Bloomberg News

Cyprus Forecasts Slower Growth, Bigger Budget Deficit Next Year

October 13, 2011

Oct. 13 (Bloomberg) -- Cyprus’s economy will expand by about 0.2 percent in 2012, less than a previous forecast for as much as 1.5 percent growth, according to the budget submitted to Parliament today.

The eastern Mediterranean island’s budget deficit will be 2.8 percent of gross domestic product, more than a previous forecast of 2.3 percent, after a shortfall of about 6.5 percent this year, according to a draft of the 2012 budget e-mailed by the Nicosia-based Finance Ministry.

Public debt will reach almost 67 percent of GDP next year, up from a previous estimate of 65 percent, the document showed. The budget confirmed an earlier forecast for 0.5 percent growth in 2011.

The Cypriot economy will show little or no growth this year and contract slightly in 2012, the International Monetary Fund said yesterday in an annual review.

--Editors: Jeffrey Donovan, Jennifer Freedman

To contact the reporter on this story: Paul Tugwell in Athens at ptugwell1@bloomberg.net

To contact the editor responsible for this story: Angela Cullen at acullen8@bloomberg.net.


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