FinMin to deliver 2024 state budget to House President

Finance Minister Makis Keravnos is expected to deliver the state budget for 2024 to the House President Annita Dimitriou on 4 October.

The budget, will is the Nikos Christodoulides administration’s first, will be formally submitted during the House plenary on 5 October.

The 2024 budget projects a surplus of €659m, equivalent to 2.2% of the GDP. Development spending shows a 12% increase on an annual basis, while social benefits are up by 15% compared to 2023, reaching €2b. Additionally, there is a restraint on public sector salaries.

As stated by Keravnos following the budget's approval by the Cabinet, its formulation took into account the significant economic uncertainties, substantial challenges to the economy such as the direct impact of new sanctions on Russia and Belarus, high inflation eroding real incomes, reduced state revenue due to decreased consumption, high interest rates hampering economic growth, and the effects of migration flows.

"The goal of the 2024 budget and the medium-term fiscal framework for 2024 – 2026 is to address these challenges and stabilize conditions for sustainable economic growth," said Keravnos.

For 2024, a growth rate of around 2.9% is projected, while in 2023, the Cypriot economy is expected to register a positive growth rate of 2.5%.

According to budget assumptions, the unemployment rate is anticipated to drop to 5.8% in 2024 from 6.5% in 2023. The budget envisages total General Government revenues of €13.2 billion and expenditures of €11.8 billion, resulting in a fiscal surplus of €659 million, or 2.2% of GDP. The primary surplus (excluding debt servicing expenses) stands at €1.09 billion or 3.6% of GDP.

Capital expenditures have increased by €135 million compared to the 2023 budget. The medium-term goal is to reduce public debt to 60% by 2026.

(Source: CNA)