Cyprus third in The Economist’s economic pentathlon

With three gold and two silver medals, Cyprus ranked third in The Economist’s economic pentathlon which calculated how the 27 EU member states perform on the five major challenges facing them, namely demand/inflation, debt, demography, decarbonisation and decoupling from the world’s autocracies.

The Economist said European economies are in for a troubling few years, noting that the European Commission is forecasting growth of just 0.8 per cent for the EU as a whole in 2023, and little more in 2024.

“Inflation is coming down only slowly, prompting the European Central Bank (ECB) to raise rates yet again at its September meeting”, while business confidence continues to worsen, it added.

It said that not all countries are equally affected, since, its own calculations show that, “they perform differently on the five major challenges that are facing all European economies”.

According to The Economist’s calculations, Cyprus came third, with Ireland in first with four gold and one silver, followed by Malta with four gold and one bronze.

The top five is completed with Luxembourg in 4th and Denmark in 5th place.

Overall, according to the analysis, “being small clearly has its advantages, though Denmark is the only economic model that could be copied by others”.

France came out as “the best large economy” with two gold medals and three silver ones.

Explaining the five categories, it said that demand will have to be lowered to fight inflation; and the resulting higher rates on debt piles will weigh against spending.

It also said that ageing societies lose workers to retirement faster than youngsters enter the labour market, while the fight against climate change requires industry to transform.

Trading with autocracies is increasingly a risk in the new geopolitical age, the analysis said.