NICOSIA, Dec. 21 (Xinhua) -- The Parliament of Cyprus approved on Wednesday night the country's 2024 state budget, which Finance Minister Makis Keravnos said is expected to boost the country's gross domestic product (GDP) by 2.9 percent.

Keravnos said the Eastern Mediterranean island's economy is facing an adverse and "fluid" international environment as a result of the conflicts in Europe and the Middle East.

Cyprus is one of the smallest European Union (EU) member states and the closest to the volatile Middle East, which threatens to deal a fresh blow to tourism, the steam engine of Cyprus's economy.

"After emerging from a health crisis with its lingering effects, we are now in the midst of serious geopolitical developments, which create a very fluid environment internationally," Keravnos said in Parliament.

He said the projected 2.9 percent economic growth is higher than the EU average, and higher than the country's 2023 GDP growth, which the Central Bank of Cyprus expects to reach 2.4 percent.

Cyprus's economy came to the brink of a melt-down in 2013 and was saved by a Eurogroup bailout in the same year.

As the economy started to pick up and reached an all-time high growth rate of 9.9 percent in 2021, despite the COVID-19 health crisis, it faced the fallout of the Russia-Ukraine conflict in early 2022.

The country's tourism and services-based economy lost its second largest tourism market as about 800,000 Russian and Ukrainian tourists were unable to travel to Cyprus as a result of the conflict and the EU sanctions on Russia.

The Israel-Hamas conflict this year threatens to hit the tourism sector again as it puts at risk the Israeli market, the third largest, which provided close to 300,000 tourists up to last October.

The Tourism Ministry has launched a campaign to fill the gap by attracting more tourists from Central Europe, mainly from Poland and Austria.

The 2024 budget provides for revenues to the tune of 13.2 billion euros (14.5 billion U.S. dollars) and expenditures of 13.04 billion euros, leaving a surplus of 2.2 percent of the 27-billion-euro annual economy.

Keravnos said that public debt is expected to be reduced to 74.7 percent of GDP in 2024, down from 81.8 percent in 2023. (1 euro = 1.10 U.S. dollar) Enditem

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