Cyprus (CYP)
Country Risk Assessment v2.3 - assessed 2026-05-28 - skew: symmetric
Flags
- Generated 2026-05-28 under v2.0: multilateral (IMF Art IV 2026, EC, Eurostat, ECB, RSF, TI, WHO) + Cypriot official (CyStat, CBC) + press; assesses the Republic of Cyprus, with the unresolved division of the island a geopolitical factor.
- A eurozone democracy with a strong post-2013-crisis recovery, dogged by a frozen division (Turkish troops in the north since 1974) and acute water/climate stress.
- Standout features: a sharp fiscal/banking recovery and low crime, against the frozen division, golden-passport-era corruption legacy, and severe water scarcity. Source-lean: MODERATE-HIGH Anglophone on the division narrative.
- civil_military_relations carries a v2.3 provisional baseline scored from coup history and military-in-politics status. It has not been through a full source-disciplined pass and its confidence is set low to reflect that.
Transparency & confidence ceiling
Tier: observable - every composite below is confidence-capped at 1.00 (TIER_CAP.observable).
Free press and open civil society - scores rest on directly observable evidence.
Economic
A strong post-crisis fiscal and banking recovery, with a services-concentrated base. (skew: positive)
┌────────────────────────────────┬────────┬──────┬──────┬──────┬──────┐
│ Sub-factor │ Weight │ Conf │ Near │ Mid │ Long │
├────────────────────────────────┼────────┼──────┼──────┼──────┼──────┤
│ Fiscal State │ 0.22 │ 90% │ +7.0 │ +7.0 │ +7.0 │
│ Monetary Independence │ 0.22 │ 90% │ +5.0 │ +5.0 │ +5.0 │
│ Reserve Currency Intl Monetary │ 0.16 │ 90% │ +2.0 │ +2.0 │ +2.0 │
│ Inflation │ 0.13 │ 85% │ +4.0 │ +4.0 │ +4.0 │
│ Banking Stability │ 0.10 │ 80% │ +4.0 │ +4.0 │ +4.0 │
│ Trade Actions Capacity │ 0.17 │ 75% │ +5.0 │ +5.0 │ +5.0 │
└────────────────────────────────┴────────┴──────┴──────┴──────┴──────┘
Fiscal State - Debt down from the 2013-crisis peak to ~55% GDP and falling, with a sizeable surplus. (IMF Art IV 2026; EC)
Monetary Independence - Pooled at the ECB - no own policy lever. (ECB)
Reserve Currency Intl Monetary - A euro participant. (IMF COFER)
Inflation - Often among the EU's lowest, ticking up modestly. (Eurostat HICP)
Banking Stability - Rebuilt since the 2013 bail-in (low NPLs, high capital), with Russian de-risking advanced but a reputational legacy. (CBC; MONEYVAL)
Trade Actions Capacity - Services-concentrated (tourism, shipping, financial/professional, tech relocation) with East-Med gas upside; small and undiversified. (EC)
Category composite by horizon (categoryComposite, confidence-capped by transparency tier):
┌─────────┬─────────────────┬────────────┐
│ Horizon │ Composite score │ Confidence │
├─────────┼─────────────────┼────────────┤
│ near │ +4.74 │ 86% │
│ mid │ +4.74 │ 86% │
│ long │ +4.74 │ 86% │
└─────────┴─────────────────┴────────────┘
Institutional
EU-standard courts and credible statistics, against corruption and the golden-passport legacy. (skew: negative)
┌──────────────────────────┬────────┬──────┬──────┬──────┬──────┐
│ Sub-factor │ Weight │ Conf │ Near │ Mid │ Long │
├──────────────────────────┼────────┼──────┼──────┼──────┼──────┤
│ Rule Of Law │ 0.31 │ 85% │ +3.0 │ +3.0 │ +3.0 │
│ Statistical Integrity │ 0.22 │ 85% │ +7.0 │ +7.0 │ +7.0 │
│ Civil Service Capacity │ 0.22 │ 70% │ +5.0 │ +5.0 │ +5.0 │
│ Press Freedom │ 0.13 │ 80% │ +3.0 │ +3.0 │ +3.0 │
│ Civil-Military Relations │ 0.12 │ 55% │ +5.0 │ +5.0 │ +5.0 │
└──────────────────────────┴────────┴──────┴──────┴──────┴──────┘
Rule Of Law - EU-standard courts but persistent corruption and a weakly-prosecuted golden-passport scandal (the scheme scrapped). (EC Rule of Law 2025; TI)
Statistical Integrity - CyStat is Eurostat-credible. (Eurostat)
Civil Service Capacity - Functional, with reform and digitalisation ongoing. (EC; OECD)
Press Freedom - Free but with a falling RSF rank, ownership concentration, and self-censorship. (RSF 2025)
Civil-Military Relations - Settled civilian control over a professional officer corps, with no military intervention in the modern constitutional period and functioning legislative oversight.
