Economy expected to grow over 5% in 2021

The economy is expected to grow by more than 5.5 per cent in 2021, Finance Minister Constantinos Petrides said on Tuesday, as preliminary estimates showed a 12.9 per cent year-on-year growth in the second quarter of the year.

In a written statement following the preliminary result published by the statistical service, the minister said the Q2 rate was markedly better than expected, signalling higher full year growth than forecasted.

“I expect that the Cypriot economy in 2021 will surpass the initial estimate of 3.7 per cent to over 5.5 per cent,” Petrides said. “This means the Cypriot economy would be one of the few economies in the European Union whose growth rate in 2021 will cover the 2020 loss in national income.”

Petrides said the Q2 performance confirmed the economy’s dynamism, signalling positive prospects for the future.

“At the same time, it shows the effectiveness in managing the pandemic and the correct targeting of the government support measures,” he added.

The minister expressed his conviction that the economy’s dynamism, the reopening of the market, the fast progress of the vaccination programme, and proper economic management would help achieve this goal.

Petrides said in 2020, which was so far a more difficult year for the economy, Cyprus managed to limit the loss in GDP to 5.1 per cent, higher than the EU average. Initial EU forecasts showed a 7.7 per cent recession in 2020.