A suite of key economic barometers for November 2025 presents a picture of cautious resilience within the Cypriot economy, according to the latest data from the University of Cyprus Economics Research Centre (CypERC). While forward-looking indicators signal sustained growth, underlying sectoral confidence reveals a nuanced landscape. Concurrently, the state-owned Electricity Authority of Cyprus (EAC) has reported robust annual profits, providing capital for critical infrastructure investments even as the nation grapples with a concerning rise in energy poverty.
The Composite Leading Economic Index, a crucial gauge of future economic activity, registered a 1.8% annual increase in November, maintaining a trajectory consistent with the previous two months. This continued expansion is primarily attributed to positive contributions from the Economic Sentiment Indicator, robust tourist arrivals, and buoyant retail trade and property sales. A moderating factor, however, was a noted contraction in temperature-adjusted electricity production, tempering more substantial gains.
Delving deeper into business and consumer psychology, the separate Economic Sentiment Indicator experienced a marginal softening, dipping to 104.0 points from 104.1 in October. This slight decline masked significant sectoral shifts: confidence strengthened within retail trade, construction, manufacturing, and among consumers themselves, but weakened in the dominant services sector. In a potentially encouraging sign, the Economic Uncertainty Indicator fell for the second consecutive month to 10.9 points, a drop driven largely by reduced consumer uncertainty.
On the energy front, the EAC announced an after-tax profit of €37.3 million for 2024, a slight improvement over the previous year’s €36.1 million. A significant factor in this financial performance was a €45 million reduction in costs associated with greenhouse gas emission allowances, which totaled €211 million. The utility is channeling these resources into modernization, having allocated €45 million for network infrastructure and signed a €50 million contract for an advanced smart metering system.
These developments unfold against a challenging socio-economic backdrop. Official statistics indicate that energy poverty afflicted 17.5% of Cypriot households in 2023, a notable increase from 15.1% the year prior. Addressing public concern, EAC Chairman George Petrou moved to quell fears of drastic price adjustments, stating he "dismissed speculation of a much larger 13% hike" in electricity tariffs.
Looking ahead, national energy strategy is focusing sharply on storage capacity to ensure grid stability and integrate renewable sources. A 120-megawatt storage system is slated for operation by June 2026. Outlining a much more ambitious future need, Energy Minister George Papanastasiou projected that "at least 600MW of storage capacity will be required by 2030."
The confluence of these reports sketches an economy in a state of deliberate transition. While leading indicators and reduced uncertainty suggest underlying growth momentum, disparities in sectoral confidence and the pressing issue of energy affordability present clear policy challenges. The EAC’s profitable position enables vital investment in grid resilience and intelligence, which will be paramount for managing costs and meeting the substantial storage requirements of the nation’s energy future.