EU Lifts Cyprus from Macroeconomic Imbalance List
Breaking News: The European Commission’s 2025 Spring Package confirms that Cyprus is off the list of countries with macroeconomic imbalances. This achievement stems from a consistent decrease in external and private debt vulnerabilities, bolstered by solid economic growth.
Nevertheless, Cyprus still faces challenges in areas like innovation and the green transition. According to a senior EU official, “Economic growth in Cyprus remains robust despite a volatile global landscape.”
Follow THE FUTURE on LinkedIn, Facebook, Instagram, X and Telegram
Major improvements include public finances showing substantial surpluses and a swiftly declining public debt. Diversification efforts in Cyprus’ economy are finally yielding positive outcomes, complemented by enhanced performance across United Nations sustainable development indicators.
Yet, ten predominant challenges have been identified by the commission, warning of risks tied to increasing public expenditures and slight deviations from the fiscal trajectory set for 2025. A glaring issue is research and innovation investment, which falls short compared to the EU average, presenting a need for enhanced collaboration among universities, the financial sector, and businesses.
The commission suggests the development of Cyprus’s financial system beyond banking and emphasizes the need to raise financial literacy levels.
Moreover, Cyprus must intensify its push towards cleaner energy. The nation’s current over-reliance on fossil fuels and imported energy leaves it vulnerable. High electricity costs for domestic usage, alongside low environmental performance, underline the urgency for these reforms.
Notably, Cyprus stands as a low investor in climate change adaptation when set against the EU norm. Using resources from the Recovery and Resilience Facility, Cyprus could address these critical areas swiftly.
Looking to the future, Cyprus is urged to enhance its labor market conditions. Youth engagement in vocational training and education in STEM fields need nurturing to tackle skill mismatches.
Though recent economic achievements mark progress for Cyprus, the commission stresses the importance of continued vigilance and reform to ensure lasting stability and prosperity.
