After the recession: PN and PL's war of words
The Nationalist Party today criticised the Labour Party for ignoring the fact that Malta had clawed its way out of the recession and not giving it press coverage in its media.
“The Labour Party had ignored achievements made by the Maltese people by ignoring the fact that through their hard work, Malta is officially out of the recession,” a statement from the PN said.
“For Joseph Muscat and PL, as well as the General Workers Union, which runs the paper L-Orizzont, the news that Malta is out of a recession is less important than a nest of dead turtle eggs.”
Meanwhile, Labour's economic spokesman Charles Mangion said while the fact that Malta is technically out of recession is a positive development, the latest indicators on economic activity, as published by NSO, should still remain a cause of concern for policymakers. Firstly, GDP growth of 0.9% in Q2 is not a sufficient growth rate for a country that aspires to have living standards converging at EU levels at an acceptable pace.
“More significantly is the fact that while the principle goal of any government should be that of implementing policies that help to improve living standards of its own citizens, the latest data show that this is not the case.
"The latest GDP data for Q2 of 2012 shows that domestic demand, comprising of household and government consumption, and investment (excluding inventories) continued to contract. Investment expenditure also worsened in Q2, declining by 1.7% after falling by 0.8% in Q1. Indeed, investment has been declining for at least the past successive six quarters."
Dr Mangion said that this dispelled the comments made by Finance Minister Tonio Fenech to The Times who stated that the growth in GDP was also due to higher investment.
"The Finance Ministry also stated that the economy was growing with better paid jobs. This is again incorrect, as growth in compensation to employees slowed down to 2.6% in Q2 of 2012. More worryingly, the fact that inflation in Q2 picked up to 4%, this means that in real terms compensation to employees fell, implying loss in purchasing power. Thus, on a per employee basis, real wages continued to decline, implying that Maltese families continue to remain in recession. Indeed, it is no surprise that in view of falling real incomes, household consumption has fallen during each of the first two quarters of 2012, as confirmed by Eurostat data that Malta has been recording one of the strongest declines in retail sales in the EU."