The Cyprus Cabinet approved the 2025 Fiscal Program on Wednesday evening, which will be submitted by the Minister of Finance to the Directorate-General for Economic and Financial Affairs of the European Commission, according to Government Spokesperson Konstantinos Letymbiotis. He noted that economic growth for the current year is expected to reach 3.7%.

In statements following the Cabinet meeting, Letymbiotis explained that this is the second annual review conducted in the fall, based on the plans and fiscal programs submitted by EU countries by October 15 each year. The review includes revised fiscal results for the current year and updated forecasts for the upcoming year, based on the government's budget plan.

The European Commission evaluates these plans by November 30 at the latest. According to the primary macroeconomic scenario in the 2025 fiscal program, the Cypriot economy is expected to grow by 3.7% in real terms in 2024. Inflation, based on the harmonized consumer price index, is projected to decrease to 2.2% in 2024 and further to 2% between 2025 and 2027.

Letymbiotis highlighted that the general government fiscal balance for 2024 is expected to show a surplus of 3.9% of GDP. Public debt is anticipated to decrease to 68.9% of GDP in 2024, compared to 77.4% at the end of the previous year.

He expressed disappointment over the dissemination of false information during critical times for Cyprus, emphasizing that misleading news does not contribute to positive outcomes. Specifically, he addressed claims of increases in the state payroll, explaining that the rise relates to the Cost of Living Allowance (COLA). He also refuted rumors of excessive spending on renovations, clarifying that ongoing work at the Presidential Palace concerns energy upgrades initiated under the previous government.

Letymbiotis also addressed reports alleging a budget allocation of €100,000 for new curtains, explaining that the Presidency's budget includes funds for the new National Security Council building, the Commissioners’ offices, the Committee on Missing Persons, and the Office for Humanitarian Affairs. He clarified that the funds are for replacing worn-out furniture and meeting the needs of the new NSC building.

He emphasized the need for responsible public discourse, stating that the government remains committed to transparency and will not compromise its work, despite attempts to spread false information. "The public expects us to engage in dialogue based on real facts, and we must uphold that responsibility," he added.

When asked about a 1.5% salary increase under discussion by the House Finance Committee, Letymbiotis clarified that the increase, stemming from a Ministry of Finance agreement, does not apply to government officials. The 1.5% raise for public sector employees will be implemented by 2027. Additionally, a 7.5% wage increase for the construction industry has been agreed upon by 2027, and a similar increase is being promoted for the hotel industry by the Ministry of Labor.

He stressed the government's efforts to raise the purchasing power of workers' wages in both the public and private sectors.