Finance Minister Makis Keravnos delivered a glowing appraisal of the Cypriot economy this Friday, confirming that the nation has maintained its powerful upward trajectory despite a volatile global landscape. Citing fresh preliminary data, Keravnos revealed that Cyprus capped off 2025 with a seasonally adjusted growth rate of 4.5% in the fourth quarter.
The figure is a significant beat against the broader European Union average, positioning Cyprus as a regional leader in economic resilience.
A “Triple Threat” of Economic Success
The Finance Minister emphasized that this growth is not merely a statistical anomaly but the result of a “people-centered and disciplined” fiscal strategy. According to the Statistical Service of Cyprus (Cystat), the late-2025 surge was primarily fueled by three high-octane sectors:
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Technology & ICT: The “Information and Communication” sector continues to expand as Cyprus establishes itself as a Mediterranean tech hub.
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Retail & Commerce: Wholesale and motor vehicle repairs showed robust activity.
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Tourism & Hospitality: “Hotels and Restaurants” capitalized on a record-breaking year for arrivals.
The “Zero Inflation” Milestone
In a statement that will resonate with local households, Keravnos announced that inflation in Cyprus has effectively reached “zero levels.” This dramatic cooling of prices is expected to act as a significant booster for local purchasing power. “Zero inflation provides a predictable environment for our citizens and businesses,” the Minister noted, adding that it creates a solid foundation for long-term planning and investment.
Fiscal Discipline and Full Employment
The Minister also drew attention to the island’s “dynamic” labor market. With unemployment remaining at historic lows—described by Keravnos as “conditions of full employment”—the economy is successfully absorbing the workforce while simultaneously reducing the national debt-to-GDP ratio.
| Metric | Q4 2025 Performance | EU Average Comparison |
| GDP Growth | 4.5% | Significantly Above |
| Inflation | ~0% | Lower |
| Fiscal Status | Surplus Budget | Stronger |
| Unemployment | Stable/Low | Outperforming |
Looking Toward 2026: The 3% Target
While earlier forecasts from international institutions conservatively placed Cyprus’ 2025 growth between 2.9% and 3.5%, the actual estimated year-end growth now sits at 3.75%.
Looking ahead, Keravnos is optimistic that the government’s prudent management will allow Cyprus to sustain a medium-term growth rate of above 3%. He argued that this continued expansion is what “unlocks economic potential,” allowing the state to fund more robust social policies and address the specific challenges faced by local businesses.
Source: Stockwatch.com.cy