It can be estimated, but not observed. The Central Bank devotes much effort to estimating Malta’s potential output growth and its underlying determinants. Growth in potential output can be largely ascribed to structural reform measures that bring about changes in the factors of production, namely labour and capital, and the way they are combined, or productivity. We estimate that the potential growth rate of the Maltese economy has more than doubled from below 2% at the time of the global financial crisis to over 4% today. This partly reflects a steady increase in the labour supply, coming from higher female participation in the work force, measures to increase the effective retirement age and the influx of foreign workers, mainly from EU countries. Apart from the increase in labour  supply, the quality of human capital has also improved. At the same time, a pick-up in investment, partly driven by developments in the energy sector, has boosted the capital stock. However, there is ample scope for improvement of labour productivity in the coming years. Indeed it is critical that it must improve. A sound and stable financial system is an essential pre-condition for strong and sustainable economic performance. The performance of the domestic financial system, especially the core domestic banks, which have the strongest linkages to the domestic economy, remained sound with strong capital ratios, high liquidity and remained very profitable despite the challenges of a prolonged low interest rate environment.
W A Wijewardena: The role of statistics and challenges for statisticians Keynote address by Mr W A Wijewardena, Deputy Governor of the Central Bank of Sri Lanka, at the Stat Day, organized by University of Colombo, Colombo, 26 March 2009. *  *  *  Consciously or unconsciously, we use statistics in everything we do in our day to day life. When we say that it rained yesterday, we simply pronounce a fact we have observed as having happened. When we say that it is raining now, we again mention something that we have observed as happening. When we say that it will rain tomorrow, we are predicting a future event. Our life is full of such statements: facts that have been experienced by us in the past, facts that are happening now and being experienced in the present and facts that we feel would happen in the future. What has happened and is happening now are our personal experiences. What will happen are our learned judgements based on our experiences. If we keep these experiences and learned judgments to ourselves, then, it would not form the subject matter of statistics. It becomes statistics only when we share them with others. Hence, statistics is basically, observing, analysing, learning and sharing facts about the real world. That sharing of facts need not necessarily be in quantitative or measurable form. They can be simple expressions in verbal form so that others could form opinions on the happenings in the real world.