International Monetary Fund (IMF) experts have noted in an annual report on the Maltese economy that Malta’s economic growth remains one of the strongest in Europe. IMF economists stated that this is due to favourable economic conditions and sound policies, together with structural reforms which supported the strengthening of private and public balance sheets.
As explained in a 57-page report*, “output is estimated to have expanded by 6.8 percent in 2017, accompanied by dynamic job creation, which brought unemployment to a record-low. Strong inflows of foreign workers and rising labour force participation kept wage pressures contained in most sectors, thus contributing to low inflation despite a positive output gap. At the same time, the rapid economic expansion and the growing population have put pressure on physical infrastructure and resulted in a continued housing market appreciation.”
“The fiscal balance is estimated to have registered a surplus for the second consecutive year in 2017, thanks to buoyant revenues—including from Individual Investor Program (IIP) proceeds – and contained capital expenditure growth. The 2017 current account is estimated to have remained in surplus, driven largely by a sizable balance of services.”
The IMF report further pointed out that the government has reached its fiscal targets “three years ahead of schedule” and that the country’s economic progress is reflected in an improved credit rating. The IMF said these were a result of the government’s prudent policies and added that “growth is projected to remain robust throughout the forecast horizon.”
IMF executive board declared it agrees with the IMF economists conclusions, adding that the risks for the Maltese economy are balanced, although it recommended that the country plans for reserves for necessities that may be required in the future. IMF also observed that the Maltese Government is implementing the advice of its experts and called for a further reinforcement of the legislative framework against money laundering to safeguard the integrity of the financial system. It added that this is essential in the light of the financial services, gaming and the great demand for the citizenship programme.
Once again the Maltese economy enjoys one of the strongest economic growth in Europe; one more time Malta is determined to maintain and strengthen those factors which will enable achieve higher results.
*full report can be found here
Written by Marta Bellamoli, Marketing Co-ordinator