ESM highlights importance of institutional dialogue
The Central Bank of Cyprus (CBC) and the European Stability Mechanism (ESM) on Friday hosted a high-level conference with the Cypriot economy at the heart of discussions.
Specifically, the conference focused on the significant economic progress Cyprus has made over the past decade, the current state of its economy, and future challenges.
The event brought together policymakers, economists, financial sector executives, and private sector representatives to discuss key economic developments and risks.
In his welcoming speech, CBC governor Christodoulos Patsalides underscored the importance of maintaining close communication between national institutions and European partners to address emerging economic risks and uphold financial stability.
“Cyprus has repeatedly demonstrated its resilience and its ability to adapt, evolve, and progress,” he said.
Patsalides highlighted the ESM’s critical role in ensuring financial stability in the eurozone and in supporting Cyprus’ economic recovery and resilience.
“Now is the time to chart the next steps by identifying policy priorities, investment opportunities, and regulatory frameworks that will further shape a healthy and prosperous economic future,” he added.
Wim Van Aken, Head of Mission for Cyprus and Senior Adviser to the Chief Economist of the ESM, echoed these sentiments, emphasising the necessity of institutional dialogue in identifying and assessing risks and vulnerabilities.
“The collaboration between the CBC and the ESM, including this conference, has strengthened the understanding of such risks and vulnerabilities through joint analysis,” he stated.
Van Aken stressed that continued cooperation between European and national institutions is crucial for safeguarding financial stability and economic well-being.
The conference featured three key thematic discussions addressing core economic concerns in Cyprus.
The first session examined the evolution of economic risks following the completion of the country’s adjustment programme.
ESM experts provided an analysis of the post-programme period, focusing on key vulnerabilities and the resilience of the Cypriot economy.
The second session explored the trends in Cyprus’ housing market and future challenges.
CBC officials presented an in-depth review of the real estate sector, highlighting recent movements in property prices and assessing the obstacles to sustainable growth in the market.
The third session assessed the risks associated with Cyprus’ public debt projections, comparing previous forecasts with the current state of public finances.
ESM representatives evaluated the long-term fiscal sustainability of the country and the potential risks to its economic stability.
“The discussions during the event were highly productive, facilitating an exchange of valuable perspectives and ideas,” the CBC said in an announcement.
The announcement added that “the CBC and ESM reaffirmed their commitment to ongoing dialogue on the key economic challenges facing Cyprus and to supporting policies that enhance resilience, stability, and growth”.
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