Malta Business Development Report European Assessment

Excerpt from Assessment :

"A particular strength of secondary data is the objectivity. The data are written by experts in various fields." (McQuarrie, 2005, P 61).

"The relatively low expense in comparison to primary research is also the main advantage of this research as no new research needs to be commissioned. However, its main disadvantage is that the data used in the analysis may be out-dated and therefore return inaccurate results. Furthermore, previous studies may not have targeted the exact issue that the current research requires." (DJS Research, 2011, P 1).

Despite the disadvantages identified in the secondary data, the author makes use of secondary research as a method of data collection. To collect data, the author employs several techniques. First, the research searches several electronic databases for secondary data. The paper searches the electronic database such as Emerald database, Sage database, Social Science Research journal database, and the database of science direct. The database contains several scholarly journals, and academic report. The major reason for collecting data from the electronic database is that the data are easily available, and the database contains several recent articles on economic development of EU members.

The paper also collects data from the EU digital library, and EuroStat website. The major benefit of collecting data from the EU digital library and EuroStat website is that they contain rich data on the economic development of the EU member. With data from these sources, it is easily to prepare economic analysis of Malta. Moreover, the low cost of collecting data from the database is one of the major reasons for using secondary research. The data passes through analysis to enhance the integrity and validity of the data collected,

2.6: Data Analysis

Data analysis is very important for the validity and reliability of the data. Data analysis is the process of cleaning, inspecting, transforming and modeling the data to transform it into the useful information. One of the methods used to analyze the data is by assessing the data if they are relevant to the research. Since the author uses several articles, report and academic journals to prepare this study, the author only handpicks the articles relevant to the study. Further analysis is that the experts in the field write all the articles reviewed. The articles not meeting these criteria are discarded. Analyzing the data helps in arriving at the research findings.

2.7: Results after analyzing the Data

Analyzing the data helps in arriving at the conclusion that Malta is the 57th freest economy in the world. Malta economy also ranks 25th out of 43 countries in the Europe region. In the EU zone, Malta scores 17th position with 83% GDP in PPP. With the Malta economic assessment, Malta is 17% below EU average. Overall economic assessment reveals that the Malta economic condition is conducive for investment. Although, the financial institution may be small, however, it is relatively strong because of its openness to competition. The country has joined the EU in 2004, and adopted the Euro on 1 January 2008. Since Malta has joined the EU, the country has recorded between 1% and 3.7% annual GDP grow rate. In 2008, the GDP growth rate of Malta was 2.6%. Although, Malta experienced negative grow rate in 2009, this was due to the global financial crisis that affected many European countries. Despite the financial crisis that affected Malta in 2009, the country recovered in 2010 with the 3.7% growth. In the first and second quarter of 2011, Malta has already scored 2.5% in the GDP grow rate. (Theodora, 2011). (The summary of Malta economic data is on Appendix 3).

There are investors that may be interested in the Malta business development, the next section presents the outline that will be used to report about Malta business development.

3: Outline of the Report

This section provides the outline that will be used to report to the investors about the Malta business development.


Malta is small country that joined the EU in 2004. To improve the economic development, the country is largely depending on foreign trade. Since the country has joined the EU zone, it has demonstrated the healthy economic growth. Although, there was a decline in the economic development in 2009. However, the country recovered in 2010 with a positive grow rate.

3.1: Business Environment of Malta

Malta has demonstrated rapid increase in the GDP in the first and second quarter of 2011. Moreover, there is low inflation rate in the country. Inflation rate was 2% in 2010 and 3% in 2011 and there is low rate of employment in the country.

3.2: Recent Investment in Malta

In Malta, many companies have invested in the country. The service sector account for the 60.69% of the GDP, and other sector account 17.31% of the GDP. Many companies that have invested in Malta produce products such as food products, minerals, chemicals, machinery and other miscellaneous manufactured articles. In addition, several companies have produced semi-manufactured goods. Several banks and other financial institutions have also invested in the Malta. To encourage investment, the government has initiated several policies.

3.2: Malta Government Business Policies

To encourage investment in the country, government has formulated favorable economic and fiscal policies. The supervision and regulation of financial sector have become more transparent and are within the international norms. The Malta's judiciary is also relatively independent and the government has made laws to protect investors' properties by formulating the property rights. Malta is also implementing the EU rules on property rights. These policies are to improve the investment environment in Malta. (Bureau of European and Eurasian Affairs, (2011).

3.3: Import and Export Situation in the Country

Malta is large depend on foreign trade. To encourage foreign trade, the government allows importation and exportation of service and goods. Tourism accounts for the 30% of the GDP, and the country exports manufactured goods mainly semi-conductors, which account for the 78% of the total exports. Typically, government derives foreign exchange from tourism with arrival of 1.2 million tourists yearly. (Bureau of European and Eurasian Affairs, (2011).

Since the report is intended to address the investors, the report emphasis on Malta business development.

3.4: Importance of Malta Business Development to Investors

Malta business development is an area that could interest the investors. By emphasizing on Malta business development, an investor will be able to understand that Malta is a vibrant economy. Since the country has joined the EU in 2004, it has recorded growth rate in the GDP and purchasing power parity. Although, the Malta recorded negative economic growth in 2009, the reason was the global financial crisis that affected many advanced countries. However, the country recovered in 2010, and in the first and second quarter of 2011, the Mata economy is recording high grow rate. The analysis of the Malta business development will be beneficial to the independent investors because the investors will understand that Malta is a potential country to invest. Malta has demonstrated the economic indices that investors look before investing in any country. The major economic indices that an investor is searching for before investing in a country are economic growth, and stable government. Analysis of the report has revealed that Malta has demonstrated the increase in the economic growth since it has joined the EU zone. Thus, Malta will be a favorable country to invest based on the following reason.

With the low inflation rate, Malta will be one of the best countries to invest. In addition, the government policy is also favorable for the investors. Malta is an open economy, and the government welcomes foreign investors.

Despite the favorable investment climate recorded in the country, Malta is still perceived as the 45th of the 180 corrupt countries globally. Malta still lacks that a comprehensive anti-corruption strategy. The appropriate institution to combat corruption still lacks in the country. Despite the shortcoming identified in the Malta economy, Malta can still be classified as the favorable country for an investor to consider. (Economic Freedom, 2011).

4: Conclusion

The report critically analyzes the Malta economy. Malta is one of the new countries that have joined the EU zone. In 2004, Malta became an EU member and in 2008, Malta accepted to adopt Euro as the country's legal tender. Since Malta has joined the EU, the country has recorded growth both in the GDP and in PPS. However, in 2009, Malta recorded a decline in the economy growth. The reason was due to the global economic crisis that affected several advanced countries. In 2010, the Malta economy recovered from the economic shock. In the literatures review, the report examines five articles. The methodology and findings of the articles were presented. The report uses secondary research as the method of data collection, and there is a data analysis to enhance data validity and reliability. The findings of the report reveal that Malta is a favorable country to invest. The report recommends that SMEs, MNEs and independent investors should consider investing in Malta because of the country's favorable economic condition.

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