Cost of living pressures continue to weigh heavily on households despite the country’s positive economic performance, economist Yiannis Telonis has warned, pointing to sharp increases in electricity prices and other essential expenses since 2020.
Speaking on Sigma TV’s “Mesimeri kai Kati”, Telonis said the general price index rose by 22.12% between 2020 and 2026, while electricity prices increased by 112.9%. Significant increases were also recorded in food, fuel and other basic consumer goods.
Although the average salary rose by 30.1% over the same period, Telonis argued that the figure does not necessarily reflect the financial reality of all workers, as the impact of inflation varies according to income levels.
Lower-income households face the greatest pressure
Telonis said lower-income households had experienced the sharpest deterioration in their financial position because they spend a larger proportion of their income on essentials such as food and housing.
“The real collapse has been among the lower class,” he said.
According to the estimates he presented, the upper-income group is approximately 10% better off, while the middle-income group is around 5% better off. The lowest-income group, however, has experienced the greatest deterioration.
For this reason, he argued that government support measures should be targeted at people facing the greatest financial difficulties rather than distributed indiscriminately.
Limited room for additional state support
Telonis also highlighted the constraints on further government assistance, despite Cyprus recording economic growth approaching 3% and unemployment standing at around 4%.
He said the country’s fiscal room for additional support was limited, making it important to ensure that available resources reach those who need them most.
Energy costs remain a major European challenge
Turning to Europe’s wider economic difficulties, Telonis described energy as a major vulnerability for the continent.
“Energy is the cancer of Europe,” he said, arguing that dependence on external energy supplies leaves European economies exposed to international crises and price increases.
He concluded that one-off financial allowances would not be enough to address the cost-of-living problem in a lasting way. Instead, he called on Europe to draw lessons from recent crises and introduce substantial changes to its energy policy.
Also read: Family of five struggles to cope with poor living conditions in Moutallos
For more videos and updates, check out our YouTube channel
