UPDATE: MTA denies UK paper's claim on Malta inflation - journalist replies

Hodson seems to be correct; Malta is, most of the time, silly and parochial.
Of course Malta is expensive, with poor value for real money. I was in London and Paris recently. For what I pay in Malta, I visited two restaurants, and got twice the value.
Figure it out MTA / MHRA and face the competitivity of the real world out there.

Joe Martinelli, my advice to you is; come and live in Malta for a few months and you will know exactly what is going on here, your canadian dollar won`t even buy a newspaper over here. I`ve always maintained that a European emigrant that wishes to widen his horizons must remain in Europe, once they venture to these far away places their mentality their mentality remain pure 'village mentality,' hence Mr. Martinelli.

First,can I say good luck to any Country that shares its currency with Italy!
Secondly for whatever reason, it is a fact that the Sterling/Lira rate was significantly better than the resulting Sterling/Euro rate - even without the effect of the decline in the value of Sterling in recent months.
There has therefore been an element of double whammy which has not affected the domestic economy as yet - but it will have an effect. How much it is difficult to say.
Finally my experiences with Air Malta at Birmingham have not been good. They are expensive and I opted for Manchester and Luton on the last trip - and halved my costs. The record for Air Malta was a quote of £800 from Birmingham and return.

hey everybody

You're missing one thing.

A tourist here for a few days is not going to be purchasing the same "basket of goods" that the local housewife does and on which our (low/reasonable) inflation is reckoned. The visitor will be purchasing a number of other goods and servcies that well may have risen in price.... and, by the way, is it the first time that prices in this sector have gone up??

On a positive note... apparently they still have freedom of speech in the UK ....you know, Norman Lowell and all that.

Dear Joe Vella, I never said that the BOE reduces rates to avoid inflation, but the other way round. It reduces rates to try and boost the economy back on track and avoid recession. Interests in UK had gone up this last year to avoid inflation, and the UK had been very good at keeping inflation low + low interest rates during these last 11 years, besides low unemployment. Something unheard of under Maggie Thatcher when interest rates had to go up to even 16% + inflation of 11% + over 3.5 million unemployed. The UK has had the highest stable and uninterrupted growth in the EU during these last 11 years. I am glad that you admit that had the Euro been kept low this would have benefited the Maltese, thanks, you are the first one to realise that, but even here you are not portraying the whole picture. If Malta changed at 1.9 Euros the cost of a room in a 3 star Hotel of say £m20 would have changed to 38Euros, but instead it now costs 46.6Euro, 18% difference! Now can you see that even the foreigners would have benefited and not just us. Another factor that you wilfully omitted to mention is the fact that a low rate changeover would NOT have made our imports dearer, in fact it would not have made any difference at all. This is the objective of the argument! The fact remains that the UK have full control of it's own economy and no finance minister would go to parliament and put the blame of economic incompetence on Brussels as is going to happen in the coming budget. Wait for it, and enjoy!

I would like to refer the dear Mr. Mark Hodson to an expression that we have in Maltese "Il-Hobz tih lil min jaf jieklu" (Give the bread to the person who knows how to eat it). The very notion that a journalist would get facts and figures relating to inflation, costs, etc.. from a post office is almost akin to getting medical advice from a gardener! It does not make any sense whatsoever!!

Not only that, but to then publish an article in a major news paper that actually has the potential to damage the reputation of a country and base this on the information acquired from totally wrong sources is verging on the professionally criminal!! Have all ethics been flushed. Then Mr. Mark Hodson has the chutzpah to come here and defend his article and call Malta "very silly and parochial"!!! How dare you?!?!

Let me take a moment to educate Mr. Mark Hodson – Malta is a member of the Euro, and as such we have the exact same currency as all the other Euro nations. The rate of the Euro to the Maltese Pound was fixed quite a while back, the fact that the British Pound is not doing so well with the Euro means that it is not the Euro Nation but the Pound. Another Maltese expression for you “Qed nibghatilek bil-posta” (I am sending it to you by post), get your facts straight sir!!

