IMF report confirms the steady developmental course of Cypriot economy

IMF report confirms the steady developmental course of Cypriot economy

Commenting on the report of the International Monetary Fund (IMF) on the course of Cyprus’ economy, Government Spokesman, Prodromos Prodromou, in a written statement says that it is proof of the steady development course the country has entered in recent years.

The report forecasts for acceleration of economic growth for 2018 and 2019.

According to today’s announcement of the IMF, the Executive Directors “welcome the boosted recovery of the economy, which is accompanied by a continuing fall in the unemployment rate, a significant amount of primary government surplus and a reduction in the government debt ratio”.

In particular, the overall assessment of the Agency’s Annual Report on Cyprus is that “strong GDP growth supports employment”, while its Annual Report on Cyprus shows analytically that growth, estimated at 4.0% in 2018, will accelerate further to 4.2% in 2019. It is also estimated that if fiscal policy continues with significant primary surpluses of 4.0-4.5%, combined with robust growth, then at the end of the period 2018-2023 the government debt ratio will be limited to 72% of GDP.

Both in the Executive Board’s assessment and the Annual Report, particular attention is given to the problem of non-performing loans and the need to take action to address it. It specifically mentions the importance of adapting the existing legal framework in order to tackle the phenomenon of payment avoidance “strategy”, as well as the under formation government  body that “should quickly take on restructured loans”.

The report also gives special attention to the ambitious macroeconomic policies that Cyprus is developing and to structural reforms that should be promoted by enhancing and safeguarding the development path in the long run.

In conclusion, Prodromou sates, “the IMF, which is undoubtedly the most important international financial institution and participated in lending the Cyprus economy, certifies through a thorough study that Cyprus has opened up a growth perspective that may even be accelerating in the next few years to stabilize Continuity.

Consideration should therefore be given both to the need to continue and deepen the successful economic policy pursued, as well as the recommendations made in this report on a number of issues”./IBNA