The Times of Malta
Following my exit from formal politics, I lowered my profile and reduced substantially my media exposure. I had intended to keep it that way but circumstances force me to make an exception. On December18, 2003, Eurostat published revised figures of the GDP per capita of acceding countries to the EU following the uniform introduction in all acceding states of ESA95, being the international standards for compilation of such statistics.
Malta's GDP in Purchasing Power Parity units (PPS), using such ESA95 standard, came out at 71 per cent of EU15 GDP average in 1999, sliding down to 69 per cent in 2002. This compares to 67 per cent of Slovenia in 1999, increasing to 69 per cent in 2002. Cyprus is way ahead of the pack at 74 per cent of the EU GDP average in 1999, increasing to 76 per cent in 2002.
Such cold statistics could be quite meaningless if one does not understand their implications and consequences.
Objective One funding is only available to countries or regions with a GDP measured in PPS using ESA95 standards at less than 75 per cent of the GDP average. This would mean that come next EU budget negotiations for the period 2007-2013, Malta will go over the 75 per cent threshold which will be calculated on the basis of EU 25 and on current arrangements we will not qualify as a country region to Objective One funding.
I had made this argument in a series of contributions I had published in The Times in April/May 2001. What sparked off these contributions was MIC's assertion that on the then available data, Malta's GDP was 52 per cent of the EU 15 average and, therefore, we would qualify for Objective One funding for a long period of time, being well below the 75 per cent threshold. Funding was depicted as the most forceful reason why Malta should join the EU in membership.
In my contributions, I had warned that our statistics were drawn up on outdated methodology and that when we will re-state our statistics using modern standards we will come very close to the EU average.
Quoting specifically from articles titled "MI(C)srepresentation" (April 4 and 5, 2001), I had argued: "What this means in practice is that the figure of 52 per cent of GDP average being widely banded about by EU enthusiasts to support their claim for EU funding upon accession will not stand up when it matters. When, sooner or later, our statistical methods are updated to Eurostat standards for consistent conversion of the nominal GDP in Euro into GDP in PPS units, which is used to establish our GDP as an average of the whole EU, the figure will look very different.
"When Malta will eventually bring its statistical standards in line with Eurostat's standard for PPS measurement, the conversion factor should be more or less that of Slovenia which is on parity with us on nominal GDP/ capita.
"If this conversion factor is applied to Malta's GDP for 1999 our EU average would be 72 per cent, on the same level with Slovenia. And if this measure is extended as a measure of the EU average not purely on the present 15 members but on the average of an enlarged EU, including the 10 east European candidates (Malta and Cyprus are too small to make any statistical difference), our GDP would be 82 per cent of the enlarged EU average.
"This is way out of the 75 per cent criterion for Objective One funding. Furthermore, one has to be realistic and take account of the probability that an enlarged EU which Malta would eventually be offered to join would have much greater demands for regional funding. To fit within budgets the criterion for accessing Objective One funding could well be reduced from the present 75 per cent level when the budget beyond 2006 gets negotiated."
I had strongly criticised MIC for making assertions without making sufficient caution warnings on the inadequacy of our statistical regime - a caution specifically made in the Eurostat publications on which MIC were basing their assertions.
Specifically, Eurostat had warned that: "Malta however is using a dated system established in 1954 with some elements of SNA 1968. The statistics in this publication should therefore be interpreted with an appropriate level of caution - full comparability with EU states cannot yet be guaranteed".
My warnings had given rise to wild reactions from MIC, (then) Minister Josef Bonnici and from the prime minister himself. MIC had accused me of persecution and Prof. Bonnici had argued that I am exposing a wish for Malta to be denied the EU funding due to it (still unanswered -The Times, May 14, 2001).
Both had argued that when our statistical methods are updated, no major changes from the 52 per cent of EU average should be expected. MIC had said specifically (The Times, April 6, 2001): "Once Malta's conversion to ESA is complete, there are no dramatic changes, whether downwards or upwards, that can be expected to its GDP statistics and certainly no changes that will effect Malta's eligibility for EU funding as an Objective One region".
I had retorted that "Perhaps we should let time to unfold and be the best judge. Let's leave the final say to the test of time. Let's become EU members if we so collectively decide. But let's not allow such decision be taken on the basis of half truths and untruths about funding bonanza".
Time has now spoken. It is my best friend. It is an unerring judge as to who makes objective analysis and who just interprets data whichever way it suits him.
And lest I be misunderstood, I repeat what I had written in The Times on May 29, 2001 (What funding?): "For all the reasons that can be brought forward as to why we should join the EU, funding ought not be one of them. Which is not the same as saying that the argument should stop there".
