Provisional estimates indicate that the Gross Domestic Product (GDP) in 2015 amounted to €8,796.5 million, an increase of €712.3 million or 8.8 per cent when compared to 2014. In real terms, GDP went up by 6.3 per cent, the National Statistics Office said today.

Gross Domestic Product: 2015

The production approach

During 2015, Gross Value Added (GVA) increased by €626.3 million when compared to 2014. This was mainly generated by wholesale and retail trade; repair of motor vehicles and motorcycles; transportation and storage; accommodation and food service activities which increased by €154.0 million or 9.6 per cent; professional, scientific and technical activities; administrative and support service activities which increased by €144.9 million or 17.9 per cent; and public administration and defence; education; human health and social work activities which increased by €93.1 million or 6.9 per cent. A drop of €2.9 million or 0.4 per cent was registered in manufacturing.

The expenditure approach

In 2015, total final consumption expenditure in nominal terms increased by 6.2 per cent and by 4.9 per cent in real terms when compared to 2014. Gross fixed capital formation increased by €401.8 million in nominal prices and by 21.4 per cent in real terms. Real exports and real imports increased.

The income approach

Compared to 2014, GDP at current prices went up by €712.3 million, and is estimated to have been distributed into a €189.9 million increase in compensation of employees, a €449.2 million increase in gross operating surplus of enterprises, and a €73.2 million increase in net taxation on production and imports.

Gross National Income

Considering the effects of income and taxation paid and received by residents to and from the rest of the world, Gross National Income (GNI) at market prices 2015 is estimated at €8,567.5 million.

Economy and Competitiveness Minister Chris Cardona described how an increase in consumption by private individuals as well as an increase in Foreign Direct Investment (FDI) is illustrative of Malta’s strong economy.

He said that this could be seen by both the National Statistics Office’s report issued this morning and the European Commission winter economic forecast report.

Dr Cardona spoke during a press conference this afternoon, where he said that the economy, in 2015, grew twice as big as what the Opposition Leader predicted.

He said that the private sector continues to be the main engine of growth, that Malta is making better use of European funds and that we are “15 years ahead of schedule,” with regard to Malta’s economic strategy.

In 2015, the Maltese economy continued to excel recording the highest growth over the last one and a half decade, Minister Edward Scicluna said in a statement. In fact, the official figures show that real GDP increased by 6.3 per cent in real terms while in nominal terms the Maltese economy is estimated to have grown by 8.8 per cent.

This robust economic performance reflected strong increases in both investment and private consumption. Indeed in 2015, investment activity increased by 21.4 per cent or €269.3 million while private consumption increased by 5.1 per cent or €203.3 million, over the previous year. Exports of goods and services also registered a positive increase of 2.4 per cent.

It is worth noting that economic growth continued to be broad-based as the majority of sectors recorded positive growth. Particularly strong increases were registered in the professional, scientific and technical sector and administration and support activities; in the financial and insurance sector; and in real estate activities with all three sectors recording double digit growth. Other notable private sector increases were also recorded in the wholesale and retail trade and accommodation and food service activities, the construction sector and the information and communication sector. The very strong growth in the service sectors more than compensated for the marginal decline (0.4 per cent) in the manufacturing sector.

Mirroring the performance in the labour market, compensation of employees increased by 5.3 per cent or €189.9 million in 2015 following a 6.4 per cent (€217.1 million) increase in the previous year. The strong performance of the economy also resulted in an increase in business profits of 12.9 per cent or €449.2 million.

Furthermore, Government expenditure growth decelerated, increasing by 4.8 per cent compared with a growth rate of 6.4 per cent registered in 2012.

Commenting on these results, Minister for Finance Edward Scicluna remarked: “The broad-base, record high economic growth rate observed in 2015 shows that this Government is succeeding in attaining sustainable growth through its strategy of attracting productive investment, reforming key sectors and adopting a growth-friendly fiscal consolidation approach.”