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European Commission published forecast for the economy of Cyprus

European Commission published forecast for the economy of Cyprus

09.02.2018
Tags: Cyprus, Economy, European Commission, Statistics

The European Commission predicts that in 2018, the growth rate of the economy of Cyprus will slow down to 3,2%, and in 2019-m - to 2,8% after the increase in GDP by 3,8%, recorded in 2017.

"The rapid growth of the economy is due to the strengthening of domestic consumption and the stable growth of exports, as well as support from government consumption," the European Commission said on 7 February. In turn, the increase in consumption in the domestic market contributed to the growth of employment in all sectors of the economy, as well as higher wages.

Improvement of the situation on the labor market, where there is a significant reduction in the number of unemployed, should further increase employment and pay, which in turn stimulates domestic consumption.

The European Commission also notes a steady increase in exports of services, especially in the second and third quarters of the year. The reason for this is the tourism boom that has been going on for several years. In turn, the gradual restoration of the construction sector and the launch of a number of large projects should stimulate investment inflow, growth of domestic consumption and imports. At the same time, the growth in exports will slow down due to "limited opportunities", especially in tourism, where the deterrent is the number of accommodation for visitors.

Inflation in the past year was 0,7% - the first positive value after two years of deflation. In the current and next years it is expected to be at the level of 1,2% and 1,3%.

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