Local
articles | 11 June 2015

Cyprus economy back on track with 1.6% growth in Q1 2015

Seasonally adjusted GDP rose by 1.6% during the first quarter of 2015, compared to the previous quarter, according to Eurostat.

In the fourth quarter of 2014, GDP also grew by 0.4% in the euro area and the EU28, while in Cyprus it dropped -0.4%. Compared with the same quarter of the previous year, seasonally adjusted GDP rose by 1.0% in the euro area and by 1.5% in the EU28 in the first quarter of 2015 and by 0.2% in Cyprus.

Two weeks ago, the Finance Ministry said the Cypriot economy returned to positive growth after 14 quarters of contraction.

Based on seasonally adjusted data, GDP growth rate in real terms is estimated at 0.2%, compared with -1.8% in the fourth quarter of 2014 on an annual basis.

The GDP growth rate in real terms during the first quarter of 2015 is positive and estimated at 0.4% over the corresponding quarter of 2014.

Positive growth rates were recorded in trade, hotels and restaurants, communication, electricity as well as the legal and accounting activities. Negative growth rates were recorded by the secondary sector of the economy, mining, manufacturing and construction.

According to the Ministry’s Public Debt Management Office (PDMO), the business-operating environment shows signs of stabilisation and gradual improvement given that lending to non-financial corporations is marginally positive and interest rates are in decline.

The economic sentiment indicator by University of Cyprus Economic Research Centre (CypERC) increased by 4 points in April from the previous month. This increase is due to the improvement in the business climate in all sectors covered by the survey, as well to the strengthening of the consumer economic confidence.

Exports increased by 45.5% in January-March compared to January-March 2014.

In January-April tourist arrivals increased by 13.7% compared to same period last year. An increase of 84.7% was recorded in tourist arrivals from Israel, 14.3% from Germany, 15.8% from the UK and a 39.4% increase from Greece. On the other hand a 16.2% decrease was recorded in arrivals from Russia. Inflation (HICP) for April was -1.7% compared to -1.4% in March and for 2015 so far it stands at -1.2%.

The Labour Force Survey (LFS) on unemployment, in monthly seasonally adjusted terms, decreased from 16.2% in March 2014 to 16% in March 2015.

Source: Financial Mirror

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