Prime Minister Joseph Muscat explained how the upgrade from A to A+ by Fitch economic rating agency will attract more foreign investors and will mean that government can borrow on the international markets at lower interest rates.

He was speaking on a brief interview with the Labour Party (PL) media unit One Radio. Muscat described how when foreign investors are deciding where they would like to invest their money, a positive rating shows them the stability and opportunity for growth, making it a more attractive investment opportunity. On the other hand, should Malta want to borrow money on the international markets, a strong rating means that the government would be charges lower interest rates, because Malta is deemed as a stable economy and therefore low risk.

Muscat spoke at length about how the ratings agencies have no allegiance or disposition towards one particular party or newspaper, and make decisions without any pressure, based on facts. He said that when an agency such as Fitch or Standard & Poors need to downgrade the rating of a particular country, they do so without hesitation.

“The politics of this government encouraged them to further upgrade our rating,” Muscat said.

Muscat turned to the housing market issue that is currently growing within Malta, where rental and housing prices have ballooned and the average Maltese citizen cannot keep up. The gaming, financial services, insurance, the citizenship by investment scheme and rental market have all attracted many foreign nationals to our shores, who can afford to pay higher prices. As demand grows and Malta’s population continues to grow, many stories are emerging of lower income Maltese families who simply cannot make ends meet.

Government organised a press conference last Friday, which Muscat made reference to, about plans to offer private sector long-let leases – that promises stability – so that it may in turn rent out those homes to vulnerable people at affordable prices. Muscat said that this is the government’s way of taking action rather than addressing a situation with pointless rhetoric.

The prime minister also made reference to the Financial Time’s positive and efficient citizenship-by-investment scheme.