Malta: 2024 Article IV Consultation-Press Release; and Staff Report

The 2024 Article IV Consultation discusses that Malta has experienced remarkable growth over the past decade, primarily driven by export-oriented service industries, such as tourism and online gaming. The authorities’ long-term developmental vision should be reflected in fiscal planning. The government recently launched ‘Malta Vision 2050’ to establish the country’s long-term strategic direction. It is essential to develop a long-term fiscal framework that reflects emerging spending pressures related to population aging, climate transition, and infrastructure needs. Continued efforts are needed to raise productivity and foster innovation for sustainable long-term growth. The authorities should continue evaluating the effectiveness of various schemes to support innovation activities, start-ups, and scale-ups, focusing on their size and overall design. Additional mitigation measures and changes in public behavior are necessary to meet the 19 percent reduction target by 2030 under the Effort Sharing Regulations. For climate adaptation, the vulnerability risk assessment should be completed, and the adaptation plan updated accordingly.