Finance Minister Makis Keravnos on Wednesday assured that the government is committed to finding lasting solutions to the economic challenges facing Cypriot society, highlighting the importance of incorporating feedback from the public and political stakeholders.
Speaking at an Akel economic forum, Keravnos said that 13.9 per cent of Cyprus’ population is at risk of poverty, according to 2023 data.
Although this is the third-lowest rate in the EU, Keravnos stressed that “the government recognises the issues troubling our society and is not complacent despite favourable statistics”.
Keravnos also said the government will continue to pursue a “balanced, socially oriented economic policy,” aimed at meeting both the community’s needs and the political expectations.
“This approach requires a cautious fiscal policy to maintain Cyprus’ economic indicators, enabling targeted social policies,” he said.
The minister then underlined the need to diversify Cyprus’ economic model, prioritising both new sectors and traditional industries like agriculture and livestock.
“Development must come from new productive sectors but also from traditional ones,” Keravnos said, adding that the government aims to encourage joint investments between Cypriot and foreign investors to create infrastructure and jobs while boosting exports.
Furthermore, Keravnos said the government is also committed to supporting traditional industries, such as tourism, shipping, retail, and professional services, which, according to him “remain vital to Cyprus’ GDP”.
Acknowledging past financial challenges, Keravnos said the government has been implementing significant social measures since its first month in office.
“However, we need to be aware of the complexities of achieving permanent solutions within the constraints of EU regulations and rapid geopolitical shifts.
“Cyprus, as a small EU member state, operates in an interconnected global economy and cannot remain isolated from external impacts,” he added.
Keravnos then mentioned the challenging economic situation in the Eurozone, especially in major economies like France, Germany, Italy, and Spain, which also affects social welfare.
“As an EU member, Cyprus has limited options other than to follow a prudent, proactive economic strategy to safeguard financial stability”, Keravnos said, further referring to the country’s “unique status as a divided island under ongoing military occupation”.
He highlighted that the government’s policies are socially focused, with particular attention to vulnerable groups and the middle class, while also mindful of not burdening future generations with debt.
With the EU average poverty risk at 21.4 per cent, Keravnos said that Cyprus’ poverty risk is “comparatively low”, but admitted that energy costs remain high, averaging 29.9 cents per kWh.
“The government recognises society’s challenges and will continue to take measures,” he concluded.
