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    Cyprus Index 2006

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    Cyprus Economy - 2006

      Economy - overview:
      The Republic of Cyprus has a market economy dominated by the service sector, which accounts for 76% of GDP. Tourism and financial services 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 grew a healthy 3.7% per year in 2004 and 2005, well above the EU average. Cyprus joined the European Exchange Rate Mechanism (ERM2) in May 2005. The government has initiated an aggressive austerity program, which has cut the budget deficit to below 3% but continued fiscal discipline is necessary if Cyprus is to meet its goal of adopting the euro on 1 January 2008. 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 2001-03 alleviating immediate concerns. The Turkish Cypriot economy has roughly one-third of the per capita GDP of the south, and economic growth tends to be volatile, given north Cyprus's relative isolation, bloated public sector, reliance on the Turkish lira, and small market size. The Turkish Cypriot economy grew 15.4% in 2004, fueled by growth in the construction and education sectors, as well as increased employment of Turkish Cypriots in the Republic of Cyprus. The Turkish Cypriots are heavily dependent on transfers from the Turkish Government. Under the 2003-06 economic protocol, Ankara plans to provide around $550 million to the "TRNC." Agriculture and services, together, employ more than half of the work force.

      GDP (purchasing power parity):
      Republic of Cyprus: $16.85 billion; north Cyprus: $4.54 billion (2005 est.)

      GDP (official exchange rate):
      Republic of Cyprus: $15.43 billion (2005 est.)

      GDP - real growth rate:
      Republic of Cyprus: 3.7%; north Cyprus: 10.6% (2005 est.)

      GDP - per capita (PPP):
      Republic of Cyprus: $21,600 (2005 est.); north Cyprus: $7,135 (2004 est.)

      GDP - composition by sector:
      Republic of Cyprus: agriculture 3.8%; industry 20%; services 76.2% (2005 est.)
      north Cyprus: agriculture 10.6%; industry 20.5%; services 68.9% (2003 est.)

      Labor force:
      Republic of Cyprus: 370,000, north Cyprus: 95,025 (2004 est.)

      Labor force - by occupation:
      Republic of Cyprus: agriculture 7.4%, industry 38.2%, services 54.4% (2004 est.)
      north Cyprus: agriculture 14.5%, industry 29%, services 56.5% (2004 est.)

      Unemployment rate:
      Republic of Cyprus: 3.8% (2005 est.); north Cyprus: 5.6% (2004 est.)

      Population below poverty line:

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

      Inflation rate (consumer prices):
      Republic of Cyprus: 2.5% (2005 est.); north Cyprus: 9.1% (2004 est.)

      Investment (gross fixed):
      Republic of Cyprus: 18.9% of GDP (2005 est.)

      revenues: Republic of Cyprus - $6.698 billion (2005 est.)
      expenditures: Republic of Cyprus - $7.122 billion (2005 est.)
      revenues: north Cyprus - $231.3 million (2003 est.)
      expenditures: north Cyprus - $432.8 million (2003 est.)

      Public debt:
      Republic of Cyprus: 72% of GDP (2005 est.)

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

      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:
      Republic of Cyprus: 3.7% (2005 est.); north Cyprus: -0.3% (2002 est.)

      Electricity - production:
      Republic of Cyprus: 3.801 billion kWh; north Cyprus: NA kWh (2003)

      Electricity - consumption:
      Republic of Cyprus: 3.535 billion kWh (2004); north Cyprus: NA kWh (2003)

      Electricity - exports:
      0 kWh (2003)

      Electricity - imports:
      0 kWh (2003)

      Oil - production:
      Republic of Cyprus: 300 bbl/day (2005 est.)

      Oil - consumption:
      Republic of Cyprus: 52,000 bbl/day (2003 est.)

      Oil - exports:
      NA bbl/day

      Oil - imports:
      NA bbl/day

      Natural gas - production:
      0 cu m (2003 est.)

      Natural gas - consumption:
      0 cu m (2003 est.)

      Current account balance:
      Republic of Cyprus: -$849 million (2005 est.)

      Republic of Cyprus: $1.237 billion f.o.b.; north Cyprus: $69 million f.o.b. (2005 est.)

      Exports - commodities:
      Republic of Cyprus: citrus, potatoes, pharmaceuticals, cement, clothing and cigarettes; north Cyprus: citrus, potatoes, textiles

      Exports - partners:
      UK 27.2%, Greece 11.9%, Germany 5%, UAE 4.8% (2004)

      Republic of Cyprus: $5.552 billion f.o.b.;; north Cyprus: $415.2 million f.o.b. (2004 est.)

      Imports - commodities:
      Republic of Cyprus: consumer goods, petroleum and lubricants, intermediate goods, machinery, transport equipment; north Cyprus: vehicles, fuel, cigarettes, food, minerals, chemicals, machinery

      Imports - partners:
      Greece 15.2%, Italy 10.5%, Germany 8.9%, UK 8.6%, France 6.3%, Japan 4.7%, Israel 4.4%, China 4% (2004)

      Reserves of foreign exchange and gold:
      Republic of Cyprus: $3.989 billion; north Cyprus $NA (2005 est.)

      Debt - external:
      Republic of Cyprus: $7.803 billion; north Cyprus: $NA (2005 est.)

      Economic aid - recipient:
      Republic of Cyprus - $NA; north Cyprus - $700 million from Turkey in grants and loans, which are usually forgiven (2003-06)

      Currency (code):
      Republic of Cyprus: Cypriot pound (CYP); Turkish Cypriot area: Turkish New lira (YTL)

      Exchange rates:
      Cypriot pounds per US dollar - 0.4641 (2005), 0.4686 (2004), 0.5174 (2003), 0.6107 (2002), 0.6431 (2001), Turkish lira per US dollar - 1.36 (2005), 1.426 million (2004), 1.501 million (2003), 1.507 million (2002), 1.226 million (2001)

      Fiscal year:
      calendar year

      NOTE: The information regarding Cyprus on this page is re-published from the 2006 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Cyprus Economy 2006 information contained here. All suggestions for corrections of any errors about Cyprus Economy 2006 should be addressed to the CIA.

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    Revised 06-Jun-06
    Copyright © 2006 Photius Coutsoukis (all rights reserved)