Investor Presentaiton
Public finances in a solid surplus position
• The government policy is for a growth-friendly fiscal
stance safeguarding the maintenance of robust
primary surpluses supporting a sustained reduction of
public debt. The budget reflects a continuation in the
employment policies adopted by the government and
places emphasis on reallocation of expenditure
towards growth-enhancing activities.
• Over the past few years the fiscal position has been
positive and is expected to peak in 2019 at a surplus
of 3,8% of GDP. In the years 2020-22 the budget
surplus is expected to fall marginally mostly due to
increased expenditure associated with the gradual
abolition of wage cuts, and the introduction of the
national health system. In 2018 Cyprus recorded the
largest fiscal surplus in the EU.
• The budget is designed to achieve the medium term
objective of a balanced fiscal position in structural
terms.
Evolution of main fiscal indicators, % of GDP
6,2
5,7
5,1
4,8
4,3
4,5
3,8
3,4
3,0
2,7
2,7
2,5
2,3
1,8
0,3
-0,3
Primary balance
Fiscal balance
2015
2016
2017
2018
2019f
2020f
2021f
2022f
Budget balance 2018, % of GDP
2,4
2,0
1,7
1,5
1,1
0
-0,5
-0,5
-0,6
-1,5
-2,1
-2,5
-2,5
3,4 Cyprus
Luxemburg
Malta
Germany
Netherlands
Greece
Ireland
EA Average
Portugal
EU Average
Italy
France
Spain
Source: Ministry of Finance
Note: The budget outcomes of 2014-15 and 2018 exclude government contributions for the Cyprus Cooperative Bank
Note: "f" denotes forecasts by the Ministry of Finance as of September 2019. All forecasts are based on assumptions and there can be no assurance they will be realised.
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