cyprus economy — cyprus economy — Cyprus’ economy recorded impressive growth in the fourth quarter of 2025, continuing to outperform its euro area counterparts. A flash estimate from the statistical service, Cystat, revealed that the seasonally adjusted gross domestic product (GDP) rose by 4.5 per cent year-on-year during this period.
The notable increase in GDP can be attributed to several key sectors, including wholesale and retail trade, information and communication, as well as the hospitality industry encompassing hotels and restaurants. This growth trajectory was further highlighted by a quarterly increase of 1.4 per cent, following previous quarters that saw GDP growth rates of 0.9 per cent, 0.8 per cent, and 1.3 per cent.
Cystat’s flash estimate serves as an early indicator of Cyprus’ economic performance, utilising preliminary data available around 45 days post-quarter-end, ahead of the comprehensive quarterly national accounts. This timely information allows for a clearer understanding of the country’s economic health.
In comparison, Eurostat’s latest data underscored Cyprus’ strong performance relative to the wider European context. The euro area and the European Union (EU) both showed modest GDP growth of only 0.3 per cent in the fourth quarter of 2025, with annual growth figures of 1.3 per cent for the euro area and 1.5 per cent for the EU.
The disparity in growth rates is striking when looking at Cyprus against its euro area neighbours. For instance, Germany’s economy expanded by a mere 0.3 per cent quarter-on-quarter and 0.4 per cent year-on-year in the same period. France saw a quarterly growth of 0.2 per cent and an annual increase of 1.1 per cent, while Italy recorded similar quarterly growth and an annual rate of 0.8 per cent.
In contrast, Spain experienced a more robust growth at 0.8 per cent quarterly and 2.6 per cent annually. Poland also performed well with a quarterly growth of 1.0 per cent and an impressive 3.6 per cent year-on-year increase.
The economic resilience of Cyprus is further reflected in its employment statistics. Eurostat reported a 0.2 per cent increase in employment across both the euro area and the EU in the fourth quarter. The annual employment growth was slightly higher in the EU, showing a 0.7 per cent increase compared to 0.6 per cent in the euro area.
Throughout 2025, Cyprus’ GDP growth accelerated from 3.3 per cent at the beginning of the year to an impressive 4.5 per cent by year-end. This upward trend in economic performance is a positive sign for the nation as it navigates through the broader European economic landscape.
