The role of commercial banks in new manufacturing industries

Abstract

In the early nineteen fifties, the British Government intimated that the retention of Malta as a strategic services base did not remain as important as it was in the post. This led to a turning point in Malta's economic history and in 1958 real sound planning for the economic future of the Maltese Islands started for the first time. Up to this time, for a century and a half, Malta's economic pattern had undergone little change. No serious steps to industrialise Malta were taken until 1959, with the result that local entrepreneurs found no encouragement and little scope to enter the field of production and industry. The calI upon the, banker to provide credit facilities to the Industrial Sector"' remained invariably on a very small scale and the banks were Provided with no alternative but to invest the major part of deposits abroad. The first Five Year Development Plan was launched in 1959, designed to stimulate industrial growth and promote full employment, A radical change in the economic structure of Malta was planned for the first time. At the end of the five year period it was however realised that some of the targets remained out of reach. This led to the second Development Plan (1964-1969) which had the Stolper Report as its basis. It had more economic feasibility than its predecessor and it provided for the necessary machinery to carry out its aims the Central Bank of Malta and the Malta Development Corporation both of which proved to be successfully established. These two Developments spearheaded the development of tourism and industry.