Performance of the Economy

The Maltese economy continues to perform and is expected to grow by 4.9% and 4.3% in 2024 and 2025 respectively, mainly driven by domestic consumption.

Against this backdrop of robust GDP growth, the debt-to-GDP ratio is expected to amount to 49.5% in 2024, increasing marginally to 50.1% in 2025, as Government maintains its energy support measures. The deficit for 2024 is expected to amount to 4.0% of GDP, and is projected to decline to 3.5% next year. While high from a historical perspective, Government is projecting this to continue to decline to 3.0% in 2026 - thus satisfying the Maastricht Criteria - and to then reach 2.6% by 2027.

Meanwhile, the annual inflation rate for 2024 is anticipated at 2.5%, down significantly from the 5.7% registered in 2023. Finally, unemployment is set to remain stable at 3.5%.

Real GDP growth rate of 4.9%

GDP is set to grow by 4.9% in real terms in 2024, driven by net exports. In 2025, GDP is set to grow by a further 4.3%, driven by domestic demand.

Inflation expected at 2.5%

For the full year 2024, the inflation rate is expected to be 2.5% and is expected to decline to 2.1% in 2025.

Government expenditure - €7.8bn

From the €7.8bn expenditure expected in 2024, €6.7bn represents recurrent expenditure, while capital expenditure is set to amount to €1.1bn. This compares with €6.0bn and €1.0bn respectively in 2023.

Government debt - €11.1bn

Government debt is set to amount to €11.1bn in 2024 (up from €9.8bn in 2023) of which €9bn comprise Malta Government Bonds.

Deficit in consolidated fund - €0.9bn

The deficit in the consolidated fund is set to amount to €909mn in 2024, up from €806mn last year. In 2025, Government expects the deficit to decline to €850mn.

Unemployment rate - 3.5%

The unemployment rate is expected to stand at 3.5% in 2024. In August 2023, the monthly unemployment rate also stood at 2.7%, which remains below the EU average rate of 6.4% in the same month.

Employment rate - 81.3%

Malta's employment rate in 2023 was 81.3%, compared to the EU average of 75.3%.

GDP set to reach €22.3bn

In 2024, the size of Malta’s economy is set to amount to €22.3bn, up from €20.6bn in 2023, reflecting a 9.6% nominal growth in GDP.

Government revenue - €7.2bn

Revenue for 2024 is expected to amount to €7.2bn, compared to the €6.4bn collected last year.

Debt to GDP ratio of 49.5% in 2024

Government debt is expected to reach 49.5% of GDP by the end of 2024 and set to increase to 50.1% in 2024, thus remaining below the 60% euro threshold.

Deficit - 4.0%

The deficit for 2024 is expected to amount to around 4.5% of GDP, declining to 3.5% by 2025 and reaching 2.6% of GDP by 2027.

Interest payments on Government debt - €263mn

Interest payments on Government debt are expected to amount to €263mn in 2024, up from €214mn last year. This interest expense is set to increase further in 2025, to €312mn.

Employment Growth - 4.6%

Employment is expected to increase by 4.6% in 2024 and 4.1% in 2025.

COLA - €5.24 per week

The weekly cost of living adjustment for 2025 will be €5.24 per week. This adjustment will be granted in full to employees, recipients of social benefits and pensioners and pro rata to students. The minimum wage will increase by €8.24 per week in 2025 to reach €221.78 per week.

Performance of the Economy

Malta Budget 2025