Malta Central Bank Reports Businesses More Optimistic

by Robert Lee, Tax-News.com, London

10 June 2002

The Malta Central Bank Quarterly Review, published at the end of May, has revealed that sentiment among businesses located in Malta has improved compared to the last quarter of 2001.

Questioned with regard to their perceptions of the global and domestic business climate in the period up to March of this year, many respondents revealed that they were now more optimistic for the future, or had, at the very least, moderated their pessimism.

Experts have suggested that this change in outlook is due to the fact that the effects of the global economic downturn predicted in the aftermath of the September 11 attacks - when the last such study was undertaken - were less severe than anticipated for many countries.

'Although respondents to the Bank’s latest business perception survey reported below-normal activity levels during the fourth quarter of 2001, the outcome was better than expected since in the previous survey respondents were very pessimistic about the short-term outlook,' the Central Bank explained in its Quarterly Review.

Media commentators on the business perceptions survey have suggested, however, that there still remains a certain degree of uncertainty regarding the size and likely timescale for a complete recovery, and that many Maltese businesses may hang back for the moment.

'Many firms seem to want to wait for more concrete signs of improvement in foreign and local economic conditions before undertaking new investment projects,' the Malta Business Weekly observed on Thursday, warning that: 'This may itself retard growth and limit the creation of new jobs in the short-term.'

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