Updated:GDP back in positive territory - PM welcomes results
Updated: Adds PL reaction
GDP was positive in the fourth quarter of last year after contracting in the previous three quarters, the NSO said today.
The results were welcomed by the Prime Minister, who said Malta had emerged from the recession (see video).
The NSO said that provisional estimates showed that GDP for 2009 amounted to €5.7 billion, an increase of 0.3 per cent over 2008.
In real terms, however, GDP contracted by 1.9 per cent.
Quarterly GDP growth rates at market prices during 2009 ranged from -2.0 per cent in Q2 to 2.4 per cent in Q4, when compared to the corresponding periods in 2008. In real terms, GDP contracted for first three consecutive quarters and was positive in Q4.
Growth in value added was generated in financial intermediation; real estate, renting and business activities; other community services; public administration; education; health; agriculture; fishing; and electricity, gas and water supply.
Drops were registered in the manufacturing sector; hotels and restaurants; transport, storage and communication; wholesale and retail trade; and construction.
GDP at constant prices declined by 1.9 per cent. Total final consumption expenditure in real terms increased by 0.4 per cent.
Gross fixed capital formation at constant prices declined by 19.3 per cent. Real exports and real imports also experienced declines.
The NSO said the annual change in GDP at current prices, amounting to €14.8 million, was estimated to have been distributed into a €6.3 million rise in compensation to employees, a €24.8 million decline in gross operating surplus of enterprises, and a €33.3 million rise in net taxation on production and imports.
See full NSO statement in PDF below.
PL REACTION
The Labour Party in a reaction to Dr Gonzi's remarks, said that if he believed himself, he should withdraw the utility bills.
"Some sectors of the Maltese might be statistically out of recession, even though GDP in real terms is still in negative territory, but hardworking families are still in the middle of a human recession.
"Lawrence Gonzi's propaganda exercise on this issue confirm that the Prime Minister is out of touch from the everyday life of families and businesses," the PL said.
It said that the figures showed that prices increased much more than wages.
"If Lawrence Gonzi is so convinced that he did the trick and has solved all problems, he might as well want to withdraw the sky-high water and electricity bill increases he voted for last week," the party said.
31 Comments
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C. Sapiano
Mar 12th 2010, 15:03
@Horace Muscat
I know how to use the English language, thanks! I used the word 'emit' as a metaphor and in relation to what other parties 'emit'. The use of the word 'emit' proves my point because the Labour party, for example, pollutes much more with its negative propaganda. Other parties emit propaganda and the PN much less. My arguments are not typically Nanionalist as what I stated are facts not myths.
J.Pace
Mar 12th 2010, 13:49
Maybe Dr Gonzi is saying that Malta is out of recession, but the companies are still using this excuse not to give the increments. Wages are still the same, and speaking for myself, I am 3 years with the same fixed wage. Life expenses are going sky high and my wage kept the same. Also to find a good job at the moment is out of question, cause companies are firing people, or the employing with yearly contracts.
Kleaven Maniscalco
Mar 12th 2010, 13:24
@ P. Schembri
You might be right when you say that part of the electricity bill might be going to control costs. But I prefer to pay a bill that I can control how much I spend rather than paying a bunch of taxes I have no control on. Because this situation is rather funny. Instead of each family is trying to invest in technologies that save energy, it is proving easier to go and protest and make a fool of oneself. My friends if you ever lived abroad especially england you would never complain again about the maltese taxes....and NO not even the difference in the paycheck between malta and another country would do good for the difference in taxings
Horace Muscat
Mar 12th 2010, 12:19
@C.Sapiano---First of all you don't "emit" propoganda, you emit gases or any other type of pollutants in the air. A great deal of the PN propoganda is worse than pollution and the Heavy fuel oil it will be using in Delimara so in this respect using the verb "to emit" might have been correct in its usage after all. Regarding your argument I find it typical of a Nationalist. A Nationalist thinks that the more propoganda you churn and the more you repeat a lie than whats wrong magically becomes right. The utility saga was and is still being mismanaged and only the blind cannot see that.
