Captain Ball soon produced a number of documents outlining the state of affairs in Malta and the advantage of retaining the islands. Ball pointed out that the harbours at Malta would provide a secure base for naval operations as unlike Port Mahon at Minorca they were not vulnerable to attack from he land. What was more, the Grand Harbour also possessed a small but complete shipyard. There were fears that the costs of garrisoning the islands might be excessive and there was generally no great awareness in London of Malta’s strategic value.

Nelson expressed a very unfavourable view of the Island’s location as a British naval base.

By 1802 (The Treaty of Amiens) the British Government was beginning to perceive just how important Malta could be in Mediterranean affairs. The Order’s small shipyard provided a useful repair base for the Royal Navy and French interests in the Levant could be squeezed from Malta. Nelson modified his earlier view of the islands as a naval station and in 1803 he wrote:

“I now declare that I consider Malta as a most important outwork to India, that it will give us great influence in the Levant and indeed all the southern parts of Italy. In this view I hope we shall never give it up”.

The British possession of Malta was recognized by the other European powers in the Treaty of Paris signed in 1814. After the declaration of peace military expenditure in the island naturally declined and this added to the economic problems. During the next 25 years British defence spending was on a limited scale - except when danger threatened. Economically the Islands were normally in a weak position:

1. The Navarino incident, when combined naval forces from Britain, France and Russia defeated a Turco-Egyptian fleet in 1827, gave a brief boost to the economy.

2. The French seizure of Algiers in 1830 had a similar effect, as the British judged that the strategic situation in the Mediterranean had altered unfavourably from their point of view. The French now had potential control of the western basin of the Mediterranean and there were fears that they might attempt to oust the British from Malta.

3. Calm was restored with a short time but when the French started to court Mehemet Ali, the ruler of Egypt, and induced hint to adopt policies which were embarrassing to Britain, the extent of French ambitions was recognized amid the British became thoroughly alarmed. Egypt lay astride the most convenient land route to India -Britain’s prime imperial possession. A hostile government in Cairo certainly cause difficulties and when in 1837 Mehemet Ali sent his forces off into Arabia with the object of securing a position on the Persian Gulf and taking Baghdad, which stood on the alternative land route to India, Britain reacted purposefully.

4. Aden was seized in 1839. and preparations were made to attack Egypt’s Mediterranean coastline, if strong measures should prove necessary.

The French became increasingly hostile to Britain and as a result of the general raising of tension alterations were made to the defence structure of the Maltese. New armaments were provided, the garrison was increased in numbers, the fortifications were repaired and modernized. A new water supply system was installed for Valletta and the Three Cities. Silos for grain were excavated in Floriana, a large bakery was built to supply the needs of the Royal Navy and in 1848 the British admiralty’s first drydock was opened at Malta. All this activity led to a return of prosperity. During the Crimean War (1853 - 56) Malta became a forward supply and refit station for the British forces being used in support of the Turks against the Russians.

By the end of the 1840’s British military spending in Malta was running at about £200,000 per annum, in 1854 it reached well over £400,000 and in 1856 it exceeded £800,000. Although spending on this scale was not maintained year after year, and indeed military expenditure fluctuated widely, Malta was now established as a major base ofthe Royal Navy.

In 1869 the opening of the Suez Canal placed the islands upon the major British Imperial seaway; the Mediterranean route to India.

Nor did the development of other British bases lessen the value of Malta. Aden was acquired in 1839 and Cyprus leased from the Turks in 1878, Egypt occupied in 1882; but these new possessions were to become links in a great chain of imperial stations which stretched from the United Kingdom, to Gibraltar, through the Mediterranean and the Red Sea, down to India, the Strait Settlements and Singapore. Eventually the chain of command and communication served the stations on the China coast to say nothing of the important colonies of Australia and New Zealand. The islands were one of hinge points in this imperial system. Malta was the headquarters of the Mediterranean fleet and secured a seaway which was considered vital to British interests.

These new strategic developments, largely consequent upon the cutting of the Suez Canal, were reflected in the military installations erected at Malta in the second half of the nineteenth century. The naval dockyard underwent a major development programme, the harbours were improved new static defences were constructed, barracks amid military hospitals were erected.

The British inherited the Order’s small shipyard and at a very early stage the Royal Navy laid plans to expand these facilities. However it was not until 1844 that the foundation stone was laid for the first dock which was built at the head of Galley Creek {see map}. (The British renamed part of the Grand Harbour Dockyard Creek). The Drydock was opened in 1848 {read about Dock Number 1}and shortly plans were drawn up to build similar works to cope with the increased volume of naval repairs. A great debate started as to whether the French Creek or the Marsa would be the best site. The choice of the latter site would have involved the movement of the entire naval dockyard but in compensation a large area of flat land would be available to allow all foreseeable expansions to develop unhindered. The French Creek site was hampered by lack of space. Against this the inner area of the Grand Harbour was shallow and would require considerable dredging. {see map}

In the end the debate was resolved in favour of French Creek and start was made on the then huge Somerset Dock which was opened in 1871. For a time this dock was larger than any available to the Royal Navy at Portsmouth. {see map}

In 1892 the Hamilton Dock was completed and in 1899 a start was made on two more dry docks. Development went on until the naval dockyard consisted of one dock in Galley Creek and four in French Creek. {see map} The docks were supported by extensive harbourside workshops and refit facilities. Naval repair establishments were developed in Marsamxett as well; a small boat yard was erected on Manoel Island and provision was also made to enable work to be undertaken on submarines and destroyers. During the First World War the Dockyard employed 10,000.

The dockyard saw a rapid increase in its working force between the 1890’s and the late 1940’s.

This means that employment of the Maltese vith the colonial Government led to a situation where the workers felt committed to the British cause “as a result of the fact that thousands of jobs were secured at a rate of pay ……. often rather better than that paid to workers in private enterprise ….. or indeed in the lower ranks of the civil service.

Commercial Activity

From 1859 onwards, at the innermost part of the Grand Harbour, new facilities for commercial vessels were constructed. After the opening of the canal the number of vessels calling at the islands rapidly increased and within a short time Malta was enjoying trade boom. By 1880 the Grand Harbour was firmly established as the chief coaling station for vessels plying between Britain, India and the East, entrepot trade was flourishing and over 3,000 steamers called at the island in due course of the year, not to mention nearly 2000 sailing vessels.

In the late nineteenth century the building of the railway between Valletta and Mdina, high spending by the Admiralty and the Royal Engineers, all contributed towards the maintenance of full employment and good rates of pay. Yet the structural weaknesses in the local economy were apparent to all who studied the matter and were constantly being debated in the Council of Government. By 1890 it was clear that Malta could not rely indefinitely upon the trade boom.

Early in the twentieth century the Admiralty started to construct a large breakwater system at the entrance to the Grand Harbour. The mouth of the harbour had been difficult to negotiate when the Grigal or north-east wind, was blowing and conditions even within the harbour could be made difficult. The new breakwater was designed to alleviate some of these problems. The project involved relatively huge numbers of workmen and the demand for labour was such that men had to be brought in from Spain and Italy. In 1905 there were over 9,000 Maltese employed in naval establishment but much of the work was of a temporary nature and once the projects were completed men were laid off very quickly indeed.

As time passed a very considerable proportion of the economy became a function of what the UK Parliament would vote for the upkeep of the fleet and its garrison in Malta and for the maintenance and occasional new constructions of barracks and military facilities on the island.

British expenditure in Malta which fluctuated according to times of peace or war affected Dockyard employment.