Government involvement in the manufacturing industry

Abstract

In 1959, the Maltese Islands embarked on a planned programme of economic diversification with manufacturing industry as its main pillar. This had to be done owing to the fact that the revenue that Malta used to derive from its crucial strategic position was declining at a fast rate. Efforts had to be made in order to diversify the Maltese economy as it could not depend anymore on military service expenditure. Malta' s natural resources are few: natural harbour, good geographical position in the Mediterranean Sea, the skill of its population and its value as a tourist resort. Because of this, economic growth at the time of launching of the first five-year development plan (1959-1964) focused - on the development of the Dockyard, on industrial production and on the tourist industry. A total programme of £32 million of capital investment was provided by the government for the five-year period 1959 to 1964. £12 million were to be used in order to complete schemes while £4 million were to be put on the reserve.