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Cyprus economy shrinks 0.7 percent in first-quarter as recession drags on

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(Globalpost/GlobalPost)

NICOSIA (Reuters) - Cyprus's economy shrank 0.7 percent in the first quarter of 2014, slightly less than the previous three months, as the bailed-out euro zone member struggles to get back on its feet in the wake of a banking sector collapse.

The island nation, which received a 10 billion euro international bailout last year, has not posted economic growth since the second quarter of 2011.

The statistics department said on Friday the economy shrank 0.7 percent in the first quarter compared with the previous three months and 4.1 percent compared with the same quarter last year. Both figures were unchanged from initial estimates it released on May 15.

The manufacturing, construction, banking, tourism and trade sectors all contracted in the first, the department said.

In the last three months of 2013 the economy shrank 0.8 percent on a quarterly basis and 4.9 percent compared with the same quarter the previous year.

Cyprus's international lenders said on May 17 they expect the economy to contract by about 4.2 percent this year, less than their earlier forecast for a 4.8 percent fall.

(Reporting By Michele Kambas; Editing by Hugh Lawson)

http://www.globalpost.com/dispatch/news/thomson-reuters/140606/cyprus-economy-shrinks-07-percent-first-quarter-recession-drags