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Cyprus’ Vulnerability To Pandemic Crisis: An In-Depth Analysis

by THEFUTURE.TEAM

July 23, 2024

Amid unprecedented support measures implemented across the European Union to mitigate the economic impacts of the COVID-19 crisis, Cyprus has emerged as one of the most vulnerable nations. Detailed analysis from the July 2024 issue of the “Review of Cypriot Economic Policy” reveals significant financial difficulties experienced by households during the pandemic.

Authors Maria Iliophotou and Nikoletta Pasiourtidou utilised data from the EU Survey of Income and Living Conditions (EU-SILC) to explore factors contributing to these economic hardships. Their study indicates that employment profiles play a crucial role, with households containing unemployed or self-employed individuals, those in hospitality, and service sectors facing the highest risks.

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Additionally, working-age households, immigrant families, larger households, and those with health issues exhibited increased financial strain. Key indicators included reduced household income and delayed payments on essential expenses such as rent or mortgage.

Comparative analysis within the EU identified Cyprus, alongside Greece, Romania, Bulgaria, and Malta, as particularly susceptible to the pandemic’s economic fallout. Despite various relief measures, the financial resilience of Cypriot households remains a pressing concern, underscoring the need for targeted policy interventions to bolster economic stability.

Employment Profiles and Economic Hardship

The study highlighted the correlation between employment status and financial vulnerability. Households with unemployed or self-employed individuals faced significant income reductions, exacerbating their financial instability. The hospitality and service sectors, heavily impacted by pandemic restrictions, saw widespread job losses and reduced working hours, further straining household budgets.

Demographic Factors Influencing Financial Strain

The analysis underscored that demographic factors such as age, immigration status, household size, and health conditions played a crucial role in financial vulnerability. Working-age households, especially those with young children, encountered heightened economic pressures. Immigrant families, often engaged in precarious employment, faced disproportionate economic challenges.

Impact on Household Income and Expense Management

The pandemic resulted in widespread income reductions across Cypriot households. Many families struggled to manage essential expenses, with significant delays in rent and mortgage payments. The financial strain was particularly acute among larger households, where the burden of multiple dependents exacerbated economic difficulties.

Comparative Vulnerability within the EU

When compared with other EU nations, Cyprus emerged as one of the most vulnerable to the economic impacts of the pandemic. Alongside Greece, Romania, Bulgaria, and Malta, Cyprus showed heightened susceptibility to financial distress, despite the implementation of relief measures. This comparative analysis highlighted the need for robust, targeted interventions to mitigate long-term economic repercussions.

Policy Recommendations for Enhancing Financial Resilience

To address these vulnerabilities, the study recommends comprehensive policy measures aimed at enhancing the financial resilience of Cypriot households. These include targeted support for unemployed and self-employed individuals, initiatives to stabilise the hospitality and service sectors, and programs to assist immigrant families and larger households. Furthermore, the study advocates for improved access to healthcare and financial services to support households with health issues.

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Cyprus Emerges As A Leading Household Consumer In The European Union

by THEFUTURE.TEAM

June 30, 2025

Overview Of Eurostat Findings

A recent Eurostat survey, which adjusts real consumption per capita using purchasing power standards (PPS), has positioned Cyprus among the highest household consumers in the European Union. In 2024, Cyprus recorded a per capita expenditure of 21,879 PPS, a figure that underscores the country’s robust material well-being relative to other member states.

Comparative Consumption Analysis

Luxembourg claimed the top spot with an impressive 28,731 PPS per inhabitant. Trailing closely were Ireland (23,534 PPS), Belgium (23,437 PPS), Germany (23,333 PPS), Austria (23,094 PPS), the Netherlands (22,805 PPS), Denmark (22,078 PPS), and Italy (21,986 PPS), with Cyprus rounding out this elite group at 21,879 PPS. These figures not only highlight the high expenditure across these nations but also reflect differences in purchasing power and living standards across the region.

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Contrasting Trends In Household Spending

The survey also shed light on countries with lower household spending levels. Hungary and Bulgaria reported the smallest average expenditures, at 14,621 PPS and 15,025 PPS respectively. Meanwhile, Greece and Portugal recorded 18,752 PPS and 19,328 PPS, respectively. Noteworthy figures from France (20,462 PPS), Finland (20,158 PPS), Lithuania (19,261 PPS), Malta (19,622 PPS), Slovenia (18,269 PPS), Slovakia (17,233 PPS), Latvia (16,461 PPS), Estonia (16,209 PPS), and the Czech Republic (16,757 PPS) further illustrate the disparate economic landscapes within the EU. Spain’s figure, however, was an outlier at 10,899 PPS, suggesting the need for further data clarification.

Growth Trends And Economic Implications

Eurostat’s longitudinal analysis from 2019 to 2024 revealed that Croatia, Bulgaria, and Romania experienced the fastest annual increases in real consumer spending, each growing by at least 3.8%. In contrast, five member states, with the Czech Republic experiencing the largest drop at an average annual decline of 1.3%, indicate a varied economic recovery narrative across the continent.

This comprehensive survey not only provides valuable insights into current household consumption patterns but also offers a robust framework for policymakers and business leaders to understand economic shifts across the EU. Such data is integral for strategic decision-making in markets that are increasingly defined by evolving consumer behavior and regional economic resilience.