Following the credit rating upgrades by Standard and Poor’s and Fitch, another independent renowned credit rating agency, DBRS, has affirmed Malta’s credit rating at A while upgrading the trend on the ratings to positive.

PRESS RELEASE BY THE MINISTRY FOR FINANCE

Minister for Finance Edward Scicluna comments that: “Four years ago, we had promised to work on upgrading Malta’s credit rating which would make our country more attractive to foreign investors. In contrast with the past deteriorating state of public finances with ballooning deficit and debt ratios, we directed our efforts to addressing such issues, bringing about an upgrade to Malta’s rating, and hence honouring our promise.”

Indeed, DBRS acknowledges that, following a fiscal consolidation process since 2013, Malta’s fiscal outturns came in better than expected in 2016 where decades of fiscal deficits were turned into surpluses. The credit rating agency also noted that in 2016, the Government debt ratio, which was already 12 percentage points lower than its 2011 peak, fell below 60% of the GDP. DBRS attributes the improvement in public finances to “…strong revenues as well as moderation in expenditure, and supported by a strengthened fiscal framework.”

The report further notes how the fiscal over-performance meant that Malta complied with the budget balance rule, the debt rule, and the expenditure benchmark of the EU Stability and Growth Pact in 2016.

DBRS positively expects that “The important improvement in the fiscal position over the past three years is likely to be sustained. A sound budget position, together with solid growth, is expected to lead to the further reduction in the public debt ratio.”

DBRS acknowledges the Government’s efforts to address structural and fiscal challenges including the restructuring of Enemalta and Air Malta, and measures to address tax evasion and informality.

DBRS notes that although age-related costs remain a challenge, in particular in pensions, the Government has implemented various reforms to help secure the long-term sustainability of the system, including measures to discourage early retirement and lengthen the contributory period.

According to the credit rating agency, the positive trend also reflects the robust growth recorded by the Maltese economy in recent years as well as its solid external position. On the latter, DBRS further notes that although the import content of investment remains high, this has declined, and that the current account surplus is supported by sizable services exports.

DBRS tafferma l-klassifikazzjoni ta’ kreditu ta’ ‘A’ għal Malta u tbiddel it-tendenza għall-pożittiv

Wara l-aġġornamenti tal-klassifikazzjonijiet tal-kreditu minn Standard and Poor’s kif ukoll minn Fitch, aġenzija oħra magħrufa għall-klassifikazzjoni ta’ kreditu indipendenti – DBRS – affermat il-klassifikazzjoni tal-kreditu ta’ Malta ta’ ‘A’ filwaqt li bidlet it-tendenza tal-klassifikazzjonijiet għall-pożittiv.

Il-Ministru għall-Finanzi Edward Scicluna kkummenta li, “Erba’ snin ilu aħna wegħdna li se naħdmu biex intejbu l-klassifikazzjoni tal-kreditu ta’ Malta sabiex pajjiżna jkun aktar attraenti għal investituri barranin. B’kuntrast mal-istat deterjorat tal-finanzi pubbliċi tal-passat bi proporzjonijiet ta’ defiċit u ta’ dejn dejjem jogħlew, aħna ħdimna biex nindirizzaw dawn il-kwistjonijiet, wassalna għal titjib il-klassifikazzjoni ta’ Malta u b’hekk żammejna mal-wegħda tagħna”.

DBRS tirrikonoxxi li wara proċess ta’ konsolidazzjoni fiskali mill-2013, l-eżiti fiskali ta’ Malta daħlu aħjar milli kien mistenni fl-2016 meta deċenji ta’ żbilanċi fiskali nbidlu għal bilanċi favorevoli. L-aġenzija tal-klassifikazzjoni tal-kreditu nnutat ukoll li fl-2016 il-proporzjon tad-dejn tal-Gvern, li kien diġà 12-il punt perċentwali inqas mill-quċċata tiegħu tal-2011, waqa’ taħt is-60% tal-GDP. DBRS tattribwixxi t-titjib fil-finanzi pubbliċi għal “… dħul qawwi kif ukoll moderazzjoni fin-nefqa, u appoġġat minn qafas fiskali msaħħaħ”.

Ir-rapport jinnota wkoll li l-prestazzjoni fiskali żejda wasslet biex Malta tikkonforma mar-regola tal-bilanċ baġitarju, ir-regola tad-dejn u l-punt ta’ referenza tan-nefqa tal-Patt ta’ Stabbiltà u Tkabbir tal-UE fl-2016.

DBRS issostni b’mod pożittiv li, “It-titjib importanti fil-pożizzjoni fiskali matul l-aħħar tliet snin x’aktarx se jibqa’ jiġi sostnut. Pożizzjoni baġitarja soda flimkien ma’ tkabbir sod, huma mistennija li jwasslu għal aktar tnaqqis fil-proporzjon tad-dejn pubbliku”.

DBRS tirrikonoxxi l-isforzi tal-Gvern biex jindirizza sfidi strutturali u fiskali inklużi r-ristrutturar tal-Enemalta u tal-Air Malta, u miżuri li jindirizzaw l-evażjoni tat-taxxa u l-informalità.

DBRS tinnota li għalkemm l-ispejjeż marbuta mal-età għadhom sfida b’mod partikolari fil-pensjonijiet, il-Gvern implimenta diversi riformi biex jgħin is-sostenibbiltà fit-tul tas-sistema inklużi miżuri li jiskoraġġixxu l-irtirar kmieni mix-xogħol u jtawlu l-perjodu kontributorju.

Skont l-aġenzija tal-klassifikazzjoni tal-kreditu x-xejra pożittiva tirrifletti wkoll it-tkabbir qawwi reġistrat mill-ekonomija Maltija fl-aħħar snin kif ukoll il-pożizzjoni esterna solida tagħha. Dwar dan tal-aħħar DBRS tinnota li għalkemm il-proporzjon tal-importazzjoni fl-investiment jibqa’ għoli, dan naqas u l-bilanċ pożittiv tal-kont kurrenti hu appoġġat minn esportazzjonijiet konsiderevoli tas-servizzi.