The Malta Business Bureau led a 19-strong business delegation to Brussels to engage with institutions, policymakers and decision-takers, discuss ETS, competitiveness, the Blue Economy and the newly published Sustainable Tourism Strategy, and advocate for Maltese business interests.

Speaking during one of two policy roundtables for which Commission and EP officials were present, MBB CEO Mario Xuereb spoke about striking the right-balance between connectivity, competitiveness and the challenges brought about by climate change.

“Around 70 per cent of Malta’s imports arrive on the Italy to Malta line so the maritime EU ETS reaches Maltese businesses and households through freight rates MBB supports the ETS and its 2030 and 2040 objectives. Our concern is proportionality: on a route with no alternative mode, a full carbon charge cannot change behaviour, it can only raise prices.”

Policy Advisor Nigel Caruana listed MBB’s recommendations on ETS which include

• a 50 per cent ETS derogation with no end date for ro-ro cargo ships, ro-pax ships and container ships travelling between a port in a Member State and a port on an island in a Member State with a surface area of less than 10,000 km² and no road or rail link to the mainland;
• charging only the cargo actually carried on the empty return leg;
• keeping the transhipment safeguards at a 50 per cent threshold and the 150 nautical mile rule to protect the Malta Freeport against nearby North African hubs;
• providing free allowances covering 50 per cent of the ETS surrender obligations for eligible flights to and from islands below 10,000 km² with no fixed road or rail link;
• and strengthening support for sustainable aviation fuel.

MBB Vice President Sergio Vella said that lessons learnt by Maltese industry in lobbying and advocacy efforts have fuelled and driven the organisation’s efforts to reach out as early as possible to influence policy proposals. He said MBB keeps monitoring and pushing for resolution of issues in favour of Maltese business and industry at various stages and different levels of the policy-making process.

On the Blue Economy, MBB Policy Executive Juliette Mizzi also presented recommendations which include the appointment of an EU Blue Economy Envoy, further cooperation on youth and skills development through Global Gateway; the mobilisation of investment and EU funding in EU port electrification, sustainable maritime fuels and water and energy resilience amongst others.

The delegation held meetings with BusinessEurope and HOTREC at their offices, informal meetings with Eurochambres and also had the opportunity to exchange views in separate meetings with EP President Roberta Metsola; Commissioner Glenn Micallef; and PREU Neil Kerr, who was joined by Deputy Permanent Representative Chris Farrugia.

They also engaged in a Q&A session with Maltese MEPs Alex Agius Saliba, Peter Agius, Daniel Attard and Thomas Bajada. Over the past months MBB engaged MEPs propose amendments to the ETS reform proposal put forward by the European Commission earlier this year. Xuereb thanked them for keeping an open channel of communication throughout and encouraged them to keep pushing the positions discussed with MBB for the benefit of Maltese business and industry.

Attard Holdings, Express Trailers, Concorde IFF, EuroBridge, ATTO, AP Valletta, Deloitte, KPMG, EY Malta, FinPlus Europe, the Institute for Tourism Studies, KM Malta Airlines, Brands International and Harbour Solutions joined the delegation. 

The MBB is the only Maltese organisation based in Brussels. It has been advising the Malta Chamber of Commerce and MHRA on EU policy for the past three decades.

The delegation was supported by Malta’s Permanent Representation to the EU, KM Malta Airlines, VisitMalta and Transport Malta.

The post Striking the right balance on ETS and competitiveness first appeared on The Malta Business Weekly.

A Central Bank of Malta analytical study by economist Eliza Farrugia examines developments in the accommodation and food services sector, covering business formation, economic performance, employment, productivity, profitability and its links with other sectors of the Maltese economy.

The number of active business units in the sector stood at 4,297 in 2024, accounting for 7.1% of all registered business units in Malta. The sector has undergone a notable transformation over the past decade, with accommodation activities accounting for an increasingly larger share of businesses.

Between 2015 and 2024, the sector added 1,911 business units. Of these, 1,401 were in accommodation, while food and beverage services accounted for the remaining 510. The share of accommodation businesses increased from 9% in 2015 to 38% in 2024, while the share of food and beverage businesses declined from 91% to 62%.

The expansion of accommodation activities was accompanied by an increase in hotel bed-stock, which grew by an average of 1.6% annually during the period. The study also notes that the number of accommodation-related business units increased particularly in the years following the COVID-19 pandemic.

