Cyprus finance minister promises new cost-of-living measures for cabinet

Nicosia, Cyprus. Finance Minister Makis Keravnos said on Monday that new measures to ease the rising cost of living would be put before cabinet when it meets later this week. He spoke after meeting trade union representatives.

Government plans

Keravnos said the government was preparing a package while continuing to assess the situation. He said it would continue supporting all social groups, particularly workers and vulnerable people during the current crisis.

The measures are intended to be targeted, he said, although some could apply across the board where problems affect everyone. Keravnos also said Cyprus could be a model for responding to the cost-of-living crisis, arguing that its measures and social policies had gone further than those of many other European countries.

Fuel prices and price caps

Asked about a possible price cap, Keravnos said Cyprus had been taking measures for two years that he considered stronger than those adopted by other European governments.

The question followed an announcement by Italian state-controlled energy company Eni that its petrol stations in Italy would sell diesel for no more than €2.19 per litre and petrol for no more than €1.99 per litre. Azerbaijani state oil company Socar, which owns Italiana Petroli, also said prices at Italiana Petroli petrol stations would be capped, but did not specify the limits.

In Cyprus, diesel reached €2 per litre this week, while petrol was around €1.68 per litre. Concerns about price increases have followed an expansion of the control and actions of Yemen’s Iran-backed Shia militant Houthi movement in Yemen.

Earlier IMF warning

The distinction between targeted and across-the-board measures comes after earlier criticism from the International Monetary Fund. In 2024, its mission chief for Cyprus, Alex Pienkowski, called on the authorities to “resist” expanding non-targeted reductions in excise taxes.