The Minister for Finance welcomes the latest assessment and related report issued on the 2rd October 2015 by DBRS Credit Rating Agency where Malta’s long-term rating was confirmed at ‘A Stable’.

PRESS RELEASE ISSUED BY THE MINISTRY FOR FINANCE

 
The Minister for Finance also notes with satisfaction the main points highlighted in the report, whereby DBRS Ratings acknowledges ‘the improving public finances and a reduction in public indebtedness’. This improvement is attributed by DBRS to the reforms undertaken by this government including the adoption of the Fiscal Responsibility Act and the Comprehensive Spending Review contrasting with the ‘weak fiscal management in the past’. Apart from the better monitoring and prioritising of public spending, DBRS also notes the increasing government revenue as a result of rising wages, corporate profitability and increased investment. It further acknowledges that the Government is on track to meet its 2015 deficit target.

 
DBRS commented favourably on the growth dynamics during the years, noting that most industries performed well with tourism, financial and business services as well as gaming being the major source of income and employment. DBRS expects growth to remain robust this year, with infrastructure investment and favourable labour market conditions supporting domestic demand and tourism and other services exports expected to continue contributing positively to economic growth.
 
DBRS confirms the successful restructuring of Enemalta noting that this will be essential to reduce risks to public finances. In addition, DBRS acknowledges that the planned conversion of the Delimara power plant to run on natural gas will reduce government’s exposure to future oil price shocks.

 
Reference was also made to the structural challenges faced by Malta, including healthcare costs and pension liabilities. DBRS also expressed concerns, shared by the Government, about the limited access to credit by banks and other challenges including the female labour participation rates and certain educational outcomes from secondary schools. The Government is committed to continue addressing these challenges with new initiatives to be announced shortly in the Budget for 2016.
 
Minister for Finance Edward Scicluna remarked: ‘The various initiatives being undertaken by this Government are bearing results and this is being acknowledged by various stakeholders including international credit agencies. We will not rest our laurels and will be announcing more measures to address remaining challenges in the forthcoming Budget’.

– Friday, 2nd October, 2015