CCLEI economic indicator about to flatline
The Cyprus Composite Leading Economic Index (CCLEI) is showing a downward trend and is about to flatline at 0% growth.
Economy
Finance Ministry welcomes review results, reaffirms commitment to economic stability
– The European Commission’s recent in-depth review highlighted that Cyprus’ economy is on a healthy trajectory, with GDP expected to grow and inflation to decrease.
– The moderation in GDP growth in 2023 was primarily attributed to weaker external demand for financial and business services influenced by Russia’s invasion of Ukraine.
– The government is focused on implementing policies to correct imbalances and enhance the competitiveness of the Cypriot economy, with emphasis on green and digital transitions.
– The Cyprus Recovery and Resilience Plan includes significant reforms to reduce macroeconomic vulnerabilities and expand the productive base of the economy.
– Public and private debt have decreased and are expected to continue decreasing in the coming years.
– Non-performing loans in the banking sector have declined, and the possibility of new non-performing loans is viewed as remote.
– Cyprus’ integration with both EU and non-EU economies makes it vulnerable to risks from geopolitical and trade tensions.
European commission highlights Cyprus’s economic growth
The European Commission’s report on the Cypriot economy highlights the observed economic growth, reduction in inflation, and ongoing correction of macroeconomic imbalances. The report identifies macroeconomic imbalances in public, private, and external debt, with improvements seen in the net international investment position and decreasing levels of public and private debt. The review also emphasizes Cyprus’ vulnerability to geopolitical developments due to its trade ties with European and third-country economies. The EC forecasts a growth rate of 2.4% for 2023, increasing to around 3% in 2024 and 2025, with a reduction in inflation and unemployment expected. The Ministry of Finance welcomes the results of the review, noting the government’s efforts to correct imbalances and strengthen the competitiveness of the Cypriot economy through policies focused on green and digital transition. The Cypriot Recovery and Resilience Plan includes reforms aimed at reducing vulnerabilities and ensuring macroeconomic stability and public finance sustainability.
Unveiling Cyprus, ’s wine industry: Challenges and solutions
Cyprus has a long history in the wine industry, with local vineyards producing a wide range of wines. However, the industry faces challenges such as small market size, economic volatility, climate change, regulatory compliance, and distribution issues. Online wine stores offer opportunities for wineries to reach a wider customer base, reduce dependency on traditional distribution networks, increase profit margins, and gather data-driven insights into consumer behavior. Online sales also provide a steady income during non-peak periods and help wineries establish a stronger presence in the global wine market.
Driving investments: : Recto advocates for corporate tax cuts via CREATE Law
Finance Secretary Ralph Recto is pushing for amendments to the CREATE Act to attract investments to the Philippines. The law has already reduced the corporate income tax rate to 25% and proposed changes include further reducing it to 20% for certain corporations. The goal is to enhance the business climate, generate more jobs, and lift millions of Filipinos out of poverty by 2028.
“C’mon Man! Tax the Rich!” Business Owners Face Tax Increases* | JD Supra
Sen. Warren reintroduced her “Ultra-Millionaires” wealth tax proposal to the Senate, inspired by the Administration’s Fiscal Year 2025 Budget which includes its own version of a wealth tax. The tax proposals are part of the upcoming contest for the White House and focus on tax avoidance by the wealthy. Business owners should familiarize themselves with the proposed changes to federal income tax and develop plans in response as there is a possibility that the Democrats may have another opportunity to turn their income tax agenda into law.
Egypt, ’s natgas woes continue
Egypt is unlikely to export any LNG to Europe this summer due to declining production at the Zohr field, which is prioritizing domestic energy needs.
Larnaca is becoming an emerging investment hub
Limassol is losing its position as Cyprus’ top investment hub to Larnaca, according to the ‘Cyprus Real Estate Market Report for the 2nd Semester 2023’ by Danos & Associates. Commercial properties in Cyprus are increasingly being used for professional purposes and workspaces, with potential disadvantages such as damages and malfunctioning spaces. However, the value of commercial properties tends to increase at a faster rate than residential properties. Demand for office spaces in Limassol has increased, with the average office value rising by 42% from 2015 to 2019. The real estate sector contributes significantly to the Cypriot economy, with a total of 5,974 transactions amounting to €1.52 billion in property sales in the second quarter of 2023. Nicosia and Famagusta provinces saw an increase in property value, while Limassol experienced a significant decrease. The abolition of the citizenship by investment program did not affect the real estate market in Cyprus, which continues to grow due to strong domestic demand and returning foreign investors.
Cocoa prices continue to rise
Cocoa prices have surged due to a supply crisis, with Ghana facing financial difficulties and struggling to secure funds for cocoa cultivation. Prices have risen by 60% in just one month and have more than doubled this year. The high cost of cocoa is expected to impact the price of chocolate, with Easter eggs already becoming more expensive. Speculators have exited the market, and there is a risk that the supply situation may worsen, especially with upcoming EU rules that may make it challenging for chocolate manufacturers to secure supplies. Attention is now on the upcoming mid-crop in West Africa, which is expected to shrink this season.
President Biden’s FY 2025 Budget Proposal: Details & Analysis
President Biden’s FY 2025 budget proposes tax hikes on businesses and high earners, amounting to a gross tax hike of over .1 trillion.