The resilience of the Cyprus economy is underscored by a reported economic growth of 4.5 per cent in the fourth quarter of 2025, as noted by Finance Minister Makis Keravnos.
- The resilience of the Cyprus economy is underscored by a reported economic growth of 4.5 per cent in the fourth quarter of 2025, as noted by Finance Minister Makis Keravnos.
“The data on the growth rate of Cyprus’ GDP in the fourth quarter of 2025 confirm once again the dynamism of the Cypriot economy despite the fact that the external environment is full of challenges and uncertainties,” Keravnos stated.
Reflecting on the broader economic landscape, he highlighted the government’s efforts in securing fiscal stability and sustainability. “Through prudent management, we manage to achieve surplus budgets, steadily reduce public debt and create the conditions for the long-term resilience of our economy,” he added.
Keravnos emphasised the importance of maintaining strong liquidity buffers, which he described as a constant goal and challenge for the Ministry of Finance. “The maintenance of high levels of available liquidity constitutes a constant goal and challenge of the Ministry,” he remarked.
In terms of inflation, the Finance Minister indicated that inflationary pressures have subsided significantly. “Inflation has now reached zero levels,” he said, which he believes strengthens purchasing power and stabilises prices for both citizens and businesses.
Keravnos linked the impressive growth figures to positive labour market conditions, noting that Cyprus continues to outperform the European Union average in terms of economic performance and unemployment rates. “The Cypriot economy is growing at rates higher than the average of the European Union, while unemployment remains at low levels, creating opportunities for society and businesses,” he explained.
Data provided by the Cyprus Statistical Service and Eurostat corroborated his views, showing that the growth rate of 4.5 per cent for the fourth quarter is significantly above the European average. “Despite a period of increased uncertainty and an external environment full of challenges, Cyprus continues to record relatively high growth rates especially compared with the EU in combination with low inflation and conditions of full employment,” he added.
Looking to the future, Keravnos maintained that adherence to cautious fiscal management will further bolster the resilience of the Cypriot economy and support sustained growth above 3 per cent over the medium term. “The maintenance of prudent and disciplined fiscal and economic management by this government will contribute even more to the resilience of the Cypriot economy so that Cyprus can continue to record medium-term growth rates above 3 per cent,” he said.
This growth trajectory allows the government to channel resources toward social priorities and business support. “This course gives us the possibility to release economic forces and capabilities in order to further strengthen social policy and mitigate any problems facing our businesses and our society in general,” Keravnos concluded.
In a related update, the Finance Ministry projected that for the entirety of 2025, economic growth is estimated at 3.75 per cent, exceeding earlier forecasts from both domestic and international institutions, which were more conservatively set between 2.9 per cent and 3.5 per cent.
Keravnos is set to travel to Brussels on February 16 for the Eurogroup meeting, prior to chairing the Ecofin Council meeting the following day. At the Eurogroup, ministers will review economic policy recommendations issued by the European Commission and discuss the euro’s international role amid ongoing geopolitical challenges.
The Ecofin Council will address pressing economic developments, including a presentation of proposals aimed at enhancing supplementary pensions and measures to strengthen occupational pension provisions. Additionally, the council will discuss the economic implications of the Russian invasion of Ukraine and is expected to approve guidelines for the EU budget for 2027.
