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Cyprus’ Financing Programme On Track Amidst Economic Optimism

by THEFUTURE.TEAM

July 22, 2024

Cyprus is advancing its annual financing programme efficiently, aligning closely with its fiscal targets for 2024. The approved borrowing ceiling stands at €1.3 billion, predominantly sourced from European Medium-Term Notes (EMTN). So far, Cyprus has successfully raised nearly €1.2 billion, including a recent €1 billion, seven-year fixed-rate bond issued in June.

The financing strategy also includes public treasury bills and domestic bonds aimed at individual investors. To date, €87.5 million of the targeted €120 million in treasury bills and €6.4 million of the intended €40 million in domestic bonds have been issued. Furthermore, Cyprus has secured €92.75 million in loans from supranational organisations, progressing towards the €140 million goal.

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Public treasury bills, set to mature in October 2024, offer an annualised yield between 3.65% and 3.75%, presenting an attractive option for non-professional investors and businesses seeking secure liquidity management.

Sophic, a financial platform, plans to acquire a portion of the upcoming treasury bill issuance, replicating its strategy from June where it, alongside Athlos Capital, acquired over 80% of the €21.5 million issuance for client allocation.

Cyprus’ prudent financial management and structured approach towards funding reflect a robust fiscal framework aimed at maintaining economic stability and fostering investor confidence. This meticulous execution of the financing programme underscores Cyprus’ commitment to strategic fiscal governance and economic resilience, which are vital for sustaining long-term growth.

The ongoing success of Cyprus’ financing programme highlights the nation’s proactive fiscal planning and the effectiveness of its public debt management office. By securing diverse funding sources and maintaining investor engagement, Cyprus continues to bolster its financial stability and economic prospects.

As Cyprus progresses with its financing activities, the focus remains on sustaining fiscal discipline while leveraging favourable market conditions to optimise funding costs. This approach not only ensures the fulfilment of immediate financing needs but also lays a solid foundation for future economic resilience.

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Cyprus Economic Resilience: Real GDP Growth Driven By Key Sectors In 2025

Macro-Economic Overview

The Statistical Service of Cyprus (Cystat) released its first estimate for 2025, showing that the country’s Gross Domestic Product increased by 3.8% in real terms and 4.5% at current prices. In real terms, GDP reached €30.52 billion, reflecting continued economic expansion compared with 2024. Nominal GDP rose to €36.32 billion, indicating higher overall economic activity during the year.

Diverse Sectoral Contributions

According to the production approach, growth was mainly supported by several key sectors of the economy. These included Information and Communications, Hotels and Restaurants, Construction, and Wholesale and Retail Trade, including motor vehicle repairs. The performance of these sectors contributed to the overall increase in economic output during 2025.

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Consumption, Investment, And Trade Dynamics

Data based on the expenditure approach show that public consumption increased by 6.7%, reaching €6.82 billion. Private consumption rose by 3.7% to €20.65 billion. Gross fixed capital formation grew by 2.3%, reaching €7.35 billion, reflecting continued investment activity. Exports increased by 5.3% to €35.52 billion, while imports rose by 4.9% to €34.04 billion. The increase in imports moderated the overall contribution of external trade to GDP growth.

Quarterly Insights: Strong Fourth Quarter Performance

Separate data from Cystat indicate that seasonally adjusted real GDP grew by 4.5% in the fourth quarter of 2025 compared with the same period in 2024, reaching €7.76 billion. Quarterly, GDP increased by 1.4% compared with the third quarter of the year. Growth during the period was mainly recorded in Wholesale and Retail Trade, Information and Communications, and Hotels and Restaurants. The figures confirm continued economic expansion across several sectors of the Cypriot economy during the final quarter of 2025.