Cyprus’ strong

economic recovery will continue in 2018 with the GDP expected to be 3.2% (2017:

3.8%) which is well above the European Union average. Inflation forecast shows

an increase in 2018 to 1.2% (2017: 0.7%) well within the healthy limits, with

unemployment expected to be near the 10% mark in comparison with 13% of the

year before.

Historic

interest rates are at record lows for the country even though they remain one

of the highest in the Eurozone. The rate for deposits of up to one year

for households was down to 1.11% compared to 1.17% and for non-financial

corporations was also down to 1.11% compared to 1.32% in December 2017.  Consumer

loans rates are down in January to 4.09% compared to 4.20% in December being

the fourth lowest in the Eurozone. Housing loans were up to 2.60% compared to

2.53% in December though.

The main

pillars of recovery are to continue flourishing in 2018 with tourism expected

to have yet another record year in tourist arrivals. 2017 witnessed an increase

of 14.6% year on year and already January 2018 arrivals are more than 20%

up from January 2017.

Real Estate

showed encouraging signs during 2017 and 2018 has started brilliantly with a

55% increase in sales recorded in the first 2 months funneled by the successful

Citizenship scheme.

At the same

time gas exploration drilling continues in Cyprus’s exclusive economic area

with ENI, EXXONMOBIL, TOTAL, SHELL and KOGAS planning to continue their

drilling expeditions. ENI’s recent drill was successful announcing a promising

gas discovery with EXXONMOBIL planning two exploration drillings within the

first six months of 2018.

Furthermore,

the introduction of the Betting Law and the establishment of the National

Betting Authority has paved the way for the long awaited 7-star Hotel and

Casino Resort to be built in Limassol as well as online betting companies. The

Casino resort investment will be in the region of 550 million euro with ‘satellite’

casinos in other cities. The resort is expected to begin operations in 2021,

with the satellite casinos within 2018. More than 11,000 jobs are expected to

be created directly from this investment.

The

construction of the Nicosia Mall is at its final stages and is expected to open

its doors in late 2018. It will be the biggest Mall in Cyprus creating new

jobs and opportunities with 135 shops 113,000 sq. meters.

While there are undoubtedly challenges ahead, the economy is growing

well and businesses are looking forward with confidence. In summary, Cyprus is

very much open for business.

Overall the

economy has recovered from the 2013 recession showing healthy signs of growth

and potential.