The confidence of Maltese retailers has hit an all-time low, with many blaming “unfair” competition in the form of merchandise coming in from Sicily.

Other sectors of the economy however, such as services and construction, are looking brighter, according to the business and consumer survey published monthly by the European Commission.

The index for retail confidence stands at -19.5, the lowest reading since Malta joined the EU and the survey 10 years ago.

A representative sample of retailers are polled every month and asked about past performance and future business prospects. The survey is based on perception and shop owners are pessimistic about the future.

We’ve observed a negative trend over the past year... month after month the picture is becoming gloomier

“We’ve been observing a negative trend in the confidence of Malta retailers for the past year, where month after month the picture is becoming gloomier,” a source close to the Commission said.

Abigail Mamo, the director general of the body representing retailers, GRTU, said the organisation was not surprised by the negative results.

“We are being inundated with calls from our members every day complaining about the amount of merchandise coming into Malta by sea from Sicily,” she said.

“The situation seems to be getting out of control and our retailers are feeling the pinch.”

Shop owners told Times of Malta yesterday they were going through hard times.

“This is the worst year I’m experiencing in over 30 years,” said a 63-year old owner of a high-end clothes shop in Valletta.

“Although I mostly sell to foreigners and tourists, I don’t know what is going on and the government needs to do something.”

A Sliema-based retailer in the electronics sector said his sales were down by half over last year as a result of unfair competition from Sicily.

The latest survey also shows a drop in consumer confidence but other important economic sectors are looking healthier, with positive trends recorded in industry, services and construction.

Overall, Malta’s economic sentiment is still in positive territory, unlike the situation in the rest of the EU where on average it entered negative territory.

Across the union, the Economic Sentiment Indicator fell by 1.2 points this month, pointing towards further economic problems outside the island.

In a statement, the EU’s Commissioner for Economic and Monetary Affairs, Jyrki Katainen, said the dip in confidence in August was not surprising as it reflected the disappointing growth figures for the second quarter and the geopolitical tensions that have marked the summer.

“There is an urgent need to use all available tools to support growth and promote investment,” the commissioner said.

He said the momentum of structural reforms must be stepped up, because it was only through reforms that the EU would achieve a sustainable recovery in growth and job creation.

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