Gold Magazine January - February 2014, Issue 34

cyprus {business} Cyprus Business Forecast Report Published Recently published research from Business Monitor International, “Cyprus Business Forecast Report Q1 2014”, is now available from Fast Market Research. Among its conclusions and predictions are the following: T he Cyprus government will remain firmly committed to the terms of its €10 billion bailout programme, which could result in a public backlash over the coming years. However, we believe that future negotiations with creditors could prove to be more confrontational in a bid to secure the best terms possible and limit a potential drop in popularity. We see a rapid adjustment in the fiscal dynamics, forecasting the nominal budget deficit to fall from 6.4% of GDP in 2012 to 4.3% in 2013 and continue narrowing to 3.2% in 2014. Further commitment to EU-prescribed austerity measures will be key to ensuring sustainable debt management given that we see the general government debt pile rising above 100% of GDP in 2013. Early indications of the severity of Cyprus’ economic adjustment following the country’s banking sector crisis in early 2013 reaffirm our view that the economy is heading towards a period of major structural adjustment. We continue to see several years of negative real private consumption, government expenditure and fixed investment growth, which will keep the economy firmly in deep recession until 2016-2017. Major Forecast Changes We have revised our 2013 real GDP growth forecast

Gold Magazine January - February 2014, Issue 34 | Page 70