The sector remains dominated by small businesses. Micro enterprises, employing between zero and nine people, accounted for 93.4% of firms in 2023, while small enterprises represented 5.6%. Medium-sized and large businesses together accounted for less than 1%.

The growth in businesses has largely been driven by sole ownerships and partnerships, particularly within accommodation. This suggests that the sector’s expansion has been led primarily by smaller operators rather than larger companies.

Changes have also been observed in the type of accommodation used by inbound tourists. Collective accommodation, which includes hotels and similar establishments, accounted for around 75% of tourist nights in 2013, but its share declined to approximately 61% in 2025. Meanwhile, the share of other rented accommodation increased from 14% to 31%, reflecting the growing importance of alternative accommodation options.

The sector’s economic contribution has increased considerably over the longer term. In 2000, accommodation and food services accounted for approximately 4% of Malta’s total GVA. By 2025, this share had risen to around 6.3%, with accommodation activities contributing 62.6% of the sector’s GVA and food and beverage services accounting for 37.4%.

Economic growth was relatively modest between 2000 and 2009, averaging 1.1% annually. It accelerated significantly during the following decade, with average growth of 9.7% between 2010 and 2019. The pandemic interrupted this expansion, but the sector recovered strongly, with real GVA growth reaching 25.9% in 2023, 20.2% in 2024 and 15.3% in 2025.

The Central Bank notes that the sector’s performance broadly follows trends in inbound tourist arrivals and nights spent. The recovery and subsequent expansion were supported by rising tourism activity and improvements in air connectivity. Policies allowing greater hotel heights also played a role in supporting the expansion of accommodation capacity.

Employment has grown alongside the sector’s economic performance. The number of workers employed in accommodation and food services reached 32,473 in 2025, accounting for around 8% of total employment in Malta. Employment grew by an average of 6.9% annually between 2013 and 2025.

Of the total workforce in 2025, 23,871 were in full-time employment and 8,602 in part-time employment. Food and beverage services continued to account for the larger share of employment, although accommodation activities recorded substantial increases in recent years.

One of the most significant developments highlighted by the study is the sector’s growing dependence on foreign workers. Their number rose from 3,013 in 2013 to 18,673 in 2025. Foreign workers consequently accounted for 58% of total employment in the sector, compared with 35% across the overall Maltese economy.

The increase has been driven largely by non-EU nationals. While EU workers outnumbered non-EU workers between 2013 and 2019, the latter began increasing at a faster pace from 2020 onwards, particularly from 2022. The study cautions that part of the change in that year was attributable to the reclassification of UK nationals as non-EU citizens following Brexit.

The reliance on foreign labour is particularly notable given the transient nature of the workforce. Foreign workers in Malta have a median length of stay of around three years, while those employed in accommodation and food services remain for a median period of just 2.3 years. This creates an ongoing need for recruitment and replacement, potentially affecting continuity and the development of skills within businesses.

The sector’s labour conditions also stand out when compared with the euro area. In 2024, the average hourly wage in Malta’s accommodation and food services sector stood at €8.90, considerably below the euro area average of €16.70. Compensation per employee in the sector amounted to approximately €17,200 in 2025, compared with €36,000 across the Maltese economy.

Although compensation per employee increased by an average of 5.2% annually between 2013 and 2025, the sector continues to be characterised by relatively low wages. This is particularly relevant given its substantial contribution to employment and the economy.

Productivity remains another challenge. The study places accommodation and food services among the sectors with the lowest productivity levels in Malta, with only construction recording lower productivity. While the sector has expanded considerably in terms of output and employment, its productivity performance has not kept pace with its growth.

Profitability presents a more mixed picture. The sector ranked fourth among Maltese economic sectors in terms of profitability per unit of GVA in 2025. However, developments differed between its two main activities: profitability increased in accommodation, while food and beverage services recorded a decline.

The study also examines the sector’s links with the wider domestic economy. Input-output data for 2020 show that accommodation and food services generated output worth €714.9 million and used €473.6 million in intermediate inputs. Around €320 million, or 68% of these inputs, were sourced domestically, while €146 million consisted of imported products.

The sector relies particularly on distribution, manufacturing and real estate for its domestic inputs. This highlights the extent to which activity in accommodation and food services supports other areas of the economy, including suppliers and businesses providing goods and services to tourism operators.

The Central Bank’s analysis further indicates that the sector has relatively strong output and employment multipliers compared with other economic sectors, although its accounting multipliers are lower. Its economic importance therefore extends beyond its direct contribution to GVA and employment.

