The Cypriot economy recorded an annual growth rate of 3.0% in the first quarter of 2026, according to preliminary Quarterly National Accounts data released on Tuesday by the Statistical Service of Cyprus. Compared with the fourth quarter of 2025, Gross Domestic Product (GDP), measured in real terms and adjusted for seasonal variations and working days, increased by 0.2%.

Economic performance was driven mainly by the wholesale and retail trade, transportation, tourism and hospitality sectors, information and communication activities, as well as financial and insurance services.

Based on the production approach, the information and communication sector posted the strongest annual growth rate at 5.4%, followed by construction at 4.9% and the broader trade, transport, accommodation and food services sector at 4.4%. Financial and insurance activities expanded by 2.4%, while real estate activities increased by 2.1%.

On the expenditure side, private consumption remained the main driver of growth. Household and non-profit institution spending rose by 5.1% compared with the first quarter of 2025, while general government consumption expenditure increased by 4.6%. Overall final consumption expenditure grew by 4.9%.

At the same time, exports of goods and services recorded a strong increase of 10.5%, reaching €8.68 billion in real terms, while imports rose by 10.4% to €8.18 billion, reflecting the continued strength of the external sector.

Investment activity, however, presented a more subdued picture. Gross fixed capital formation increased by 1.5% year-on-year, although it declined by 5.2% compared with the previous quarter. Excluding ships and aircraft, investment fell by 2.3% on an annual basis, indicating a slowdown in investment activity across key sectors of the economy.

CNA/TNE/EPH/2026

ENDS, CYPRUS NEWS AGENCY