Republic of Cyprus Second Voluntary National Report - Sustainable development goals

72 NARRATIVE Following the financial crisis in 2013, economic recovery resumed by 2015, with a solid growth path over the period 2015-2019. Before the onset of the COVID-19 pandemic in the beginning of 2020, the macroeconomic projections of both the national authorities and the European Commission, pointed towards another year of significant growth. However, the effects of the pandemic proved detrimental to the Cypriot economy, plunging it into a deep recession. The Government has taken measures to mitigate this effect, by offering a set of financial and incentive schemes targeting the creation of new jobs, the employment of young people and persons with disabilities, and overall people affected by the pandemic. A new ambitious Long-Term Economic Strategy (LTES) is currently being prepared, aiming for a new growth model, to transform Cyprus into a productive, green, and digitalised economy, resilient to external shocks and at the same time encompassing a fair and inclusive society. ANALYSIS Economic growth remained resilient for five consecutive years until 2019, despite the great imbalances of high debt and non-performing loans, which are a legacy of the 2013 crisis. Needless to say that, in 2020 this growing trend has been reversed by the pandemic (see Figure 21). For 2019, Cyprus ranked 13th among EU countries both in terms of the real GDP per capita (€24 570 relative to €27 970 in the EU), and its growth (1.9% relative to 1.3% in the EU). In terms of the total investment share of GDP, Cyprus is placed in the 20 th position, but notably it ranks 1st among EU countries in household investment share of GDP (see Figure 22). In terms of the main employment indicators, Cyprus ranks somewhere in the middle among EU countries. In particular, it is placed 14th in the employment rate (75.7% relative to 73.1% in the EU) having a U-shaped trend from 2010 onwards. In particular, the employment rate initially increased until 2014, and then a decrease in the employment rate was observed. The long- term unemployment rate in Cyprus in 2019 was 2.1%, which is lower than the EU average of 2.8%, placing Cyprus in the 17 th position (see Figure 23). The percentage of young people neither in employment nor in education and training remains a challenge at 14.1%, just above the EU 20000 20500 21000 21500 22000 22500 23000 23500 24000 24500 25000 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 euro per capita 23400 22900 21780 20400 20250 21020 22270 23200 24120 24570 Figure 21.: Real GDP per capita 0 5 10 15 20 25 % of GDP 19.4 7.9 2.4 9.1 22.5 14.1 3.0 5.3 Total Investment Business Investment Government Investment Households Investment Cyprus EU Figure 22.: Investment share of GDP 72 72 73 73 74 74 75 75 76 76 0 1 2 3 % of population aged 20 -64 % of total active population Cyprus EU Long-term Unemployment Rate Employment Rate 2.1 2.8 75.7 73.1 Figure 23.: Employment