Home » Annual non-financial Accounts by Institutional Sectors: 1995-2023
The national accounts series by institutional sector presented here provides a new insight on the structure of the Maltese economy. This release is a first in the series and presents the full sequence of non-financial accounts from 1995 to 2023. The series presented in this news release is consistent with the national accounts main aggregates as published on 28 August 2024 and government finance statistics as published on 22 October 2024.
The non-financial accounts by institutional sector describe the results achieved by non-financial (S11) and financial (S12) corporations, general government (S13), households (S14), and non-profit institutions serving households (S15) in the different phases of the economic process. The behaviour of resident operators is described starting from the generation of income resulting directly from the production process and its distribution between the factors of production (labour, capital) and general government (via taxes on production and imports, and subsidies). It enables the operating surplus (or mixed income in the case of households) and primary income to be determined. We then present the effects produced by the redistributive policies implemented by the public sector and by other private sectors (resident or otherwise), thus managing to measure the resources that economic operators have available for their consumption or investment in tangible and/or financial assets through savings.
If the savings are not sufficient to finance the investment, debt is created through external financing. On the contrary, a surplus of available resources compared to spending needs indicates a financing capacity. Chart 1 provides an overview of the net lending and borrowing by institutional sectors since 1995.
Annual Non-Financial Accounts for the Institutional Sectors 2023
The national economy recorded a net lending compared with the rest of the world of €1,235 million in 2023, which represents 6.0 per cent of the GDP of the said period. This is an improvement compared to 2022, when the economy registered a net borrowing of €102 million (-0.6 per cent of GDP).
This increase is explained by a higher balance of foreign trade in goods and services (€3,733 million, compared to €2,458 million in 2022). With an increase of €5 million, the evolution of primary and secondary income transactions had a much smaller impact on the current account balance. Furthermore, the balance of capital transfers stood at €230 million, compared to €182 million in 2022 (Table 1).
A more detailed representation of the national economy is available in Table 3 while the detailed breakdown of the rest of the world is available in Table 10.
The increase in net lending can be attributed mainly to the non-financial corporations which experienced a higher net balance of property income and in secondary income flows (disposable income, gross) of €208 million and a drop in gross capital formation of €779 million leading to a significant increase in net lending (Table 2).
Table 2 presents the contribution of each institutional sector to the net lending of the national economy presented in Table 1.
Dynamics in economic growth
In 2023, the value added at current prices generated by the national economy (valued at basic prices) marked a growth of 13.4 per cent compared to the previous year.
Positive dynamics were recorded in all institutional sectors. In particular, the growth in the economy was led by the non-financial corporate sector, whose value added increased by 10.1 per cent (+12.0 per cent in 2022), contributing 6.6 percentage points to the overall trend in 2023. The value added of financial corporations increased by 29.3 per cent (+4.8 per cent in 2022), contributing 2.3 percentage points to the overall trend in 2023. After a long period of low interest rates in the euro area, the European Central Bank increased its policy rate starting in July 2022. This had a direct impact on the derivation of financial intermediation services indirectly measured (FISIM) output of financial corporations, which increased strongly since the third quarter of 2022 reaching a peak in 2023. FISIM is a main contributor to value added and gross operating surplus of financial corporations.
The household sector which includes unincorporated enterprises and self-employed workers, recorded a growth in value added of €611 million or 28.0 per cent (+11.3 per cent in 2022), which translated into a contribution of 3.6 percentage points to the overall growth of 2023. This increase is partly attributable to a drop in intermediate consumption related to FISIM of owner-occupied dwellings of €208 million in 2023.
Finally, the value added generated by the activity of general government increased by 6.6 per cent compared to the previous year (+5.0 per cent in 2022).
Non-financial corporations
Gross value added generated by non-financial corporations increased by 10.1 per cent in 2023 as compared to 2022 and the gross operating surplus by 9.6 per cent. The share of the sector’s gross operating surplus in its value added stood at 61.4 per cent almost at par to the previous year. The share of the sector’s compensation of employees in the economy stood at 61.2 per cent.
If we add the net balance of property income (interest, dividends, etc.) to the gross operating surplus of the sector, we derive the balance of gross primary income, which increased by 4.3 per cent with respect to the previous year.
As a consequence of the above, and the evolution of the flows in the secondary income distribution account (corporate taxes, social contributions and benefits and other current transfers), the disposable income of non-financial corporations increased by 5.8 per cent.
