€590 million decrease in Malta’s international investment position

As at the end of June 2011, Malta's IIP was estimated to be €0.25 billion. This indicated a 65 per cent decrease over the IIP position in June 2010. This change was mainly caused by the decrease in the country's foreign assets, as the foreign liabilities remained at the same level of the previous year.

The International Investment Position (IIP) Statement is a statement which summarizes the country's balance sheet showing the stock of external assets and liabilities of Malta with respect to the rest of the world at the end of a particular period.

Malta's total foreign assets abroad amounted to €45.11 billion as at the end of June 2011. The direct investment abroad accounted for €1.15 billion (2.55 per cent) of total foreign assets; portfolio investment €14.70 billion (32.59 per cent); financial derivatives €0.17 billion (0.37 per cent); other investments €28.72 billion (63.66 per cent); and reserve assets €0.37 billion (0.83 per cent).

The major cause in the decrease of Malta's IIP was caused by the decline in the portfolio and in the other investment accounts; these were mainly affected by a decrease of 3.39 per cent in debt securities and a decrease of 6.38 per cent in loans and currency and deposits respectively.

These accounts recorded a combined decline of €0.59 billion.

Malta's foreign liabilities retained the same level when compared to the previous year.

There was a rise of €0.49 billion (or 4.35 per cent) in the equity capital and reinvested earnings over the position as at the end of June 2010. This change was counter-balanced by a decrease of €0.43 billion (1.38 per cent) in loans and currency and deposits. Malta's total liabilities as at the end of June 2011, were estimated at €44.86 billion. The direct investment in Malta accounted for €12.38 billion or 27.60 per cent of total foreign liabilities; portfolio investment €0.49 billion (1.09 per cent); financial derivatives €0.22 billion (0.49 per cent); and other investment €31.76 billion (70.81 per cent).

The position of the foreign reserve assets at the end of June, standing at €0.37 billion, showed an increase €0.08 billion when compared to the position in June 2010.