Figures issued today by the NSO show a sharp drop in foreign investment, which is fuelled heavily by financial services.

The National Statistics Office said that s at December 2013, the stock of foreign direct investment in Malta was estimated at €9.6 billion, with 70.6 per cent originating from financial and insurance enterprises. This was a decrease of €3.0 billion over the position as at end 2012.

The EU was the largest contributor to Malta’s inward foreign direct investment, with €6.4 billion, or 66.2 per cent of total FDI.

There was a net decrease of €1.6 billion in FDI flows, whereas the corresponding period in 2012 showed an increase of €0.1 billion. These were mainly the result of decreases in equity capital, mainly from entities involved in financial and insurance activities, the NSO said.

Direct investment abroad

During 2013, direct investment flows decreased by €13.9 million, compared to a decrease of €35.6 million during the previous year. This was mainly the result of a decrease of €4.5 million in equity capital and an increase in payables to direct investors of €21.5 million.

In terms of stock positions, in December 2013 direct investment abroad by resident enterprises was estimated at €1.1 billion, of which €0.6 billion were invested in the EU.

As in previous years, direct investment abroad was predominantly in
financial and insurance enterprises, these accounting for over 47.3 per cent of total stock as at end December 2013.

PN calls for economic plan

In a reaction to the statement, PN economic affairs spokesman Mario de Marco and Kristy Debono MP said a 24% drop in foreign direct investment was another signal in a series which showed that all was not well with the economy.

Earlier statistics had shown drops in industrial production, imports, exports and retail sales. All were factors which could have an impacts on jobs and salaries.

The government needed to come up with an economic plan which addressed these matters while coming up with a vision for new job-creating sectors in the country. 

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