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Cypriot economy to return to growth: EC

Xinhua, February 6, 2015 Adjust font size:

Cypriot recession has bottomed off and the economy is expected to return to growth this year, albeit at a marginal rate, a European Commission (EC) report said on Thursday.

The Commission said in its winter economic forecast made available in Nicosia that the economy of the bailed out eastern Mediterranean island is showing signs of stabilization.

But it warned of difficulties ahead due to the economic situation in Russia.

"On the external side, negative economic developments in Russia are likely to weigh on export growth in 2015, given the sizable trade links between Russia and Cyprus. This negative effect is likely to dominate the positive impact from lower oil price, leading to downside risk to the GDP growth projections for 2015," the report said.

Authorities estimate that due to the sharp devaluation of the ruble and Russia's lower income because of the decline in oil prices Cyprus stands to lose 25 percent of Russian tourists this year relative to 2014.

Cyprus was pulled back from bankruptcy in March, 2103, with a 10-billion-euro (11.4 billion U.S. dollars) deal offered by the Eurogroup and the International Monetary Fund. Endit