Who’s making our economy Appear to Grow

The recent GDP report tells us that the Maltese economy has made a miraculious revival, but did it really? "Are our members made to tell us that they don't feel any growth in their level of operations?" ask Vince Farrugia economist and Director General of GRTU.

A review of the latest statistics published, actually gives the answers "GDP growth has restarted from the second quarter 2009. This inspite of  the fact that household cosumption did not start lifting before the last quarter of 2009 and government consumption expenditure not before the first quarter of 2010. One reason why I was literally screaming at Government to implement the Budget 2010 schemes early in 2010 was precisely because when household cosumption is low it is up to public expenditure on local consumption to be hiked, so the total disposable moneys that keep most of our members going does not feel the pinch.  But government was too slow to react. Furthermore the construction industry was last year and still is in 2010 in the duldruns and suffering from negative growth.  This industry supports directly many self-employed, micro-enterprises who are themselves a motor that generate growth in other micro-firms.  But again  all GRTU's proposals to boost construction remained on the shelve. Now they will boost construction in later 2010.  But that's how politicians work don't they? They are always late economically speaking by three to four quarters.

Furthermore the growth factor in the Accounts are not SME's. Though some SME's in manufacturing and in tourism are biginning to push their heads up, most of the growth is coming from sectors like the financial institutions, e-gaming and real estate.  Retail and wholesale have however stopped sliding and its good to note that this sector started growing again. If the proposals we made for Budget 2010 are implemented without further delay and the boost to construction comes today we may be looking to better times. We keep our fingers crossed that what Hon. Mario Demarco is promising does materialise as tourism is a real saviour" concludes Vince Farrugia economic commentary