The currency of Cyprus. Currency code (CYP)
What Was the Cypriot Pound (CYP)?
CYP was the currency abbreviation for the Cypriot pound, which was the national currency of the Republic of Cyprus before it adopted the shared euro currency.
Understanding the Cypriot Pound
The Cypriot pound was the official currency for Cyprus before its membership in the European Union (EU) and adoption of the euro (EUR) as legal tender in 2008. The Central Bank of Cyprus issued and administered the currency following its establishment in 1963. The British first used the pound in Cyprus in 1879, even though the country still belonged to the Ottoman Empire. The Cypriot pound remained pegged to the British pound (GBP) until 1972, at which point the central bank changed the peg to the U.S. dollar.
Starting in 1973, Cyprus dropped its dollar peg in favor of a peg to a currency basket based upon the country's imports, then switched to a currency basket based on its trading activities in 1984.
The decision to move to the euro eventually triggered a permanent exchange rate of 0.585274 Cypriot pounds per euro. The euro became legal tender effective Jan. 1, 2008. The agreement with the European Central Bank allowed the exchange of older pound coins for two years following the changeover and CYP banknotes for the ten years following.
Cyprus had annual GDP growth of 3.23% in 2019 with an inflation rate of 0.56%.
A Divided Cyprus
Britain annexed Cyprus as a colony following the breakup of the Ottoman Empire in 1925. However, the nation's inhabitants generally have viewed themselves as either ethnically Greek or Turkish, leading to periods of civil unrest. Greek Cypriots have periodically called for the country to unite with Greece. In contrast, Turkish Cypriots have traditionally demanded that the nation combines with Turkey or that the northern part of the country secedes. The republic received independence from England in 1960 and almost immediately plunged into sporadic violence between Greek and Turkish elements. A coup backed by the U.S. and Greece attempted to assassinate the Cypriot president in 1974, and the resultant fight led to the country's division as Turkish forces entered the northern part of the island.
Turkish Cypriots attempted to formalize the division in 1983 when they declared themselves the Turkish Republic of Northern Cyprus. Other than Turkey, however, no other nation has recognized the republic. On multiple occasions, northern and southern factions have tried to forge a peace plan between the two sides without result. The north remains occupied, and the United Nations oversees and patrols a demilitarized buffer zone between the two territories.
Despite the north's technical existence as part of the island of Cyprus, it has maintained the Turkish lira (TRY) as its official currency, though businesses serving tourists often accept payments in euros (EUR), British pounds (GBP), or U.S. dollars (USD).