National Statistics Office (NSO) data indicate that the economic impact of the pandemic was better controlled in Gozo than it was in Malta. This goes against the predictions made at the onset of the pandemic when many had predicted that since the Gozitan economy depends more on tourism, the impact of the pandemic in Gozo would be stronger.
In absolute terms the GDP per capita in Gozo actually decreased by two thirds of the decrease in Malta during 2020. This continued the trend that has been going on since 2016 that the Gozitan economy consistently improves more than that on the main island.
An important element behind the better performance of the Gozitan economy was Government’s intervention. In fact, there was an increase of around €6.1 million in the value added of the public administration and health sector in Gozo. There was also a similar increase in the construction sector, where the incentives given in stamp duty led to strong demand for properties in Gozo exceeding in terms of percentage growth those in Malta.
Another sector that did better in Gozo than it did in Malta was information and communication. Here value added grew by more than €4 million, or by 19%. By contrast in the main island this digital sector grew by 9%. The strong trend in Gozo shows how much the second fibre optic cable project was needed, as this will continue to make it possible for more digital activity to be carried out in Gozo.
When it comes to retail, hotels and restaurants, the trend in Gozo was also better than in Malta, with the decline in activity being almost a fifth less. This development certainly reflects Government incentives to increase domestic tourism, such as vouchers. So much so that by end of 2020 there were more Gozitans employed in retail, hotels, and restaurants than there were before the pandemic struck. This is in contrast to what happened in Malta, where employment declined in these sectors.
By end of 2020 there were more Gozitans employed in retail, hotels, and restaurants than there were before the pandemic struck.
While the Opposition argues that the Gozitan economy is only expanding because of increased employment with public administration, the reality is very different. In 2020 employment with public administration and health in Gozo accounted for 28.6% of all jobs, in contrast to 31.5% in 2013.
The sector that increased employment the most in Gozo during 2020 was professional services, with growth of 249 employees. This was even more than the 227 rise that was observed in Malta during the same period. There have been increases in employment in almost all economic sectors in Gozo, with an overall increase of 530, or 3.8% more than before the pandemic. This was a six-fold growth rate than that registered in Malta.
Official statistics indicate that despite the pandemic Gozo’s gross domestic product compared to Malta’s remained at a record high of 64%, which compares very well to the 58% observed in 2013.
In contrast under a Conservative administration the relative position of the Gozitan economy had consistently deteriorated.