the Cypriot Pound and the Euro

The last few years have been ones of real change in Cyprus, especially the northern area which has for so long been isolated from much of the “outside” world.

The changing point for the north seems to have been the introduction of direct flights from places such as the UK, which have put the country back on the holiday map again. This has led to a marked improvement in other areas of the country, including the economy, property prices and general investment, with more than a little help from the impending entry into the EU on 1 January 2008. The improving climate has helped the exchange rate of the country and Cyprus money is now going from strength to strength.

The improving economy has also prompted much interest in Cyprus money overseas, and Moody‘s (the credit ratings company) have announced an upgrade in their credit rating of the country on foreign currency grounds. This upgrade from A2 to A1 will have a major impact upon government spending, as the authorities will be able to borrow from overseas partners on more favourable terms, leaving more to invest into the country, and less to spend on interest repayments.

After the adoption of the Euro in 2008, Cyprus money will then be quoted in Euros rather than Cypriot Pounds, aligning the country more to Europe than ever before. Like so many countries before, who have shown a greater interest in participating in the European Union, 2008 will see a vast array of grants and extra spending power for the country, financed by the European “economy” and the membership countries. Cyprus money has long been avoided by many on the currency exchanges although the forthcoming moves may well restore some of the lost confidence of years gone by. Cyprus seems set for a major growth phase, with improvements to the economy and infrastructure very high on the agenda. It will be interesting to see how it progresses.