Fitch confirms Malta’s ‘A’ rating, upgrades its forecast from ‘stable’ to ‘positive’

Ratings agency Fitch has confirmed Malta’s ‘A’ rating while upgrading its forecast from ‘stable’ to ‘positive’.

This means, the government said in a statement, that three credit rating agencies have revised their outlook for Malta upwards. This contrasts with the downgrades Malta received during the previous legislature, it said.

One of the reasons why Fitch has upgraded Malta’s outlook was the government’s financial results. It noted that national debt went down as a percentage of GDP during 2015. The agency estimates that national debt will decrease to 58 per cent by 2018, returning to 1998 levels during the course of the current legislature.

“According to Fitch this reflects a strong economy. Its analysts have also praised the pensions reform and the energy projects. Despite the Opposition’s repeated claims that these projects are unnecessary, Fitch says that these will lead to economic growth and increased efficiency,” the government said.

The agency also noted that the income of families would keep increasing and inflation would remain low. There would also be a high level of investment in the residential, medical and education sectors.

“Once again an independent analysis carried out by foreign experts has confirmed our economy’s strength. Malta is the country with the best economic growth and lowest unemploy- ment in the EU.”

Prime Minister Joseph Muscat reacts

Prime Minister Joseph Muscat said he believes that while the economy has continued to grow and benefits are being felt by a wider range of people, much work still needs to be done.

“The success we have achieved is not the point of arrival, but the point of departure for future success,” he said in a press release issued yesterday morning.

“While we see many people moving forward and youngsters who want to work, we need to think of people who are living in poverty. Poverty in Malta has been reduced for the first time in 10 years, however we still need to break it,” he added, in reaction to the Fitch report which turned Malta’s economic outlook from stable to positive.

“This is confirmation of what Maltese and Gozitan families have been feeling in their pockets. The knowledge that there is work out there, that there are benefits to be distributed, and the knowledge that this legislature began at a time where the economy was stagnant shows that we changed all this and turned Malta’s economy into one of the fastest growing in Europe, with the lowest rates of unemployment as well as the lowest rates of youth unemployment.”

He reiterated previous comments about creating a new middle class, confirmed through the 40 per cent decrease in people receiving social benefits and a 14 per cent increase of people categorised in the middle class.