Manuel Debattista
Mar 12th 2010, 12:06
And yet some more creative accounting to make things look positive. The TRUTH is so so vastly different. You can see it in the PM's face expression in this photo. He couldn't even afford to give us his usual sarcastic smile. Ah well.
P. Schembri
Mar 12th 2010, 10:41
@J. Borg. The PL can only suggest (not propose) ways to cut down the tariffs. The government has to propose! But of course, as the EU is breathing down heavily on the Government's neck to reduce the national deficit by 2011, the government had to do something. So what happens? The tariffs are increased (the excuse being the oil increase in price per barrel) and so the government will be left with a surplus to balance or decrease the deficit. The thing is that oil price is lower than when we were paying 50% surcharge! Now we're paying over 195%!
joseph gariboldi
Mar 12th 2010, 10:08
The gdp is about 5.600.000.000 and the public debt is about 3.800.000: what is the percentage?
C. Sapiano
Mar 12th 2010, 09:39
There is more positive than negative going on in the country. One of the few negative things is the Utility Bills. Unfortunately the government has itself to blame as it does not emit enough propoganda.
One can mention many postitve things:
1. Malta is probably out of the recession.
2. Tax incentives to families sending their children to private schools.
3. Tax incentives to working mothers.
4. Tax inccentives to families hosting foreign students.
5. The removal of the Credit card levy tax.
The list goes on and on...
g.c.Forte
Mar 12th 2010, 12:50
If you put the incentives that you mentioned, on a scale, they will not be enough to put the scale down, compare with the energy tariffs. Another important but negative issue is the cost of living. Negative is that the govt, increase of our wages, are not comparable with the cost of living. Is it negative that we have a government that is ignoring 60 % of the citizens,and wasting more than 100millions euros on a stupid project ( Gonzi / Piano`s) that can wait ?. Is it negative that on every national project, there is always a mystery ?, example... The extension of the power station. Is it negative that the backbenchers are threatening the P.M.?ect...ect...ect. Those incentives that you mention are irrelevant,because not all the citizen are benefiting from them. The tariffs are hurting everybody. As for the recession, if what the P.M. and you are saying is true, why the government do not revoke the energy tariffs ? or at least reduce them a little bit.
Anthony Pace Gouder
Mar 12th 2010, 09:22
Thanks to the L-ISTRINA and the SANTA CLAUS effect ? Picture says it all .
laurence schembri
Mar 12th 2010, 08:57
Joe, if a day trip shopping to Catania is classed as a bi-annual holiday, then you will in future see the number quadruple, it is cheaper to shop abroad, hence the flights to the UK at Christmastime and NewYear. I spend a goog part of my time here and I can touch it, another example, my € has more shopping power in Germany than in Malta and the difference is not minute, at least by a quarter to one-third. I`m not having a go at you, but facts are facts.
J.Borg
Mar 12th 2010, 00:13
All that the PL wants is to make it clear that the utility bills are high. But the PL never said how they would fix this problem if they where in government.
g.c.Forte
Mar 12th 2010, 09:12
Only children reason like that.................How can the P.L. says what can do now, when the P.N. are hiding the real truth about how the government is negotiating the oil prices. What we know for sure is that Min. Tonio Fenech said in public that one of the main reason for raising the energy tariffs, is to bring back EneMalta on its feet from the disastrous situation that the mismanagement had brought it in. One argue about the Dr. Sant era, when he was advised to put a little raise on energy. I believe that " IF " that proposition matured, today we are in a different situation. I know the Maltese saying that goes like this " Kieku waqa u kiser siequ " jew " Kieku u Kien qatt ma qaghadu flimkien " and this goes even today J.Borg, how can the P.L say what he can do when the playing cards are not in his hand. It remains the responsibility of the P.N.