Category composite by horizon (categoryComposite, confidence-capped by transparency tier):
┌─────────┬─────────────────┬────────────┐
│ Horizon │ Composite score │ Confidence │
├─────────┼─────────────────┼────────────┤
│ near │ +4.53 │ 77% │
│ mid │ +4.53 │ 77% │
│ long │ +4.53 │ 77% │
└─────────┴─────────────────┴────────────┘
Political & Social
A stable EU democracy with strong liberties, against migration pressure and the island's division. (skew: symmetric)
┌────────────────────────┬────────┬──────┬──────┬──────┬──────┐
│ Sub-factor │ Weight │ Conf │ Near │ Mid │ Long │
├────────────────────────┼────────┼──────┼──────┼──────┼──────┤
│ Political Stability │ 0.30 │ 85% │ +6.0 │ +6.0 │ +6.0 │
│ Civil Liberties │ 0.20 │ 80% │ +6.0 │ +6.0 │ +6.0 │
│ Treatment Non Citizens │ 0.25 │ 75% │ +1.0 │ +1.0 │ +1.0 │
│ Social Cohesion │ 0.15 │ 70% │ +1.0 │ +1.0 │ +1.0 │
│ Demographics │ 0.10 │ 75% │ +1.0 │ +1.0 │ +1.0 │
└────────────────────────┴────────┴──────┴──────┴──────┴──────┘
Political Stability - A stable EU democracy with peaceful turnover. (EC)
Civil Liberties - Strong, EU-protected. (Freedom House; EC)
Treatment Non Citizens - A lawful EU framework but a frontline asylum entry point (a high per-capita rate) with deterrence-leaning policy. (Eurostat; ECRE)
Social Cohesion - Cohesive in the south, but the island's division is the structural cleavage. (ICG)
Demographics - Ageing with low fertility, supported by positive net migration. (CyStat; Eurostat)
Category composite by horizon (categoryComposite, confidence-capped by transparency tier):
┌─────────┬─────────────────┬────────────┐
│ Horizon │ Composite score │ Confidence │
├─────────┼─────────────────┼────────────┤
│ near │ +3.65 │ 78% │
│ mid │ +3.65 │ 78% │
│ long │ +3.65 │ 78% │
└─────────┴─────────────────┴────────────┘
Geopolitical
Deepening Eastern-Med partnerships, against the frozen, unresolved division. (skew: negative)
┌────────────────────────────┬────────┬──────┬──────┬──────┬──────┐
│ Sub-factor │ Weight │ Conf │ Near │ Mid │ Long │
├────────────────────────────┼────────┼──────┼──────┼──────┼──────┤
│ Alliance Reliability │ 0.40 │ 80% │ +4.0 │ +4.0 │ +4.0 │
│ Conflict Involvement │ 0.35 │ 80% │ -5.0 │ -5.0 │ -5.0 │
│ Sanctions Capital Controls │ 0.25 │ 80% │ +4.0 │ +4.0 │ +4.0 │
└────────────────────────────┴────────┴──────┴──────┴──────┴──────┘
Alliance Reliability - An EU member but non-NATO, with deepening US/Israel/Greece (3+1) defence and energy ties. (US State; FDD)
Conflict Involvement - A frozen division - Turkish troops have occupied the north since 1974 - with recurring maritime/gas disputes, a real unresolved tail. (ICG; Atlantic Council)
