President: Macroeconomic stability a fundamental objective

The fundamental objective of the government is to ensure macroeconomic stability and the rational management of the resources and financial obligations of the public sector, said President of the Republic Nikos Christodoulides.

Addressing the 63rd Annual General Meeting of the Institute of Certified Public Accountants of Cyprus (ICPAC) that took place at Nicosia Municipal Theatre, on Thursday evening, he said this will lead to strengthening businesses competitiveness and improving standard of living of every citizen of the Republic of Cyprus.

President Christodoulides said that the economic data "prove beyond any doubt that our economy is on the right path and we will continue this responsible policy without ever resting on our laurels, taking into account both the volatile geopolitical environment and the need to have a strong economy that will allow us to develop a targeted social policy that is a priority for our government."

In this context, the President said, "fiscal responsibility, financial stability and continuous structural reforms are the triptych that determines our economic policy, determines any decisions taken in the Council of Ministers."

"And it is this that ensured the significant successive upgrades by the international rating agencies, the importance of which I am certain you understand, but also the results of Cyprus' re-entry on Wednesday to international markets," the President added.

Referring to the state of the Cypriot economy, President Christodoulides said that "despite the multiple and diverse challenges facing the global economy, we have managed – through responsible and rational policies and approaches – the economy of Cyprus – and we are proud of this – to be one of the leading in the European Union in terms of its economic performance."

This, he continued, "is also confirmed by the upgrades of the Cypriot economy by two major international rating agencies that we have had in the last two weeks."

"Our country showed the greatest acceleration in the Eurozone and in the European Union as a whole, with a growth rate of 3.5% in the first quarter of 2024, when the average growth in the European Union was only 0.4%", he added.

Regarding the years 2024 and 2025, President Christodoulides said that growth is forecast to strengthen compared to 2023, unemployment is forecast to remain on a downward trajectory, while inflation will continue to slow down and at the same time, as he said, "the reduction of public debt is achieved significantly, with the aim of reaching less than 60% of GDP by 2026."

Referring to yesterday's seven-year bond issue of €1 billion. with an interest rate of 3.25% and a yield of 3.31%, President Christodoulides said that "the great interest from international and domestic investors translated, in a very short time, into a book of offers amounting to €9.6 billion. and allowed the process to be completed quickly with positive results for the Republic".

"Today's issue and the results demonstrate the confidence of international investors in the resilience and dynamics of the Cypriot economy and complement the corresponding view of the international rating agencies," he underlined.

Referring to the agreement with the US on the institutionalization of a strategic dialogue between the two countries, the President of the Republic said that it is something that strengthens Cyprus' reputation at an international level "and offers us a solid foundation for establishing the interests of the Republic of Cyprus in security, defense, energy, research, but especially the economy where there are huge opportunities".

The agreement, he said, "provides for dialogue on cooperation in trade, investment and development, areas which we all understand the importance of having a more resilient, more competitive economy of the country".

At the same time, he continued, "we aim to align our tax policies with the objectives of the European Green Deal, in the context of the promoted green tax reform, aiming to address the huge challenges of climate change, the consequences of which we experience every day".

He said issues such as installing air conditioners in schools, fires and immigration, "all these are directly related to climate change". He urged everyone who is concerned about the great cost of the green transition, to take into consideration the cost that we will have to bear as a state or as businesses, as households, as a society, in general, if we do not act collectively immediately. 

He also said that another major goal he has set since the beginning of his administration is "to safeguard the name of Cyprus as a reliable business and financial centre", adding that "from the very first moment, we have been working in cooperation always with the supervisory bodies, but also with the technical support of internationally reliable authorities, to safeguard the name of our country".

Also, the President of the Republic said that the government pledge for the rebranding of Cyprus is progressing and we are working to "present our country as an ideal business and investment destination".

The President of the Republic also said that we are facing challenges, such as digitalisation, the emergence of new technologies, climate change, the demographic crisis and the aging of the population, with all the consequences in the sectors of the economy, while in relation to the rapid digital transition, which crucially touches the competitiveness of our country, as he said, "we must ensure that both the state and Cypriot businesses will successfully adapt to this new one reality."