Finance Minister Prof. Edward Scicluna explains that, much like fortifications and towers built on high ground give those inside a view of incoming enemies or allies, so do leading indicators in economics and statistics enable economists to make informed predictions as to future trends.

Prof. Scicluna explains that one such leading indicator, published by the National Statistics Office (NSO) some days ago, is the importation of Capital or Investment Goods, which contribute significantly to the Malta’s economic growth.

The Finance Minister notes that statistics published by NSO show that, with one exception, importation of Investment Goods have been in decline for eight consecutive quarters — from the end of 2011 to the middle of 2013. He notes that this is thanks to the new Government’s change in economic policy direction.

Prof. Scicluna explains that such indicators would not be reflected in the country’s Gross Domestic Product, given that the GDP concerns itself with the past, but is an indicator for the country’s future economic performance.

He explains that given how economic growth depends considerably on investment, this leading indicator gives an indication that investment, both by the private sector and by government, is strong, and that consequently, we can expect favourable economic growth.

– Monday, 10th February 2014