According to the credit rating agency, it could be considered raising the ratings on Cyprus this year if the economic recovery and direction of macroeconomic policy provides impetus for further meaningful general government and private sector debt reduction.

They also expect to see whether the economy’s external debt metrics improve further, particularly via a short-term debt burden decline, and if Cyprus’ credit and monetary conditions continue to converge with those of the eurozone, via a material reduction concerning Cyprus` unusually high non-performing exposures (NPEs).

At the same time, Standard & Poor note that they could revise the outlook to stable if economic growth is significantly lower than currently expected or if a fiscal stance shift leads them to believe that general government debt-to-GDP is no longer set to decline over the forecast horizon through 2021.