This title is taken verbatim from the latest forecasts made by the economists of the European Commission. These experts are claiming that “the economy of Malta is set to continue expanding, by 4.2% in 2022 and by 4% in 2023 while withstanding the impact of the increase in commodity prices and the Russian invasion of Ukraine.” In fact, this year Malta will have the third largest growth in the EU, behind that in Ireland and Portugal, while next year our nation will have the second highest rate of economic growth, after that of Ireland.
The European Commission’s report indicates that the main factors behind our country’s positive economic performance is that domestic demand as well as investment are projected to continue to rise. This is in addition to the tourism sector continuing to bounce back. In addition, the European Commission experts point out that growth in our country remains underpinned by the Government’s strong investment. This while the report notes that a positive decision is expected in June regarding the successful completion of the action plan agreed with the FATF.
The economy of Malta is set to continue expanding, by 4.2% in 2022 and by 4%
Economic growth is expected to lead Malta having the third lowest unemployment rate among the countries of the Union, almost half the European average. This success is due to the labour market support given by the Government during the pandemic. Furthermore, the Commission’s report indicates that inflationary pressures in our country are being kept relatively low compared to other countries. In fact, this year Malta is projected to have the second lowest rate of inflation in the Union, at 4.5%, just above the 4.4% predicted for Portugal, the country with the lowest inflation rate. In addition, inflation in Malta is expected to fall by almost two percentage points next year.
According to Commission experts the fiscal deficit is expected to continue to decrease in the coming years despite the significant support the Government is still giving to households and businesses. This improvement in the deficit is not due to some austerity measures but rather reflects the positive impact on expected revenues resulting from the high rate of economic expansion. The latter is also forecast to lead to the national debt burden remaining below 60%.