The Finance Ministry welcomed Moody’s announcement on Cyprus’ economy, pointing out that it acknowledges the economy’s resilience and potential to overcome the challenges.
The Ministry issued on Saturday an announcement following Moody’s decision yesterday to change the outlook on the Government of Cyprus’ Ba1 ratings to positive from stable, while affirming the long-term foreign-currency and local-currency issuer and the local-currency senior unsecured ratings at Ba1.
The Ministry in its announcement underlines that the continuous growth of Cyprus’ fiscal situation and the clean-up of the banking sector will lead to future upgrades.
FinMin notes that the upgrade is due to the strong reduction in Cyprus’ public debt ratio this year, the stronger-than-expected economic resilience to Russia’s invasion of Ukraine and also to the pandemic, coupled with solid medium-term GDP growth prospects and the decision of ongoing strengthening of the banking sector, with non-performing exposures on decline.
The Ministry also points out that Moody’s have said that an upgrade is possible in a course of 12 months if there is a growth in GDP of 3% in 2022 and 2% in 2023. It adds that Moody’s announcement has a lot of positive elements given the problems created by the geopolitical developments in the region.
Moody’s also point out that continued evidence of strong economic resilience coupled with a high absorption of EU funding and implementation of reforms under the National recovery and resilience plan would also support an upgrade in the future, the Ministry’s announcement says.
Source: Cyprus News Agency