The Finance Ministry this evening welcomed the latest winter forecast published by the European Commission, which expects economic activity in Malta to remain robust, well above the European Union average. Furthermore, the economic expansion is forecast to continue at a broadly unchanged pace in 2017 and 2018.

“Growth is expected to be more self-sustaining in the coming years, fuelled by private consumption, supported by favourable labour market developments, and investment backed by improving financing conditions.

The European Commission attributes the net job creation in 2016, which it defines as ‘robust’, to the labour market policies implemented by the Government. The unemployement rate is expected to remain at a low level, coupled with moderate inflation.

Malta’s external trade is also expected to remain bouyant as the surplus in the current account is expected to rise to 6 per cent by 2018.

Similar to the Government’s deficit targets, the Commission expects the deficit to decline to 0.7 per cent in 2016 and further down to 0.6 per cent this year. The favourablemacroeconomic environment, revenue-increasing measures, and contained expenditure are expected to contribute to such declines. In addition, the debt-to-GDP ratio is also projected to fall below 60% in 2016, and to reach 55.6% by 2018.

The Commission expects the fiscal outlook to remain positive for 2016, while risks for 2017 and 2018 are expected to be balanced.”

Finance Minister Edward Scicluna said this was “another positive forecast for the Maltese economy in the coming years, which as stated by the European Commission, is the result of structural reforms and activation polices implemented by the Government.”