Nicosia – A suite of newly released economic data paints a picture of an economy navigating a path of moderate, stable growth while cautiously managing external risks. Key indicators for November 2025, published by the University of Cyprus Economics Research Centre (CypERC), alongside government fiscal updates and corporate results, suggest resilience tempered by acknowledged vulnerabilities in the geopolitical and energy spheres.
The Composite Leading Economic Index, a bellwether for future activity, registered a 1.8% annual increase in November, maintaining a consistent growth trajectory observed in the preceding months. Analysts note this expansion was primarily fueled by robust tourist arrivals, a buoyant retail sector, and sustained property market transactions, further aided by a recent dip in global oil prices. A minor counterweight was a recorded decrease in electricity generation, adjusted for seasonal temperature variations.
Concurrently, the broader Economic Sentiment Indicator remained virtually unchanged, dipping a negligible 0.1 point to 104.0. Beneath this stable headline figure, confidence displayed a mixed pattern: it strengthened within the retail, construction, and industrial sectors, as well as among consumers, but softened in the critical services industry. Notably, a decline in the associated Economic Uncertainty Indicator suggests businesses and households are experiencing a slightly clearer, if still complex, outlook.
On the fiscal front, the government presented an optimistic debt reduction forecast. The Public Debt Management Office projects the national debt will fall to 55.3% of Gross Domestic Product by the close of 2025, with a further decline to 50.9% anticipated in 2026. This downward revision has prompted a reduction in the planned borrowing ceiling for the current year. Finance Minister Makis Keravnos, while presenting these figures to parliament, struck a note of caution, stating, “The probability of increased market volatility due to ongoing geopolitical tensions... is considered an adverse scenario.” The government’s gross financing needs are projected to remain modest in the near term before rising in the latter part of the decade.
In the corporate sector, the state-controlled Electricity Authority of Cyprus (EAC) reported a rise in its annual net profit, reaching €37.3 million for 2024. Chairman George Petrou attributed a significant portion of this performance to a substantial €45 million reduction in costs for greenhouse gas emission allowances. The utility has earmarked these funds for reinvestment, planning a €45 million upgrade to its network infrastructure and a major €50 million smart grid collaboration with telecoms provider Cyta. Petrou also moved to quell public concern, explicitly dismissing circulating speculation about an impending 13% hike in electricity tariffs.
Despite these positive signals, a persistent social challenge shadows the economic landscape. Official statistics indicate that energy poverty afflicted 17.5% of Cypriot households in 2023, a rise from the previous year, underscoring the ongoing strain of high energy costs on a segment of the population.
Collectively, the data delineates an economy demonstrating commendable stability and improving fiscal health, effectively capitalizing on strengths in tourism and domestic demand. However, policymakers and businesses alike remain vigilant, aware that this equilibrium is susceptible to shocks from international tensions and energy market fluctuations, even as strategic investments aim to secure a more sustainable and affordable energy future.