Tourism-related exports remain a major source of revenue. Travel receipts reached €2.89 billion in 2025, while net travel receipts accounted for 26.5% of Malta’s services balance.

The findings underline the considerable expansion of accommodation and food services and its growing importance within Malta’s economy. Yet the sector’s performance remains closely tied to tourism activity, while its reliance on foreign workers, relatively low wages and weak productivity point to challenges that could become increasingly significant.

Sustaining growth will therefore require not only continued tourism activity, but also attention to the sector’s labour conditions, productivity and ability to generate stronger economic value from its expanding workforce and business base.

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In October 2026, the number of final deeds of sale relating to residential property amounted to 1,217, a decrease of 5.6% when compared to those registered in October 2025. The value of these deeds totalled €415.4 million, representing an increase of 12.1% when compared to the corresponding value recorded in October 2025.

The residential property transactions featured in this release are not limited to purchases by individuals (households) but may also involve other economic agents. In addition, a single final deed of sale or promise of sale agreement may include more than one property.

In the month under review, 1,081 (88.8%) of these final deeds of sale involved individual buyers (households), with companies accounting for virtually all remaining deeds. The value of the deeds involving individual buyers (households) amounted to €307.2 million, equivalent to 74.0% of the total value.

Final deeds of sale by locality

The highest numbers of final deeds of sale were recorded in the following localities: San Pawl Il-Baħar (83), Birkirkara (63) and Il-Mosta (47).  

Properties transacted in the final deeds of sale

During the month under review, the number of properties transacted in the final deeds of sale was equivalent to 1,337. Apartments (477) and garages (305) accounted for the largest shares, at 35.7% and 22.8%, respectively.

Promise of sale agreements

In October 2026, 1,408 promise of sale agreements relating to residential property were registered, equivalent to an increase of 4.1% over the same period in 2025. The value of these agreements totalled €522.0 million, representing an increase of 4.9% when compared to the corresponding value recorded in October 2025. Individual potential buyers (households) accounted for 1,262 (89.6%) of these agreements, while the rest mainly involved companies.

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Malta’s trade deficit narrowed significantly in the first eight months of 2026, as exports increased and imports declined, according to provisional figures published by the National Statistics Office (NSO).

The deficit in trade in goods reached €2.84 billion between January and August, down by €624.1 million from the corresponding period last year.

During this period, imports totalled €6.32 billion, a decrease of €152.2 million compared with the first eight months of 2025. Exports, meanwhile, rose by €471.9 million to €3.48 billion.

The figures point to an improvement in Malta’s trade balance, supported by stronger export performance and lower imports across several major commodity groups.

Exports surge in August

In August alone, Malta recorded a provisional trade deficit of €295.7 million, compared with €371.8 million in the same month last year.

Exports increased by €76.9 million year on year to €481.4 million, representing growth of 19%. Imports edged up by just €0.8 million to €777.1 million, an increase of 0.1%.

The stronger export performance was largely driven by mineral fuels, lubricants and related materials, which recorded an increase of €65.1 million. Machinery and transport equipment also contributed, with exports in this category rising by €26.7 million.

These gains were partly offset by a €30.6 million decline in chemical exports.

On the import side, higher purchases of mineral fuels, lubricants and related materials contributed an additional €91.1 million. However, this was partly counterbalanced by decreases in imports of machinery and transport equipment, chemicals and food, which fell by €50.1 million, €36.1 million and €12.7 million respectively.

The August figures suggest that stronger exports, rather than a significant reduction in imports, were the main factor behind the narrower monthly trade deficit.

Machinery and fuels shape trade performance

Developments in machinery, transport equipment and energy-related products played an important role in Malta’s trade performance during the first eight months of the year.

Imports of machinery and transport equipment fell by €390.6 million compared with the same period in 2025. Lower imports of chemicals, down by €56.4 million, and miscellaneous transactions and commodities, down by €29.6 million, also contributed to the overall reduction in imports.

These declines were partly offset by a €291.4 million increase in imports of mineral fuels, lubricants and related materials, alongside a €34.4 million rise in miscellaneous manufactured articles.

On the export side, machinery and transport equipment generated an additional €200 million compared with the first eight months of last year.

Exports of mineral fuels, lubricants and related materials increased by €194.2 million, while miscellaneous manufactured articles recorded a rise of €47.7 million.

The contrasting movements across these categories underline the importance of the composition of Malta’s imports and exports in determining the overall trade balance.

European Union remains Malta’s main trading partner

The European Union continued to account for the largest share of Malta’s merchandise trade during January-August 2026.

