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Cyprus' living standards have continued to improve, with the country's GDP per capita reaching 95% of the EU average in 2023, according to recent data from the Statistical Service of Cyprus. While Cyprus saw a decline in inflation and unemployment, there are still areas that require attention to ensure continued growth and stability for the population.
Economic Growth and GDP
Cyprus' GDP per capita in 2023 stood at €35,700, which is 95% of the EU average of €37,600. This indicates Cyprus' economy is close to matching the overall economic output of the EU, though it still has some ground to cover. While GDP growth is important, it’s just one part of a broader economic picture that includes inflation, unemployment, and income distribution.
Unemployment and Inflation
In terms of unemployment, Cyprus had a rate of 6.1% in 2023, slightly higher than the EU's 6%. The long-term unemployment rate in Cyprus is 31%, lower than the EU’s 35%. Cyprus' inflation rate was 3.9%, significantly lower than the EU's 6.4%, which indicates the country is managing its cost of living increases better than many EU nations. However, Cyprus saw a higher rise in electricity prices, with a 7.9% increase compared to just 1.3% across the EU.
Income and Poverty Levels
The average disposable income in Cyprus increased by nearly 7% from 2022, reaching €38,147 in 2023. However, Cyprus still lags slightly behind the EU in terms of disposable income per person, which stands at €22,171 compared to the EU's €23,067. Despite this, Cyprus' average disposable income, when adjusted for purchasing power, surpasses the EU average.
The percentage of people in Cyprus at risk of poverty is 13.9%, which is lower than the EU average of 16.2%. However, there are disparities in income distribution, with 28% of the population in the lowest income group and 7.9% in the upper income class.
Living Conditions and Social Deprivation
Cyprus performs well in several key indicators of living conditions. The country ranks well below the EU average for severe material and social deprivation, at just 2.4% compared to the EU’s 6.8%. Housing costs also remain manageable for most Cypriots, with only 2.6% of the population facing excessive housing costs, far below the EU average of 8.8%.
However, despite these positives, some challenges remain, including a higher percentage of people late on utility bill payments in Cyprus (9%) compared to the EU average of 6.9%. Additionally, 26.4% of those in the middle-income class and 31.6% in the lower-income class are behind on house payments.
Digital Connectivity
Cyprus also ranks highly in terms of digital connectivity. With 1,536 mobile subscriptions per 1,000 residents and 92.3% of households having access to the internet, the country is keeping up with digital trends, though it slightly lags behind the EU’s 93.1% internet access. E-commerce is also growing, with 56.8% of Cypriots shopping online, but still below the EU average of 69.6%.
Looking Ahead
Cyprus has made notable strides in improving its economy and the standard of living for its residents. While the country is closing the gap with the EU in several areas, challenges like inflation and income inequality remain. By continuing to focus on areas such as reducing the cost of utilities, tackling late payments, and enhancing digital infrastructure, Cyprus can continue to improve the quality of life for its population in the coming years.
[Source: CNA]
