GDP up by 8% in third quarter, NSO says

Provisional estimates indicate that the Gross Domestic Product (GDP) for the third quarter of 2024 amounted to €5.9 billion, registering an increase of €435.0 million, or 8.0 per cent, when compared to the same quarter of 2023. In volume terms, GDP rose by 4.9 per cent, the NSO said Wednesday.

For the third quarter of 2024, the Gross Domestic Product (GDP) of the Maltese economy registered a positive year-on-year growth rate of 4.9 per cent in volume terms.

The GDP deflator went up by 2.9 per cent compared to the same quarter last year. This represents a decrease of 2.6 percentage points in comparison to the year-on-year rate recorded in the third quarter of 2023.

The production approach

The production approach, also called the output approach, measures GDP as the sum of the Gross Value Added (GVA), which is the difference between value of output and the value of intermediate consumption and taxes, less subsidies on products.

During the third quarter of 2024, GVA rose by 5.7 per cent in volume terms when compared to the corresponding quarter of 2023.

The expenditure approach

The expenditure approach is another method used to calculate GDP and is derived by adding final consumption expenditure, gross capital formation and exports, less imports.

Domestic demand had a positive contribution of 4.9 percentage points to the year-on-year GDP growth rate in volume terms.

External demand had a neutral contribution.

In the third quarter of 2024, final consumption expenditure witnessed an increase of 6.3 per cent in volume terms: This was the result of an increase in the expenditure of households and general government of 5.1 and 10.5 per cent, respectively.

Conversely, non-profit institutions serving households' final consumption expenditure decreased by 1.4 per cent.

Gross fixed capital formation increased by 5.3 per cent in volume terms.

Exports and imports of goods and services in volume terms rose by 3.8 and 4.4 per cent, respectively.

The income approach

The third approach to measure economic activity is the income approach, which shows how GDP is distributed among compensation of employees, operating surplus of enterprises and taxes on production and imports net of subsidies.

Compared to the third quarter of 2023, the €435 million increase in nominal GDP was the result of a €223.6 million increase in compensation of employees, a €211.0 million rise in gross operating surplus and mixed-income, and an increase of €0.3 million in taxes on production and imports, less subsidies.

Gross National Income

GNI differs from the GDP measure in terms of net compensation receipts, net property income receivable and net taxes receivable on production and imports from abroad.

Considering the effects of income and taxation paid and received by residents to and from the rest of the world, GNI at market prices for the third quarter of 2024 was estimated at €5.2 billion.