Imports from EU member states amounted to €3.76 billion, equivalent to 59.5% of Malta’s total imports. Exports to the bloc reached €1.13 billion, accounting for 32.6% of total exports.

Asia was the second-largest regional trading partner, representing 20.7% of imports and 12.7% of exports.

At country level, Belgium recorded the largest increase in imports, at €102.7 million. France registered the largest decrease, with imports falling by €512.9 million compared with the corresponding period last year.

Germany was the destination recording the largest increase in exports, with a rise of €55.4 million. Exports to Turkey, meanwhile, registered the largest decline, falling by €44.9 million.

These figures highlight the continued importance of European markets to Malta’s external trade, while also illustrating how shifts in individual trading partners can influence the country’s overall trade flows.

Underlying trade deficit also improves

A separate measure published by the NSO excludes mineral fuels, oils and related products, aircraft and spacecraft, and ships and other floating structures.

Under this measure, Malta’s trade deficit stood at €175.2 million in August, down from €211.3 million a year earlier.

Imports within this category totalled €439.6 million, a decrease of 4.3% year on year, while exports rose by 6.5% to €264.4 million.

For January-August, the deficit under this measure narrowed by €340.3 million to €1.72 billion. Imports declined by 2.7% to €3.81 billion, while exports increased by 12.7% to €2.09 billion.

The figures indicate that the improvement in Malta’s trade balance was not limited to the overall headline measure, although the composition of trade remains an important consideration when assessing the underlying trend.

A stronger trade balance

Malta’s goods trade deficit remains substantial, reflecting the fact that the value of imported merchandise continues to exceed that of exports. Nevertheless, the latest figures show a marked improvement compared with 2025.

The €624.1 million reduction in the deficit during the first eight months of the year reflects both a decline in imports and an increase in exports, with machinery and transport equipment and mineral fuels playing a significant role in export growth.

The figures are provisional and may be revised as additional trade data become available.

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In proposals submitted as part of the national Budget consultation, the MMF argues that, as an island economy dependent on shipping for trade, energy and essential supplies, Malta’s port capacity and maritime connectivity are fundamental to its economic resilience and prosperity. Timely investment, maintenance and policy coordination are therefore not only priorities for the maritime industry, but national necessities.

To this end, the Forum urged immediate attention to critical port infrastructure.  Its priorities include restoring and strengthening the Marsaxlokk breakwater, completing Ras Ħanżir with a permanent and fixed  Ro-Ro berth  and creating backup options for cargo operations. The Forum maintains that changes linked to the Grand Harbour Revival Project should not displace existing operations before suitable alternative facilities are provided .

At the centre of the proposals is a call to fund the implementation of the National Maritime Transport Strategy through a clear action plan identifying responsibilities, deadlines and measurable outcomes. The Forum is also proposing a permanent interministerial structure to coordinate maritime policy across transport, finance, energy, climate, infrastructure and foreign affairs, ensuring that urgent priorities are acted upon rather than delayed.

The budgetary proposals also include a dedicated financing framework for major maritime decarbonisation and digitalisation projects.  A meaningful share of climate funding linked to the EU Emissions Trading System – as long as this is in place – should be channelled back into cleaner vessels, alternative-fuel infrastructure, energy-efficient port machinery and digital technologies.

Addressing the industry’s skills shortage, the MMF recommends a National Maritime Certification Centre, a Maritime Skills Board and a national cadetship scheme.  It proposes a medium-term target of at least 600 valid Maltese Certificates of Competency, helping Malta develop its own maritime professionals alongside its internationally prominent ship register.

Other proposals include shifting cargo from road to sea through a Ro-Ro link between Malta Freeport and Gozo, developing legal frameworks for cleaner marine fuels, and establishing a public-private entity to promote Maritime Malta internationally.

Godwin Xerri, Chairman of the Malta Maritime Forum, said:

“Malta cannot aspire to be a leading maritime centre while treating port resilience, maritime skills and policy coordination as secondary matters.  The 2027 Budget should move beyond statements of intent and provide clear responsibilities, realistic deadlines and the resources needed for implementation.  These proposals are not solely about supporting maritime operators.  They concern Malta’s supply chains, energy security, environmental transition and ability to remain connected to international markets. Investment in maritime capability is investment in national resilience.”

The MMF presented its proposals personally and separately to the Minister for Sustainable Mobility as well as to the Leader of the Opposition and selected Shadow Ministers.  It offered its support and expertise to Government, Opposition and other stakeholders on the detailed implementation of its proposals.

