Public debt posts decline in Cyprus
Cyprus is seeing a promising reduction in its public debt, with figures suggesting a return to 2019 levels. The debt stood at 22.3 billion euros by the end of 2023, showing a slight decrease from €22.4 billion in September of the same year. Notably, the debt had reached €23.8 billion last June.
Analysis of the debt structure reveals that domestic debt accounts for a mere 3%, with the remaining 97% being foreign debt. The composition of borrowing also indicates a shift, with fixed-rate borrowing at 67% and floating-rate borrowing at 33%. Interestingly, the latter has been on the rise, increasing from 30% in June to 33% by the end of 2023, while fixed-rate loans have witnessed a decline.
In the fiscal realm, the Ministry of Finance’s preliminary projections foresee a continued downward trajectory of public debt as a percentage of GDP, with an estimated 60.1% by the end of 2026. The government’s fiscal balance remains in surplus, although slightly decreased compared to previous years. However, the primary surplus is expected to remain robust.
Looking ahead, the economic outlook remains positive albeit with some uncertainties. Growth is anticipated to rebound in the coming years.
