After decades of economic struggle which the pandemic and COVID-related restrictions exacerbated, Greece and Cyprus are optimistic about their economic futures. In 2019, both countries’ economies were in grim states. In Cyprus, 15.3% of the population was at risk of poverty as of 2020, a marginal rise from the previous year. Meanwhile, 30% of Greece’s population was at risk of poverty or social exclusion in 2020. Amid all the pessimism, however, there are reasons to have a bright outlook for the future of Greek and Cypriot poverty reduction.
Massive pandemic relief packages stemming from the E.U. budget have already allowed a solid recovery for Greece and Cyprus.
In June 2021, the E.U. approved a recovery plan worth 30.5 billion euros for Greece. According to E.U. Commission President Ursula von der Leyen, the plan “will help Greece build a better future.” The recovery plan could spur Greek economic growth by 7% within the next six years, giving people a reason to be optimistic about the future of Greece’s economy.
In Cyprus, the 1.2 billion euros that Greece secured from the E.U. Recovery and Resilience Program and 1.8 billion euros from the E.U.’s Structural and Investment Funds form part of the Cypriot president’s self-described “ambitious” recovery plan. The massive cash influx will help add at least 11,000 new jobs, a significant number for a country with a population of around 875,000. In addition, it will help Cyprus reverse course from the continuous austerity its government has implemented in recent years, which has proven counterproductive in the fight against poverty. These two gigantic pandemic relief packages from the E.U. will allow a bright future for Greek and Cypriot poverty reduction.
Optimistic Economic Growth Projections
Another major reason for optimism about Greek and Cypriot poverty rates is the countries’ economic growth projections. Despite the pandemic significantly shrinking both nations’ economies, economic growth projections for upcoming quarters and years are notably better than expected.
In Greece, for example, after a fantastic 4.4% rise in GDP in the first quarter of 2021 despite the COVID-related restrictions that were in place for almost the entire quarter, the E.U. Commission has released a favorable economic forecast for Greece for the remainder of 2021 as well as for 2022. It expects Greece’s GDP to grow by 4.3% in 2021 and 6% in 2022. Cyprus’s economy also appears poised to bounce back phenomenally from its shrinkage. Cypriot President Nicos Anastasiades has said that the E.U.’s relief plan will enable a 7% increase in GDP over the next five years.
– Gabriel Sylvan