Economy of Malta

File:Malta airport aerial view.jpg

Malta has an airport, Luqa International Airport, and two majors ports, Malta Freeport and Valletta Cruise Port. Malta Freeport is used for all cargo ships and imports-exports while Valletta Cruise Port is only used by cruise ships. The Malta Freeport reported revenues of 170 million euros, while €90 million came from the Valletta Cruise Port, totaling €260 million. The Freeport connects Malta with 110 others ports in the world including 55 in the Mediterranean. Furthermore, 2,189 container ships carried 2.80 million TEU of container traffic in and out of Malta Freeport in 2022. The Valletta Cruise Port welcomed 900,000 passengers in 2023, contributing €53 million to the Maltese economy.

Luqa International Airport serves 35 different airlines with 115 destinations. In 2023, 7.8 million people travelled through the airport, providing $2.7 billion in revenues to the Maltese economy, equivalent to 24% of Malta's Gross Domestic Product (GDP). Specifically, the former air flag carrier of Malta Air Malta, KM Malta Airlines since 2024, had a revenue of €679.4 million in 2022. Another new airline operating from Luqa Airport, Universal Air, started operations in April 2024 with a fleet of 6 aircraft. The airlines, airport, and surrounding businesses employ almost 7,000 people.

During the Napoleonic Wars (1800–1815), Malta's economy prospered and became the focal point of a major trading system. In 1808, two-thirds of the cargo consigned from Malta went to Levant and Egypt. Later, one half of the cargo was usually destined for Trieste. Cargo consisted of largely British and colonial-manufactured goods. Malta's economy became prosperous from this trade and many artisans, such as weavers, found new jobs in the port industry.

In 1820, during the Battle of Navarino, which took place in Greece, the British fleet was based in Malta. In 1839, P&O and East India Company used Malta as a calling port on their Egypt and Levant runs.

In 1869, the opening of the Suez Canal benefited Malta's economy greatly as there was a massive increase in the shipping which entered in the port. The economy had entered a special phase. The Mediterranean Sea became the "world highway of trade" and a number of ships called at Malta for coal and various supplies on their way to the Indian Ocean and the Far East. From 1871 to 1881, about 8,000 workers found jobs in the Malta docks and a number of banks opened in Malta. By 1882, Malta reached the height of its prosperity.

However, the boom did not last long. By the end of the 19th century, the economy began declining and by the 1940s, Malta's economy was in serious crisis. This was primarily due to the invention of large ships which had become oil-fired and therefore had no need to stop in the Grand Harbor of Malta to refuel. The British Government had to extend the dockyard.

At the end of World War II, Malta's strategic importance had reached a low point. Modern air warfare technology and the invention of the atomic bomb had changed the importance of the military base. The British lost control of the Suez Canal and withdrew from the naval dockyard, transforming it for commercial shipbuilding and ship repair purposes.

The Maltese economy is dependent on foreign trade, manufacturing (especially electronics and pharmaceuticals), and tourism. Malta adopted the Euro currency on 1 January 2008.

Tourist arrivals and foreign exchange earnings derived from tourism have steadily increased since 1987.{{Cite web |title=The World Financial Review |date=4 June 2022 |url=https://worldfinancialreview.com/malta-turned-into-an-unreliable-investment-destination/}} Following the September 11 attacks, the tourist industry suffered a temporary setback. With the help of a favorable international economic climate, the availability of domestic resources, and industrial policies that support foreign export-oriented investment, the economy has been able to sustain a period of rapid growth.{{Citation needed|date=April 2020}} Growing public and private sector demand for credit has led — in the context of interest rate controls — to credit rationing to the private sector and the introduction of non-interest charges by banks. Despite these pressures, consumer price inflation has remained low (2.2% according to the Central Bank of Malta in 2007), reflecting the impact of a fixed exchange rate policy (100% hard peg to the euro, in preparation for currency changeover) and lingering price controls.

