As I have previously expressed, Budget 2025 continues to push economic growth mainly through stimulating domestic demand (consumption). However, the most interesting stuff is beyond the immediate fiscal decisions for 2025.

It seems, that finally, everyone is agreeing that while economic growth is important, people are demanding that economic growth without preserving and improving the quality of life, will not be enough. As we learn in the infamous Maslow Hierarch of needs, while economic growth satisfies the most basic physiological needs, it is now only normal for the electorate at large to aspire to a higher sense of well-being.

To be honest, we can have a debate that could literally be endless as to why we ended up here and what we could have done differently to have economic growth on a more sustainable basis. Many mistakes based on a short-term mindset were committed. However, I am personally more interested that we focus on making sure that while we fully map out where we want to be and what we want to achieve, we in turn are all fully committed as a nation, to get there.

So, my focus is about the debate and formulation of various policies and documents that will likely shape our collective future. The main one is obviously the Malta Vision 2050. As I had the chance to publicly state, we need to get this national effort to formulate Malta Vision 2050, right. Failure is not an option. To do so, we need to ensure that all this effort does not end up in glossy documents and snazzy slogans, that will likely cost this country dearly. The government keeps saying that KPIs will be set up as part of this Malta Vision 2050 process, to ensure that targets outlined in this vision will be met. I expect these KPIs to be measured regularly and to have the results of these KPIs easily available for everyone, so that we all can see whether we are moving towards achieving the targets set out for such KPIs or not.

I also expect that come Budget 2026, these KPIs and where we stand on them, would be a core element of such budget and this should remain so for subsequent budgets. This would ensure that politicians would take all the necessary decisions to have this country move towards the targets for these KPIs.

Besides the ultimate destination, the journey to get us there is also very important. One of the main challenges we face is balancing between the changes we will inevitably need to implement, while doing so with minimum shocks to our economy. A case in point is the upcoming economic migration policy. On one hand this country needs a policy that serves as a baseline and framework as to what type of foreign workers this country needs and how many are needed. On the other hand, the transition to such policy needs to be very carefully planned as this could create huge shockwaves that could affect economic growth. This change needs to allow for a mindset change for the business community, while also incentivising even further investments towards digitalisation. With government planning to run annual budget deficits to the tune of €700m-€800m in the coming years, we need economic growth to keep our deficit and debt to GDP ratios in check.

Ultimately, this country has a long history of truly changing when it absolutely cannot do otherwise. However, on the other side, we normally manage to adapt to change quite well. We are now faced with having to bank on our collective courage and wisdom to transform our economy to achieve new heights based on higher productivity and a more sustainable basis. We owe it ourselves, but more so to future generations. We already have one of the lowest European birth rates - the last thing we want is for future generations to conclude that our small islands offer them a diminished quality of life and has deteriorated so much that our best brains decide to move out. That would be tragic considering that our greatest natural resource is ourselves.