Malta and the EU: Membership and non-membership: Costs and benefits

Summary:

The objective of this report is to gauge and provide a detailed analysis of the economic implications of EU membership for Malta. The issue of membership should be considered within the ongoing international and regional integration process. Malta cannot prosper in isolation. Having established that close ties with Europe are a natural fit for Malta, the report examines the most important features of European integration and its successive phases of restructuring, adaptation and development.

The report also provides an analysis of the development of the Maltese economy over the past decade and looks at the key challenges poised by EU membership. It provides an overview of all the impact studies undertaken by other local institutions and authors in Malta. It also presents an overview of the accession package negotiated between Malta and the EU. Simulation results, which also take account of the EU financial package, show that the overall impact of EU membership would be positive on the Maltese economy in the medium to long term. The real GDP would grow by an additional 5.9 percent, which is equivalent to an additional Lm 95 million of value added every single year. In the non-membership scenario, the overall impact would be slightly negative on the real GDP.