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U.S. Department of State Background Note

Malta

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Malta

PEOPLE

Malta was an important cultic center for earth-mother worship in the 4th millennium B.C. Archeological work shows a developed religious center there long before those of Sumer and Egypt. Malta's written history began well before the Christian era. The Phoenicians, and later the Carthaginians, established ports and trading settlements on the island. During the second Punic War (218 B.C.), Malta became part of the Roman Empire. During Roman rule, in A.D. 60, Saint Paul was shipwrecked on Malta at a place now called St. Paul's Bay.

In 533 A.D. Malta became part of the Byzantine Empire and in 870 came under Arab control. Arab occupation and rule left a strong imprint on Maltese life, customs, and language. The Arabs were driven out in 1090 by a band of Norman adventurers under Count Roger of Normandy, who had established a kingdom in southern Italy and Sicily. Malta thus became an appendage of Sicily for 440 years. During this period, Malta was sold and resold to various feudal lords and barons and was dominated successively by the rulers of Swabia, Aquitaine, Aragon, Castile, and Spain.

In 1522 Suleiman II drove the Knights of St. John out of Rhodes. They dispersed to their commanderies in Europe and after repeated requests for territory to Charles V, in 1530 the Knights were given sovereignty of Malta under the suzerainty of the Kings of Sicily. In 1523, a key date in Maltese history, the islands were ceded by Charles V of Spain to the Order of the Knights of St. John of Jerusalem. For the next 275 years, these famous "Knights of Malta" made the island their domain. They built towns, palaces, churches, gardens, and fortifications and embellished the island with numerous works of art and enhanced cultural heritage. In 1565 Suleiman the Magnificent laid siege to Malta. After several months the strength of the Knights and the Maltese population prevailed and the Turks were defeated. Over the years, the power of the Knights declined, however, and their rule of Malta ended with their peaceful surrender to Napoleon in 1798.

The people of Malta rose against French rule, which lasted two years, and with the help of the British evicted them in 1800. In 1814, Malta voluntarily became part of the British Empire. Under the United Kingdom, the island became a military and naval fortress, the headquarters of the British Mediterranean fleet. During World War II, Malta survived relentless raids from German and Italian military forces (1940-43). In recognition, King George VI in 1942 awarded the George Cross "to the island fortress of Malta--its people and defenders." President Franklin Roosevelt, describing the wartime period, called Malta "one tiny bright flame in the darkness." In September 1943, the Italian fleet’s surrender in Malta was signed by U.S. General Dwight Eisenhower and Italian Marshal Pietro Badoglio. Victory Day, celebrated on September 8, commemorates victory in the 1565 Great Siege, and the end of the WWII attacks in Malta. Malta obtained independence on September 21, 1964, became a Republic on December 13, 1974, and a member of the European Union on May 1, 2004. The last British forces left in March 1979.

GOVERNMENT

President--Eddie Fenech Adami
Prime Minister--Lawrence Gonzi
Minister of Foreign Affairs--Michael Frendo
Ambassador to the United States--John Lowell
Ambassador to the United Nations--Victor Camilleri

Malta maintains an embassy in the United States at 2017 Connecticut Avenue NW, Washington, DC 20008 (202-462-3611).

POLITICAL CONDITIONS

Possessing few indigenous raw materials and a very small domestic market, Malta has based its economic development on the promotion of tourism, accounting for roughly 30% of GDP, and exports of manufactured goods, mainly semi-conductors, which account for some 75% of total Maltese exports. Since the beginning of the 1990s, expansion in these activities has been the principal engine for strong growth in the Maltese economy.

Tourist arrivals and foreign exchange earnings derived from tourism have steadily increased since the late 1970s. Following the September 11 attacks, the tourist industry has suffered some setbacks worldwide. Maltese tourist arrivals fell by 8% since 2000. At the same time, the bursting of the high tech bubble dampened exports and private investments.

Despite these adverse developments, the relatively flexible labor markets kept unemployment fairly steady at 7.2% (Labor Force Survey Jan - Dec 2005). The economy improved by a modest 0.2% in 2004 in real terms.

The recent low economic growth coupled with corporate bond preference by the private sector has contributed to a weak demand for bank loans. Combined with the strong growth in deposits in the past couple of years, this has led to a rapid buildup of liquidity in the banking system and pressures to reduce interest rates that are fully liberalized. The banking system remains highly concentrated with two of the four local banks accounting for about 90% of total loans and deposits.

The Maltese Government has pursued a policy of gradual economic liberalization, taking some steps to shift the emphasis in trade and financial policies from reliance on direct government intervention and control to policy regimes that allow a greater role for market mechanisms. Malta’s accession into the EU marked the total dismantling of protective import levies on industrial products, increasing the outward orientation of the economy. The Maltese Lira is pegged to the euro. Malta hopes to join the Euro zone in 2008.

The fiscal situation remains difficult despite some progress in consolidating public finances. The budget deficit was brought down from 10.7% of GDP in 1998 to 9.7% of GDP in 2003 (still high by EU standards), mainly through increases in tax rates and improved collection of taxes due. Current expenditures were reduced in the late 1990s but have crawled back up. The public sector wage bill and subsidies to public enterprises were mainly responsible for this increase. Substantial privatization proceeds have limited the increase in public debt, which grew from 24% of GDP in 1990 to almost 72.01% in 2003.

