Malta

The Republic of Malta is a small and densely-populated island nation in southern Europe. It consists of an archipelago in the middle of the Mediterranean Sea directly south of Italy and north of Africa. These strategically-located islands have been ruled and fought over by various powers over the centuries.

Economic history

Until 1800, Malta had very few industries except the cotton, tobacco, and shipyards industry. The dockyard was later used by the British for military purposes. At times of war, Malta's economy prospered due to its strategic location.

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During the Napoleonic Wars (1800–1815), Malta's economy prospered and became the focal point of a major trading system. In 1808, two-thirds of the cargo consigned from Malta went to Levant and Egypt. Later, one-half of the cargo was usually destined for Trieste. Cargo consisted of largely British and colonial-manufactured goods. Malta's economy became prosperous from this trade and many artisans, such as weavers, found new jobs in the port industry.

Related Topics:
Napoleonic Wars - Levant - Egypt - Trieste

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In 1820, during the Battle of Navarino, which took place in Greece, the British fleet was based in Malta. In 1839, the Pacific and Orient and East India Companies used Malta as a calling port on their Egypt and Levant runs.

Related Topics:
Battle of Navarino - Pacific and Orient - East India Companies

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In 1869, the opening of the Suez Canal benefited Malta's economy greatly as there was a massive increase in the shipping which entered in the port. The economy had entered a special phase. The Mediterranean became the "world highway of trade" and a number of ships called at Malta for coal and various supplies on their way to the Indian Ocean and the Far East.

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From 1871 to 1881, about 8,000 workers found jobs in the Malta docks and a number of banks opened in Malta. By 1882, Malta reached the height of its prosperity.

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However, the boom did not last long. By the end of the 19th century, the economy began declining and by the 1940s, Malta's economy was in serious crisis. This was primarily due to the invention of large ships which had become oil-fired and therefore had no need to stop in the Grand Harbour of Malta to refuel. The British Government had to extend the dockyard.

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At the end of World War II, Malta's strategic importance had reached a low point. Modern air warfare technology and the invention of the atomic bomb had changed the importance of the military base. The British lost control of the Suez Canal and withdrew from the naval dockyard, transforming it for commercial shipbuilding and ship repair purposes.

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