A new barometer published by the Chamber of SMEs last Thursday found that close to two-thirds (64%) of businesses feel that Malta is moving in the wrong direction.

A majority of businesses (56%) remain uncertain whether the next twelve months represent a good time to invest, while only around one in five businesses believe it is the right time to make new investments.

The findings are not new: they actually reflect the findings of the same barometer in previous quarters.

For instance, in Q1 this year, 59% said that they felt that Malta was moving in the wrong directly, and 49% where uncertain about whether the next year is a good time to invest. 

In Q1 of 2025, 70% of SMEs felt that Malta is heading in the wrong direction - the data goes on and on; if you go back years you will find that the majority of SMEs have consistently felt that Malta is going in the wrong direction.

The survey is a qualitative one, which means that it doesn't ask respondents to explain their stance - but it would be interesting to understand why these SMEs feel this way, and more so to understand why they feel that nothing appears to be changing.

SMEs are asked about what they feel are the issues which need government action as a key priority, and they ranked overpopulation as the most important issue, with concern increasing further compared with previous quarters.

At the same time, safeguarding quality of life and improving the ease of doing business registered some of the largest increases in importance, with the Chamber suggesting that this indicates that businesses are increasingly seeking a better balance between economic growth, public services and the overall business environment.

While good governance, inflation and corruption remain important concerns, all three registered lower levels of concern than in the first quarter of 2026.

Yet this is where the contradictions, and perhaps hence the difficulty to understand the root of the issue, begins.

While SMEs list overpopulation as the most important issue for the government to address, the survey also found that employee shortages remain the single biggest challenge facing SMEs, cited by almost four in every ten businesses (38.8%), slightly down from the previous survey.

SMEs also had concerns regarding the processing of Third Country National (TCN) visa applications, believing that the process should be more efficient.

There is a paradox here: SMEs are saying that the country is overpopulated, but at the same time, they are saying that they need more workers and that it should be easier for TCNs to get a visa to migrate to Malta.

It is a bit difficult to understand how these two issues presented as realities in the survey can be reconciled together.  One cannot first complain that there are too many people in Malta, but then suggest that it should be made easier for visas to be granted because there aren't enough workers.

The direction change and economic shift that has been the topic of many, many debates over the last few years usually has the population at its core.  Critics argue that the economy's growth was supercharged by an increase in population which Malta simply cannot cope with.

SMEs consistently suggesting that the country is moving in the wrong direction must no doubt in part be down to the notion that the economic model needs to change. 

Yet the change cannot only come from the government: SMEs themselves must be a part of the change - relying on TCNs cannot be the answer in a new economic model.