The 2022 state budget will record the island’s transition from Covid-19 support measures to economic recovery, Finance Minister Constantinos Petrides has said.
At the same time, Labour Minister Zeta Emilianidou already stated that Covid-19 income support measures will be abolished in October.
In statements late on Saturday, Petrides also said that the state budget of 2020 and partly that of 2021 featured measures to support employment and the real economy due to the pandemic. And that these measures have yielded results.
“Unemployment has been reduced drastically, indices for consumption and transactions are high, tourism has performed better than estimated,” Petrides said.
“Therefore, the 2022 state budget will feature the transition from support to growth and that’s why development expenditure is increased by 10% to 12%,” he added.
Petrides also said that under the existing data, growth will exceed 5.5% in 2021 followed by growth close to 4% in 2022, adding that Cyprus is one of the few countries in the European Union to regain the ground lost in 2020. Cypriot real GDP declined by an annual 5.1% in 2020.
He also noted that the 2022 state budget includes spending associated with the National Recovery and Resilience plan which seeks to create new jobs for youth associated with green growth, digitisation and other development projects.
On her part Emilianidou said that Cyprus is close to conditions of full employment as unemployment rate declined to 5.2%, adding that the economic growth will make the employment conditions “much better.”
The Labour Minister said that income support measures will be abolished in October, noting that by then support measures will be targeted to hotel and tourism-related activities, which continue to be affected by COVID-19.
She said that in March 2020 when income support measures began the Ministry had 220,000 applications while current applications are very low.
Noting that the demand for personnel is rising, Emilianidou said “we believe that the continuation of support measures for the next two months is satisfactory.”