The Economy of Cyprus


The Economy of Cyprus


Cypriot Economy

Economy - overview: The area of the Republic of Cyprus under government control has a market economy dominated by the service sector, which accounts for 78% of GDP. Tourism, financial services, and real estate are the most important sectors. Erratic growth rates over the past decade reflect the economy's reliance on tourism, which often fluctuates with political instability in the region and economic conditions in Western Europe. Nevertheless, the economy in the area under government control has grown at a rate well above the EU average since 2000. Cyprus joined the European Exchange Rate Mechanism (ERM2) in May 2005 and adopted the euro as its national currency on 1 January 2008. An aggressive austerity program in the preceding years, aimed at paving the way for the euro, helped turn a soaring fiscal deficit (6.3% in 2003) into a surplus of 1.2% in 2008. This prosperity will come under pressure in 2009, as construction and tourism slow in the face of reduced foreign demand triggered by the ongoing global financial crisis. Growth is expected to slow to less than 2%, which would be its lowest level since 2003. As in the area administered by Turkish Cypriots, water shortages are a perennial problem; a few desalination plants have been added to existing plants over the last year and are now on line. After 10 years of drought, the country received substantial rainfall from 2001-04. Since then, rainfall has been well below average, making water rationing a necessity.

GDP:

GDP - real growth rate: 3.6% (2008 est.) 4.4% (2007 est.) 4.1% (2006 est.)

GDP - per capita: GDP - composition by sector: agriculture: 8.6%, industry: 22.5%, services: 69.1% (2006 est.) Labor force: 95,030 (2007 est.) Labor force - by occupation: agriculture: 14.5%, industry: 29%, services: 56.5% (2004) Unemployment rate: 9.4% (2005 est.) Population below poverty line: %NA Inflation rate: 11.4% (2006) Budget: revenues: $2.5 billion, expenditures: $2.5 billion (2006) Agriculture - products: citrus fruit, dairy, potatoes, grapes, olives, poultry, lamb Industries: foodstuffs, textiles, clothing, ship repair, clay, gypsum, copper, furniture Industrial production growth rate: -0.3% (2007 est.) Electricity production: 998.9 million kWh (2005) Electricity consumption: 797.9 million kWh (2005) Exports: $68.1 million, f.o.b. (2007 est.) Export - commodities: citrus, dairy, potatoes, textiles Export - partners: Turkey 40%; direct trade between the area administered by Turkish Cypriots and the area under government control remains limited Imports: $1.2 billion, f.o.b. (2007 est.) Import - commodities: vehicles, fuel, cigarettes, food, minerals, chemicals, machinery Import - partners: Turkey 60%; direct trade between the area administered by Turkish Cypriots and the area under government control remains limited Economic aid - recipient: under a July 2006 agreement, Turkey plans to provide the area administered by Turkish Cypriots 1.875 billion YTL ($1.3 billion) over three years (600 million YTL in 2006, 625 million YTL in 2007 and 650 million YTL in 2008); Turkey has forgiven most past aid; additionally, the EU pledged financial assistance of Euro 259 million ($388 million) in 2004, which is yet to be disbursed. Reserves of foreign exchange and gold: $NA Debt - external: $NA Currency (code): Turkish new lira (YTL) Exchange rates: Turkish new lira per US dollar: 1.319 (2007) 1.4286 (2006) 1.3436 (2005) 1.4255 (2004) 1.5009 (2003)

GDP - composition by sector: agriculture: 2.6% industry: 19.1% services: 78.3% (2008 est.)

