Bank of Valletta has just published the Spring 2011 edition of the BOV Review. The 43rd Edition of this popular publication features four informative papers and is available for download from Bank of Valletta’s website www.bov.com

“Emigrant and immigrant small island profiles” is authored by Stephanie A. Mitchell and Jerome L. McElroy of the University of Saint Mary’s College in Notre Dame, Indiana USA. This study examines a global sample of forty small islands less than three million in population including 15 dependent and 25 independent microstates. Fourteen are characterized by chronic immigration and 26 typified by chronic emigration. It constructs separate socio-economic and demographic profiles of the two island groups classified by disparate migration experiences and using means difference analysis across twenty-two indicators.

The paper concludes that the immigrant islands are significantly more economically and socially advanced and demographically mature than their emigrant counterparts. It argues indirectly that the source of the former’s affluence is their greater degree of post-war diversification, especially towards international tourism, offshore banking and export manufacturing.

Michael Briguglio and Ian Bugeja from the University of Malta write about Malta’s welfare model. Their paper compares the Maltese welfare state with other mainstream welfare regimes. It makes use of Esping-Andersen’s concepts of decommodification and stratification, whilst also looking at political and ideological factors. The European context in general, as analyzed by Roche, and the Southern European context in particular, as analyzed by Ferrera, are given particular attention. For this purpose, qualitative interviewing and analysis of secondary data was analysed through a sociological perspective. The paper argues that Malta has a hybrid model which does not neatly fit in one particular model of welfare. Indeed it has similarities and differences with other welfare models such as the Liberal, Social-Democratic, Continental and Southern European. However Malta must also keep in line with targets set by the European Union, which in turn are likely to influence Malta’s welfare model.

The third article, authored by Stephanie Vella, an independent consultant, is entitled “Developing the private sector, in particular SMEs, as a means of building economic resilience.” This paper discusses the role of private sector development in the economic resilience building of small states. The private sector is generally more exposed and more responsive to market dynamics, thereby contributing to the flexibility of the economy. However, instances of market failure may be more prevalent in small economies, especially if there is a proliferation of monopolies and oligopolies.

This calls for appropriate polices to encourage competition and efficiency, within the context of promoting a business environment that is congenial to small and medium sized enterprises which are the main drivers of economic growth in small states. The paper considers the Doing Business index published by the World Bank and hypothesises that small states which have overcome their vulnerability through the establishment of policies aimed at enhancing economic resilience also register positive performance in the doing business index.

The global financial crisis and the recession that ensued has affected many small island states, given that these tend to be very open economies. T.K. Jayaraman of the University of the South Pacific write about the challenges and opportunities for the small island countries in the South Pacific.

With the decline in economic activities in the advanced countries, the American financial crisis soon became a global economic crisis, triggering a world-wide recession since then. Following the onset of global recession, Pacific island counties have been experiencing the impact in varying degrees. The global crisis has posed challenges with both short- and long-term implications. While the short-term challenges are thought to be dealt with by fiscal and monetary policies, which have only a limited scope, the long-run challenges can be looked upon as opportunities for renewing efforts towards sustained growth as well as minimizing the impacts of similar future uncertainties. This paper, which deals with six major countries in the South Pacific region, namely Fiji, Papua New Guinea, Samoa, Solomon Islands, Tonga and Vanuatu, seeks to examine policy options, including regional economic integration.