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Country Highlights

Malta: Impact of Government Policies on Economic Growth

Malta’s economic policies have significantly contributed to the country’s long-term economic prosperity and high growth. The shift toward the provision of internationally focused services has been a key driver of economic growth. The government’s provision of relief to enterprises and individuals, including measures such as vouchers, wage support, and rent subsidies, has helped to mitigate the impact of the pandemic on the tourism-dependent economy. The country’s economic policies have also focused on boosting potential growth while achieving environmentally sustainable growth, addressing labor shortages, and infrastructure bottlenecks. However, the government’s economic planning and policy coordination have been somewhat limited, and there is a need for stronger ties between public institutions and the economic planning ministry. Malta’s economic freedom score is 67.5, making its economy the 41st freest in the 2023 Index. The country’s openness to international trade and investment has enhanced its competitiveness, but some institutional foundations remain weak, undermining prospects for more dramatic growth.

Malta’s regulatory efficiency has been a key focus of the government’s economic policies. The country has adopted transparent and effective regulations to foster competition, but the pace of reform has slowed. Bureaucracy continues to discourage dynamic entrepreneurial activity, and the country’s sprawling bureaucracy oversees heavy entitlement spending. The Maltese economy is considered stable, and the country’s sovereign credit ratings are A-/A-2 with a stable outlook (S&P); A2 with a stable outlook (Moody’s); and A+ with a stable outlook (Fitch). The government’s economic policies have aimed to address challenges such as labor shortages and infrastructure bottlenecks, and the country has recovered rapidly since the COVID-19 crisis.

Malta’s government deficit has reached 5.8% of GDP in 2022, and the increase in public expenditure related to measures to mitigate the impact of high energy prices is the main reason for this high deficit. The government’s economic policies have focused on boosting potential growth while achieving environmentally sustainable growth, and the country’s economic performance before the pandemic was significantly higher than the EU average. Malta’s economic policies have aimed to address challenges such as labor shortages and infrastructure bottlenecks, and the country has recovered rapidly since the COVID-19 crisis. The government’s economic policies have also focused on addressing inequalities and improving indicators related to productivity, fairness, and macroeconomic stability.

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Understand the macroeconomic situations that affect the global positioning of countries.

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Featured Reports

Understand the macroeconomic situations that affect the global positioning of countries.

Businesses can better understand how chatbots can advocate their vision.

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