The international rating agency Standard & Poor's has confirmed the credit rating of the Republic of Cyprus at A- and upgraded the country's outlook to positive from stable, according to a decision published on November 14, 2025. The agency attributes the rating to the resilience of the Cypriot economy, the strong fiscal and macroeconomic performance and the continued reduction of public debt.
In its analysis, the agency notes that public debt is expected to continue its downward trend in the coming years, supported by solid growth momentum. GDP growth in the medium term is projected to be boosted by exports of services, domestic consumption and public and private investments implemented through the Recovery and Resilience Fund. The agency also points to the gradual de-escalation of inflation and the improvement of the banking sector, with a reduction in non-performing loans and a recovery in domestic credit from 2025.
The revision of the outlook to positive reflects the prospects for further improvement of Cyprus' external debt position through deleveraging and high exports of services. S&P predicts that ongoing budget surpluses will reduce net public debt to 35% of GDP by 2028.
The agency points out that the assessment is based on stable governance, participation in the eurozone and the improvement of the banking system, while remaining cautious about high external deficits and dependence on external factors. As a precondition for a future upgrade, it cites a shrinking current account deficit, while warning that a possible deterioration in geopolitical conditions or weaker performance of key trading partners could put pressure on credit ratings.
According to the agency's forecasts, the Cypriot economy will grow at a rate of 3% in the period 2025-2028, due to strong investment activity under the Recovery and Resilience Fund, enhanced private consumption and an increase in exports of services. The government states that it will continue to support economic activity in a responsible way in the face of the challenges posed by geopolitical developments, emphasizing employment, fiscal stability and the efficient use of European resources.
In a written statement, Finance Minister Makis Keravnos welcomes the evaluation, underlining that the agency not only confirms the investment grade A- but also upgrades the outlook to positive. It states that the report is based on the resilience of the Cypriot economy, the strong fiscal performance and the ongoing de-escalation of public debt, which, as it notes, demonstrates the confidence of international agencies in the government's policies.
The minister believes that the positive outlook paves the way for future upgrading, as fiscal surpluses are expected to reduce net public debt to 35% of GDP by 2028. It emphasizes that the successive positive ratings reflect both the creditworthiness of the Republic of Cyprus in the markets and the dynamics of the economy in an environment of increased geopolitical risks.
Mr. Keravnos states that the government will continue to implement an economic policy oriented towards stable and sustainable growth, giving priority to fiscal discipline, financial stability and targeted policies to support citizens, especially the most vulnerable social groups.
The President welcomes the upgrade of Cyprus' prospects by S&P
The Republic of Cyprus is entering a "course of enhanced dynamics" after the confirmation of its credit rating in category A- and the upgrade of its outlook to Positive from Stable by Standard & Poor's, the President of the Republic Nikos Christodoulidis states in a written statement.
The President stated that the evaluation reflects the consistency and responsibility of the government's fiscal choices, as well as the promotion of reforms that strengthen Cyprus' position as a reliable center of quality investments. He stressed that the benefits of this performance are tangible for citizens, talking about reducing borrowing costs, strengthening entrepreneurship and creating new, well-paid jobs.
He also noted that the strategic targeting for a competitive and technology-oriented economic model, with an emphasis on extroversion, is bearing fruit and further strengthening the prospects of the Cypriot economy.