There is a strong manufacturing base for high value-added products like electronics and pharmaceuticals, and the manufacturing sector has more than 250 foreign-owned, export-oriented enterprises. Tourism generates around 15% of GDP. Film production in Malta is another growing industry (approx. 35 million euros between 1997 and 2011), despite stiff competition from other film locations in Eastern Europe and North Africa, with the Malta Film Commission providing support services to foreign film companies for the production of feature cinema, commercials and television series.{{cite web|url=http://www.culturalpolicies.net/web/malta.php?aid=426|title=Malta : 4.2 Specific policy issues and recent debates : 4.2.6 Media pluralism and content diversity|access-date=3 March 2015|archive-date=2 April 2015|archive-url=https://web.archive.org/web/20150402110147/http://www.culturalpolicies.net/web/malta.php?aid=426|url-status=dead}}

From 2001 to 2005 the mean GDP real growth was 0.4%{{cite web|url=http://www.gfmag.com/gdp-data-country-reports/223-malta-gdp-country-report.html|title=Malta|work=Global Finance Magazine|access-date=3 March 2015|archive-date=19 May 2013|archive-url=https://web.archive.org/web/20130519230738/http://www.gfmag.com/gdp-data-country-reports/223-malta-gdp-country-report.html|url-status=dead}} due to Malta losing pace in tourism and other industries. Unemployment was down to 4.4%, its lowest level in 3 years. Many formerly state-owned companies are being privatised—and the market liberalised.

Fiscal policy has been directed toward bringing down the budget deficit after public debt grew from a negative figure in 1988 to 56% in 1999 and 69.1% in 2009.{{cite web|url=http://www.timesofmalta.com/articles/view/20100422/local/2009-deficit-down-to-218-2-million|title=2009 deficit down to €218.2 million|work=Times of Malta|date=22 April 2010 |access-date=3 March 2015}} By 2007, the deficit-to-GDP ratio was comfortably below 3% as required for eurozone membership, but due to pre-election spending has gone up to 4.4% in 2008 and 3.8% in 2009.

{{Main|Energy in Malta}}

{{Outdated as of|2014}}

Despite a great potential for solar and wind power,"MALTA – Renewable Energy Fact Sheet". Europa. January 2007. <{{cite web |url=http://ec.europa.eu/energy/energy_policy/doc/factsheets/renewables/renewables_mt_en.pdf |title=Archived copy |access-date=2009-01-08 |url-status=dead |archive-url=https://web.archive.org/web/20090207124857/http://ec.europa.eu/energy/energy_policy/doc/factsheets/renewables/renewables_mt_en.pdf |archive-date=7 February 2009}}> Malta produces almost all its electricity from oil, importing 100% of it."MALTA – Energy Mix Fact Sheet". Europa. January 2007. <{{cite web |url=http://ec.europa.eu/energy/energy_policy/doc/factsheets/mix/mix_mt_en.pdf |title=Archived copy |access-date=2008-09-25 |url-status=dead |archive-url=https://web.archive.org/web/20081002203232/http://ec.europa.eu/energy/energy_policy/doc/factsheets/mix/mix_mt_en.pdf |archive-date=2 October 2008}}> Energy and the cost of energy, which is oft-quoted as the highest in Europe, was a key issue in the 2013 election.{{cite web|url=http://www.timesofmalta.com/articles/view/20130120/opinion/The-great-energy-debate.453993|title=The great energy debate|work=Times of Malta|date=20 January 2013 |access-date=3 March 2015}}

{{Main|List of banks in Malta}}

{{clear}}

{{Outdated as of|2014}}

File:GDP MALTA NSO 2016-2020.png

Electricity - production:

1,620 GWh (1998)

Electricity - production by source:

fossil fuel:

98.6%

hydro:

0%

nuclear:

0%

Renewable sources:

1.4%

other:

0% (1998)

Electricity - consumption:

1,507 GWh (1998)

Electricity - exports:

0 kWh (1998)

Electricity - imports:

0 kWh (1998)

Agriculture - products:

potatoes, cauliflower, grapes, wheat, barley, tomatoes, citrus, cut flowers, green peppers; pork, milk, poultry, eggs

Currency:

1 euro = 100 cents since 1 January 2008

previously 1 Maltese lira = 100 cents;

Exchange rates:

Maltese liri (LM) per US$1 – 0.4086 (January 2000), 0.3994 (1999), 0.3885 (1998), 0.3857 (1997), 0.3604 (1996), 0.3529 (1995)

Irrevocably fixed conversion rate to the euro: Maltese liri (LM) per EUR1 - 0.4293 (2007)

According to HitHorizons, companies registered in Malta generate € 88,255,174,701 in sales per annum. The company with the highest sales is ALKAGESTA LTD with € 2.075B followed by HC TRADING MALTA LIMITED and ADVAITA TRADE PRIVATE LIMITED with € 1.346B and € 1.253B in sales respectively.{{cite web | url=https://www.hithorizons.com/eu/analyses/country-statistics/malta | title=Industry Breakdown of Companies in Malta | website=HitHorizons}}

