Finance Minister Clyde Caruna said that Vision Malta 2050 will address issues such as climate change, demographic changes, and global market dynamics.
Delivering his budget speech in Parliament on Monday, Caruana said that this vision will serve as a plan for the economic, social, and environmental development of the country with a focus on digital innovation, infrastructure, education, sustainability, and healthcare.
Caruana said that it is planned for the "definition phase" of this vision to be ready by the end of Q1 2025 but that work on this project has already begun.
A carbon-free economy by 2050
As part of the government's aim to have a carbon-free economy by 2050, Caruana said that it will continue to support residences which invest in renewable energy systems and equipment that increases efficiency in the use of energy and water. He continued that in 2025, the government will be supporting schemes for the installation of photovoltaic panels and battery systems for the storage of renewable energy.
He continued that there will be schemes for the installation of heat pump water heaters and solar water heaters, as well as incentives to restore wells of old houses along with a scheme for water purification equipment. He added that the government will also continue to incentivise the private sector to develop large renewable energy installations.
Transition to clean energy
On the matter of the transition to clean energy, Caruana commented that Malta's biggest natural resources are the sun and the sea, which he said are capable of helping the country make the next leap in energy production.
He said that the government's vision is a strategic one. He continued that the first step is the implementation of the second interconnector to continue strengthening the network's stability. The second step is investment for mass energy storage through the use of batteries on land. The third step is the launching of the national policy to spur renewable energy projects, and the fourth step is preliminary consultation in the market to assess interest and see how prepared the market is.
The Finance Minister said that offshore wind technology presents an alternative solution to take advantage of wind energy, and added that the government is also looking towards nearshore solar projects.
Transition to cleaner private and public transport
Speaking about the transition to cleaner transport, Caruana began by saying that the demand in the country's infrastructure brings challenges with it that must continue to be addressed so that growth remains sustainable. With that in mind, the Finance Minister stated that in Budget 2025, the government is addressing these challenges with measures which strengthen efficiency, improve accessibility, and help Malta move towards a more modern mobility system.
He said that the government will continue its investment in fast ferry services and other holistic projects which make it possible to increase the use of mass sea transport. He continued that preparatory work is underway for an underground parking project near ferry areas, and added that the government is strengthening the infrastructure of the ports and piers by continuing the work in the Grand Harbour and the Deep Water Quay.
Moving to land transport, Caruana said that for 2025, the government will continue its investment to foster cleaner and more efficient transport infrastructure.
He said that from next year, the scheme for the purchase of new electric vehicles will be extended, and everyone who purchases a new vehicle which is powered by electricity will be entitled to a grant varying between a maximum of €2,000 for motorcycles, and up to a maximum of €8,000 for cars and small vans, he commented that some conditions will apply.
Caruana continued that a €1,000 grant will also be given for the scrapping of old vehicles. He said that the additional grant of €1,000 for old vehicles registered in Gozo will also be maintained. He added that the scheme which incentivises the purchase of new pedelecs and ekickscooters for personal use will also be extended.
He stated that the schemes where a grant equivalent to a full refund is being given for VAT on bicycles and e-bikes will be extended, and that the same applies to the scheme which incentivises the purchase of motorised electric bicycles along with the grant for those who switch their vehicle to gas instead of petrol.
The Finance Minister said that electric vehicles and plug-in hybrids with an electric range of 50km or more will remain exempt from the registration tax and from the annual licence fee of the road for a period of five years from the date of first registration.
He said that the government will be publishing a national strategy that focuses on cycling as an alternative means of travelling while implementing the first phase of the CSAM (Connections for Safer Active Mobility) project, which he said incorporates interventions such as the creation of cycle paths as well as pedestrian paths and landscaping areas in urban areas.
Caruana remarked that the use of technology plays an important role in better traffic management, and so the government will be investing in the 'Intelligent Traffic Management System', which he stated will contribute to optimising the influx of traffic.
He continued that the government is looking at a number of proposals which can be carried out in a short time with the aim of relieving traffic congestion, "especially in peak hours". He said that the priority in this work is to better organise the country's roads and "adapt to the modern economy of 24 hours every day".
The Finance Minister said that the government has already launched a national consultation regarding these proposals.
Agriculture
The Finance Minister said that in 2025, the government will establish a Food Safety Authority, so that there would be one regulatory in that area while also having an authority responsible for ensuring food safety in the event of a crisis. He continued that in order to reduce food waste, the government will give a fiscal incentive to producers and food vendors for products which are approaching their expiry date to be given for social needs or to be sold at a reduced price.
Caruana said that the government will help fishermen to adopt environmentally friendly practices so that the sector causes less pollution.
He said that the government will reduce the excise duty on beer with a low alcohol content which is produced from small and independent breweries in Malta in order to create a level playing field in the market. He added that the way the excise tax is calculated "will change from degree Plato for ABV%".
Financial Services
The Finance Minister said that the government is planning to pass legislation intended to further strengthen Malta's attraction in the sector of financial services. He said that this includes "family offices, aircraft leases, as well as Fintech and AI". He continued that in 2025, the government will pass legislation on Limited Partnerships.
Tourism
Caruana said that air connectivity has increased to the point where Malta is directly connected with around 110 airports. He continued that tourism's contribution to the country's economy will exceed €3 billion for the first time. Caruana said that head-to-head tourist expenditure is always increasing, with the latest results showing that by August 2024 the expenditure had risen to €904 per person. He commented that this will mean a cumulative increase of €56 million in Malta's economy.
Caruana spoke of how Gozo has unique characteristics which the government wants to preserve to maintain its value and sustainability. He said that the government is committed to ensuring Gozo's connectivity.