Malta Economic Forecast

Malta Economic Outlook

May 31, 2022

The available data paints a mixed economic picture for Q1. Industrial production contracted, suggesting downbeat private sector activity. Meanwhile, consumer sentiment plunged and inflation soared, pointing to depressed household spending. On the other hand, the unemployment rate continued to fall, economic sentiment strengthened and tourism continued to recover. Moreover, government finance data for the quarter shows that the consolidated fund deficit shrank compared to the same period of the previous year, mainly due to rising revenue from income and value added taxes, as well as an increase in social security contributions. Moving into Q2, the labor market remained relatively tight in April, while in the same month consumer confidence rebounded. However, inflation continued to spike, while economic sentiment began to weaken.

Malta Economic Growth

GDP should expand at a solid rate this year, underpinned by Next Generation EU fund inflows, a strong labor market and a tourism sector revitalized by reduced Covid-19 restrictions in the EU. That said, growth will be constrained by a high base effect. However, protracted global supply chain issues and the war in Ukraine pose downside risks. FocusEconomics panelists see GDP expanding 4.2% in 2022, which is down 0.4 percentage points from last month’s forecast, and 3.3% in 2023.

Malta Economy Data

2015 2016 2017 2018 2019
Population (million)0.40.50.50.50.5
GDP per capita (USD)24,50025,55627,78330,54630,536
GDP per capita (EUR)21,94823,04424,61326,05727,375
GDP (USD bn)10.811.512.814.514.8
GDP (EUR bn)9.710.411.312.413.3
Economic Growth (GDP, annual variation in %)10.95.86.57.34.7
Consumption (annual variation in %)5.02.63.37.82.9
Investment (annual variation in %)55.6-0.2-7.1-1.86.2
Exports (G&S, annual variation in %)15.54.54.83.42.5
Imports (G&S, annual variation in %)18.11.6-0.53.03.0
Industrial Production (annual variation in %)-0.2-6.98.31.61.7
Unemployment Rate5.44.74.03.73.4
Fiscal Balance (% of GDP)-1.01.03.31.90.5
Public Debt (% of GDP)58.055.550.345.643.1
Inflation Rate (HICP, annual variation in %, eop)1.21.01.31.21.3
Inflation Rate (HICP, annual variation in %)1.20.91.31.71.5
Inflation (PPI, annual variation in %)-  -  -  -  -  
Policy Interest Rate (%)-  -  -  -  -  
Exchange Rate (vs USD)-  -  -  -  -  
Exchange Rate (vs USD, aop)-  -  -  -  -  
Current Account (% of GDP)3.66.312.310.610.5
Current Account Balance (EUR bn)0.30.41.21.41.3
Trade Balance (EUR billion)-2.0-2.0-1.5-1.4-1.6

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Malta Facts

Value Change Date
Bond Yield0.433.09 %Dec 30
Exchange Rate1.120.65 %Dec 31

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