As in previous years, this disposable income, together with the capital transfer balance, was sufficient to finance investment (Table 4).
In turn, the investment rate of non-financial corporations stood at 16.7 per cent of their gross value added, 8.8 points lower than in the previous year. The non-financial corporations’ self-investment ratio, which is derived by taking the sector’s gross saving and dividing it by their gross fixed capital formation stood at 2.0 in 2023, compared to the average of 1.4 in the previous 5 years (Table 11).
As a result, a net lending of €1,768 million is estimated for the sector, compared with €674 million in 2022 (Table 4).
Percentage over Gross Value Added
No Data Found
Financial corporations
Gross value added of financial corporations increased by 29.3 per cent in 2023 compared to the previous year. The gross operating surplus of the sector increased by 46.1 per cent. The share of the sector’s compensation of employees in the economy stood at 9.9 per cent.
This, together with a lower net balance of property income (interests, dividends, etc.) received by the sector, caused the balance of primary income to increase by 59.6 per cent.
If we also consider the flows in the secondary income distribution account (corporate income tax, social security contributions and benefits and other current transfers), the sector’s gross disposable income was estimated at €146 million.
Gross capital formation by financial corporations amounted to €379 million, an increase compared to the previous year when it was estimated at €349 million.
With this, and considering the balance of capital transfers, the sector generated a net borrowing of €311 million, compared to €501 million in 2022 (Table 5).
General government
Gross value added of general government increased by 6.6 per cent in 2023 compared to the previous year. The share of the sector’s compensation of employees in the economy stood at 24.2 per cent.
The gross disposable income for the general government reached €3,292 million in 2023, 19.7 per cent more than the previous year.
Final consumption expenditure increased by 7.8 per cent, up to €3,422 million. With this, the sector’s gross savings amounted to -€129 million, registering an improvement compared to the previous year when it stood at -€424 million.
Investment by the general government sector was estimated at €709 million, with an increase of 21.3 per cent as compared to the previous year. Savings and investment in the sector, together with the balance of capital transfers, led the sector to generate net borrowing of €939 million, an improvement compared to the net borrowing of €954 million in 2022 (Table 6).
No Data Found
Households
The households sector includes individuals or groups of individuals whose principal function is consumption, and that produce goods and non-financial services for exclusively own final use. Own final use relates to services of owner-occupied dwellings and domestic services produced by paid employees. The household sector also includes sole proprietorships and partnerships without legal status, other than those treated as quasi-corporations, and which are market producers.
The gross value added generated by the household sector increased by 28.0 per cent in 2023 compared to the previous year. Due to the impact of FISIM, the value added of owner-occupied dwellings increased by 92.8 per cent. On the other hand, the growth generated by unincorporated enterprises stood at 16.2 per cent. Similarly, operating surplus increased by 92.8 per cent, while mixed income which represents the income from self-employment increased by 14.2 per cent. The share of the sector’s compensation of employees in the economy stood at 4.5 per cent.
Considering the increase in compensations receivable by employees (+8.4 per cent) and the evolution of the net balance of property income received by the sector (interests, dividends, etc.), an increase of 15.5 per cent was registered in the gross balance of primary income (Table 7).
Likewise, considering the combined performance of secondary income distribution flows (income and wealth tax, social contributions and social benefits and other current transfers), in 2023 the gross disposable income of households grew by 16.0 per cent, to €10,431 million. Household final consumption expenditure was estimated at €9,199 million, with an increase of 18.3 per cent compared to the previous year. As a result, savings in the sector amounted to €1,238 million (€1,222 million in 2022) (Table 7). The household savings rate stood at 11.9 per cent (Table 11) of gross disposable income, compared to 13.6 per cent in the previous year. Savings in 2020 and 2021 were higher due to a slowdown in household final consumption expenditure during the pandemic. Households’ gross disposable income per head increased by 11.4 per cent in 2023, compared to 4.6 per cent in 2022 at current prices. On the other hand, real households’ gross disposable income per head increased by 5.0 per cent in 2023 compared to the drop of 0.7 per cent in 2022 (Table 11).
Household investment reached €905 million in 2023 compared to €837 million in the previous year. In turn, the investment rate of households, stood at 8.7 per cent of their gross disposable income, 0.6 percentage points lower than the previous year.
After considering the balance of capital transfers in the sector, households recorded a net lending of €747 million compared to the €694 million estimated in 2022 (Table 7).
Percentage over Gross Disposable Income