Financial Mirror (Cyprus) - - FRONT PAGE -

How­ever, growth is ex­pected to pick up slightly to 3.7% in 2007, far short of the govern­ment’s fore­cast of 4.2% it dubbed as “op­ti­mistic” as the is­land is on the verge of join­ing the eu­ro­zone in Jan­uary 2008.

Cyprus could be in trou­ble over the way it taxes sec­ond hand cars as the Euro­pean Com­mis­sion de­cided to send a “for­mal re­quest for in­for­ma­tion” over th tax rules on reg­is­tra­tion of EU-im­ported used cars. The main stum­bling blocks are the way Cyprus ap­plies tax on CO2 emis­sions and the is­sue of de­pre­ci­a­tion,



which ap­pears to im­pose an ex­ces­sive tax on sec­ond hand im­ports.

Rates un­changed:

The Mon­e­tary Pol­icy Com­mit­tee of the Cen­tral bank of Cyprus de­cided to keep in­ter­est rates un­changed at 4.25% for mar­ginal lend­ing, com­pared to a 3.50% equiv­a­lent in the euro area. The min­i­mum on the main re­fi­nanc­ing rate stays at 3.25% (2.50% in eu­ro­zone), and the de­posit fa­cil­ity is at 2.25% (1.50% in eu­ro­zone).



The RICS Euro­pean hous­ing re­view said that the Cyprus prop­erty mar­ket will re­main con­stant in 2006, but on an up­ward trend as the mod­er­ate to low in­ter­est rates in the com­ing years, due to Euro ac­ces­sion, as well as low in­fla­tion and un­em­ploy­ment, are ex­pected to help.

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