‘PN gets it wrong on foreign direct investment’ – Labour

The Opposition has once again misinterpreted statistics issued by the National Statistics Office, this time claiming that foreign investment dropped by 64%, the Labour Party said in a statement.

“In its umpteenth attempt to issue negative statements against the government, the Nationalist Party falsely interpreted the statistics,” Labour said.

Official data released by the NSO on Thursday showed a €2.7 million drop – 64% – in manufacturing, financial services, professional, technical activities and other activities.

The NSO also said that there was a net increase €1.5 billion in Foreign Direct Investment flows. As at June 2014, Foreign Direct Investment in Malta was estimated at €136.8 billion, with 97.9% originating from financial and insurance activities, which now include special purpose entities.

“This amounts to an increase of €5.6 billion over the corresponding month in 2013,” the NSO said.

FDI in Malta as at the end of June 2014 stood at €136 billion, with 97.9% originating from financial and insurance activities, an increase of €5.6 billion over the corresponding month in 2013.
While the flow of FDI decreased from €4.1 billion in the first quarter of 2013 to €1.4 billion in the first quarter of 2014, mainly the result of decreases in equity capital, total FDI grew over June 2013 by €5.4 billion.

“This data casts doubt on the government’s claim that the country is managing to attract a record amount of foreign direct investment and requires an explanation from government on the cause of the drop registered in foreign direct investment in 2014 and whether such drop is of concern to government,” the PN said, citing a recent EY survey amongst investors pointing towards a declining appetite for new investment.

According to the Labour Party, the Opposition “amateurishly” carried a quarterly comparison of the financial entities’ activities when “these companies do transactions to and fro Malta but barely have a local presence in terms of jobs”.

“The data quoted by the Opposition does not include foreign direct investment in terms of construction of new factories or companies. Reality is that there was a substantial increase in investment during the first half of 2014.”

The PL said that while in six months Malta attracted €19 million in FDI flow, €51 million had been lost during the same period under the previous administration.

The party said that the value of assets held by foreign investors in Malta increased by €131 million.

In a separate statement, the government said Malta Enterprise helped over 100 investors who in total took €46.5 million in tax credits while SMEs received €7 million in fiscal aid.