Cyprus’ current account balance in 2023 deteriorated significantly with the deficit rising to €3.61 billion, corresponding to 12.1% of the island’s GDP, Central Bank of Cyprus has said.

According to the preliminary balance of payments data for 2023 released by the CBC, the current deficit rose by an annual 64% compared with a deficit of €2.20 billion in 2023, or 7.9% of Cyprus’ GDP.

Adjusted for the impact of Special Purpose Entities (SPEs), that is, classifying SPEs as non-Cypriot residents, the deficit stood at €3.43 billion in 2023, compared with a deficit of €2.54 billion in 2022, which corresponds to 11.5% and 9.2% of the country’s annual GDP, respectively, the CBC added.

Cyprus’ international investment position (IIP) recorded a deterioration in 2023, presenting a net liability position of €28.74 billion, compared with a net liability position of €26.71 billion in 2022.

Adjusting for SPEs Cyprus’ IIP recorded a net liability position of €10.85 billion in 2023, compared with a net liability position of €9.36 billion in 2022.

The gross external debt increased to €171,696.6 million in 2023 from €169,326.4 million in 2022.

According to the CBC, the external assets in debt instruments increased to €154,615.2 million, up from €147,388.9 million in 2022.

Consequently, the net external debt decreased by €4,857 million to €17,081.4 million in 2023, the CBC added.

Adjusted for the impact of SPEs, gross external debt reached €58,448.5 million in 2023, compared to €58,444.7 million, in 2022 with the corresponding net external debt indicator decreased to -€15,141.3 million in 2023, compared with -€11,861.7 million in 2022, the CBC said.