Richard Parks Moody’s Investors Service has raised Cyprus’ credit rating by two notches, upgrading it from Baa2 to A3, with a stable outlook. This marks the first time in over a decade that the country has been rated in the “A” investment grade, signaling a strong recovery following the financial crisis and subsequent bailout measures.
The Cypriot government welcomed the decision, viewing it as a validation of its effective fiscal policies and successful efforts to reduce public debt. Moody’s highlighted that Cyprus has made significant strides in reducing its debt-to-GDP ratio since 2020, positioning itself as a leader in global debt reduction. The agency anticipates continued improvement in the country’s debt sustainability, boosting long-term economic stability.
Growth in Cyprus is being driven by a thriving services sector, supported by foreign direct investment, corporate relocations, and key reforms under the National Recovery and Resilience Plan (NRRP). Moody’s also noted the ongoing stabilization of the banking sector, with reduced risks thanks to a strong credit profile and continued deleveraging.
President Nicos Christodoulides expressed his pride in the achievement, calling it a significant step forward for Cyprus. “This upgrade is a powerful signal of confidence in our economy and policies,” he said. “It opens the door for increased foreign investment and new job opportunities, enhancing our competitiveness on the global stage.”
The President further emphasized that the government would continue to use this momentum to drive further economic growth and implement measures that improve the daily lives of Cypriot citizens.