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Tourism In Cyprus: Modest Growth Amidst Stable Markets

Cyprus experienced a slight increase in tourist arrivals for May 2024, according to recent data from CySTAT. The island welcomed 421,400 tourists, a 0.3% rise compared to May 2023. The United Kingdom remained the largest source of visitors, accounting for 39.8% of total arrivals, followed by Israel, Poland, Germany, and Sweden. While arrivals from Israel and Sweden decreased, those from the UK, Germany, and Poland saw modest gains.

From January to May 2024, tourist arrivals totalled 1,170,214, up 1.2% from the same period last year. This indicates a steady but modest growth trajectory for the Cypriot tourism sector.

Additionally, outbound travel by Cypriot residents saw a significant increase of 13.8% in May 2024, with Greece, the UK, and Italy being the most popular destinations.

These figures suggest a stabilisation of the tourism industry in Cyprus, reflecting both resilience and the potential for further growth. The government’s efforts to attract tourists from diverse markets and enhance travel infrastructure are likely contributing factors to this trend. As Cyprus continues to navigate the post-pandemic landscape, these incremental increases highlight the island’s enduring appeal as a tourist destination.

Interest rates on housing loans up and down on deposits

Cypriot banks raised mortgage rates in August while cutting interest on one-year deposits for households, according to data released by the Central Bank of Cyprus (CBC).

Meanwhile, the total value of new loans dropped sharply in August, falling by 33 per cent compared to July.

The latest figures, published on Wednesday reveal that the interest rate for short-term deposits by households fell to 1.79 per cent, from 1.96 per cent in July. In contrast, the deposit rate for businesses (non-financial companies) travelled in the opposite direction up to 2.33 per cent in August from 2.28 per cent in the previous month.

Consumer loan rates also saw a small decline, dropping to 6.59 per cent from 6.67 per cent in the previous month. Mortgage rates rose marginally to 4.65 per cent, from 4.59 per cent.

Rates for businesses, on loans €1 million also fell to 5.36 per cent from 5.61 per cent. For loans

above €1 million the rate fell to 5.42 per cent from 5.64 per cent.

In terms of new loans, there was a marked drop across the board. Total new loans fell to €395.5 million, down from €596.3 million in July.

Consumer loans also fell with net new loans at €19m, compared to July’s €28m (€26.1m net).

Loans for house purchases also declined significantly, falling to €95.6m, of which €72.3m were net new loans, down from €134.3m (€100.7m net) in July.

New loans of under a million euro to businesses decreased to €52.8m (€34.1m net), down from €75.5m in July (€49.5m net).

Similarly, loans of over a million euros were halved to €179.3m (€78.3m net), compared to €345.2m (€211.8m net) in the previous month.

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