I think many people here are missing some really important facts. The most important is that the Maltese Lira had been completely pegged to the euro since the 2nd of May 2005, which means that since the 2nd of May we were already completely exposed to the same monetary concerns we are in now. So when it comes to British exchanging the currency, nothing really changed since the euro became Malta’s legal tender currency, from May 2005 till December 2008 they were getting the Maltese lira and since 1st January 2008 they are getting the euro, but in terms of exchange rate nothing changed since May 2005.

In addition to this, one should also realise that the value of the Maltese lira was previously fixed in terms of a basket of other currencies. And since the inception of the Euro, the Maltese Lira was dependent on the euro by 70%, on the UK sterling by 20% and the US dollar by 10%. This means that if the Euro went up in value by 2% the Maltese lira would go up MARGINALLY by 1.4%.

For further info have a look at: http://www.centralbankmalta.org/site/eurofaqs.htm

So one should realise that since the inception of the Euro the Maltese economy was highly correlated to any moves of the Euro, and the reason of this is because Malta’s biggest trade partner are the Euro-zone countries. This means that we would almost be in the same situation have we not entered the ERM II and later adopted the Euro.

Mark Grima is right, we are making more fuss about this than it is really worth.

Mr. H is obviously another one of those keen to attack the euro whenever the opportunity arises. Sadly for Britain this is going to be another over dramatised "go it alone against all odds" press saga . Unfortunatly this is not a weight or measure that after will remain constant. A currency reflects a myriad of complex factors and variables that are very hard to predict. Being alone does not help to make that task any easier. England in Europe would be so much more strong with Britain helping to lead it rather than oppose it.

A. Daley, do you know what you are talking about? You have one thing right which you stated in the last paragrapgh. Even with the latest cut by the BofE, the interest rates in the uK are still one basis point higher than that of the Continent. If inflation is the B of E major concern it wouldn't have cut interest rate last week.

Keeping the Maltese Lira low prior to change over to the Euro would only have benefit only those who are living in Malta and the only source of income is coming from abroad.

The British have been paying more, then those on the Continent, in servicing thier car loans, mortgages and other debt.

And may I suggest that the reason England have not adopted the Euro has to do more or less with the British of being hard nosed. That Imperialistic mentallity.

Laurence Schembri, even if Rupert Murdoch owns two thirds of the world media, does it give him the right to allow inaccurate articles by his reporters?
Mr. Hodson should have probably advised his government to join the eurozone, in which case their currency would be at par with Malta's.
I do not know what kind of information he got from MTA but data can be conveniently interpreted unless someone like Mr. Hodson uses it in his capacity as an economist and not that of a reporter.

Mark Hodson is being disingenuous. He claims to having done no more than, “report things”. However, he could not help but vouchsafe his opinion, to quote, “One place to avoid is Malta”. And he should know better than to pass the buck to The Post Office as it is The Sunday Times that has the total responsibility (at law if push comes to shove) for whatever it prints on its pages. As regards his last sentence (below) – “parochial”? Does he not know that Malta is the centre of the universe, and that does not come cheap.

