National Accounts Estimates
December 2009
Highlights

Year 2009
GDP growth rate
1. On the basis of latest information gathered on various sectors of the economy, GDP growth is now revised to 2.8% slightly higher than the 2.7% growth forecasted in September 2009. This upward revision is mostly explained by higher growths in “Sugarcane/sugar milling” (21.1% instead of 18.2%),“Other agriculture” (8.0% instead of 5.0%), “Construction” (3.0% instead of 2.5%) and a less severe contraction in “Hotels and restaurants” (-6.4% instead of -8.8%), partly offset by growths of 0.0% instead of 1.0% in “Other manufacturing” and 5.0% instead of 5.9% in “Financial intermediation”. Exclusive of sugar, the growth rate worked out to 2.4%, compared to the forecast of 2.3% made in September 2009.
Consumption and Saving
2. Final consumption expenditure of households and Government grew by 2.5% in 2009, lower than the 6.0% growth in 2008. The final consumption expenditure of households grew by 2.1% and that of general government by 4.9% compared to growths 7.0% and 0.7% respectively in 2008. Saving rate defined as the ratio of GNS to GDP at market prices, decreased to 13.6% from 16.9% in 2008.
Investment
3. Investment grew by 6.1% in 2009 higher than the 3.6% growth in 2008. However, exclusive of aircraft and marine vessel, investment grew by 2.0% compared to 7.2% in 2008.
4. Investment rate, defined as the ratio of investment to GDP at market prices increased to 25.4% from 24.6% in 2008. Exclusive of aircraft and marine vessel, investment rate works out to 24.1% compared to 24.3% in 2008.
5. Private sector investment declined by 2.1% as opposed to a high growth of 9.7% registered in 2008, due to the completion of some big investment projects, (commercial and office buildings, new hotels and hotels renovation), partly mitigated by the start of some new ones (e.g. RES, hotel renovations and office buildings, and telecommunications infrastructure).
6. Public sector investment picked up by 45.8% in 2009 after a decline of 18.1% in 2008, mainly due to higher investment in public infrastructure projects such as roads, schools and the acquisition of aircraft. Exclusive of aircraft and marine vessel, public sector investment grew by 16.1% compared to 1.7% in 2008.
7. Private investment rate decreased to 19.4% from 20.4% in 2008 while public investment rate increased to 6.0% from 4.2%. Exclusive of aircraft and marine vessel, public investment rate was 4.7% compared to 4.2% in 2008.
8. The share of private sector investment decreased to 76.4% from 82.9% in 2008. That of the public sector increased to 23.6% from 17.1%. Exclusive of aircraft and marine vessel, the share of private sector investment in 2009 was 80.3%, slightly lower than the 2008 figure of 82.7%, and that of the public sector 19.7% compared to 17.3%.

Year 2010
9. On the basis of information gathered on the key sectors of the economy and taking into consideration measures announced in the last budget, GDP is expected to grow by around 4.3% in 2010, higher than the 2.8% growth in 2009. Exclusive of sugar, the growth rate would be around 4.4% compared to 2.4% in 2009. The main assumptions used are:
(i) Sugarcane/sugar milling: sugar production of around 480,000 tonnes, resulting in growth of 1.1% compared to 21.1% in 2009,
(ii) Manufacturing Industries: to expand by around 1.7% compared to 0.6% in 2009. Within the sector,
a. “Food processing” to grow by 3.0%, same as in 2009, assuming a good performance in “fish processing”,
b. A growth of 1.0% in “Textile”, assuming some recovery in the economies of our main markets, and
c. “Other manufacturing” to expand by 1.0% compared to no growth in 2009.
(iii) Construction: to grow at a higher rate of 8.0% as opposed to 3.0% in 2009 mainly due to the frontloading of public sector investment projects (road infrastructure, hospitals, airport, housing, schools, etc.) as announced in the last budget
(iv) Hotels and restaurants: a growth of around 5.0% based on a forecast of 900,000 tourist arrivals compared to 860,000 in 2009, assuming some recovery in our main markets and positive effects of the holding of the world football competition in the region,
(v) Transport, storage and communications: to grow by 6.0% slightly higher than the 5.3% growth in 2009, mostly due to expected better performances in air transport and tourism related activities.
(vi) Financial intermediation: to grow at a higher rate of 6.0%, compared to the 5.0% growth in 2009, due to expected pick up of the economy in 2010,
(vii) Business activities: to grow by 8.5% compared to 8.1% in 2009, explained by expected higher activities in ICT industry as well as in property development,
(viii) Other sectors: growth rates based on trends observed during the last quarters of 2009.

December 2009