The harbor with boats in Malta

Malta Economic Forecast

Malta Economic Outlook

Annual economic growth cooled in the second quarter from the first due to weaker domestic demand. Available data hints at resilient activity in Q3. The unemployment rate ticked up but remained below 3.0% in the quarter. Moreover, in the same period, inbound tourist numbers were up by around 20% year on year. Additionally, economic sentiment averaged higher in Q3 compared to the previous period. That said, rising interest rates, shrinking imports and subdued industrial activity are likely dragging on growth. On the fiscal front, figures for January–September indicate that the budget recorded a significantly narrower deficit compared to the same period of last year. The improvement was mainly due to a strong increase in revenue from income taxes.

Malta Inflation

Harmonized inflation fell to 4.3% in October from 4.9% in September, mainly due to softer increases in prices for food and housing and utilities. Inflation should average lower in 2024 than this year, thanks to a tough base effect and the lagged effects of higher interest rates. Commodity price spikes pose an upside risk to the outlook.

This chart displays Economic Growth (GDP, annual variation in %) for Malta from 2013 to 2022.

Malta Economic Data

2018 2019 2020 2021 2022
Population (million) 0.5 0.5 0.5 0.5 0.5
GDP (EUR bn) 13.0 14.3 13.4 15.3 17.5
GDP per capita (EUR) 27,403 28,936 25,927 29,704 33,494
Economic Growth (Nominal GDP, ann. var. %) 9.3 9.6 -6.6 14.8 13.9
Economic Growth (GDP, ann. var. %) 7.4 7.1 -8.1 12.6 8.2
Private Consumption (ann. var. %) 9.8 4.2 -10.9 8.2 11.1
Government Consumption (ann. var. %) 11.3 13.2 14.9 6.5 2.4
Fixed Investment (ann. var. %) 3.9 11.6 -5.9 12.5 31.4
Exports (G&S, ann. var. %) 8.4 9.7 -1.8 7.5 6.8
Imports (G&S, ann. var. %) 9.1 10.7 1.5 5.0 10.1
Industrial Production (ann. var. %) 1.5 1.1 -0.3 0.1 2.8
Unemployment (% of active population, aop) 3.7 3.6 4.3 3.4 2.9
Fiscal Balance (% of GDP) 2.0 0.5 -9.6 -7.5 -5.7
Public Debt (% of GDP) 43.4 40.0 52.2 54.0 52.3
Inflation (HICP, ann. var. %, eop) 1.2 1.3 0.2 2.6 7.3
Inflation (HICP, ann. var. %, aop) 1.7 1.5 0.8 0.7 6.1
ECB Refinancing Rate (%, eop) 0.00 0.00 0.00 0.00 2.50
ECB Overnight Deposit Rate (%, eop) -0.40 -0.50 -0.50 -0.50 2.00
3-Month EURIBOR (%, eop) -0.31 -0.38 -0.55 -0.57 2.13
Exchange Rate (USD per EUR, eop) 1.14 1.12 1.22 1.14 1.07
Exchange Rate (USD per EUR, aop) 1.18 1.12 1.14 1.18 1.05
Current Account Balance (EUR bn) 0.8 1.3 0.3 0.2 -0.5
Current Account Balance (% of GDP) 6.4 9.0 2.2 1.2 -3.1
Merchandise Trade Balance (EUR bn) -1.6 -1.6 -1.3 -2.3 -3.1
Foreign Direct Investment (EUR bn) 3.5 3.4 3.2 3.6 4.0

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