The post MMF proposes investment in port resilience, maritime skills, cleaner fuel infrastructure first appeared on The Malta Business Weekly.

Employers share the objective of a more productive Maltese economy, and that objective is exactly why the Association has consistently argued for investment, efficiency and higher-value activity rather than continued reliance on an expanding workforce.

In this context, ME contested the characterisation that Malta’s population growth is the product of employers preferring cheap imported labour to capital investment. That is not what employers have been saying and it is not what the evidence shows.

Malta’s own figures bear this out. Gross value added per worker grew by just 1.4 per cent in 2025, against employment growth of 3.9 per cent, while GDP per capita rose by only 1.6 per cent. The economy added people, added output, and delivered almost nothing per individual. The Association has said plainly that this model has reached its production possibility limit. Employers are not the obstacle to capital investment, they are the ones asking for it, the association said.

However, labour is not always interchangeable with capital. In sectors such as tourism, care, transport and construction, capital complements workers rather than replacing them. No machine waits tables, drives a delivery round, lays tiles or provides personal care. And Maltese workers are no longer seeking many of these roles: where technology offers no assistance such as waiters, drivers, builders, tilers, shop attendants, carers, cleaners, and the list continues, there is no domestic queue to draw from and no alternative source. The shortage is sharpest in qualified trades where essential trades are disappearing and the gap is being filled from abroad. Employers are not choosing cheap labour over expensive machinery; they are filling posts that must be filled.

Government’s own choices deepen the shortage.

The national strategy to generate growth through an unprecedented increase in population and construction was never agreed to, nor discussed, with the social partners. Government acted unilaterally and it cannot point fingers towards employers because of its consequences.

In addition, public sector employment has risen, partly to service a larger population and more so through recruitment that drains the private sector of people it cannot replace, competition for the same workers, but on unequal terms.

Successive new leave entitlements, introduced without any assessment of labour supply, mean absent workers must be replaced by others who cannot be found. Productive time lost in the ever-increasing traffic compounds the same loss. Each is a policy decision.

Malta Employers said it has repeatedly set out what it believes is needed: a decisive shift from a growth model based on population expansion, imported labour and domestic consumption towards one driven by export competitiveness, productivity and higher value added. We have called for incentives that reward capital investment, technology and automation, the upfront costs and uncertainty of which deter smaller enterprises from taking the first step. We have argued that Malta cannot indefinitely absorb the strain of a rapidly growing foreign population. We have asked for fair competition and for a national effort against tax evasion and money laundering, which would itself generate revenue for government to invest.

Malta Employers said it does not accept that the workforce model Malta now has was chosen by employers. It was arrived at, over years, in the absence of the capital incentives, skills pipeline and infrastructure that would have made the alternative viable. We will continue to engage constructively as social partners. A serious national conversation about productivity is one worth having, and it should rest on an accurate reading of the workforce model we now have and of who is responsible for it.

In a separate statement, The Malta Chamber of Commerce said it shared Minister Clyde Caruana’s concern that population growth is placing unnecessary and unsustainable pressure on Malta’s infrastructure and quality of life, but begs to differ on the Minister’s claim that the private sector prefers low-cost third-country nationals (TCNs) to capital investment.

It misdiagnoses the root cause of Malta’s economic bottlenecks. The Finance Minister is well aware of how the current labour market framework was built – it was a PL administration that pushed for economic growth based on foreign labour, the chamber said. Businesses are currently operating within a regulatory and administrative environment that was designed for volume-driven growth, and that model has not been reversed in any way, even though there have been multiple calls over the years to move from quantity to quality and more value-added. It is neither fair nor accurate to place the full burden on employers now that physical and infrastructural limits are being reached.

Furthermore, recruiting TCNs is also far from a cheap or easy option for employers, as it comes at a steep cost in terms of HR administration and time.

Over the last decade, Malta’s Gross Value Added grew by 81.9%. Of that growth, 68.9% came purely from expanding the labour force. Shifts towards higher value-added sectors contributed only 9.9%, and actual productivity gains, meaning output per worker, accounted for a mere 3.1%. This volume-driven model was encouraged by state policy, and it is unrealistic to expect private enterprises to single-handedly undo a decade of state-backed workforce expansion, even more so when one takes into consideration that Government has repeatedly ignored implementing proposals which would help improve productivity.