Sanctions Capital Controls - An EU regime with an open capital account; Russian-money de-risking ongoing. (EC; CBC)
Category composite by horizon (categoryComposite, confidence-capped by transparency tier):
┌─────────┬─────────────────┬────────────┐
│ Horizon │ Composite score │ Confidence │
├─────────┼─────────────────┼────────────┤
│ near │ +0.85 │ 80% │
│ mid │ +0.85 │ 80% │
│ long │ +0.85 │ 80% │
└─────────┴─────────────────┴────────────┘
Physical & Practical
Good infrastructure and low crime, against severe water scarcity and heat. (skew: negative)
┌────────────────────┬────────┬──────┬──────┬──────┬──────┐
│ Sub-factor │ Weight │ Conf │ Near │ Mid │ Long │
├────────────────────┼────────┼──────┼──────┼──────┼──────┤
│ Climate │ 0.20 │ 80% │ -5.0 │ -6.0 │ -7.0 │
│ Healthcare │ 0.30 │ 80% │ +5.0 │ +5.0 │ +5.0 │
│ Infrastructure │ 0.20 │ 70% │ +5.0 │ +5.0 │ +5.0 │
│ Crime Safety │ 0.15 │ 70% │ +6.0 │ +6.0 │ +6.0 │
│ Disaster Insurance │ 0.15 │ 60% │ 0.0 │ 0.0 │ 0.0 │
└────────────────────┴────────┴──────┴──────┴──────┴──────┘
Climate - An Eastern-Med hotspot - among the fastest-warming, severe drought/water scarcity, and extreme heat approaching critical. (IPCC AR6; EEA)
Healthcare - A universal system (GESY) since 2019, with rising public spend. (WHO Europe)
Infrastructure - Good roads, telecom, and ports, with a desalination buildout. (EC)
Crime Safety - Low violent crime - a strength. (Eurostat)
Disaster Insurance - Drought/seismic exposure with a moderately deep market. (press)
Category composite by horizon (categoryComposite, confidence-capped by transparency tier):
┌─────────┬─────────────────┬────────────┐
│ Horizon │ Composite score │ Confidence │
├─────────┼─────────────────┼────────────┤
│ near │ +2.35 │ 74% │
│ mid │ +2.14 │ 74% │
│ long │ +1.92 │ 74% │
└─────────┴─────────────────┴────────────┘
Decisions
Confidence-weighted composite of every category above (decisionComposite), at each decision's native horizon (HORIZON_BY_DECISION), with the threshold reading (readingFor).
┌──────────┬─────────┬───────┬────────────┬────────────────┐
│ Decision │ Horizon │ Score │ Confidence │ Reading │
├──────────┼─────────┼───────┼────────────┼────────────────┤
│ Living │ long │ +3.75 │ 78% │ clear positive │
│ Assets │ mid │ +3.77 │ 81% │ clear positive │
│ Currency │ near │ +4.08 │ 83% │ clear positive │
└──────────┴─────────┴───────┴────────────┴────────────────┘
Same weighting projected across all three horizons (near 1-3y, mid 3-7y, long 5-10y):
┌──────────┬───────┬───────┬───────┐
│ Decision │ Near │ Mid │ Long │
├──────────┼───────┼───────┼───────┤
│ Living │ +3.81 │ +3.78 │ +3.75 │
│ Assets │ +3.79 │ +3.77 │ +3.75 │
│ Currency │ +4.08 │ +4.08 │ +4.08 │
└──────────┴───────┴───────┴───────┘