President Christodoulides Announces 2025 Budget Surplus, Prioritises Economic Strength And Social Reforms

In a bold economic declaration, Cyprus’ President Nikos Christodoulides revealed a budget surplus forecast for 2025 during a recent Cabinet meeting. This announcement underscores the government’s strategic focus on fiscal responsibility, strong financial systems, and comprehensive reforms.

Strategic Fiscal Management

President Christodoulides emphasised the critical need for meticulous budget management across ministries. He called for a detailed review of each ministry’s budget to categorise non-negotiable operational costs alongside social and developmental expenses. The intent is to ensure every ministry aligns its priorities with the overarching budget ceilings, promoting efficient utilisation of resources.

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Pillars of Economic Strength

The proposed surplus is built upon three foundational pillars: fiscal discipline, a robust financial system, and aggressive reforms. This approach aims to solidify Cyprus’ economic resilience, fostering a stable environment conducive to sustainable growth and development.

Social and Developmental Focus

Central to the budget are the “flagship policies” targeting digital transformation, climate change, and addressing infertility, reflecting a holistic approach to national development. The government’s commitment to a “social contract” with its citizens is evident, promising enhanced social spending and developmental initiatives.

Transparent and Inclusive Governance

In a bid to maintain transparency and public engagement, President Christodoulides has mandated that each ministry publicly present its budget and outline specific actions and reforms. This move is designed to ensure that the annual budget reflects both the President’s vision and the governance programme’s priorities.

Supporting the Middle Class

Government spokesperson Konstantinos Letymbiotis highlighted that the budget will particularly focus on supporting the middle class. The detailed presentations from the Ministries of Labour and Social Insurance, Energy, Trade and Industry, Foreign Affairs, and various Deputy Ministries reflect a comprehensive approach to policy implementation.

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Cyprus Hits Historic Tourism Peak As Overtourism Risks Mount

by THEFUTURE.TEAM

February 13, 2026

Record-Breaking Performance In Tourism

Cyprus’ tourism sector achieved unprecedented success in 2025 with record-breaking arrivals and revenues. According to Eurobank analyst Konstantinos Vrachimis, the island’s performance was underpinned by solid real income growth and enhanced market diversification.

Robust Growth In Arrivals And Revenues

Total tourist arrivals reached 4.5 million in 2025, rising 12.2% from 4 million in 2024, with momentum sustained through the final quarter. Tourism receipts for the January–November period climbed to €3.6 billion, marking a 15.3% year-on-year increase that exceeded inflation. The improvement was not driven by volume alone. Average expenditure per visitor increased by 4.6%, while daily spending rose by 9.2%, indicating stronger purchasing power and higher-value tourism activity.

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Economic Impact And Diversification Of Source Markets

The stronger performance translated into tangible gains for the broader services economy, lifting real tourism-related income and overall sector turnover. Demand patterns are also shifting. While the United Kingdom remains Cyprus’ largest source market, its relative share has moderated as arrivals from Israel, Germany, Italy, the Czech Republic, the Netherlands, Austria, and Poland have expanded. This gradual diversification reduces dependency on a single market and strengthens resilience against external shocks.

Enhanced Air Connectivity And Seasonal Dynamics

Air connectivity has improved markedly in 2025, with flight volumes expanding substantially compared to 2019. This expansion is driven by increased airline capacity, enhanced route coverage, and more frequent flights, supporting demand during shoulder seasons and reducing overreliance on peak-month flows. Seasonal patterns remain prominent, with arrivals building through the spring and peaking in summer, thereby bolstering employment, fiscal receipts, and corporate earnings across hospitality, transport, and retail sectors.

Structural Risks And Future Considerations

Despite strong headline figures, structural challenges remain. The European Commission’s EU Tourism Dashboard highlights tourism intensity, seasonality, and market concentration as key risk indicators. Cyprus records a high ratio of overnight stays relative to its resident population, signalling potential overtourism pressures. Continued reliance on a limited group of origin markets also exposes the sector to geopolitical uncertainty and sudden demand swings. Seasonal peaks place additional strain on infrastructure, housing availability, labour supply, and natural resources, particularly water.

Strategic Investment And Market Resilience

Vrachimis concludes that sustained growth will depend on targeted investment, product upgrading, and continued market diversification. Strengthening year-round offerings, improving infrastructure capacity, and promoting higher-value experiences can help balance demand while preserving long-term competitiveness. These measures are essential not only to manage overtourism risks but also to ensure tourism remains a stable pillar of Cyprus’ economic development.

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