Malta became 'poorer' last year

During its first year of accession to the EU (May-December 2004) Malta's economy grew poorer when compared to the EU average, according to Eurostat, the statistical office of the EU.

The new figures show that whereas Malta's GDP per capita in purchasing power standard (PPS) stood at 72 per cent of the EU average in 2003, it went down to 69 per last year.

The PPS is an artificial currency unit used by the EU to calculate on a level playing field the strength of EU economies in member states. It reflects differences in national price levels that are not taken into account by exchange rates. This unit allows meaningful volume comparisons of economic indicators between countries.

Contacted by The Times, a spokesman for Eurostat said that "as the GDP growth of Malta in 2003/2004 was lower than the total of the EU 25, Malta's relative position in relation to the average of the EU decreased".

The spokesman said that the 2003/2004 annual GDP growth of Malta was only 0.1 per cent whereas the GDP growth rate for all the 25 member states of the EU was 2.4 per cent.

Malta was the only new EU member state that saw a decline of its economic strength when compared to the EU average. However, when all the 25 member states are taken into consideration, Malta was not the exception as even stronger economies such as France and Italy experienced a similar decline.

The Eurostat figures show that the strongest economy in the EU remains that of Luxembourg with a PPS of more than twice the EU average in 2004. The Grand Duchy is followed by Ireland, the Netherlands, Austria, Denmark, Belgium and Sweden. The poorest EU member state is Latvia with an economy of just below 45 per cent of the EU average.

Malta has the third strongest economy of the 10 new member states. Only Cyprus and Slovenia registered stronger economies.