Malta’s high national income per head, robust economic growth, large net external creditor position, and strong governance indicators led to another positive credit rating, this time by Fitch Ratings.
Indeed, the Credit Rating Agency affirmed Malta’s credit rating at A+ with a stable outlook.
Minister for Finance Edward Scicluna comments, “This positive rating, released just after the upward revision in Malta’s growth forecasts by the EU, further confirms yet again that Malta is in for more years of success that will be enjoyed by all.”
PRESS RELEASE BY THE MINISTRY FOR FINANCE
Fitch acknowledges that the Government over-achieved its Medium-Term Objective three years ahead of schedule in 2016 and recognises the Government’s intention to maintain a fiscal surplus net of IIP revenues over the coming years.
Fitch forecasts public spending to remain fairly stable and expects the debt ratio to decline to below 50 per cent this year, supported by high nominal GDP growth and ongoing expected fiscal surpluses.
The report expects the increased absorption of EU funds and the launching of large projects in health and education sectors to contribute positively to growth in investment. It also notes that the Malta Development Bank, which will support SME financing and large infrastructure projects, could further lift investment and help remove structural bottlenecks in the economy.
Fitch positively notes that the structural shift of the economy towards more service oriented and less investment intensive-sectors will lead to a sustained current account surplus and hence a robust external position.
Fitch also notes that the Maltese banking sector remains sound with robust capitalisation and liquidity ratios and an improving asset quality.
Fitch expects the Maltese economy to grow faster than the ‘A’ median five-year average boosted by strong domestic demand on the back of declining unemployment and increases in wages.
- 10th February, 2018