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Cyprus Central Bank Revises GDP Growth Projections Upward

by THEFUTURE.TEAM

December 20, 2024

The Central Bank of Cyprus (CBC) has revised its GDP growth forecast for 2024, increasing it by 0.2 percentage points to 3.7%. This adjustment reflects stronger domestic demand, with private consumption playing a pivotal role, supported by the continued resilience of the Cypriot economy.

However, forecasts for 2025-2026 have been slightly downgraded due to the impact of rising imports needed to meet elevated domestic demand. While exports, particularly non-tourism services, remain a growth driver, they are not sufficient to fully offset the increase in imports.

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Labor Market Nearing Full Employment

The labor market in Cyprus continues to strengthen, with unemployment expected to fall to 5% in 2024, down from 5.8% in 2023. This trend is forecast to continue, with unemployment rates projected to drop to 4.9% in 2025, 4.7% in 2026, and 4.6% in 2027, approaching conditions of full employment.

The improved GDP outlook has led to a downward revision of the 2024 unemployment forecast by 0.1 percentage points. The sustained growth momentum of the economy is seen as the key factor driving this positive trend.

Inflation Stabilizing Towards Target Levels

Inflation, as measured by the Harmonized Consumer Price Index (HICP), is expected to decline to 2.2% in 2024 from 3.9% in 2023, moving closer to the medium-term target of 2%. This stabilization is attributed to easing external inflationary pressures, including a reduction in energy and raw material prices, as well as the lagged effects of eurozone monetary policy, which continues to temper inflation.

Wage growth is anticipated to remain moderate, helping to limit inflationary pressures. However, the gradual introduction of a green carbon tax from 2025 may result in modest fuel price increases.

The normalization of inflation for industrial goods (excluding energy) is also expected between 2025 and 2027, following the high levels seen in 2022-2023. Core inflation—excluding energy and food—is forecast to decline from 3.8% in 2023 to 2.6% in 2024, 2.0% in 2025, 1.9% in 2026, and 2.0% in 2027. Service price inflation is expected to decelerate during the 2025-2027 period.

The 2024 inflation forecast was revised upward by 0.1 percentage points compared to September 2024 projections, reflecting higher-than-expected service price inflation.

Risks And Prospects

The economic outlook for 2024 is balanced, while projections for 2025-2027 suggest a slight increase in downside risks.

Key downside risks include ongoing geopolitical tensions and weaker-than-expected external demand amid heightened global trade uncertainty. Domestically, the introduction of new taxes on multinational corporate profits could negatively impact economic performance, although the extent of this effect is uncertain. Slower-than-expected easing of financing conditions may also curb domestic demand.

On the upside, stronger-than-anticipated private consumption, driven by lower household savings rates, could boost economic performance.

Inflation risks for 2024 are balanced, while those for 2025-2027 lean slightly upward. Upside risks include potential geopolitical escalations, trade policy uncertainties (such as new US tariffs and EU retaliatory measures), and climate-related impacts like extreme weather events and the implementation of green taxation. Wage growth exceeding expectations and higher corporate profit margins could also contribute to inflationary pressures.

Conversely, inflation could underperform baseline projections if financing conditions ease more slowly than expected or if heightened geopolitical tensions unexpectedly weaken the global economic environment.

The Decline Of Smartwatches: A Turning Point In The Wearable Tech Industry

by THEFUTURE.TEAM

March 13, 2025

For the first time in history, the smartwatch market is facing a significant downturn. Shipments are expected to drop by 7% in 2024, marking a major shift in a segment that has been growing steadily for over a decade. A report by Counterpoint reveals that while Apple still holds the top spot, its dominance is being challenged by a surge from Chinese brands like Huawei, Xiaomi, and BBK. Even as the overall market struggles, some companies are thriving.

The Big Picture: Why Smartwatches Are Slowing Down

Apple’s flagship products have long been the driving force in the smartwatch market, but even the tech giant is feeling the pressure. The company’s shipments are projected to fall by 19% this year, though it will remain the market leader. Meanwhile, brands from China are capitalizing on the shift, with Huawei showing an impressive 35% growth in sales, driven by the booming domestic market and a broad range of offerings, including smartwatches for kids.

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Xiaomi, too, is experiencing remarkable success, with a staggering 135% increase in sales. In contrast, Samsung is seeing more modest growth, up 3%, thanks to its latest Galaxy Watch 7 and Galaxy Watch Ultra series.

While some companies are succeeding, the broader market is facing headwinds. The biggest factor behind the overall decline is the slowdown in India, where consumer demand for smartwatches has stagnated. The segment is suffering from a lack of innovation and fresh updates, leaving many consumers with little incentive to upgrade their devices. Add to that market saturation, and it’s clear why many users are content with their current models. The Chinese market, however, is bucking the trend, showing 6% growth in 2024.

A Glimpse Into The Future

Looking ahead, the smartwatch market may begin to recover in 2025, driven by the increasing integration of AI and advanced health monitoring tools. As these technologies evolve, the industry could see a resurgence in demand.

Huawei’s Remarkable Comeback

Huawei’s impressive performance in the smartwatch space signals a broader recovery for the company, which has been hit hard by US sanctions. Once the world’s largest smartphone maker, Huawei’s business was decimated when it lost access to advanced chips and Google’s Android operating system in 2019. But in China, Huawei has maintained its dominance, with its market share growing to 17% in 2024.

This resurgence was partly driven by the launch of the Mate 60 Pro, a smartphone featuring a 7-nanometer chip developed in China. Despite US sanctions, the device surprised many with its capabilities, a testament to China’s rising investment in domestic semiconductor production.

In February, Huawei also unveiled its Mate XT foldable smartphone, the world’s first device to fold in three directions. Running on HarmonyOS 4.2, Huawei’s proprietary operating system, the phone further demonstrates the company’s resilience and ability to innovate despite international challenges.

Huawei’s smartwatch offerings are also catching attention, particularly the Huawei Watch GT 5 Pro, which launched in September of last year. With a premium titanium alloy design, a high-resolution AMOLED display, and impressive health tracking features, the GT 5 Pro has become a standout in the market, available to both Android and iOS users.

A Brief History Of The Smartwatch Revolution

The smartwatch market has had its fair share of milestones, but the real breakthrough came in 2012 with the Pebble, a Kickstarter-funded project that raised over $10 million. Pebble introduced the world to smartphone integration, app downloads, and long battery life, becoming the first truly mass-market smartwatch.

In 2013, Samsung entered the game with the Galaxy Gear, marking its first attempt at wearable tech. But it was Apple’s entry in 2014 that truly set the industry on fire. The Apple Watch’s sleek design, integration with iOS, and emphasis on health and fitness catapulted it to the top of the market, establishing a standard that many other brands would try to follow.

By 2021, the smartwatch industry had grown to over $30 billion in revenue, with annual growth reaching 20%. Yet now, it finds itself at a crossroads, with innovation stagnating and market saturation taking a toll.