Through the Malta Vision 2050, Government itself acknowledged the imperative to pivot away from labour-driven growth towards higher productivity. We must now ensure that its outlined KPIs are rigorously tracked and achieved, rather than merely remaining aspirational talking points.

If the government had truly been pushing in a different direction, we would have seen a decisive increase in capital and targeted expenditure to avoid the recurring electricity disruptions, to address the traffic gridlock, to address the disruptions brought about by abusive planning and construction, to support effective digitalisation across the public sector and private industry, and to support reskilling and upskilling. We have not seen any of this, the chamber said.

In its statement, the Malta Chamber of SMEs said it is concerned by comments made by Minister Clyde Caruana, attributing Malta’s productivity challenges primarily to employers choosing cheaper labour over capital investment. While businesses undoubtedly have a responsibility to invest, innovate and improve efficiency, it is unfair and overly simplistic to place the burden of Malta’s productivity challenge predominantly on employers. Productivity is also heavily influenced by the environment in which businesses are expected to operate.

As highlighted in the Malta Chamber of SMEs’ Budget Proposals 2027, improving productivity requires more than investment in technology. It also depends on efficient regulation, accessible skills, effective workforce management and public services that support businesses rather than burden them. The proposals specifically identify traffic, skills mismatch, unfair competition and over-regulation as factors contributing to lower productivity. Every hour spent dealing with duplicated paperwork, unnecessary administrative procedures, regulatory delays or a lack of coordination between public entities is an hour taken away from productive business activity.

Rather than merely pointing towards the problem, the Malta Chamber of SMEs said it has put forward a comprehensive set of proposals for Budget 2027 aimed specifically at improving productivity. These include a Mandatory SME Test for new laws, regulations and major administrative procedures, a Regulatory Stocktake, implementation of the Once-Only Principle so that businesses are not repeatedly asked for the same information by different public authorities and a Productivity Tech Kit to help micro and small businesses adopt digital tools and more efficient systems.

The SME Chamber has also proposed measures to encourage productive investment and reinvestment, together with policies aimed at fair competition, improved enforcement, energy efficiency, transport and mobility. The overall objective is to create the conditions that allow businesses to invest, innovate and grow sustainably.

The SME Chamber said it has also proposed the establishment of a cross-party taskforce on Malta’s long-term priorities to identify the country’s main challenges, agree on a common way forward and provide greater continuity on reforms extending beyond a single electoral term. This is the type of mature and coordinated approach that Malta’s productivity challenge requires. Businesses must play their part, but productivity is a shared national responsibility. If we genuinely want to invest more in technology, automation and capital, we must also remove the regulatory, administrative and infrastructural obstacles that consume productive time and discourage investment, the statement said.

The post Employer bodies reject minister’s claims cheap labour growth was their choice first appeared on The Malta Business Weekly.

A comprehensive presentation of the Forum’s evolving position was led by Chairman, Godwin Xerri and Vice Chairman, Alex Montebello.  They maintained that the Forum’s consistently supported decarbonisation and the objectives of EU ETS. Nevertheless, they showed how, in line with their warnings ahead of its enactment, the application caused serious competition distortions and leakages with disproportionate risks on Malta and other member states.  These risks compromise fair competition, solidarity and other fundamental EU principles.

The Forum showed how EU ETS on maritime was not achieving its climate change objectives because ships still traversed the same sea but were increasingly diverting their transhipment operations away from the EU ports instead.  Besides this carbon and business leakage, the Directive was also diverting investment in new transhipment ports outside of the Union.

In the context of Malta’s dependence on global maritime connectivity, the presentation clearly outlined the risks of loss of mainline services with direct effects on the whole of the economy including connected feeder services, towage, pilotage, port services, terminal operations, stevedoring, mooring, ship agency, legal services, bunkering, importation of raw materials and supplies, and the manufacturing industry.  Loss of connectivity can cause the relocation of certain industry away from Malta due to market proximity considerations and limitations of export channels causing loss of jobs, investment and balance of payments imbalance for the country. 

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The increase is immediate and substantial, the statement said. Effective 1 October 2026 revised “EU ETS + FuelEU + BAF Surcharge” rates have been introduced on the Malta to Genoa service. The rates will apply until 31 December 2026 and will then be reviewed quarterly.

“This is a burden that European Union policy is placing on all Maltese citizens simply because we are an island. It is an unfair burden that will have repercussions on businesses and ultimately, all Maltese consumers,” said Joseph Bugeja, ATTO Chairman .

All operators have started contacting their respective clients to inform them of the increased rates.

