Malta’s share of the European Stability Mechanism’s total paid-in capital – which consists of €80 billion, and a disposable capital of €620 billion guaranteed by member-states – would be €511.7 million on the basis of a temporary contribution key of 0.0731 per cent.

Finance Minister Tonio Fenech said yesterday this was the result of changes that had been decided upon by the EU about the mechanism. However, he underlined, Malta’s actual payment would be worked out on the paid-in capital of €58.4 million, which would be divided into five equal annual payments.

The ESM is a permanent rescue funding programme to replace the temporary European Financial Stability Facility and European Financial Stabilisation Mechanism in the 17-member eurozone. The ESM is due to be launched as soon as member states representing 90 per cent of the capital commitments have ratified it.

Instead of the original start-up date of July 2013, the ESM would now go on stream a year earlier, next July.

The minister said that another decision taken, “which was very important for Malta”, was that member states with a GDP of less than 75 per cent of the EU average – which includes Malta – would benefit from a temporary adjustment for 12 years after their access to the eurozone.

As a result, the shares allocated to ESM members would be reallocated to ESM members which would not be benefiting from this temporary adjustment on the basis of their shareholding in the European Central Bank.

Answering a parliamentary question by Labour MP Charles Mangion, the minister had earlier said that the ESM would not be operating on the basis of guarantees but on a capital base. In fact the ESM would have a total subscribed capital of €700 billion. Of this amount, €80 billion would be in paid in capital from member states. Besides, the ESM would be disposing of guaranteed disposable capital from member states for a total of €620 billion.