Despite the severe impact of the economic crisis on Cyprus over the past year, with the arrival of the new year, the people of Cyprus remain hopeful for the future.
Cyprus had to seek assistance from the European Union and the International Monetary Fund (IMF) due to significant losses in the banking sector. In March of last year, the Cypriot government reached a €10 billion bailout agreement with the Eurogroup and the IMF, which came with a series of stringent austerity measures. In 2014, the salaries and pensions of government employees will decrease by 3%; the value-added tax will increase from 18% last year to 19%; and gasoline prices will rise by approximately 3.5%. These austerity measures have affected everyone living in Cyprus to some extent.
Cypriot Finance Minister Harris Georgiades recently stated that Cyprus has avoided the danger of bankruptcy, and the economy is beginning to get back on track.
Many economists believe that considering Cyprus's small size and population, economic recovery is relatively easier. The strong performance of the tourism industry and investments from abroad have aided the recovery of the Cypriot economy. As Cypriot President Nicos Anastasiades stated in his New Year’s address: “The new year will mark the beginning of our country’s recovery.”
