Malta’s statistics chief has defended figures produced by his agency after the Central Bank governor questioned whether they painted a true picture of the economy.
Michael Pace Ross, director of the National Statistics Office, yesterday said the agency had the “necessary technical expertise to come up with the best GDP estimates”.
He insisted the reliability of economic figures in small countries was greater than in larger ones.
Figures published last week by the NSO showed the economy entered a recession in the first three months of the year, having registered negative growth for the second quarter in a row.
The “statistical fuzziness” was questioned by Central Bank governor Josef Bonnici. He said the extent of statistical discrepancies was unknown.
This could be seen in the item changes in inventories, which includes the build-up of stock.
Prof. Bonnici said the situation “could be different from what appears at first sight” and urged the NSO to split the build-up of stock from statistical discrepancies.
However, this would probably expose “a technical limitation of the present approach to calculating GDP”, he added.
But Mr Pace Ross said the trends shown by the GDP statistics were “corroborated by short-term statistics and trade statistics”.
The statistical discrepancy represents the difference between two different methods of calculating GDP as is the case in other EU member states.
A statistical discrepancy always arises, since different sources were used for both methods, but the discrepancy was “within the acceptable parameters”, Mr Pace Ross added.
He also asked for some understanding from users of statistics: “Revisions are part and parcel of NSO’s work, as provisional figures are revised by the data suppliers themselves once they become final.”
But questions over the NSO’s statistics were also raised by Labour MEP Edward Scicluna, who represents the European Parliament on Eurostat, the EU’s statistical agency.
On the day the economic figures were released Prof. Scicluna went on record saying “the statistical picture was murky”.
There was an error of some €135 million between the different methods of GDP measurement, he said, adding it was hard to get a clear picture.
However, the lack of clarity did not lead Prof. Scicluna to reach a different conclusion from that highlighted by the NSO statistics.
“I would not conclude that the economy has not entered a recession because the quarterly downward trend started a year ago and if projected would have shown it was leading to a recession. This is contrary to the Central Bank of Malta and government projections.”