Malta's gross domestic product (GDP) for the second quarter of 2020 fell by just under 15% when compared to the same period last year, according to provisional estimates published by the National Statistics Office.
GDP amounted to €2,825.2 million during that period, a decrease of €494.3 million or 14.9% over the same period in 2019.
In volume terms, GDP fell by 16.2%.
The April-June period was characterised by a widespread economic slowdown caused by restrictions to limit the spread of the COVID-19 pandemic.
The NSO figures detailing the GDP decline were published on the same day that official data on government finances indicated a steep rise of more than €900m in the public deficit between January and June, with government spending up and revenues down.
The production approach
During the second quarter of 2020, gross value added (GVA) fell by 13.8% in nominal terms and 15.1% in volume terms, when compared to the same quarter last year.
GVA fell significantly in the second quarter, with widespread contractions across all main sectors of the economy.
The drop in services was mainly driven by declines in the accommodation and food service activities which, in volume terms fell by 100.2%, transportation and storage with a decrease of 58.2%, wholesale and retail trade, repair of motor vehicles and motorcycles which contracted by 18.6%, and professional, scientific and technical activities which declined by 13%.
Services, which contributed positively to GVA, included information and communication, financial and insurance activities and arts, entertainment and recreation activities.
The decline in industry was mainly driven by manufacturing, which fell by 10.5%.
Net taxes on products contributed negatively towards GDP growth with a decline of 25.8% in volume terms.
The expenditure approach
During the second quarter of 2020, total final consumption expenditure witnessed an annual drop of 10.2% in nominal terms and 11.8% in volume terms.
This was the result of a decrease in household expenditure of 22.3%, which was partly offset by an increase in the expenditure of non-profit institutions serving households of 47% and a rise in government expenditure of 11.9% in volume terms.
Gross fixed capital formation (GFCF) declined by 10.1% % in nominal terms and 11% in volume terms.
The drop in GFCF was mainly triggered by a decrease of 22.3% in dwellings, a reduction of 15.5% in machinery and equipment and a contraction of 11.4% in other buildings and structures in volume terms.
Exports of goods and services fell by 11.9% in nominal terms and 12.8% in volume terms. Moreover, imports of goods and services declined by 7% in nominal terms and 7.9% in volume terms.
The income approach
Compared to the second quarter of 2019, the €494.3 million decrease in GDP in nominal terms was primarily a result of a €315 million decrease in gross operating surplus and mixed-income and a drop of €234.4 million in net taxation on production and imports.
Gross National Income (GNI)
Considering the effects of income and taxation paid and received by residents to and from the rest of the world, GNI at market prices for the second quarter of 2020 was estimated at €2,523 million.