Muscat.Pat
Mar 11th 2010, 22:44
My GDP did not go up, I don't know about yours. How did the public administration, gas electricity and water generate a growth in GDP? Am I right in reading that if the utility tariffs get higher, we will probably get a higher GDP? At the moment we are only getting the bones; so where is the beef?
Joe Busuttil
Mar 11th 2010, 19:22
mario degabriele. Maltese travel for work, to visit sons and daughters living abroad and for other various reasons which force them to travel,and not for pleasure only. Others go for cheap day trips to various places, some of them using low cost airlines and some of them don't even know where exactly they have been to. So that leaves only a small number who really spend on their holiday .
Michael Catania
Mar 11th 2010, 17:20
I'M A LITTLE CONFUSED ABOUT THESE FIGURES. How come the GDP went up by 0.3% but in real terms it went down 1.9%. I have to assume that the extra taxes we have been lumbered with has inflated the price of goods produced, otherwise pound for pound we have reduced the GDP AS COMPARED TO THE SAME PERIOD LAST YEAR.
@Martinelli I have received my wsc bill and when compared to the same period last unit for unit are as follows:-
last year 9.33cents per unit (Kwh)
this year 14.71 cents per unit. AND THIS DOES NOT INCLUDE THE RISE EFFECTIVE FROM JANUARY 1ST. 2010.
Have I made it simple enough for you to understand
M. Xerri
Mar 11th 2010, 23:08
Ok so the GDP (in euro), rose by 0.3% while inflation was up 2.1% in 2009. If you work out the figures, that means that the GDP (in actual value) is down by 1.9%.
This is the same effect of inflation on a savings account. Ex. if you have EUR1,000 in a savings account and you get 1% interest after 1 year (I'll ignore the taxes here, to make it simple), you have EUR1,010. In last year's euro spending power, however, you now have EUR989.32.
It's not that complicated actually. The euro (like the US$ and all fiat money) has a value that is being steadily lowered by the market (inflation). Supply/demand. Then we are mis-lead and tricked by the same democracy we support by being given values at face value, instead of real value. Tragically, most of the population either does not understand this or refuses to do so.
R Spiteri
Mar 11th 2010, 16:37
Very good news indeed.....let's keep this momentum. Doom and gloom leads to failure....so such good news will lead to further growth.
Wise decisions by the Government, like it or not, have led to this good news.
Paul Debono
Mar 11th 2010, 16:13
Interesting news on the GDP.
However the fact that the GDP in real terms contracted 1.9% is sobering.
What I cannot understand why the goverment has not yet announced the full year goverment budget deficit figures for 2009.....
Mario Degabriele
Mar 11th 2010, 15:58
Interestingly, more Maltese people travelled in 2009 than in 2008, which just goes to show how little, if at all, the worldwide deep recession - which economists are now calling The Great Recession - affected us.
The figures published by NSO with this news show that Maltese families' consumption in the quarter Oct-Dec last year was the highest ever on record.
The economy has shown trust in Lawrence Gonzi's steady pair of hands, as someone rightly said below, and he saved us from the worst effects of this great global recession.
It is now up to the government and the PN to work hard so that people understand just how empty and shallow Labour is.
T Micallef
Mar 12th 2010, 00:57
I formally nominate you for the Nobel prize of economics for the very interesting theory of correlating number of flight passengers to the exceptional economic growth we experienced last year. In the meantime may I remind you that air malta made a whooping 30 million euro loss last year. Bravu!
Jeffrey Montebello
Mar 11th 2010, 15:48
@ R Agius
Rejoice indeed.
In the 80s recession, the Labour government had a registered unemployment rate of 10% for years on end. Malta now has a registered unemployment rate of only 5% - half.
Open economies like ours depend on foreigners buying and travelling and are therefore hit even harder than average by worldwide recessions of this depth and breadth. But in this particular recession, we have been hit only very slightly and we have now returned to real growth.
Prime Minister and government, well done and keep it up. Rejoice and work harder as this country does not deserve the shallowness and emptiness being offered, as ever, by Labour and its new leader who’s only interested in nice ties, Alfa Romeos and junkets abroad.