Poverty and social exclusion are significant problems in Malta.{{cite web|url=http://www.timesofmalta.com/articles/view/20111017/opinion/Maltese-living-in-poverty.389492|title=Maltese living in poverty|work=Times of Malta|date=17 October 2011 |access-date=3 March 2015}} As of 2008, an estimate of 15% of Malta's citizens were living below the poverty line, which was slightly better than the EU average of 17% at the time.{{Cite web|url=https://timesofmalta.com/articles/view/Maltese-living-in-poverty.389492|title=Maltese living in poverty|website=Times of Malta|date=17 October 2011 |language=en-gb|access-date=2020-03-31}} To address the issue of poverty, on 24 December 2014 Malta addressed poverty in the six branches of social services, health and environment, culture, income and social benefits, education and employment, by unveiling the National Strategic Policy for Poverty Reduction and Social Inclusion; this will stay in effect from 2014 to 2024.{{Cite web|url=http://www.timesofmalta.com/articles/view/20160312/opinion/Strategy-for-poverty-reduction.605360|title=Strategy for poverty reduction|last=Cuschieri|first=Claudia|date=12 March 2016 |access-date=1 December 2016}} Under this policy, stakeholders will be involved in the discussion of how to reduce hardships experienced by families living in Malta.{{Cite web|url=http://eige.europa.eu/gender-mainstreaming/resources/malta/green-paper-framework-poverty-reduction-and-social-inclusion-2014-2024|title=Green Paper: A Framework for Poverty Reduction and for Social Inclusion 2014-2024|access-date=1 December 2016}}

Benefits for unemployment are given out based on contributory and non-contributory schemes. Contributory schemes distribute unemployment benefits within 50 weeks of contribution. Non-contributory schemes a Social Unemployment Benefit is granted after a means test to the head of a household. In order to qualify for unemployment benefits, a person must be able to do work and have registered as unemployed.{{Cite web|url=http://www.mywage.org/malta/home/labour-law/social-security/unemployment-benefits|title=Unemployment Benefits|access-date=1 December 2016}}

There are three categories to the Malta registrar of unemployment. People who have never worked fall into category one. Those who quit or were dismissed from their jobs fall into category two. Category three is for people who are currently employed but are looking for other job prospects. Benefits for unemployment are given for 156 days after which a person may qualify for the means tested unemployment assistance.{{Cite web|url=https://www.angloinfo.com/how-to/malta/working/unemployment/unemployment-benefits|title=Unemployment Benefits in Malta|access-date=1 December 2016}} People eligible for unemployment benefits are Maltese citizens who are aged sixteen years or older, people signed up for eligible work-study programs, and citizens outside of Malta who are employed by foreign entities.{{Cite web|url=https://www.ssa.gov/policy/docs/progdesc/ssptw/2008-2009/europe/malta.html|title=Social Security Programs Throughout the World: Europe, 2008|access-date=1 December 2016}}

Some scholars have noted that Malta's unemployment system has created a dependency on the benefits provided by the system.{{Cite journal|last=Zerafa|first=Mary Anne|date=Autumn 2007|title=Unemployment Benefits and Incentives to Seek Employment in Malta|journal=Bank of Valletta Review|pages=33–56|url=https://www.bov.com/documents/bov-review-36-paper-3}} From 1992 to 2005, there was an increase in the number of recipients of both short-term and long-term benefits. Additionally, in 2016, 969 Maltese citizens were cut off the employment register for abusing the system.{{Cite news|url=https://www.maltatoday.com.mt/news/national/79034/969_people_cut_off_unemployment_register_for_trying_to_abuse_the_system#.WunuHyMrJO2|title=969 people cut off unemployment register for trying to abuse the system|work=MaltaToday.com.mt|access-date=2018-05-02|language=en}} For these reasons, there has been movements from politicians to reduce and reshape the unemployment system. After the election of the Labour Party in 2013, the number of people receiving unemployment benefits dropped by 75%.{{Cite news|url=https://www.timesofmalta.com/articles/view/20171020/local/75-decrease-in-unemployment-beneficiaries-but-nearly-5000-on-work.660875|title=75% decrease in unemployment beneficiaries - but nearly 5,000 on work schemes|last=Ltd|first=Allied Newspapers|work=Times of Malta|access-date=2018-05-02|language=en-GB}} This same government introduced the "in-work" benefit which forces more people to work while helping the most poor and desperate.

