality and retail industries.

In addition, the country’s highly educated workforce and its reputation as a business-friendly environment make it an attractive destination for foreign investors. The government has also been taking steps to improve the investment climate, such as simplifying the process for obtaining building permits and reducing red tape.

Despite these positive developments, the European Commission has warned that the recovery is still fragile, and risks such as the potential for a new wave of COVID-19 infections or a slowdown in global economic activity could pose a threat to the country’s growth prospects.

However, with a projected growth rate of 4.4%, Cyprus is well-positioned to outpace the growth of the Euro area and continue its upward economic trajectory in 2023.

“The Cypriot economy is poised for a strong recovery this year, driven by a rebound in key sectors such as tourism and investment,” said the European Commission.

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