The Finance Ministry welcomed the International Monetary Fund’s assessment of the Cypriot economy while issuing a clear warning that any changes to the foreclosure framework must not create room for abuse by strategic defaulters.
In a statement responding to the IMF’s observations and recommendations following its Article IV mission to Cyprus from April 22 to May 4, 2026, the ministry said any revision of the foreclosure system must protect genuinely vulnerable borrowers without opening opportunities for exploitation “at the expense of the economy, compliant borrowers and taxpayers.”
It added that creating exemptions or blanket suspensions could undermine the effectiveness of the debt‑recovery mechanism.
The ministry said it shares the IMF’s view that the Cypriot economy has shown resilience, fiscal performance has been strong and, despite recent disruptions, the outlook remains positive.
On fiscal policy, it agreed that spending should become more efficient, avoid distortions and focus on growth‑enhancing investment, particularly under the EU’s new economic‑governance framework.
On energy, the ministry acknowledged heightened challenges driven by external factors and said the government is implementing a strategy aimed at ensuring adequacy and security of supply while reducing electricity costs. It said projects and targeted actions are under way to meet these goals.
Regarding environmental policy, the ministry noted that the National Strategy for 2025–2050 aims to address rising temperatures, prolonged droughts and coastal erosion through interventions in agriculture, energy, water, infrastructure and health.