Now before I go any further, I have read no more about this than what is in the banner article. I visit Malta every month, apart from the high summer months. I have not noticed any massive leap in inflation in the past year in the shops, sure the odd thing here and there. What I have seen is a change of 16% in currency against sterling since early January, now that is affecting travelling for UK citizens within the Euro zone and will be affecting European businesses trading with the UK. There is not a lot that Malta can do about that exchange rate, now they do not have the control over their own currency.
However, there is one area that I have seen a big difference in and that is the cost of flying to Malta. I fly from Birmingham and in October – end February, I had 6 visits and never paid over GBP 100.00 for a return flight, very good value. However in March that went to GBP 175.00 and the price of a flight of 2 weeks ago went up to over GBP330.00 even 4 weeks before departure trying to book this flight. As a consequence I travelled by a budget airline and that was over GBP 150.00, but I had a 220 mile round trip to the UK airport. If I was not coming for business, it would have seriously made me think twice about coming.
In the 4 years that I have been coming to Malta, I have seen the change in the type of visitor coming to Malta. It seems to me, more short breaks where people were coming due to the cheaper flights and a higher proportion were spending that saving on the higher priced hotels, so well done to the MTA for part of that success. As you can gather by the flight prices, the flights are very busy and this level of short break tourist seems to be still coming here, but with the difference in the exchange rate across Europe, it is not that which is going to stop people coming to Malta it is the price of flights. After all, you can travel to most other destinations in Europe for a lot less than you can to Malta.
Out of curiosity, I just checked. If I go to fly 12/6 returning 16/6 for a long weekend, the flight per person from Birmingham to Malta is GBP 313.00. Yet on the same schedule I can fly to New York for GBP 362.00 and over 30 other Mediterranean destinations for less than half the Malta flight price.

Excellent research, Mr Hodson. You got your facts for this from the Post Office. Where would you go to get facts about the Post Office? The local butcher? I only ask because I'm interested in the way reporters from non-parochial countries do their job. You know, non-parochial, as in "we know it all and you poor ex-colonials don't know anything"....

I think it is Mr.Hodson who is "very silly" and,like many other UK journalists, does not let facts get in the way of a good story. The tone of his comments to the Malta times is rather patronising to Malta and I am still trying to work out why the Post Office (was that Maltapost or UK post office?) is the organisation releasing figures which he insists are accurate. I am sure someone will enlighten me. Eurostat figures after the changeover must surely be more believable than the post office. The Maltese government ensured that for a year prior to the changeover prices were displayed in both currencies and still are, so one could see that merchants were not inflating prices when changing to euros. I have to point out that this is far more than the UK government did at the changeover to decimalisation in 1971 when prices rocketed! As has been said already, the fact that the UK pound is weak against the euro is no fault of Malta. It also means that it will be just as weak against the euro in the rest of Europe. I do know that I can still get a meal or a decent cup of coffee in Malta for a quarter of the price I can when I return to UK on holiday. Maybe the answer is for UK citizens to stay at home and pay inflated prices for goods in their own currency

A lot of people are getting confused about this including, it seems, the chairman of the Malta Tourism Authority.

My article in the Sunday Times was a news story, which (accurately) reported figures released to the press by The Post Office. That's what reporters do - we report things.

And where do you think the Post Office got its figures? Wait for it ... the Malta Tourism Authority.

Sad to say, this whole business is making Malta look very silly and parochial.

J. Zammit, you are correct, but there are other aspects as well. I do not care as to which party and who agrees with Euro or not, but the following are facts. Once the decision to join the Euro was taken the Maltese Govt. could have made sure to keep the Lm as low as possible so that when the changeover happens our currency would not be worth too much of the new currency. As far as we know the 1.9 Euros was the lowest we could have gone. All that costed £m would have been 1.9 Euros not 2.33 Euros. Now I am not saying that the British market would have done better, but this is one of the reasons that the British will never agree to dispose of their own Currency. Malta has no control on the value of the Euro and no control on the interest rates either. So if the Euro creeps up even further then Maltese manufacturing is going to be too expensive with the usual consequences, albeit to say that imports would be more stable. Tourism will suffer though and although it might not be felt just yet it will surely happen. The Bank of England tries to keep inflation down to prevent a recession, which is looming not only in the USA, but also in Europe. Sterling is therefore low in value because interest rates are low and have just been cut down to 5% today, so expect Sterling to go even lower. UK Exports though, are cheaper, Industry can borrow for less and the housing market needs a push. Malta cannot do any of this because the CBM has now no control over the currency except that this stuff is decided in Brussels not in Valletta. If the Euro keeps increasing in value then there will be dire consequences in our economy especially tourism because yes, then Malta will become very expensive to the British who incidentally amount to about 60% of our tourist industry. British tourists are flocking to the USA because the $ is even weaker!

