Despite a steady economic recovery and positive macroeconomic indicators, not all Cypriot citizens are benefiting equally, according to official data. A recent Eurostat report, “Key Figures on European Living Conditions 2024”, highlights growing inequalities in both Cyprus and across Europe, as many households continue to face financial hardship despite overall growth.
The report underscores that while some indicators point to improved prosperity, a significant portion of the population remains at risk of poverty and social exclusion. Discrepancies in living standards are particularly stark when comparing Cyprus to Northern European countries, though the island fares better than some Baltic states.
Purchasing Power Below EU Average
In terms of purchasing power, Cyprus ranks below the EU average, with 18,873 units compared to the EU’s 27-country average of 19,955.
Moreover, the Eurostat data shows that disposable income across the EU has increased by 18.5% in real terms since 2010. However, five EU countries, including Cyprus, recorded lower average incomes in 2023 compared to 2010. Cyprus saw a decline of 1.8%, alongside Greece (-28.4%), France (-1.8%), Italy (-1.0%), and Spain (-0.3%).
Financial Struggles for Many Households
In 2023, 23.2% of households in Cyprus reported difficulty in meeting their financial obligations. Only 6.8% of households described their financial situation as very comfortable, while 27.1% managed fairly easily. By comparison, 26.3% of EU households reported financial strain, with 5.8% experiencing no difficulties.
Households across Europe also face challenges, with countries like Portugal (35.7%), Ireland (33%), and Latvia (34%) showing high percentages of financial hardship.
In-Work Poverty and Vulnerable Groups
The risk of poverty is not confined to the unemployed. In 2023, 7.4% of working Cypriots aged 18 and over were at risk of poverty, slightly below the EU average of 8.3%. In contrast, Romania (15.3%) and Luxembourg (14.8%) reported the highest rates of in-work poverty.
Poverty risk is particularly high among those aged 65 and older in Cyprus, with 24.8% of this age group facing financial challenges, compared to 14.8% for adults aged 18-64.
Persons with Disabilities at Greater Risk
People with disabilities are especially vulnerable, with 29.7% of Cypriots aged 16 and above at risk of poverty or social exclusion in 2023—higher than the EU average of 28.8%. The poverty risk for individuals without disabilities in Cyprus stood at 13%.
The Eurostat data underscores the need for further efforts to address inequality in Cyprus, where social and economic disparities remain significant, despite an overall positive economic outlook.
