Credit rating agency Standard and Poor's affirmed Malta's short and long-term sovereign credit rating at 'A-/A-2' with a positive outlook.
Standard and Poor's attributed Malta's positive rating to its strong growth performance, recurring current account surpluses driven by its large services exports, and the improving Government budgetary and debt positions, and fiscal management.
Standard and Poor's report stated that Malta's headline GDP growth performance was expected to, likely, exceed that of peers at similar income levels and stages of development.
The credit rating report noted that Malta's real GDP growth accelerated to 7.6 per cent on average in the 2014 to 2018 period. It also acknowledged that the structural shifts in the economy created new employment opportunities causing the unemployment rate to decline further to 3.8 per cent in 2018, the lowest in two decades.
The credit rating agency positively noted that several structural reforms were undertaken, notably those that have reduced the country's energy bill and increased female participation in the labour market. They expect efforts to further reduce skill mismatches and improve the long-term sustainability of public finances in the context of an ageing population to be implemented gradually, alongside public investment to plug infrastructure gaps.
"We are committed to continue safeguarding our success in economic growth and public finances and to continue strengthening the supervisory standards of the financial sector,” commented Minister for Finance Edward Scicluna. “Indeed, the credit rating report acknowledges the Maltese authorities' efforts to strengthen supervisory standards and their cooperation with the EBA to reach this goal.”
“As regards the external risks to growth pointed out by the credit rating agency, we are actively monitoring such risks by promoting further diversification and registering broad-based economic growth."