J.Cassar
Mar 11th 2010, 15:28
@ R. Agius.
You have got it all wrong. I never watch Super 1, but I am not prepared to wear blinkers and refuse to get hoodwinked by political spin, just like that you are are promoting. It is so sad that there are still people like you who are only prepared to sing from your party's hymn book
C Muscat
Mar 11th 2010, 15:27
Greece gave the wrong information. We have been given the news that our budgets are without any deficit for many years.
Who can answer this please? Just tell me if in those figures we have all the money due by the government.. namely the money owed for medicines.. the money owed for Enemalta investments?? like the old Delimara power station?? like the money spent on Mater Dei??like the money borrowed by government authorities??
Dear All, do not be fooled around with these kind of news.
Joseph Debono
Mar 11th 2010, 15:17
Prim Ministru bahri tal-maltemp, as we say in Maltese.
Talk can be cheap, as the opposition shows, but Lawrence Gonzi has shown his mettle not only in good times (reducing the deficit and introducing the euro to Labour's opposition and skepticism) but also in the worst recession in a century (even though we are a very open economy, we have been touched by the recession only half as much or less as the rest of the EU).
Well done, Prime Minister, you have shown you fully deserved the trust people showed in your steady pair of hands exactly two years ago.
R Agius
Mar 11th 2010, 14:51
@J Cassar
In case you haven't noticed - and if you just watch Super One you wouldn't have noticed - le me try to explain what has happened. We are in the midst of the worst WORLDWIDE (ie not GonziPN induced) recession in the history of the modern world. As Malta is not immune it has been adversely affected - just like every other country on earth that depends on other economies to proser. Even oil rich countries like the Emirates are experiencing an economic crisis.
The challenge is to minimise the damage that results from these factors which are outside of our control (something Super One or the PL would never say). What GonziPN has done is carefully crafted aid to specifically target those most vulnerable thus cushioning the effect of the recession and safeguarding jobs. The slight increase in unemployment would have been far worse had GonziPN not acted in this way.
Now that economic indicators are showing that the worst is probably over this is indeed good news - we are not out of the storm yet but things are calming down - and you and I both still have jobs - REJOICE!
j.cassar
Mar 11th 2010, 14:31
I fail to understand what there is to celebrate in this news. When gdp goes down by 1.9 % in real terms, there is no reason to rejoice. Moreover when one see where the delines are most pronounced ie tourism and manufacturing, one is more justified in being worried. The growth areas are the ones that should be under control ie public expenditure.
Let's stop the happy talk and the hype and get on with the business of reforming our economy by concentrating on competitivness and investment - and by investment I do not mean just investment in immovable property.
Joe Vella
Mar 11th 2010, 14:24
@ Joseph Arapa
If the postman have delivered your WSC bill, at least you can now rest assured that you are being billed for what you have consumed and not for the waste of others,
J Martinelli
Mar 11th 2010, 14:23
@ Joseph Arpa
Since you gave the world the news that you received your WSC bill only today, and assuming that it reflected the new (horrible) tariffs, can you truthfully tell us how much difference there is compared to previous bills? You may be also helpful by, truthfully again, say how much the increase will crimp your lifestyle and whether you receive any eco-credits back.
I will be eagerly watching departure numbers by Maltese going abroad for their bi-annual holidays. According to the agents of doom and gloom the number should shrink by at least one half!
G. Fenech
Mar 11th 2010, 14:20
This is adding insult to injury.
Our tactics have proven right?
By tactics, do you mean: Tax the hell out of everything to cover up all the money we lost in the past?
Yes, thats working. The rich stay rich, everyone else gets poorer.
Thanks Gonz, i'm sure i can afford a new car and a holiday now that recession is over!
Joseph Arpa
Mar 11th 2010, 13:21
Waaaahahahha I can't believe that taxes, tariffs etc fly left right and centre in this country, however we always hear positive news that all is good all is on track.
Give me a break! oh gotta go...the postman just delivered the WSC bill.