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Economy
Cyprus

Economy - overview:

The area of the Republic of Cyprus under government control has a
market economy dominated by the service sector, which accounts for
78% of GDP. Tourism, financial services, and real estate are the
most important sectors. Erratic growth rates over the past decade
reflect the economy's reliance on tourism, which often fluctuates
with political instability in the region and economic conditions in
Western Europe. Nevertheless, the economy in the area under
government control grew by an average of 3.6% per year during the
period of 2000-06, well above the EU average. Cyprus joined the
European Exchange Rate Mechanism (ERM2) in May 2005 and adopted the
euro as its national currency on 1 January 2008. An aggressive
austerity program in the preceding years, aimed at paving the way
for the euro, helped turn a soaring fiscal deficit (6.3% in 2003)
into a surplus of 1.5% in 2007. As in the area administered by
Turkish Cypriots, 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 2001-04 alleviating
immediate concerns. Rainfall in 2005 and 2006, however, was well
below average, making water rationing a necessity in 2007.

GDP (purchasing power parity):

$21.4 billion (2007 est.)

GDP (official exchange rate):

$21.3 billion (2007 est.)

GDP - real growth rate:

4.4% (2007 est.)

GDP - per capita (PPP):

$27,100 (2007 est.)

GDP - composition by sector:

agriculture: 2.7%
industry: 19.2%
services: 78% (2007 est.)

Labor force:

393,000 (2007 est.)

Labor force - by occupation:

agriculture: 8.5%
industry: 20.5%
services: 71% (2006 est.)

Unemployment rate:

3.9% (2007 est.)

Population below poverty line:

NA%

Household income or consumption by percentage share:

lowest 10%: NA%
highest 10%: NA%

Distribution of family income - Gini index:

29 (2005)

Investment (gross fixed):

20.8% of GDP (2007 est.)

Budget:

revenues:: $9.996 billion
expenditures:: $9.304 billion (2007 est.)

Fiscal year:

calendar year

Public debt:

59.6% of GDP (2007 est.)

Inflation rate (consumer prices):

2.4% (2007 est.)

Central bank discount rate:

5% (31 December 2007)

Commercial bank prime lending rate:

6.74% (31 December 2007)

Stock of money:

$4.094 billion
note: see entry for the Eur