Cyprus Business Now: GDP revision, tourism strategy, consumer loans

The Deputy Ministry of Tourism on Friday outlined the need to address long-standing challenges in the tourism sector, in order to maximise its performance and boost the Cypriot economy.

Initiatives include enhancing the tourism product and extending the national tourism strategy to 2035 to meet international market trends.

Tourism remains vital to the Cypriot economy, the ministry said, contributing significantly to GDP.

According to the strategic plan for 2025-2027, submitted alongside the 2025 state budget, the sector generated €2.99 billion in revenue in 2023, compared to €2.68 billion in 2019.

The World Travel and Tourism Council (WTTC) estimates that tourism’s total contribution to GDP was 12.9 per cent in 2023, down from 13.5 per cent in 2019.

Cyprus’ gross domestic product (GDP) in nominal terms (current prices) reached €31.34 billion in 2023.

This marks a growth rate of 6.5 per cent, according to the major revision of national accounts for 1995–2022 and the updated 2023 estimate from the Cyprus Statistical Service (Cystat).

In real terms (volume measurements), the GDP growth rate was revised to 2.6 per cent, up from the previous estimate of 2.5 per cent, with real GDP amounting to €26.96 billion.

Fiscal Council president Michalis Persianis on Friday raised concerns over the growing trend in consumer loans, which, according to him, are being granted easily by some banks without collateral.

He warned that these loans are unproductive and could strain both households and the wider economy. 

Persianis said that the council does not “welcome” the rise in consumer loans, pointing out that they “are granted very easily and without special collateral by some banks”.

He explained that while mortgages are productive, providing long-term returns on the property purchased, consumer loans can be used for non-productive purposes like entertainment, travel, or supporting the family budget.  

Unlike mortgages, he noted, “consumer loans do not create wealth for households”.

Businesses in Cyprus are strengthening their cybersecurity measures in anticipation of the European Union’s network and information security directive (NIS 2).

The new directive comes into effect across all 27 EU member states on October 18, 2024.

The directive aims to enhance cyber resilience across a wider range of industries, introducing stricter risk management requirements and faster incident reporting, in response to a global surge in cyberattacks.

The NIS 2 directive updates the 2016 legislation, which focused on protecting critical infrastructure sectors like energy, healthcare, and finance.

The cruise ship Silver Ray anchored off the coast of Kato Paphos on Friday, bringing over 1,000 passengers and crew to the area.

According to the Paphos Port and Marine Police, the ship carried 535 crew members and 596 passengers.

The vessel arrived at 8am, allowing passengers to disembark and explore some of the Paphos District’s renowned archaeological sites and attractions.

The Cyprus Stock Exchange (CSE) ended Friday, October 18 with losses.

The general Cyprus Stock Market Index was at 195.44 points at 12:13 during the day, reflecting a decrease of 0.87 per cent over the previous day of trading.

The FTSE / CySE 20 Index was at 119.11 points, representing a drop of 0.89 per cent.

The total value of transactions came up to €139,795, until the aforementioned time during trading.

In terms of the sub-indexes, the main and investment firm indexes fell by 1.35 per cent and 3.3 per cent respectively.

The alternative index rose by 0.68 per cent while the hotel index remained unchanged.

The biggest investment interest was attracted by the Bank of Cyprus (no change), Hellenic Bank (-0.77 per cent), Demetra Holdings (-3.35 per cent), Atlantic Insurance (no change), and the Cyprus Cement Company (no change).