Cyprus has an open, free-market, services-based economy. Tourism, financial services, and real estate are the most important sectors. Trade is also very important for the economy and most goods are imported. Cyprus' accession as a full member to the European Union as of May 1, 2004, has been an important milestone in its recent economic development. Cyprus joined the European Exchange Rate 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, and reduced inflation.

Cyprus has few proven natural resources, good business and financial services, modern telecommunications, an educated labor force, good airline connections, a sound legal system, and a low crime rate. Investors may invest freely either directly or indirectly in Cyprus in most sectors. According to the United Nations Conference on Trade and Development (UNCTAD) "World Investment Report 2008," Cyprus ranks among the world's leading countries per capita in terms of attracting FDI.

Although Cyprus lagged its EU peers in showing signs of stress from the global crisis, the economy tipped into recession in mid 2009 and GDP contracted by 0.8% in 2009. In addition, the budget deficit is on the rise and reached 3.5% of GDP, a violation of the EU's budget deficit criteria of no more than 3% of GDP. In response to the country's deteriorating finances, Nicosia is promising to implement measures to cut the cost of the state payroll, curb tax evasion, and revamp social benefits.


Labor force:
400,000 (2009 est.)
country comparison to the world: 159

Labor force - by occupation:
agriculture: 8.5%
industry: 20.5%
services: 71% (2006 est.)

Unemployment rate:
4.8% (2009 est.)
country comparison to the world: 43
3.6% (2008 est.)

Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%

Distribution of family income - Gini index:
29 (2005)
country comparison to the world: 116

Investment (gross fixed):
22.4% of GDP (2009 est.)
country comparison to the world: 63

Budget:
revenues:: $9.689 billion
expenditures:: $10.72 billion (2009 est.)

Public debt:
52.4% of GDP (2009 est.)
country comparison to the world: 43
49.1% of GDP (2008 est.)

Inflation rate (consumer prices):
0.9% (2009 est.)
country comparison to the world: 40
4.7% (2008 est.)

Central bank discount rate:
3% (31 December 2008)
country comparison to the world: 105
5% (31 December 2007)
note: this is the European Central Bank's rate on the marginal lending facility, which offers overnight credit to banks in the euro area

Commercial bank prime lending rate:
7.19% (31 December 2008)
country comparison to the world: 130
6.74% (31 December 2007)

Stock of money:
$NA (31 December 2008)
$4.094 billion (31 December 2007)
note: this figure represents the US dollar value of Cypriot pounds in circulation prior to Cyprus joining the Economic and Monetary Union (EMU); see entry for the European Union for money supply in the euro area; the European Central Bank (ECB) controls monetary policy for the 16 members of the EMU; individual members of the EMU do not control the quantity of money and quasi money circulating within their own borders

Stock of quasi money:
$NA (31 December 2008)
$43.93 billion (31 December 2007)

Stock of domestic credit:
$80.68 billion (31 December 2008)
country comparison to the world: 47
$52.09 billion (31 December 2007)

Market value of publicly traded shares:
$NA (31 December 2008)
country comparison to the world: 59
$29.48 billion (31 December 2007)
$15.9 billion (31 December 2006)

Agriculture - products:
citrus, vegetables, barley, grapes, olives, vegetables; poultry, pork, lamb; dairy, cheese

Industries:
tourism, food and beverage processing, cement and gypsum production, ship repair and refurbishment, textiles, light chemicals, metal products, wood, paper, stone, and clay products

Industrial production growth rate:
-3.5% (2009 est.)
country comparison to the world: 99

Electricity - production:
4.502 billion kWh (2007 est.)
country comparison to the world: 115

Electricity - consumption:
4.277 billion kWh (2007 est.)
country comparison to the world: 116

Electricity - exports:
0 kWh (2008 est.)

Electricity - imports:
0 kWh (2008 est.)

GDP (purchasing power parity):
$22.97 billion (2009 est.)
country comparison to the world: 116
$23.16 billion (2008 est.)
$22.35 billion (2007 est.)
note: data are in 2009 US dollars

GDP (official exchange rate):
$23.49 billion (2009 est.)

GDP - real growth rate:
-0.8% (2009 est.)
country comparison to the world: 120
3.6% (2008 est.)
5.1% (2007 est.)

GDP - per capita (PPP):
$21,200 (2009 est.)
country comparison to the world: 58
$21,700 (2008 est.)
$21,300 (2007 est.)
note: data are in 2009 US dollars

GDP - composition by sector:
agriculture: 2.1%
industry: 19%
services: 78.9% (2009 est.)

Oil - production:
0 bbl/day (2008 est.)
country comparison to the world: 184

Oil - consumption:
59,000 bbl/day (2008 est.)
country comparison to the world: 94

Oil - exports:
0 bbl/day (2007 est.)
country comparison to the world: 194

Oil - imports:
58,930 bbl/day (2007 est.)
country comparison to the world: 80

Oil - proved reserves:
0 bbl
country comparison to the world: 178

Natural gas - production:
0 cu m (2008 est.)
country comparison to the world: 192

Natural gas - consumption:
0 cu m (2008 est.)
country comparison to the world: 193

Natural gas - exports:
0 cu m (2008 est.)
country comparison to the world: 192

Natural gas - imports:
0 cu m (2008 est.)
country comparison to the world: 183

Natural gas - proved reserves:
0 cu m (1 January 2009 est.)
country comparison to the world: 188

Current account balance:
-$1.639 billion (2009 est.)
country comparison to the world: 144
-$4.479 billion (2008 est.)

Exports:
$1.135 billion (2009 est.)
country comparison to the world: 145
$1.906 billion (2008 est.)

Exports - commodities:
citrus, potatoes, pharmaceuticals, cement, clothing

Exports - partners:
Greece 20%, UK 10.8%, Germany 6% (2008)

Imports:
$6.676 billion (2009 est.)
country comparison to the world: 100
$10.54 billion (2008 est.)

Imports - commodities:
consumer goods, petroleum and lubricants, intermediate goods, machinery, transport equipment

Imports - partners:
Greece 16.9%, Italy 10.7%, UK 8.7%, Germany 8.3%, Israel 8.2%, China 5.3%, Netherlands 4.1%, France 4.1% (2008)

Reserves of foreign exchange and gold:
$NA (31 December 2009 est.)
$1.003 billion (31 December 2008 est.)

Debt - external:
$NA (31 December 2009 est.)
$32.86 billion (31 December 2008 est.)

Stock of direct foreign investment - at home:
$16.88 billion (31 December 2009 est.)
country comparison to the world: 68
$15.69 billion (31 December 2008 est.)

Stock of direct foreign investment - abroad:
$7.908 billion (31 December 2009 est.)
country comparison to the world: 50
$7.097 billion (31 December 2008 est.)

Exchange rates:
Euro (EUR) per US dollar - 0.734 (2009), 0.6827 (2008), Cypriot pounds (CYP) per US dollar - 0.4286 (2007), 0.4586 (2006), 0.4641 (2005)