The referendum, announced late Wednesday by Prime Minister Eddie Fenech Adami, will be held simultaneously with partial local elections in one-third of this Mediterranean archipelago.

Fenech Adami's Nationalist Party is leading the campaign for a Yes vote, but the population of the tiny island group is still divided over the issue.

EU membership is strongly opposed by the opposition Labour Party.

Both the Labour Party and two anti-EU pressure groups claim EU membership would rob Malta of its sovereignty.

Occupied in turned throughout the centuries by Phoenicians, Greeks, Romans, Arabs, France and Britain, Malta won its independence from London in 1964.

But the pro-campaign has opened up a healthy lead, according to an opinion poll published earlier this month. It showed 53.1 percent in favour of EU membership and 23.9 percent against. Yet more than 17 percent are still undecided.

Fenech Adami spearheaded a drive for EU membership after returning to power in 1998. Before that, Malta's application, originally submitted in 1991, had been shelved by the previous socialist government.

His government has engaged in a round of privatization of state-controlled firms and liberalized markets in order to prepare for membership in 2004. Malta would be the smallest EU member.

With a total area of just 316 square kilometres (122 square miles), its overwhelmingly Roman Catholic population of around 382,000 is around 50,000 fewer than that of Luxembourg, the smallest of the current 15 member states.

Located at the crossroads of three continents and just south of Sicily, the Maltese archipelago consists of three islands, Malta, Gozo and Comino.

The main source of income is tourism, which triples the population every summer.

The Malta Freeport at Marsaxlokk is one of the Mediterranean's leading ports for container trans-shipments.

Malta sees its future as a "Mediterranean Switzerland" and an upmarket tourist destination.