More specifically, gross fixed capital formation expanded by 3,3% in real terms during the period 1989-93, a rate only marginally lower than the targeted rate of 3,4%. Particularly intense activity was observed in the construction of dwellings, Including second homes and tourist accommodation. The public sector played a significant role in the investment activity in construction, through the promotion of various development projects with emphasis on the expansion of road network.

Investment in machinery exhibited continuous fluctuations and expanded at a relatively low average annual rate of about 3,5% in real terms during the 1989-93 period, indicating that the progress in the field of restructuring and technological upgrading did not reach the anticipated levels. It should be noted that the Development Plan, recognising the significance of investment in machinery for the expansion of production capacity and the improvement of the competitiveness of the economy, set an ambitious target for an average annual increase of 5,6% in real terms.

Domestic savings rose in relative terms during the 1989-90 period, fell during the 1991-92 period and rose again in 1993. In total, domestic savings amounted to 23,5% of the G.D.P. on average, during 1989-1993 compared to the target of 24%. The level of savings was not sufficient to cover the financing needs of the economy, consequently the financing resource gap reached 2,5% of the G.D.P. on average during the period 1989-93, and exceeded the level anticipated in the Plan 0,5%.

Source: www.kypros.org