Cyprus debt ratio falls to 54.6 per cent in first quarter of 2026

Cyprus reduced its government debt ratio in the first quarter of 2026, recording one of the largest annual declines in the European Union, while overall debt levels increased across both the euro area and the bloc, according to figures released by Eurostat on Tuesday.

Cyprus’ general government gross debt stood at 54.6 per cent of GDP at the end of March 2026, down from 55 per cent at the end of the fourth quarter of 2025 and significantly lower than the 62 per cent recorded in the first quarter of 2025.

In absolute terms, Cyprus’ government debt reached €20.09 billion in the first quarter of 2026, compared with €20.08 billion at the end of 2025.

The annual decline of 7.4 percentage points in Cyprus’ debt-to-GDP ratio was the second largest reduction among EU member states, behind Greece, which recorded a fall of 9.4 percentage points.

Eurostat data showed that the euro area’s government debt ratio increased to 88.9 per cent of GDP at the end of the first quarter of 2026, up from 87.7 per cent in the previous quarter.

Across the European Union, the debt ratio also increased, rising from 81.8 per cent to 82.9 per cent of GDP over the same period.

Compared with the first quarter of 2025, government debt ratios increased in both the euro area and the EU, with the euro area rising from 87.2 per cent to 88.9 per cent and the EU increasing from 81.4 per cent to 82.9 per cent.

At the end of the first quarter, debt securities accounted for the largest share of government debt, representing 84.3 per cent of total debt in the euro area and 83.6 per cent in the EU.

Loans accounted for 13.2 per cent of euro area debt and 13.9 per cent of EU debt, while currency and deposits represented 2.5 per cent in both areas.

Eurostat also reported that intergovernmental lending accounted for 1.3 per cent of GDP in the euro area and 1.1 per cent in the EU.

Among EU countries, the highest debt-to-GDP ratios were recorded in Greece at 143.5 per cent, followed by Italy at 138.9 per cent, France at 117.6 per cent, Belgium at 109.1 per cent and Spain at 101.6 per cent.

The lowest ratios were recorded in Estonia at 25.2 per cent, Denmark at 26.8 per cent, Bulgaria at 28.5 per cent and Luxembourg at 29.2 per cent.

Compared with the final quarter of 2025, 17 EU member states recorded increases in their debt ratios, while eight recorded declines.

The largest quarterly increases were recorded in Hungary, Lithuania, Luxembourg, Ireland, Croatia, Austria, France, Poland and Italy.

The biggest quarterly declines were recorded in Greece, where the ratio fell by 2.6 percentage points, followed by Bulgaria, the Netherlands and Slovenia.

Compared with the first quarter of 2025, 19 EU member states recorded higher debt ratios, while eight saw declines.

The largest annual increases were recorded in Finland, Bulgaria, Poland, Romania, France, Luxembourg and Belgium.

Cyprus was among the countries recording the strongest improvement, with only Greece posting a larger annual reduction.