Malta’s GDP per capita outpaces Eurozone’s

Once lagging behind by 21%, the EU's smallest member state has in just 11 years surged ahead of the eurozone average.

Preliminary estimates by Eurostat indicate that, for the first time, Malta’s GDP per capita is exceeding the euro area average. Last year Malta’s GDP per capita was estimated to be 5% above the EU average, while euro area countries are reported to have a GDP per capita that is only 4% higher than the EU average.

In 2012 Malta’s GDP per capita was 13% below the EU average, while that of the euro area was 8% better than the average. Over 11 years, the country has shifted a negative 21% gap from the euro area to a positive gap of 1%. In 2012, there were 11 euro area countries that had a better level than Malta; today, that number has fallen to 7. In the last 11 years, according to this measure, the Maltese economy has become stronger than that of Cyprus, Italy, France, and Spain.

Malta managed to reach the EU average in 2017 and, despite the shock of the pandemic, it has now managed to reach another very ambitious target. The importance of this economic measure stems from the fact that it adjusts national wealth not just to the difference in price levels between countries but, more importantly, to changes in the population. This, theefore, negates the narrative that the Maltese economy has grown because of a rising population. If that were true, GDP per capita would have remained stable or declined, and not increased to such an extent to start to outperform the average of the euro area, one of the richest regions in the world. Since 2013, on a per capita basis and compared to the rise in the euro area average, Malta has grown by 20% more than the countries around it.

The result means that pledge number 2 of the PL manifesto for the 2022 general election, that during this legislature Malta’s GDP per capita would exceed that of the euro area, has been fulfilled in the first full year of the current electoral mandate. This happened because the Maltese economy grew once again by more than that of the rest of the euro area. Malta’s GDP grew by 5.6%, while in the euro area there was growth of only 0.4%. It is also worth recalling that in 2022 the Maltese economy grew by 8.1%, while the euro area saw a growth of 3.4%.

In the electoral manifesto, pledge number 1 was that our country’s economic growth would average 5.5% during the legislature. So far, in the first two years, the average has been 6.9%, or almost one and a half percentage points more than promised.

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