Strategically located at the crossroads between the Middle East, North Africa and Europe, Malta is a natural hub and boasts a strong GDP due to its open market economic policies, a multilingual population, a productive labor force, exceptional ICT infrastructure and finance clusters and low corporate tax.
Malta’s GDP per capita is among the best in the world and thanks to its sound financial foundations, large infrastructure projects and consistent domestic demand, it has consistently grown over recent years. Although it is expected to fall due to the Covid-19 outbreak, Prof. Edward Scicluna, Governor of the Central Bank of Malta, is projecting a GDP growth of approximately 5% every year in the three coming years, beginning with a strong rebound of up to 5.9% in 2021.
“The last 10 years saw us bridge the gap with the European average when it comes to GDP per capita and the employment rate. The next decade will now see us become a centre of excellence, worthy of being with the best in Europe and the world.”
H.E. Robert Abela, Prime Minister of Malta
Malta maintains a highly industrialized, innovative and dynamic economy that is led by financial services and tourism, with continued support from real estate, ICT, I-gaming and manufacturing. Arch. David Xuereb, Former President of the Chamber of Commerce, Enterprise and Industry, says, “Malta’s engagement with technological infrastructure has been considerable. We are the ideal birthing ground for new technology and offer the best testing grounds for any new societal innovative technology and are invested in the development and research of electrification and new sources of energies, for example green hydrogen.”
Technology has experienced extensive developments across virtually every sector, with Malta being the first to regulate cryptocurrency and subsequently becoming a frontrunner in the blockchain sphere, inspiring other countries to follow. Blockchain-based tech company Wyzer is one such company that employs digitization to streamline processes for business and facilitate growth. Dr. Abdalla Kablan, Chairman and Co-founder of Wyzer, states, “What we’re trying to achieve is to obtain understanding from the knowledge, evolve it into wisdom, and actually operate into the wisdom sphere here.” While the financial sector has been Wyzer’s main target in the past, technology and digitization have made it so that any company from any sector is a prime target for Wyzer’s services.
Manufacturing and industry represent 22% of the GDP and 35% of employment and manufactured products accounting for 90% of Malta’s exports, recent national infrastructure enhancement is looking to revamp industrial zones and attract businesses and start-ups in biotech, automated manufacturing, and will even impact the transport sector through the Grand Harbour Regeneration Plan. The Plan is a catalyst for growth across sectors, designed to sustainably develop the port areas of Malta, making it a Mediterranean hub and attracting attention from investors worldwide. David Magro, CEO of Malta Freeport Corporation, says, “Our industry will continue to strive and move forward despite this pandemic because goods need to be moved around. Trading can’t stop and for this to go on, you need shipping.” Other infrastructure will facilitate better connectivity with Gozo, improving day-to-day life for the Maltese people and increasing tourism in the area.
Tourism drives the nation’s economic engine, contributing around 27% of GDP annually, projections show a 33% GDP contribution by 2028. Malta is one of the first countries in the EU to achieve herd immunity through a high vaccination rate, making Malta among the first for safe tourism and for investments. “In my opinion, [the pandemic] gave us time to rethink on how we were moving forward,” states Johann Buttigieg, CEO of Malta Tourism Authority. “Before we were just looking at numbers, basing our success on how many tourists we brought over, but at the end of it that was smoke because that has an impact obviously on the locals, it has an impact on the infrastructure and so we’re moving away from that and now we want to speak about quality rather than quantity. You need quantity but obviously also quality.”
The financial services sector is the fastest-growing sector of the Maltese economy. Recognized internationally as a world-class centre for blue-chip banks, investment houses and fund managers, finance accounts for 12% of GDP and employs more than 10,000 people. Malta’s comprehensive laws that regulate financial services and provide a favorable regulatory and legal framework indicate the government’s commitment to supporting financial sector development and direct foreign investment. Globally, Malta ranks sixth in inward Foreign Direct Investment and amongst the top twenty among countries most likely to sustain economic growth over the medium and long term.
Malta has a reputation for being safe, secure and welcoming to investors through favorable legislation and tax incentives. Marisa Marmara, CEO of Malta Strategic Partnership Projects Ltd says: “Partnerships between the government and the private sector are those that can lead the country to attain a lot of objectives on an economic level, social level, environmental level to rehabilitate, restore and take care of our heritage assets. There is so much potential in every sector that you look at.” Malta’s strong rebound from 2020, government initiatives to help businesses and investment, as well as its strategic position, make the island country a haven for investment.