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Cyprus Government Surplus Rises Amid Elevated Expenditure in Key Sectors

by THEFUTURE.TEAM
June 30, 2025

Robust Fiscal Position Despite Increased Spending

Cyprus has demonstrated resilient fiscal management with a general government surplus of €551.2 million from January to May 2025, representing 1.6% of GDP, according to preliminary data released by the Statistical Service of Cyprus (Cystat). This marginal increase from the €542.6 million surplus in the same period of 2024 underscores the nation’s ability to maintain a favorable balance even as spending intensifies across key sectors.

Stronger Revenue Streams Drive the Surplus

The fiscal report highlights a notable boost in total government revenue, which climbed by €310.8 million to reach €5.9 billion—a 5.6% increase compared to the corresponding period in 2024. Income and wealth taxes led the charge, surging by 11.1% to €1.37 billion, while social contributions increased by 8.8% to €1.96 billion. Remarkably, property income more than doubled, rising significantly from €41.1 million to €92.8 million, reinforcing the diversified nature of the revenue portfolio.

Balanced Growth in Specific Revenue Categories

Revenues stemming from the sale of goods and services and taxes on production and imports also experienced healthy growth, increasing by 7.8% to €401.5 million and by 1.7% to €1.91 billion, respectively. However, among these, the net VAT collection noted a slight decline of 1.0%, reflecting modest adjustments in this segment. Conversely, current and capital transfers saw significant downturns, dropping 36.4% and 60.5%, respectively, suggesting a strategic focus on direct revenue enhancements.

Expenditure Expansion and Strategic Allocation

On the expenditure front, government spending rose by 6% to €5.35 billion compared with the previous year. Increased compensation for employees, social benefits, and intermediate consumption indicate targeted investments in the country’s workforce and social infrastructure. Moreover, the capital account expanded robustly by 27.7%, driven by an 18.0% rise in gross capital formation and nearly doubling of other capital expenditures, signaling ongoing commitments to long-term capital projects.

Conclusion: A Delicate Fiscal Balance

The fiscal trajectory reported by Cystat reflects a balanced approach: while key revenue streams are strengthening and contributing to a surplus, rising expenditures and selective cuts in transfer payments illustrate deliberate fiscal recalibration. This dynamic suggests a government focused on sustainable growth and the strategic management of public resources, even in a challenging economic milieu.

EU Moderates Emissions While Sustaining Economic Momentum

by THEFUTURE.TEAM
November 15, 2025

The European Union witnessed a modest decline in greenhouse gas emissions in the second quarter of 2025, as reported by Eurostat. Emissions across the EU registered at 772 million tonnes of CO₂-equivalents, marking a 0.4 percent reduction from 775 million tonnes in the same period of 2024. Concurrently, the EU’s gross domestic product rose by 1.3 percent, reinforcing the ongoing decoupling between economic growth and environmental impact.

Sector-By-Sector Performance

Within the broader statistics on emissions by economic activity, the energy sector—specifically electricity, gas, steam, and air conditioning supply—experienced the most significant drop, declining by 2.9 percent. In comparison, the manufacturing sector and transportation and storage both achieved a 0.4 percent reduction. However, household emissions bucked the trend, increasing by 1.0 percent over the same period.

National Highlights And Notable Exceptions

Among EU member states, 12 reported a reduction in emissions, while 14 saw increases, and Estonia’s figures remained static. Notably, Slovenia, the Netherlands, and Finland recorded the most pronounced declines at 8.6 percent, 5.9 percent, and 4.2 percent respectively. Of the 12 countries reducing emissions, three—Finland, Germany, and Luxembourg—also experienced a contraction in GDP growth.

Dual Achievement: Environmental And Economic Goals

In an encouraging development, nine member states, including Cyprus, managed to lower their emissions while maintaining economic expansion. This dual achievement—reducing environmental impact while fostering economic activity—is a trend that has increasingly influenced EU climate policies. Other nations that successfully balanced these outcomes include Austria, Denmark, France, Italy, the Netherlands, Romania, Slovenia, and Sweden.

Conclusion

As the EU continues to navigate its climate commitments, these quarterly insights underscore a gradual yet significant shift toward balancing emissions reductions with robust economic growth. The evolving landscape highlights the critical need for sustainable strategies that not only mitigate environmental risks but also invigorate economic resilience.

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