Following my exit from formal politics, I lowered my profile and reduced substantially my media exposure. I had intended to keep it that way but circumstances force me to make an exception. On December18, 2003, Eurostat published revised figures of the GDP per capita of acceding countries to the EU following the uniform introduction in all acceding states of ESA95, being the international standards for compilation of such statistics.
Malta's GDP in Purchasing Power Parity units (PPS), using such ESA95 standard, came out at 71 per cent of EU15 GDP average in 1999, sliding down to 69 per cent in 2002. This compares to 67 per cent of Slovenia in 1999, increasing to 69 per cent in 2002. Cyprus is way ahead of the pack at 74 per cent of the EU GDP average in 1999, increasing to 76 per cent in 2002.
Such cold statistics could be quite meaningless if one does not understand their implications and consequences.
Objective One funding is only available to countries or regions with a GDP measured in PPS using ESA95 standards at less than 75 per cent of the GDP average. This would mean that come next EU budget negotiations for the period 2007-2013, Malta will go over the 75 per cent threshold which will be calculated on the basis of EU 25 and on current arrangements we will not qualify as a country region to Objective One funding.
I had made this argument in a series of contributions I had published in The Times in April/May 2001. What sparked off these contributions was MIC's assertion that on the then available data, Malta's GDP was 52 per cent of the EU 15 average and, therefore, we would qualify for Objective One funding for a long period of time, being well below the 75 per cent threshold. Funding was depicted as the most forceful reason why Malta should join the EU in membership.
In my contributions, I had warned that our statistics were drawn up on outdated methodology and that when we will re-state our statistics using modern standards we will come very close to the EU average.
Quoting specifically from articles titled "MI(C)srepresentation" (April 4 and 5, 2001), I had argued: "What this means in practice is that the figure of 52 per cent of GDP average being widely banded about by EU enthusiasts to support their claim for EU funding upon accession will not stand up when it matters. When, sooner or later, our statistical methods are updated to Eurostat standards for consistent conversion of the nominal GDP in Euro into GDP in PPS units, which is used to establish our GDP as an average of the whole EU, the figure will look very different.
"When Malta will eventually bring its statistical standards in line with Eurostat's standard for PPS measurement, the conversion factor should be more or less that of Slovenia which is on parity with us on nominal GDP/ capita.
"If this conversion factor is applied to Malta's GDP for 1999 our EU average would be 72 per cent, on the same level with Slovenia. And if this measure is extended as a measure of the EU average not purely on the present 15 members but on the average of an enlarged EU, including the 10 east European candidates (Malta and Cyprus are too small to make any statistical difference), our GDP would be 82 per cent of the enlarged EU average.
"This is way out of the 75 per cent criterion for Objective One funding. Furthermore, one has to be realistic and take account of the probability that an enlarged EU which Malta would eventually be offered to join would have much greater demands for regional funding. To fit within budgets the criterion for accessing Objective One funding could well be reduced from the present 75 per cent level when the budget beyond 2006 gets negotiated."
I had strongly criticised MIC for making assertions without making sufficient caution warnings on the inadequacy of our statistical regime - a caution specifically made in the Eurostat publications on which MIC were basing their assertions.
Specifically, Eurostat had warned that: "Malta however is using a dated system established in 1954 with some elements of SNA 1968. The statistics in this publication should therefore be interpreted with an appropriate level of caution - full comparability with EU states cannot yet be guaranteed".
My warnings had given rise to wild reactions from MIC, (then) Minister Josef Bonnici and from the prime minister himself. MIC had accused me of persecution and Prof. Bonnici had argued that I am exposing a wish for Malta to be denied the EU funding due to it (still unanswered -The Times, May 14, 2001).
Both had argued that when our statistical methods are updated, no major changes from the 52 per cent of EU average should be expected. MIC had said specifically (The Times, April 6, 2001): "Once Malta's conversion to ESA is complete, there are no dramatic changes, whether downwards or upwards, that can be expected to its GDP statistics and certainly no changes that will effect Malta's eligibility for EU funding as an Objective One region".
I had retorted that "Perhaps we should let time to unfold and be the best judge. Let's leave the final say to the test of time. Let's become EU members if we so collectively decide. But let's not allow such decision be taken on the basis of half truths and untruths about funding bonanza".
Time has now spoken. It is my best friend. It is an unerring judge as to who makes objective analysis and who just interprets data whichever way it suits him.
And lest I be misunderstood, I repeat what I had written in The Times on May 29, 2001 (What funding?): "For all the reasons that can be brought forward as to why we should join the EU, funding ought not be one of them. Which is not the same as saying that the argument should stop there".
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