Nicosia:The latest International Monetary Fund (IMF) forecast for the Cypriot economy has been described as particularly encouraging by Finance Minister Makis Keravnos. In a written statement, the Minister highlighted the IMF's projections in the October 2026 World Economic Outlook, which support the resilience of Cyprus's economy amid global uncertainties influenced by armed conflicts.
According to Cyprus News Agency, the IMF has slightly adjusted its growth forecast for Cyprus in 2026 from 3% to 2.9% due to ongoing conflicts but has raised its 2027 projection to 3.2% from an earlier estimate of 3%. The Finance Ministry's own forecast remains at 3.1% for 2026, based on recent data showing a growth rate of 3.2%.
Minister Keravnos emphasized that these growth forecasts, despite minor differences, place Cyprus among the European Union's top performers. He attributed this success to the economic policies of President Nikos Christodoulides's government, which focus on fiscal management, financial stability, and boosting investor confidence.
On inflation, the IMF anticipates a rate of 3.7% in 2026, decreasing to 1.9% in 2027. The Minister noted that the government's efforts, including support packages and initiatives to raise citizens' incomes, are effectively easing inflationary pressures.
Regarding unemployment, the IMF projects a decrease from 4.6% to 4% in 2026 and from 4.7% to 4.4% in 2027. This forecast reflects the government's successful policies that have led to full employment.
Keravnos also welcomed the IMF's projection of a declining public debt, expected to reach 38.6% by 2029, a development he described as both unprecedented and beneficial for Cyprus. Additionally, a budget surplus of 2.6% of GDP in 2026 and 2.5% in 2027 underscores the government's effective fiscal policy.
The Minister affirmed the government's commitment to maintaining a prudent fiscal approach, which he believes will enhance the Cypriot economy's credibility and foster conditions for a more productive and resilient economy, ultimately benefiting its citizens.