A family meal out in Cyprus has become significantly more expensive compared with previous years, with an outing that cost €100 in 2023 now costing around €126 on average.
According to the Harmonised Index of Consumer Prices for August, prices in the category of “restaurants and hotels” were 45.6% higher in 2026 than in 2020, 26% higher than in 2023 and 13% higher than last year.
This means that for equivalent services costing €100 today, consumers would have paid just €68.68 in 2020 and €79.37 in 2023.
Food and accommodation costs
The figures show that the rise in dining costs has outpaced increases in several operating expenses faced by food service businesses.
Food and beverage prices were 29% higher in August 2026 than in 2020, but had increased by only 4.7% since 2023.
Meanwhile, the category covering housing, water, electricity, gas and other fuels recorded a 36% increase from 2020, but only a 2.7% rise since 2023.
The figures suggest that the cost of eating out has increased at a faster rate than some of the key costs associated with running hospitality businesses.
At the same time, average monthly earnings have not risen at the same pace.
According to the latest available data from the Statistical Service, seasonally adjusted average monthly earnings increased by 31.8% in the first quarter of 2026 compared with 2020, and by 14.9% compared with 2023.
This indicates a gap between the increase in restaurant and hospitality prices and the growth in average earnings.
Consumer complaints
Marios Drousiotis, president of the Cyprus Consumers Association, told the Cyprus News Agency (CNA) that a significant increase in restaurant prices is indeed being observed.
He noted, however, that the association was unable to conduct this year the survey it had carried out in previous years, which collected data from 200 restaurants.
Asked about complaints received by the association regarding the food service sector, Drousiotis said the main issues concerned customers being charged for items they had not ordered or facing higher-than-expected charges.
Energy and alcohol costs
PASYKA General Secretary Fanos Leventis attributed the increases to several factors, including higher energy and alcohol costs.
“The fact that there are increases is indisputable. The fact that the increases are justified is also indisputable,” Leventis told CNA.
He said businesses had faced a “continuous increase in raw material costs” since the pandemic.
He also pointed to geopolitical challenges in recent years, which he said had contributed to continuing price increases and a sharp rise in energy costs, which have remained at high levels.
Leventis added that the zero-VAT measure on certain products did not appear to have benefited businesses in the sector, as prices still increased.
He also highlighted a “sharp increase” in the cost of alcoholic beverages, saying this had significantly raised the average amount spent per person at restaurants and other hospitality venues.
Energy remains a major factor
Commenting on the fact that services inflation remained higher even after inflation in other sectors of the economy had eased, Leventis said the high cost of energy was a decisive factor.
“In the calculations businesses used to make in the past, energy was not included in the costing of food and beverages because it was considered a given. Today, however, if someone does not take it into account, there will be a very serious deviation,” he said.
Leventis acknowledged that some price increases may not be justified. At the same time, he said businesses were also offering discounts and lower prices in an effort to attract customers amid the difficult economic environment.
He said restaurant and hospitality businesses were “walking a tightrope” between setting prices that ensure their viability and taking into account consumers’ purchasing power.
“It is a difficult equation, I would say. It is a choice that many do not have the luxury of managing in the most appropriate way,” he said.
Leventis stressed that there is a wide range of prices among businesses, giving consumers different options.
He also described the hospitality sector as vulnerable to economic pressures, saying it would be among the first sectors to be affected by any downturn, although it can recover quickly.
Asked about the average profit margin for food service businesses, Leventis said a business needs a net profit of around 10% to remain financially healthy.
“During this period, several businesses certainly do not reach that level, while a significant number, despite having customers, are struggling for viability,” he said.
Also read: Sharp fuel price hikes in Cyprus as heating oil hits record high
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