Cyprus Economy
Economy - overviewThe Greek Cypriot economy is prosperous but highly susceptible to external shocks. Erratic growth rates over the past decade reflect the economy's vulnerability to swings in tourist arrivals, caused by political instability in the region and fluctuations in economic conditions in Western Europe. Economic policy is focused on meeting the criteria for admission to the EU. EU-driven tax reforms in 2003 have introduced fiscal imbalances, which, coupled with a sluggish tourism sector, have resulted in growing fiscal deficits. As in the Turkish sector, water shortages are a perennial problem; a few desalination plants are now on-line. After 10 years of drought, the country received substantial rainfall from 2001-03, alleviating immediate concerns. The Turkish Cypriot economy has roughly one-third of the per capita GDP of the south. Because it is recognized only by Turkey, it has had much difficulty arranging foreign financing and investment. It remains heavily dependent on agriculture and government service, which together employ about half of the work force. To compensate for the economy's weakness, Turkey provides grants and loans to support economic development. Ankara provided $200 million in 2002 and pledged $450 million for the 2003-05 period. Future events throughout the island will be highly influenced by the outcome of negotiations on the UN-sponsored agreement to unite the Greek and Turkish areas.
GDP
Republic of Cyprus: purchasing power parity - $14.82 billion (2003 est.); north Cyprus: purchasing power parity - $1.217 billion (2003 est.)
GDP - real growth rate
Republic of Cyprus: 1.9% (2003 est.); north Cyprus: 2.6% (2003 est.)
GDP - per capita
Republic of Cyprus: purchasing power parity - $19,200 (2003 est.); north Cyprus: purchasing power parity - $5,600 (2003 est.)
GDP - composition by sector
Republic of Cyprus: agriculture 4.1%; industry 20.3%; services 75.6%
north Cyprus: agriculture 10.6%; industry 20.5%; services 68.9% (2003)
Investment
19.9% of GDP (2003)
Population below poverty line
NA
Household income or consumption by percentage share
lowest 10%: NA
highest 10%: NA
Inflation rate
Republic of Cyprus: 4.1% (2003 est.); north Cyprus: 12.6% (2003 est.)
Labor force
330,000 Republic of Cyprus: 306,000; north Cyprus: 95,025 (2003)
Labor force - by occupation
Republic of Cyprus: services 75.6%, industry 19.4%, agriculture 4.9% (2003); north Cyprus: services 68.9%, industry 20.5%, agriculture 10.6% (2003)
Unemployment rate
Republic of Cyprus: 3.4%; north Cyprus: 5.6% (2003 est.)
Budget
revenues: Republic of Cyprus - $3.971 billion, north Cyprus - $231.3 million (2002 est.)
expenditures: $4.746 billion, Republic of Cyprus - $539 million, including capital expenditures of $539 million, north Cyprus - $432.8 million, including capital expenditures of NA (2003)
Public debt
62.3% of GDP (2003)
Agriculture - products
potatoes, citrus, vegetables, barley, grapes, olives, vegetables, poultry, pork, lamb, kids, dairy
Industries
food, beverages, textiles, chemicals, metal products, tourism, wood products
Industrial production growth rate
Republic of Cyprus: -0.6% (2002); north Cyprus: -0.3% (2003)
Electricity - production
3.401 billion kWh; north Cyprus: NA kWh (2001)
Electricity - consumption
Republic of Cyprus: 3.163 billion kWh; north Cyprus: NA kWh (2001)
Electricity - exports
0 kWh (2001)
Electricity - imports
0 kWh (2001)
Oil - production
0 bbl/day (2001 est.)
Oil - consumption
49,000 bbl/day (2001 est.)
Oil - exports
NA (2001)
Oil - imports
NA (2001)
Current account balance
$-545 million (2003)
Exports
Republic of Cyprus: $1.054 billion f.o.b. north Cyprus: $46 million f.o.b. (2003 est.)
Exports - commodities
Republic of Cyprus: citrus, potatoes, pharmaceuticals, cement, clothing and cigarettes; north Cyprus: citrus, potatoes, textiles
Exports - partners
UK 32.1%, Greece 9.2%, Lebanon 3.5% (2003)
Imports
Republic of Cyprus: $4.637 billion f.o.b.; north Cyprus: $301 million f.o.b. (2003 est.)
Imports - commodities
Republic of Cyprus: consumer goods, petroleum and lubricants, intermediate goods, machinery, transport equipment; north Cyprus: food, minerals, chemicals, machinery
Imports - partners
Greece 11.9%, Italy 9.8%, UK 8.3%, Germany 7.5%, Japan 5.6%, France 5.1%, China 4.9%, US 4.2%, Spain 4% (2003)
Reserves of foreign exchange & gold
$3.453 billion (2003)
Debt - external
Republic of Cyprus: $8.85 billion; north Cyprus: NA (2003)
Currency
Republic of Cyprus: Cypriot pound (CYP); north Cyprus: Turkish lira (TRL)
Currency code
CYP; TRL
Exchange rates
Cypriot pounds per US dollar - 0.5174 (2003), 0.6107 (2002), 0.6431 (2001), 0.6224 (2000), 0.5429 (1999), Turkish lira per US dollar 1.505 million (2003), 1.507 million (2002), 1,225,590 (2001), 625,218 (2000), 418,783 (1999)
