GDP exceeds €3 billion in second quarter of 2018

Provisional estimates published by the National Statistics Office on Thursday indicate that Malta’s Gross Domestic Product (GDP) for the second quarter of 2018 amounted to just over €3 billion.

This represents an increase of €238 million, or 8.6% when compared to the corresponding period last year. The NSO said that in real terms, GDP went up by 5.9%.

GDP refers to an estimate of the value of goods and services produced in the country’s economy over a period of time and can be estimated using a number of different methods, including the production approach, the expenditure approach and the income approach.

According to the NSO the production approach aggregates the economic output of the various sectors while the expenditure approach refers to is derived by adding consumption of households, government and non-profit serving households, investment, government spending and net exports.

The third approach to measure economic activity is the income approach which shows how GDP at market prices is distributed into compensation of employees, operating surplus of enterprises and taxes on production and imports net of subsidies.

In a statement, the government noted that at 5.9%, Malta had registered a level of economic growth that was almost three times higher than the European average.

It said that increase in economic growth had been mainly driven by an increase in private consumption, which increased by 6% and which the government said had resulted from an increase in worker income.

Moreover, government said that businesses were also doing better and contributing to the country’s economic growth.

“Another factor which emerges from the statistics is that in 2018, the country’s dependence on government expenditure continued to decrease,” it said, adding that government consumption stood at 16.6%, when compared to 20% before 2013.

“In addition to this, the official statistics show that the financial services sector, which according to the Opposition is passing through a time of uncertainty, in reality grew its operation by €31 million,” the government said.

The same applies to gaming, which grew by €70 million.

Finally, it said that government policy was leading to a substantial increase in the income of workers and businesses.

“In the next budget, the government will continue introducing measures to sustain the economy for it to renew itself and create more wealth of a better quality of life.”