Those who would want to understand what is happening in Malta especially with regards to the Budget for 2017 announced by the Government this week would do well to contextualize their reading with the statement by Standard & Poor's last Friday when it announced it had upgraded Malta's credit rating from BBB+ to A-.
It has been said that the Budget Speech, mainly announcing measures, is rather short on the wider context. That, in a way, is provided by the S&P document.
The Budget for next year must be looked at within the context, as described by S&P, of Malta's strong real GDP growth, which it expects to average 3% in 2016-2019, "the rise in supply of labour, growth in the export of services and robust investment driven by large-scale projects in education, healthcare, tourism, transport industries and energy projects".
S&P described Malta as being "in the midst of one of the strongest medium-term economic expansions in the eurozone" with the second-highest average GDP growth rate in 2010-2015 and the third-highest average expected real GDP growth in 2016-2019.
The Standard and Poor's upgrade was further substantiated by Malta's "consistent improvement in qualitative and quantitative fiscal performance, with general government deficits below 1% in 2016-2019, tighter management of contingent liabilities, and durable current account surpluses, standing at 1.9% of GDP on average in 2016-2019."
Raising Malta's rating from BBB+ to 'A-, was the first time S&P raised Malta's credit rating in 20 years.
More than the low unemployment figures, which put Malta among the countries with the least unemployment in the EU, it is the consistent, across-the-board, credit ratings and, in particular, this credit upgrade that should impress people.
For this, as the report stated, reflects "an improvement in Malta's fundamental external position."
Malta's expanding labour supply was singled out as one the key drivers of its solid economic performance, thanks to net migration calculated as 1% of its 2015 population, and an increase in employment, especially of women. This, coupled with the ongoing economic growth, led to improvements in the sustainability of the social security system, said Standard and Poor's.
Since Budget Day, the airwaves, news portals, blogs and the lot have been full of Budget details and claims and counter-claims that the Budget was very good or, according to the speaker, very bad. Unfortunately, however, few were the voices of reason in this melee, able to sift through the multitude of details and measurers and to find out the general trends.
There are details, or measures, in the Budget Speech that one may disagree with, such as the skimpiness of proposals regarding traffic, which has become a daily headache for most of us.
One may also disagree with the basic thrust of the Budget when it says it wants to give more to the lower placed in that it is clearly taking from the middle class and its earnings and none from the top classes which benefit far more from the growth around us.
As S&P itself stated, one of the issues which may bring problems to Malta is Brexit. The fact Brexit may bring problems not just to Malta but to Britain first of all and to the EU in general is something which still has to be faced up to in the future.
The fact remains, though, that once again Malta is a sea of calm in the middle of a raging sea and many neighbouring countries would dearly love to get that same kind of deficit and of growth that Mata has and looks like having.