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Investor Presentaiton

Strong fiscal performance continues during early 2019 • During Jan-Apr 2019 the fiscal position continued to be in surplus at 2,5% of GDP compared to 2,0% of GDP of the corresponding period of the previous year. • Government budget was in surplus in 2018 at 3,2% of GDP compared to 1,8% the year before. • The revenue side increased by 7,7% vis-à-vis the corresponding period of 2017. This improvement can be attributed to higher income tax receipts reflecting primarily indirect tax revenue and secondarily, tax revenue on income and wealth. The expenditure side increased at a rate of 2,3% vis-à- vis 2017. An increase was recorded in compensation of employees, attributed to higher employment in education, health and security sectors. Intermediate consumption increased mostly due to expenditure relating to water supply and pharmaceuticals. Budget revenue breakdown, EUR million 10.000 8.278 7.671 8.000 6.976 7.087 6.000 4.000 2.000 3.088 3.290 0 2015 2016 2017 2018 Jan-May 2018 Other Social contributions Direct taxation Jan-May 2019 Indirect taxation Budget expenditure breakdown, EUR million 10.000 7.038 8.000 7.028 7.328 7.542 6.000 4.000 2.000 2.672 2.773 0 2015 ■Capital Expenditure Interest 2016 2017 2018 Others Jan-May 2018 Jan-May 2019 Social Transfers Consumption Source: Cyprus Statistical Service, Ministry of Finance ■Compensation of Employees Note: The budget outcomes of 2014-15 and 2018 exclude government contributions for the Cyprus Cooperative Bank. 17
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