The surcharge for a trailer travelling from Genoa to Malta rises from €35 to €39 per linear metre, translating into €530.40 per trailer. The same €530.40 applies to the return journey from Malta to Genoa, meaning that every trailer making a Genoa-Malta-Genoa round trip will now incur €1,060.80 in these surcharges alone.

The €35 million annual figure has been calculated on over 55,000 trailers originating mainly from Genoa but also to and from other Italian ports each year. Based on the new €1,060.80 round-trip charge, this represents an annual cost of approximately €35 million.

“Virtually everything Malta imports to sustain its economy and economic activity must cross the sea. Unlike most countries on mainland Europe, Maltese businesses have no alternative. Malta must stand up and challenge a policy designed for Europe as a whole but imposed on an island economy without adequately considering our unique geographic disadvantage.”

“The annual €35 million is being presented as Malta’s environmental bill. Safeguarding the environment is important, but environmental policy cannot come at the price of disproportionately penalising an island that has no alternative to maritime transport. This is an additional cost being imposed on Malta’s entire supply chain and it will ultimately be paid by Maltese businesses, families and consumers.”

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More than a third of Maltese family business increased their turnover between 2022 and 2025 but reported lower profits, according to the Malt Chamber Family Business Survey of 2026, announced on Thursday.

Malta Chamber Vice President Silvan Mifsud presented these results at “Turning Growth into Profit: Structure, Governance & Digitalisation in Family Business,” an event organised as part of Malta SME Week 2026.

The chamber’s cross-tabulation report sets the financial performance of 154 respondents from 2022 to 2025 against their sector, size, governance arrangements, strategic plans and priorities. It found that 57 firms, or 37%, reported higher turnover but lower profits. An identical number, also 37%, reported higher turnover alongside higher profits.

Growth was almost universal. In all, 142 of the 154 firms (92%) reported rising turnover, while 28 reported stagnant results and only 12 recorded lower turnover, ten of them with lower profits as well. The report calls the largest problem group “profitless growth”. It argues that the post-pandemic years gave family firms the chance to expand their market footprint, but that scaling up “fractured legacy cost structures and diluted margins”. The pressure is felt most acutely, it says, by mid-sized firms and by companies in importation and distribution.

The report concludes that growth without formal governance is a high-risk strategy. It says the dividing line between firms that create long-term value and those experiencing profitless growth is the move from informal, family-led execution to structured corporate professionalism, and that the businesses turning higher turnover into lasting corporate wealth are those that build independent boards, map out written strategic plans and pair automation with clean organisational design. It groups family businesses into two camps: a high-performing group it calls “offensive optimisation”, which it says is typically backed by regularly reviewed written strategic plans, often clustered in services and found in the largest size brackets, and a squeezed mid-market it calls “defensive structural engineering”.

The sharpest contrast in the tables was between firms with and without a formal plan. Of the 65 businesses with a written strategic plan that is regularly reviewed, 27 (41.5%) reported higher turnover and higher profits, while 17 (26.2%) reported higher turnover but lower profits. Among the 77 firms, half of all respondents, that said they did not have a plan but needed one, 36 (46.8%) fell into the profitless growth category and 26 (33.8%) reported higher profits. A further 12 said they did not need a plan. The report says operating without a formal blueprint severely damages a firm’s ability to capture financial value while scaling.

Performance also varied by sector. Services fared best, with 23 of 52 firms (44.2%) reporting higher turnover and higher profits. In importation and distribution, the largest group with 56 firms, 23 (41.1%) reported higher turnover but lower profits, which the report attributes to “competitive and inflationary compression”. It says service-oriented businesses are better equipped to turn top-line growth into profit, and that asset-light structures make it easier for them to preserve margins. Of the 16 manufacturers, five reported higher turnover and higher profits and five reported profitless growth.

Firm size also mattered. The report identifies a “scaling canyon” among mid-sized firms, where overheads rise before efficiencies materialise. Across the 10-to-30 and 31-to-50 employee bands, 28 of 64 firms (44%) reported profitless growth, although the tables show the share was higher still, at 47.8% (11 of 23), among firms with 101 to 250 employees. At the top end, nine of the 15 firms (60%) with more than 250 employees reported higher turnover and higher profits, the highest proportion of any size band, followed by 13 of the 24 firms (54.2%) with fewer than ten employees. The report reads the largest firms’ results as evidence of structural resilience and economies of scale.