In order to be eligible for in-work benefit, applicants must first have children under the age of 23, and from that point, benefits vary depending on marital status and the number of people employed per family. For a single parent in employment who earns between €6,600-€16,500, they are eligible for a maximum payable rate of up to €1,250 annually per child. For a married couple whose collective income is between €10,000 and is less than €24,000 (the income of one of the spouses must be over €3,000), they are eligible for a maximum payment rate of up to €1,200 annually per child.{{Cite web|url=https://socialsecurity.gov.mt/en/Short-Term-Benefits/Pages/In-Work-Benefit.aspx|title=In-Work Benefit|website=socialsecurity.gov.mt|language=en|access-date=2018-05-02}} In 2016, the in-work benefit was extended to married couples where only one parent works, extending the benefit to an additional 3,700 families.{{Cite news|url=https://www.timesofmalta.com/articles/view/20151013/local/in-work-benefit-for-another-3700-families.588075|title='In-work' benefit for another 3,700 families|last=Ltd|first=Allied Newspapers|work=Times of Malta|access-date=2018-05-02|language=en-GB}} For a married couple with only one parent gainfully employed whose income is greater than €6,600 and less than €16,500, they are eligible for a maximum payable rate of up to €350 yearly per child. The in-work benefit is paid quarterly in January, April, July, and October.{{Cite web|url=https://servizz.gov.mt/en/Pages/Inclusion_-Equality-and-Social-Welfare/Social-Solidarity/Benefits-and-Services/WEB647/default.aspx|title=In-Work Benefit|website=servizz.gov.mt|language=en|access-date=2018-05-02}}

At 42.3% in 2017, female workforce participation rate in Malta is relatively low.{{Cite web|url=https://data.worldbank.org/indicator/SL.TLF.CACT.FE.ZS|title=Labor force participation rate, female (% of female population ages 15+) (modeled ILO estimate) {{!}} Data|website=data.worldbank.org|language=en-us|access-date=2018-05-03}} For over half of Maltese women who stay out of the workforce altogether, they do not receive direct unemployment benefits. Rather, most unemployment benefits are given to men because to receive unemployment benefits, one must first be employed. However, because older women tend to stay out of the workforce, those women who do participate in the workforce tend to be younger and have higher levels of education. This has led to a lower long-term unemployment rate amongst women than men. In 2011, the long-term unemployment rate of women was 2.5% while the long-term unemployment rate of men was 3.3%.{{Cite journal|last=Debono|first=Manwell|date=July 2012|title=EEO Review: Long-Term Unemployment, 2012, Malta|url=https://www.um.edu.mt/library/oar/bitstream/handle/123456789/21898/_resources_reviews_Malta-LTU-July2012.pdf?sequence=1&isAllowed=y|journal=European Employment Observatory}}

Malta has public and private pension systems. There are two types of contributions for the public pension system: class one and class two. Employed people contribute to class one and those are self-employed contribute to class two.{{Cite web|url=https://www.oecd.org/countries/malta/43469300.pdf|title=Malta: Pension system profile|access-date=1 December 2016}} There was a gradual increase in pension age in Malta in the 1950s and 1960s; for example, someone who was born in 1953 needs to be 62 years old in order to collect pensions while another person born in 1960 would have to be 64 years old in order to collect pensions.{{Cite web|url=http://yesitmatters.com/resources/social-security-matters/pensions-faqs/|title=Pensions FAQs for Malta|access-date=1 December 2016}} Another requirement to qualify for a Malta pension program is that a person must have been contributing to the program for a certain time period or they will not be eligible.{{Cite web|url=https://www.canada.ca/en/services/benefits/publicpensions/cpp/cpp-international/malta.html|title=Malta - Pensions and Benefits|date=7 October 2015|access-date=1 December 2016}}.In Malta there is a state Malta Retirement Programme for foreign pensioners. According to the programme, a foreigner whose income is more than 75% from pension payments, can receive a residence permit in the country and a special tax status.{{Cite web|url=https://cfr.gov.mt/en/inlandrevenue/itu/Pages/Malta-Retirement-Programme.aspx|title=Malta Retirement Programme}}

• Tourism in Malta
• List of companies of Malta
• Economy of Europe
• General Retailers and Traders Union

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