20/01/2015 08:29
The European Bank for Reconstruction and Development appears more optimistic for the course of the Cyprus economy, despite the deteriorating economy of Russia, on which it depends.
The Bank estimates that growth in Cyprus will reach 0.7% in 2015.
In September 2014, the EBRD expected that the Cyprus economy would register zero growth in 2015.
Growth will occur despite the weak credit growth in Cyprus driven by the high non-performing loans reaching 50%.
The course of the domestic macroeconomic environment also improves despite the rapid deterioration of the Russian economy.
It is estimated that the Russian GDP will shrink by 4.8% due to the collapse in oil prices and the Western sanctions.
In September, the EBRD expected recession of 0.2%. According to EBRD, on average, countries across the EBRD regions are now expected to see a contraction of 0.3 per cent in 2015, after a forecast of 1.7 percent growth in September
On the positive side, the oil price decline - and resulting improvements in terms of trade - could help soften the impact on emerging economies of the expected normalisation of U.S. monetary policies.
The halving of oil prices has added to problems in Russia, whose economic growth was already slowing down amid uncertainty and weak investor confidence after the imposition of sanctions in 2014. Energy exporters Kazakhstan, Azerbaijan and Turkmenistan have also been negatively affected by the lower prices.
Estimates of growth rates fell to 1.5% (from 5.1% in September) for Kazakhstan and 1.5% (from 3%) for Azerbaijan.
The Bank estimates that growth in Cyprus will reach 0.7% in 2015.
In September 2014, the EBRD expected that the Cyprus economy would register zero growth in 2015.
Growth will occur despite the weak credit growth in Cyprus driven by the high non-performing loans reaching 50%.
The course of the domestic macroeconomic environment also improves despite the rapid deterioration of the Russian economy.
It is estimated that the Russian GDP will shrink by 4.8% due to the collapse in oil prices and the Western sanctions.
In September, the EBRD expected recession of 0.2%. According to EBRD, on average, countries across the EBRD regions are now expected to see a contraction of 0.3 per cent in 2015, after a forecast of 1.7 percent growth in September
On the positive side, the oil price decline - and resulting improvements in terms of trade - could help soften the impact on emerging economies of the expected normalisation of U.S. monetary policies.
The halving of oil prices has added to problems in Russia, whose economic growth was already slowing down amid uncertainty and weak investor confidence after the imposition of sanctions in 2014. Energy exporters Kazakhstan, Azerbaijan and Turkmenistan have also been negatively affected by the lower prices.
Estimates of growth rates fell to 1.5% (from 5.1% in September) for Kazakhstan and 1.5% (from 3%) for Azerbaijan.
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