Cyprus unveils €14.4bn budget with defence boost and social spending
Finance Minister Makis Keravnos presents the 2027 state budget to the House Finance Committee, with total spending rising 5.1 per cent and defence funding up sharply.
Cyprus's 2027 state budget went before the House Finance Committee on Monday, with Finance Minister Makis Keravnos setting out the government's revenue and spending plans, as reported by Cyprus Mail. Total expenditure is put at €14.4bn, up from €13.7bn in 2026 — a rise of roughly €700m, or 5.1 per cent.
Defence receives €430.15m, compared with €176.8m this year, as part of a €1.28bn programme running through 2029. Social welfare benefits are allocated €820m, healthcare €1.066bn and education €235m, while road projects across the island are set to receive €148.8m.
The government projects GDP growth of 2.9 per cent and inflation of 2.5 per cent for 2027. It expects a fiscal surplus of about 4 per cent of GDP and public debt falling to 45.2 per cent of GDP by the end of next year.
"For the third consecutive year, it has a fiscal surplus, which is expected to reach around four per cent of gross domestic product in 2027, while public debt continues to decline and is expected to be limited to 45.2 per cent of GDP by the end of 2027," Keravnos said.
What it means for residents
The budget sets the money that will flow to services people use daily — health, schools, benefits and roads — though the figures still need parliamentary approval, so nothing changes yet. Two items stand out for island households.
- Defence jump: Spending on defence rises more than twofold compared with 2026, money that will not go to social programmes.
- Benefits and health: Social welfare and healthcare allocations grow, which may affect support payments and hospital funding once the plan is approved.
- Roadworks: More money for road projects could mean extra construction and diversions on key routes, including the Paphos–Polis Chrysochous road.
This text is written from the source article and is not a translation of it.
