Fitch affirms Malta’s ‘A+’ rating with a positive outlook

14th January 2020

The third quarter of 2019 saw a government surplus of €57.4m, the NSO said on Monday, translating to half the surplus that was reached in the same period in 2018.

The Ministry for Finance has welcomed the latest credit rating report issued by Fitch which affirmed Malta’s rating at ‘A+’ with a positive outlook, it said in a press statement issued over the weekend.

“The positive outlook reflects Fitch’s expectation of sustained high economic growth from diverse sources in the medium term. As a result, it expects Malta’s per capita income to continue converging to the EU average in the coming years,” the Finance Ministry said.

“I am pleased to note that Fitch has acknowledged our policies to sustain growth by diversifying the Maltese economy as well as our sound and prudent management of public finance. More importantly, Fitch accepts the government resolve to continue upholding its fiscal rules targeting a balanced budget in structural terms (net if IIP receipts) and ensuring that expenditure growth does not exceed the economy’s potential growth rate,” commented Minister for Finance Edward Scicluna.

Despite the strong economic growth enjoyed by the Maltese economy, Fitch notes that there has been little evidence of overheating. Indeed, it forecasts inflation to remain below the 2 per cent threshold this year and the next.

Fitch acknowledges recent efforts to strengthen supervisory and regulatory institutions. Indeed, it commends the recent increase in the FIAU and MFSA budget, as well as the new supervisory procedures introduced in July.

In a separate press statement, the National Statistics Office (NSO) reported that the third quarter of 2019 saw a Government surplus of €57.4m. This translates into half the surplus that was reached in the same period in 2018.

Quarterly non-financial accounts

During the period July to September 2019, total revenue stood at €1,215.7m, a decrease of €3.6m when compared to the corresponding quarter in 2018.

Decreases in revenue were registered in current taxes on income and wealth (€29.0m), taxes on production and imports (€18.7m) and current transfers receivable (€2.1 million). This was partially outweighed by increases in Net social contributions receivable (€26.0m), Market output (€11.4m), Property income receivable (€4.9m) and Capital transfers receivable (€3.8m).

Total expenditure in the third quarter of 2019 amounted to €1,158.3m, an increase of €51.8m over the previous quarter in 2018. Increases were recorded in almost all components of general government expenditure, mainly in Intermediate consumption (€32.6m) and Current transfers payable (€21.8m).

In addition, other increases were registered in Compensation of employees (€17.9m), Subsidies payable (€12.5m), Social benefits and social transfers in kind (€4.2m) and Current taxes on income and wealth (€0.1m).


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