Although I can not Comment on Inflation in Malta ( Because I've not been for 8 months) I think That the comments by Mark Hodson are well out of order. Because the pound is growing weak the cost of living in any EU country that is paying, using the Euro, will of gone up to the Brit. Why Malta should be singled out to be Mentioned is not only bigoted but is rude and shows ignorance. I hope that the formentioned gentlman also states that all of Europe is getting more Costly and doesn't forget that British inflation figures are not the most desirable in the world at the moment. The other thing that I want to say is if Inflation was running at 30% It would not deter me coming back as there is no way I can purchase the feelings That I Have for Malta And it's people

My husband and I have been visiting Malta for 10 years and rest assured we will not be put off by this article.We are visiting Malta on 22/4/08 and looking forward to our holiday VERY much.

Can't understand all the fuss about this. Strikes of paranoia slightly when this sort of thing makes the local head-lines. The article was about South Africa, with a minor (if inaccurate) reference to Malta in the final paragraph. I read The Sunday Times but I missed this particular reference to Malta.......along with 99.9% of the UK population. Don't expect to see RyanAir executives shaking in their boots over the possible fall-out from this.

What legal action? The Maltese mentality. If I do not agree with you I libel you. Haven`t you got an idea who Rupert Murdoch is? He owns two-thirds of the world media.

For the British its still a bargain to come to Malta especially if they prefer local beer than the Uk beer.

Its not inflation, its the sinking value of the sterling.

The English should avoid travelling anywhere in that case.

The journalist should be sued.

Legal action against a newspaper is hardly likely to improve Malta's reputation as a haven of relaxation and good value. There's another factor to consider. With or without inflation, Malta may be experienced as bad value for money because of poor quality and shoddy service.

Re the coment by J.Zammit, the rate LM/Euro has been fixed well before the "change to Euro".

You are right Mr. Zammit... but it isn't our fault that the UK are still with the sterling, which is losing its value day by day! The Euro is a very stable and strong currency. When we had the LM, for Lm100 we use to get around 60 sterling.... today with 100 Euro we around 80 sterling... which is more!! Whose going wrong here??

I'm in London.
Can anyone tell me the current price for a Pastizzi as it's the only reason I visit malta

MTA has no idea what cost is all about. My family (4) were coming over for a month in July. After weighing the pros and cons we decided to go to Orlando for three weeks, it will be 35% cheaper all round. I said this before, the exchange we greedily managed to get against the €uro is far too high and who is going to feel the brunt of this? Malta!

is it the case that mr. hodson is inviting himself for a free of charge v.i.p. visit to the island to verify facts; similar to what happened in the past with other negative write-ups.

It is obvious that Mr Sam Mifsud does not do the shopping for his family.

I do - and I assure him that there is no exaggeration in that article.

Before malta changed to the Euro a British tourist would buy a package worth Lm100 for 161 Sterling ( LM1=STG 1.61). Now with the exchange rate being that of Euro 1.25 to the Pound, s/he would have to pay 186 Sterling for the same package. That is an increase of 25 Sterling or 15.7%. Now where does the truth lie? I hope that this was foreseen and some sort of measures are in process.

MTA should consider taking legal actions against the newspaper. This is a serious matter which could have already lost Malta some revenue. MTA should make out an example of this newspaper to make sure that no other newspaper in any other country gives incorrect information about Malta. If MTA does not take legal actions then it will send the message that this newspaper could actually be right, which is obviously wrong for the image of Malta!

It is to late Sam the damage has been done. A friend of mine just phoned and the news is spreading. Can the Maltese government sue the London sunday times? This news can cost Malta irreparable damage.