Population below poverty line: Inflation rate: 11.4% (2006) Budget: revenues: $2.5 billion, expenditures: $2.5 billion (2006) Agriculture - products: citrus fruit, dairy, potatoes, grapes, olives, poultry, lamb Industries: foodstuffs, textiles, clothing, ship repair, clay, gypsum, copper, furniture Industrial production growth rate: -0.3% (2007 est.) Electricity production: 998.9 million kWh (2005) Electricity consumption: 797.9 million kWh (2005) Exports: $68.1 million, f.o.b. (2007 est.) Export - commodities: citrus, dairy, potatoes, textiles Export - partners: Turkey 40%; direct trade between the area administered by Turkish Cypriots and the area under government control remains limited Imports: $1.2 billion, f.o.b. (2007 est.) Import - commodities: vehicles, fuel, cigarettes, food, minerals, chemicals, machinery Import - partners: Turkey 60%; direct trade between the area administered by Turkish Cypriots and the area under government control remains limited Economic aid - recipient: under a July 2006 agreement, Turkey plans to provide the area administered by Turkish Cypriots 1.875 billion YTL ($1.3 billion) over three years (600 million YTL in 2006, 625 million YTL in 2007 and 650 million YTL in 2008); Turkey has forgiven most past aid; additionally, the EU pledged financial assistance of Euro 259 million ($388 million) in 2004, which is yet to be disbursed. Reserves of foreign exchange and gold: $NA Debt - external: $NA Currency (code): Turkish new lira (YTL) Exchange rates: Turkish new lira per US dollar: 1.319 (2007) 1.4286 (2006) 1.3436 (2005) 1.4255 (2004) 1.5009 (2003)

Household income or consumption by percentage share: lowest 10%: NA% highest 10%: NA%

Distribution of family income - Gini index: 29 (2005)

Inflation rate (consumer prices):

Labor force: 403,000 (2008 est.)

Labor force - by occupation: agriculture: 8.5% industry: 20.5% services: 71% (2006 est.)

Unemployment rate: 3.8% (2008 est.)

Budget: revenues:: $11.33 billion expenditures:: $11.2 billion (2008 est.)

Industries: tourism, food and beverage processing, cement and gypsum production, ship repair and refurbishment, textiles, light chemicals, metal products, wood, paper, stone, and clay products

Industrial production growth rate: 2.8% (2008 est.)

Electricity - production: 4.52 billion kWh (2007 est.)

Electricity - production by source:

Electricity - consumption: 4.151 billion kWh (2006 est.)

Electricity - exports: 0 kWh (2007 est.)

Electricity - imports: 0 kWh (2007 est.)

Oil - production: 0 bbl/day (2008 est.)

Oil - consumption: 57,830 bbl/day (2006 est.)

Oil - exports: 0 bbl/day (2005)

Oil - imports: 55,970 bbl/day (2005)

Oil - proved reserves: NA bbl

Natural gas - production: 0 cu m (2007 est.)

Natural gas - consumption: 0 cu m (2007 est.)

Natural gas - exports: 0 cu m (2007 est.)

Natural gas - imports: 0 cu m (2007 est.)

Natural gas - proved reserves: 0 cu m (1 January 2006)

Agriculture - products: citrus, vegetables, barley, grapes, olives, vegetables; poultry, pork, lamb; dairy, cheese

Exports: $1.53 billion f.o.b. (2008 est.)

Exports - commodities: citrus, potatoes, pharmaceuticals, cement, and clothing

Exports - partners: Greece 21.1%, UK 14.3%, Germany 6.6% (2007)

Imports: $8.689 billion f.o.b. (2008 est.)

Imports - commodities: consumer goods, petroleum and lubricants, intermediate goods, machinery, transport equipment

Imports - partners: Greece 17.7%, Italy 10.2%, UK 9.6%, Germany 9.4%, Israel 6.5%, France 5.4%, China 5.3%, Netherlands 4.1% (2007)

Debt - external: $28.84 billion (31 December 2008 est.)

Economic aid - recipient: Reserves of foreign exchange and gold: $NA Debt - external: $NA Currency (code): Turkish new lira (YTL) Exchange rates: Turkish new lira per US dollar: 1.319 (2007) 1.4286 (2006) 1.3436 (2005) 1.4255 (2004) 1.5009 (2003)

Currency:

Currency code:

Exchange rates: euros (EUR) per US dollar - 0.6827 (2008 est.), Cypriot pounds (CYP) per US dollar - 0.4286 (2007), 0.4586 (2006), 0.4641 (2005), 0.4686 (2004)

Fiscal year:




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