**Title: Cyprus Economy Displays Mixed Performance in Early 2026**
Cyprus’ economy has shown a mixed yet generally resilient performance in the early months of 2026, according to the latest report from the Cyprus Statistical Service (Cystat). The data highlights significant growth in the construction sector and vehicle registrations, while also revealing challenges in exports and a notable decline in tourist arrivals.
The construction industry has emerged as a bright spot in the economy, with a substantial increase in activity. Cystat reported that the total area covered by authorized building permits reached 661,400 square meters during January and February 2026. This figure marks a remarkable year-on-year increase of 54.9% compared to the same period in 2025, indicating robust momentum in construction projects across the island.
In addition to construction, the automotive market has also experienced positive growth. Total motor vehicle registrations surged by 15.1% from January to April 2026, amounting to 18,570 vehicles. This increase was driven primarily by a rise in private saloon car registrations, which climbed by 18.2% to reach 12,866 units. Furthermore, registrations of light goods vehicles grew by 13.4%, totaling 1,781 units during the same timeframe.
Manufacturing production has also seen a slight uptick, with a reported increase of 0.5% during the first quarter of 2026 compared to the previous year. This modest growth reflects ongoing resilience in the manufacturing sector, despite the broader economic challenges.
Inflation rates have remained relatively stable, with the Consumer Price Index rising by 1.1% from January to April 2026 compared to the same period last year. This indicates that while prices are increasing, the rate of inflation has not escalated significantly, providing some stability for consumers.
However, the trade sector has shown mixed trends. Imports have continued to rise, with the total value of imported goods reaching €4.697 billion in the first four months of 2026, reflecting a 4.8% increase from the previous year. In contrast, exports have declined, with the total value amounting to €1.639 billion, marking a significant decrease of 9.3%. This disparity between rising imports and falling exports may raise concerns about the balance of trade in the coming months.
Tourism, a critical sector for Cyprus, has faced considerable challenges. The number of tourist arrivals dropped sharply to 710,370 between January and April 2026, compared to 865,326 during the same period in 2025. This represents a year-on-year decrease of 17.9%, raising questions about the factors contributing to this decline and the potential impact on the economy.
Overall, while the early months of 2026 have seen positive developments in construction and vehicle registrations, the economy is grappling with significant challenges in tourism and exports. The mixed performance underscores the need for ongoing monitoring and strategic planning to address these issues and support continued economic growth in Cyprus.