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Cyprus Economy In 2024: Growth In Key Sectors, But Trade Faces Challenges

Cyprus experienced notable economic growth in 2024, driven by increases in construction, manufacturing, tourism, and vehicle registrations. However, trade performance weakened, with both imports and exports declining. The latest data from CySTAT provides a comprehensive overview of these trends.

Key Figures

  • Construction Growth: Building permits reached 1.72 million square meters (January–August 2024), an 18% increase compared to the same period in 2023.
  • Manufacturing Expansion: Industrial production rose 1.8% from January to November 2024, reflecting steady growth in the sector.
  • Increase in Vehicle Registrations: Total vehicle registrations grew 9.1%, reaching 49,616; Private saloon car registrations increased 11.2%, while light goods vehicle sales surged 36.1%.
  • Consumer Price Index: Inflation remained moderate, with the CPI rising 1.8% for the year.
  • Tourism Growth: Tourist arrivals reached 4,040,200, marking a 5.1% increase compared to 2023.
  • Decline in Trade Performance: Imports fell 7%, totaling €12.26 billion; Exports declined 12.5%, amounting to €4.12 billion.

The data highlights strong domestic economic activity but also signals potential challenges in external trade.

Central Bank Of Cyprus Balance Sheet Reflects Strong Eurosystem Position

Overview Of Financial Stability

The Central Bank of Cyprus (CBC) has released its latest balance sheet, reaffirming its steadfast role within the Eurosystem. The balance sheet, featuring total assets and liabilities of €29.545 billion, underscores the institution’s stable financial posture at the close of January 2026.

Asset Allocation And Strategic Holdings

Governor Christodoulos Patsalides issued the balance sheet, which details the CBC’s asset composition under the Eurosystem framework. Notably, the bank’s gold and gold receivables amounted to €1.635 billion, providing a significant hedge and stability to its balance sheet. Additional asset categories include claims on non-euro area residents denominated in foreign currency at €1.099 billion, while claims on euro area residents in both foreign and domestic currency add further depth to its portfolio.

The most substantial asset category, intra-Eurosystem claims, reached €19.438 billion, an indication of the CBC’s deep integration with its European counterparts. Furthermore, euro-denominated securities held by euro area residents contributed €6.587 billion. Despite a marked emphasis on these areas, lending to euro area credit institutions in monetary policy operations recorded no activity during the period.

Liability Structure And Monetary Policy Implications

On the liabilities side, banknotes in circulation contributed €3.218 billion. Liabilities to euro area credit institutions associated with monetary policy operations were notably the largest single category, totaling €17.636 billion. Supplementary liabilities included those to other euro area residents, which aggregated to €4.989 billion, with government liabilities playing a predominant role at €4.754 billion.

Other liability items, such as claims related to special drawing rights allocated by the International Monetary Fund at €494.193 million, and provisions of €596.571 million, further articulate the CBC’s exposure. Revaluation accounts stood at €1.643 billion, and overall capital and reserves were confirmed at €333.822 million, completing the picture of a well-capitalized institution.

Conclusive Insights And Strategic Alignment

The detailed breakdown illustrates the CBC’s sizeable intra-Eurosystem exposures, reinforcing its central role within Europe’s monetary landscape. With an asset-liability balance maintained at €29.545 billion, the CBC’s financial position remains robust, indicating a commitment to structural stability and strategic risk management.

This fiscal disclosure not only provides transparency into the CBC’s operations but also serves as a benchmark for comparative analysis among other central banks within the Eurosystem, highlighting the intricate balance between asset liquidity, regulatory oversight, and monetary policy imperatives.

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