Cyprus’ Q4 2024 GDP growth rate took a hit due to a strike in the construction sector.

Macro/Political

• Finance Minister Kostis Hatzidakis dismissed the possibility of reinstating the 13th and 14th salaries for public employees and pensioners, as well as universal retroactive payments for pension cuts, citing a prohibitive EUR 8bn cost. He clarified that only pensioners who won legal cases will receive back payments. He also reaffirmed the government’s stance since 2020, stressing there is no fiscal room for such measures but highlighted the unfreezing of pension increases.
Source: euro2day.gr

Macro/Political
• According to cystat (flash estimate), in 4Q24 Cyprus’ GDP growth rate in real terms was 2,6% (y-o-y). Based on seasonally data, GDP growth rate in real terms is estimated at 2,9% (y-o-y) and 0,3% (q-o-q). The positive GDP growth rate is mainly attributed to the sectors: “Hotels and Restaurants”, “Wholesale and Retail Trade, Repair of Motor Vehicles” and “Information and Communication”. The “Construction” activities recorded a negative growth rate. The MoF announced that the annual growth rate for 2024 is estimated at 3.4%, lower that the MoF’s forecast of 3.7%. According to the Ministry, this is primarily attributed to the impact of the cement industry workers’ strike, which lasted for one of the three months in the fourth quarter of 2024. The MoF said that situation is expected to normalize within the first quarter of 2025.
Source: Cystat

• Cypriot Energy Minister Giorgos Papanastasiou announced that Cyprus will sign a deal with Egypt to send natural gas from the Cronos offshore field. Cyprus will also sign the production plan proposed by a Chevron-led venture for the Aphrodite offshore field.
Source: Bloomberg