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Malta: Economic and Political Outline
Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline
Malta has achieved an exceptional economic development during the last years. The country managed to maintain an average GDP growth rate of 5% during 1990s, mainly due to large investments in infrastructure projects. However, the economy experienced a global slowdown at the beginning of the second millennium. The economic crisis of 2008-2009 affected the country but to a lesser extent than the rest of Europe. Thanks to its solid financial foundation, with little inclination for toxic loans, the country came out of the crisis relatively well.
The only sector that was really affected by the crisis was the tourism sector with a reduction in foreign visitors into the country. The only damper is still its excessive budget deficit, which is over the 3% threshold imposed by the European Commission. Malta finished the yera 2011 with a growth of 2% compared to 3.1% in 2010.
Domestic demand has remained strong and fiscal revenues were larger than expected. This allowed the government to reduce the deficit to 4.2% of the GDP in 2010 and to 3% in 2011. The debt has been contained at around 68% of the GDP and unemployment remained weak in 2011 compared to the eurozone, with a rate of around 6.6%.
One of the major challenges of 2012 will be to improve the rate of absorbtion of structural funds transfered to the Maltese. Between 2007 and 2010, only 40% of the funds attributed to Malta for the 2007-2013 period were put to use. An ambitious three-year plan of 500 million euro, targetting infrastructure (roads, beaches) and environment (waste and water treatment) has been implemented in order to boost the city's attractiveness. However, the majority of projects using structural funds require national cofinancing, which it is difficult to mobilize during periods of budgetary restrictions.
| Main Indicators | 2009 | 2010 | 2011 | 2012 (e) | 2013 (e) |
| GDP (billions USD) | 8.17 | 8.27 | 9.33e | 9.78 | 10.11 |
| GDP (Constant Prices, Annual % Change) | -3.3 | 3.1e | 2.5 | 2.2 | 2.2 |
| GDP per Capita (USD) | 19,637e | 19,707 | 22,058e | 22,936 | 23,543 |
| General Government Balance (in % of GDP) | -3.6e | -4.1 | -3.1e | -3.1 | -2.5 |
| General Government Gross Debt (in % of GDP) | 67.3e | 67.1e | 66.3 | 66.1 | 65.9 |
| Inflation Rate (%) | 1.8 | 2.0 | 2.6 | 2.3 | 2.4 |
| Unemployment Rate (% of the Labor Force) | 7.0 | 6.9 | 6.3 | 6.2 | 6.2 |
| Current Account (billions USD) | -0.61 | -0.40 | -0.36 | -0.47 | -0.63 |
| Current Account (in % of GDP) | -7.5 | -4.8 | -3.8e | -6.2 | - |
Source: IMF - World Economic Outlook Database ; World Bank , Last Available Data
Note: (e) Estimated Data
The agricultural sector only represent 2% of the Maltese GDP.
The island's economy is primarily based on tourism (which accounts for almost 30% of the country’s GDP, with over 1 million tourists visiting Malta annually), on manufacturing (electronics and pharmaceutical products) which accounts for 18% of the GDP and 75% of the total exports and on financial activities (which account for 24.7% of the GDP).
The transport and telecommunications sector represents 23.4% of the GDP.
Malta does not have any mineral or energy reserves and it is completely dependent on imports in this field.
| Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
| Employment By Sector (in % of Total Employment) | 1.4 | 24.7 | 72.9 |
| Value Added (in % of GDP) | 1.8 | 33.0 | 65.2 |
| Value Added (Annual % Change) | -4.8 | -15.5 | 5.3 |
Source: World Bank - Last Available Data.
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| Monetary Indicators | 2003 | 2004 | 2005 | 2006 | 2007 |
| Euro (EUR) - Average Annual Exchange Rate For 1 USD | 0.38 | 0.34 | 0.35 | 0.34 | 0.31 |
Source: World Bank - Last Available Data.
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Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation
Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
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Being centrally located in the Mediterranean, Malta has, for a long time, portrayed itself as a bridge between Europe and North Africa. Foreign trade represents more than 150% of the GDP. in 2011, its main clients were Germany (12% of exports), Singapore (10.4%), France (10%), the USA (8.9%) and Italy (6%). Malta exports mainly electrical and electronic products, machinery, textile products, books and newspapers.
Its three main suppliers are Italy (25.2%), the United Kingdom (8.6%), France (8%), Germany (7.9%) and Singapore (3.5%). Malta mainly imports electrical and electronic components, machinery, mineral fuels and oil, vehicles, plastics, and food products.
The country's trade balance has, for a long time, been in the red. However, the situation improved in 2008-2009 due to exports picking up again, propelled by the development of a large export pharmaceutical industry. In 2011, a series of measures favoring the internationalization of Maltese companies will be conducted.
| Foreign Trade Indicators | 2007 | 2008 | 2009 | 2010 | 2011 |
| Imports of Goods (million USD) | 4,760 | 4,783 | 4,135 | 4,176 | 6,125 |
| Exports of Goods (million USD) | 3,077 | 2,946 | 2,242 | 2,522 | 4,098 |
| Imports of Services (million USD) | 2,200 | 2,300 | 2,118 | 2,503 | 2,625 |
| Exports of Services (million USD) | 3,461 | 3,841 | 3,470 | 4,079 | 4,466 |
| Imports of Goods and Services (Annual % Change) | -0.8 | -2.9 | -10.6 | - | - |
| Exports of Goods and Services (Annual % Change) | 2.7 | -3.0 | -7.6 | - | - |
| Imports of Goods and Services (in % of GDP) | 91.5 | 86.8 | 73.7 | - | - |
| Exports of Goods and Services (in % of GDP) | 90.5 | 83.8 | 74.2 | - | - |
| Trade Balance (million USD) | -1,351 | -1,849 | -1,370 | -1,229 | - |
| Trade Balance (Including Service) (million USD) | -298 | -316 | -96 | 133 | - |
| Foreign Trade (in % of GDP) | 182.0 | 170.7 | 147.8 | - | - |
Source: WTO - World Trade Organization ; World Bank , Last Available Data
| Main Customers (% of Exports) |
2010 |
| Singapore | 14.7% |
| United States | 11.0% |
| Hong Kong | 10.3% |
| Germany | 9.3% |
| France | 7.9% |
| See More Countries | 46.8% |
| Main Suppliers (% of Imports) |
2010 |
| Italy | 23.2% |
| United Kingdom | 8.3% |
| Germany | 8.2% |
| France | 7.9% |
| Singapore | 4.0% |
| See More Countries | 48.4% |
Source: Comtrade, Last Available Data
Source: Comtrade, Last Available Data
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Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
Map of freedom 2010
Source: Freedom House
Note: The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
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Last Updates: May 2012