FOREIGN RELATIONS

Malta’s diplomatic and consular representation includes accreditation to 143 foreign countries and international organizations. Malta is host to 20 resident diplomatic missions, and 118 countries have non-resident diplomatic representation.

With its central location in the Mediterranean, Malta has long portrayed itself as a bridge between Europe and North Africa, particularly Libya, with whom it has enjoyed positive diplomatic and commercial ties. Malta is one of the southernmost points of the European Union. Malta continues to be an active participant in the United Nations, the Commonwealth, the Council of Europe, OSCE, and various other international organizations. In these fora, Malta has frequently expressed its concern for the peace and economic development of the Mediterranean region. The Nationalist Party government is continuing a policy of neutrality and nonalignment but in a Western context. The government desires close relations with the United States, with an emphasis on increased trade and private investment. U.S. Navy ships resumed liberty calls in 1992 and currently visit on a regular basis.

U.S.-MALTESE RELATIONS

Principal U.S. Embassy Officials
Ambassador-- Molly Bordonaro
Deputy Chief of Mission--William Grant
Consul General--Michael Troje
Public Affairs Officer-Jeff Anderson
Political-Economic-Commercial Officer--Monica Cummings
Information Management Officer--Bruce MacEwen
Management Officer--Jonathan Schools
Regional Security Officer--Jonathan Kazmar
General Services Officer--Joseph Runyon
Defense Attache--Philip Munaco
Community Liaison Officer--Lisa Hamlin

The U.S. embassy in Malta is located in Development House, St. Anne Street, Floriana; tel: (356) 2561-4000; fax: (356) 2124-3229; web page: http://malta.usembassy.gov/

TRAVEL AND BUSINESS INFORMATION
The U.S. Department of State's Consular Information Program advises Americans traveling and residing abroad through Consular Information Sheets, Public Announcements, and Travel Warnings. Consular Information Sheets exist for all countries and include information on entry and exit requirements, currency regulations, health conditions, safety and security, crime, political disturbances, and the addresses of the U.S. embassies and consulates abroad. Public Announcements are issued to disseminate information quickly about terrorist threats and other relatively short-term conditions overseas that pose significant risks to the security of American travelers. Travel Warnings are issued when the State Department recommends that Americans avoid travel to a certain country because the situation is dangerous or unstable.

For the latest security information, Americans living and traveling abroad should regularly monitor the Department's Bureau of Consular Affairs Internet web site at http://www.travel.state.gov, where the current Worldwide Caution, Public Announcements, and Travel Warnings can be found. Consular Affairs Publications, which contain information on obtaining passports and planning a safe trip abroad, are also available at http://www.travel.state.gov. For additional information on international travel, see http://www.usa.gov/Citizen/Topics/Travel/International.shtml.

The Department of State encourages all U.S citizens traveling or residing abroad to register via the State Department's travel registration website or at the nearest U.S. embassy or consulate abroad. Registration will make your presence and whereabouts known in case it is necessary to contact you in an emergency and will enable you to receive up-to-date information on security conditions.

Emergency information concerning Americans traveling abroad may be obtained by calling 1-888-407-4747 toll free in the U.S. and Canada or the regular toll line 1-202-501-4444 for callers outside the U.S. and Canada.

The National Passport Information Center (NPIC) is the U.S. Department of State's single, centralized public contact center for U.S. passport information. Telephone: 1-877-4USA-PPT (1-877-487-2778). Customer service representatives and operators for TDD/TTY are available Monday-Friday, 7:00 a.m. to 12:00 midnight, Eastern Time, excluding federal holidays.

Travelers can check the latest health information with the U.S. Centers for Disease Control and Prevention in Atlanta, Georgia. A hotline at 877-FYI-TRIP (877-394-8747) and a web site at http://www.cdc.gov/travel/index.htm give the most recent health advisories, immunization recommendations or requirements, and advice on food and drinking water safety for regions and countries. A booklet entitled "Health Information for International Travel" (HHS publication number CDC-95-8280) is available from the U.S. Government Printing Office, Washington, DC 20402, tel. (202) 512-1800.

Further Electronic Information
Department of State Web Site. Available on the Internet at http://www.state.gov, the Department of State web site provides timely, global access to official U.S. foreign policy information, including Background Notes and daily press briefings along with the directory of key officers of Foreign Service posts and more. The Overseas Security Advisory Council (OSAC) provides security information and regional news that impact U.S. companies working abroad through its website http://www.osac.gov

Export.gov provides a portal to all export-related assistance and market information offered by the federal government and provides trade leads, free export counseling, help with the export process, and more.

STAT-USA/Internet, a service of the U.S. Department of Commerce, provides authoritative economic, business, and international trade information from the Federal government. The site includes current and historical trade-related releases, international market research, trade opportunities, and country analysis and provides access to the National Trade Data Bank.

Revised: Apr. 2007

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