I cannot fault Anthony Curmi's explanation (The Falling Pound, January 17) to Brian Simmons from England who complained about the high value of Maltese currency, except to say that Mr Curmi bases his reasons on the money market fluctuations of various currencies. The point I make is that his explanation does not refer to any macro-analysis of the relationship between GDP and the value of the currency in the market. Please let me explain. A consumer in England wishes to buy a unit for £1,000. If he wishes to buy the same thing in Malta he will need to fork out the equivalent of the old lira, viz. £1,700 or its euro conversion.

Because the euro has strengthened against the British pound he will need to pay more than the £1,700 or whatever increase the market dictates. I ask Mr Curmi, what relationship has the increase with Gross Domestic Product? Has Mr Simmons shirked on his job and produced less or has the Maltese workman made an extra effort to justify the new price of the euro if bought by sterling? I hasten to suggest that it is dishonest for any government to raise prices when it does not merit any increase in its GDP. It follows that Mr Simmons and others, through no fault of their own, have had their spending powers reduced by two factors: the Maltese gambling on the euro to its value and the stubborn persistence of the British government to stay out of the eurozone and to maintain a cheap sterling policy. The Maltese government on its part has set a high value on the euro of 42.93 cents, hoping it will reap dividends and optimistically retain its competitiveness.

Either way, Mr Simmons feels cheated and I do not blame him.