CIU Academic Evaluates the Rising Cost of Living

Assoc. Prof. Dr. Demet Beton Kalmaz, a faculty member at the Faculty of Economics and Administrative Sciences at Cyprus International University (CIU), stated that the rising cost of living in Northern Cyprus is closely linked to individuals’ purchasing power and economic well-being. She noted that the share of household budgets allocated to essential needs may increase, emphasizing the importance of assessing changes in the cost of living in relation to wage policies, market conditions and social protection mechanisms.

Kalmaz stated that changes in food, housing, energy and transportation costs can affect how household budgets are allocated. She explained that increased spending on essential needs may have implications for the resources available for areas such as healthcare, education and social life. Emphasizing the importance of ensuring that wage increases keep pace with inflation, she noted that this is essential for protecting purchasing power. She also stated that economic conditions can shape individuals’ spending and saving preferences, as well as their long-term plans.
Pointing out that the impact of the rising cost of living in Northern Cyprus may vary between public- and private-sector employees, Kalmaz stressed that wage increases must remain aligned with changes in living costs to preserve purchasing power. In this context, she noted that evaluating minimum wage policies alongside cost-of-living adjustments, developing measures to support private-sector employment and strengthening social assistance mechanisms for low-income groups could contribute to economic well-being.

Kalmaz stated that, in addition to the significant share of imports in the economy, foreign currency-based pricing in areas such as rent, education and real estate can also influence living costs. She emphasized the importance of implementing measures to reduce costs in essential sectors such as food, medicine and energy, as well as introducing policies that support domestic production. She further explained that effective market inspections and improvements in public education and healthcare services could help balance household expenditures.

Noting that the rising cost of living can have long-term effects on individuals’ economic expectations and future plans, Kalmaz stated that economic uncertainty can influence long-term goals such as saving money and purchasing property. She emphasized that, in order to support economic sustainability and social welfare, wage policies must be addressed in line with changes in living costs, alongside the development of measures that facilitate access to essential goods and services.