The accelerating pace of vaccination and the improved epidemiological situation in Cyprus, as well as in the rest of the EU, have prompted a significant relaxation of domestic and travel restrictions since mid-May, laying the ground for sustained growth in the coming months. Nevertheless, the tourism sector is still expected to recover only gradually, as uncertainty remains and international travel, particularly from the UK – an important market for Cyprus – has yet to fully recover. The IMF expects the Cypriot economy to grow by a modest 4% in 2021, following a contraction of 5.1% in 2020. This has been further cemented by president Nicos Nastasiades who proposed a €4.4 billion stimulus plan which is projected to increase GDP by 7% over the next five years and create an additional 11,000 jobs.
