A prudent fiscal policy by the government as well as deleveraging by the banks have helped place the economy on a far better footing compared with its low point of 2013, finance minister Harris Georgiades said on Thursday.
In his annual lecture to the University of Cyprus on the state of the economy, the minister said 2017 would mark the third consecutive year of growth.
GDP is expected to grow more than 3.5 per cent, compared with 3 per cent in 2016 and 2 per cent in 2015.
Rising private consumption, as well as increases in retail turnover and construction, were among the positive trends.
The unemployment rate was still high, though it had dropped compared to previous years – another indication of an economic recovery in progress, Georgiades said.
But it was still a fragile recovery, and to ensure its viability government would do its part by ensuring that the state does not live beyond its means.
Expenditure increases would be made only when revenues allow, so that the budget is always balanced and no new deficits are created.
“There are no magic wands to turn the situation around. I do not believe in miracles or messiahs,” Georgiades noted.
“But I do believe in hard work and steady steps.”