Econ­omy back on track, 1.6% growth in Q1

Financial Mirror (Cyprus) - - FRONT PAGE -

Sea­son­ally ad­justed GDP rose by 1.6% dur­ing the first quar­ter of 2015, com­pared to the pre­vi­ous quar­ter, while in both the euro area and the EU28 GDP rose by 0.4% dur­ing the same pe­riod, ac­cord­ing to Euro­stat.

In the fourth quar­ter of 2014, GDP also grew by 0.4% in the euro area and the EU28, while in Cyprus it dropped - 0.4%. Com­pared with the same quar­ter of the pre­vi­ous year, sea­son­ally ad­justed GDP rose by 1.0% in the euro area and by 1.5% in the EU28 in the first quar­ter of 2015 and by 0.2% in Cyprus.

Two weeks ago, the Fi­nance Min­istry said the the Cypriot econ­omy re­turned to pos­i­tive growth af­ter 14 quar­ters of con­trac­tion. Based on sea­son­ally ad­justed data, GDP growth rate in real terms is es­ti­mated at 0.2%, com­pared with -1.8% in the fourth quar­ter of 2014 on an an­nual ba­sis.

The GDP growth rate in real terms dur­ing the first quar­ter of 2015 is pos­i­tive and es­ti­mated at 0.4% over the cor­re­spond­ing quar­ter of 2014.

Pos­i­tive growth rates were recorded in trade, ho­tels and restau­rants, com­mu­ni­ca­tion, elec­tric­ity as well as the legal and ac­count­ing ac­tiv­i­ties. ¡ega­tive growth rates were recorded by the sec­ondary sec­tor of the econ­omy, min­ing, man­u­fac­tur­ing and con­struc­tion.

Ac­cord­ing to the Min­istry’s Public Debt Man­age­ment Of­fice, the busi­ness en­vi­ron­ment shows signs of sta­bil­i­sa­tion and grad­ual im­prove­ment given that lend­ing to non-fi­nan­cial cor­po­ra­tions is marginally pos­i­tive and in­ter­est rates are in decline.

The eco­nomic sen­ti­ment in­di­ca­tor by Uni­ver­sity of Cyprus Eco­nomic Re­search Cen­tre (CypERC) in­creased by 4 points in April from the pre­vi­ous month. This in­crease is due to the im­prove­ment in the busi­ness cli­mate in all sec­tors cov­ered by the sur­vey, as well to the strength­en­ing of the con­sumer eco­nomic con­fi­dence.

Ex­ports in­creased by 45.5% in Jan­uary-March com­pared to Jan­uaryMarch 2014.

In Jan­uary-April tourist ar­rivals in­creased by 13.7% com­pared to same pe­riod last year. An in­crease of 84.7% was recorded in tourist ar­rivals from Is­rael, 14.3% from Ger­many, 15.8% from the UK and a 39.4% in­crease from Greece. On the other hand a 16.2% de­crease was recorded in ar­rivals from Rus­sia. In­fla­tion (HICP) for April was - 1.7% com­pared to -1.4% in March and for 2015 so far it stands at -1.2%.

The Labour Force Sur­vey (LFS) on un­em­ploy­ment, in monthly sea­son­ally ad­justed terms, de­creased from 16.2% in March 2014 to 16% in March 2015.

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