Having a board did not, on its own, appear to protect firms from margin pressure. Some 109 of the 154 respondents (71%) said they had a functioning board that meets regularly to discuss performance and future direction. Yet 44 of them (40.4%) reported higher turnover but lower profits, compared with 13 of the 45 firms without a board (28.9%). The report says a board does not automatically shield a business from margin contraction, and suggests that larger, more mature firms, which are more likely to have boards, face stronger headwinds such as inflation and rising operational costs.

The make-up of the board appeared to make a difference. Of the 109 firms with boards, 55 included independent non-executive directors who are not family members. These firms were more likely to report stagnant profits (14 of 55, or 25.5%) than those with family-only boards (six of 54, or 11.1%). They were also less likely to report higher turnover but lower profits, at 36.4% against 44.4%, although slightly less likely to report higher turnover and higher profits, at 32.7% against 37.0%. The report says independent directors “seem” to introduce a stabilising framework that acts as a buffer against severe profit decay.

Respondents were also asked to rate a series of priorities from one to five, and the report reads the answers as a “reactive governance pattern”. Of the 31 firms that gave the top rating to improving corporate governance and adding independent non-executive directors, 15 (48.4%) were in the profitless growth category.

So were 24 of the 59 firms (40.7%) that gave the top rating to regular, timely reporting of financial performance and key performance indicators, and 20 of the 47 (42.6%) that gave it to running the family business on more professional lines. Professionalisation drew ratings of four or five from 98 of the 152 firms that answered. The report concludes that firms facing eroding margins are prioritising governance reform, digital investment and restructuring in response to negative financial results.

Digital transformation to automate processes and increase efficiency drew more top ratings than any other priority, with 56 of 152 firms giving it a five. Of these, 23 (41.1%) reported higher turnover and higher profits and 21 (37.5%) profitless growth. The report says high performers use automation offensively to unlock scalability, while margin-squeezed firms use it defensively to offset wage and logistics costs.

Among the 33 firms that rated investing in digital solutions such as CRM and ERP systems, rather than employing many more people, at four out of five, 17 (51.5%) reported higher turnover and higher profits. At the top rating, 14 of 39 firms (35.9%) reported higher profits and 16 (41.0%) lower profits, which the report says could reflect initial capital outlays and organisational changes compressing short-term margins.

On artificial intelligence, 16 of the 38 firms (42.1%) that gave the top rating to exploring its use were in the profitless growth category, and the report calls AI an exploratory remedy rather than an active driver of returns. Improving internal organisational structure drew ratings of four or five from 100 of the 152 firms, with higher and lower profit growth almost evenly split at the top two ratings (36.5% to 37.5% against 35.4% to 40.4%).

The findings are based on 154 respondents, or 152 for some questions, and several categories contain only a handful of firms. The tables show associations between variables rather than establishing cause.

The post 37% of Maltese family firms saw margins shrink despite higher turnover, survey shows first appeared on The Malta Business Weekly.

This substantial investment by the Freeport involved the complete replacement and modernisation of the medium-voltage switchgear and extensive refurbishment of the substation building, with all works carefully planned and executed while maintaining uninterrupted operations across the terminal.

The new medium-voltage switchgear was installed alongside the existing equipment, enabling the transfer of electrical circuits in phases without disrupting power supply to the terminal.

The upgraded distribution centre also includes a fully refurbished building envelope, with new doors and apertures to ensure an airtight environment, together with new air-conditioning systems, fire detection and alarm systems, and CCTV installations.

The project features Medelec’s locally factory-assembled MSGair medium-voltage switchgear, designed and manufactured in Malta in accordance with the internationally recognised IEC 62271-200 standard. The equipment has undergone independent type testing at the Cesi laboratories in Milan, confirming compliance with stringent international performance and safety requirements.

The new switchgear provides Malta Freeport Terminals with significant operational advantages. Its modular design allows for future expansion as the terminal’s electrical infrastructure continues to evolve, while the additional bus arrangement and ringed circuit capability substantially improves operational flexibility and network resilience.

The system has also been designed with safety and ease of operation as key priorities. All normal switching operations can be carried out with compartment doors closed, enhancing operator protection, while the equipment can be controlled both locally and through the terminal’s Scada system, providing greater operational flexibility.

Alex Montebello, chief executive officer at Malta Freeport Terminals, said the project represented another important investment in the terminal’s critical infrastructure.

“The reliability of our electrical distribution network is fundamental to maintaining the high levels of operational performance expected by our customers, and this upgrade provides us with a more resilient, flexible and future-ready system while ensuring the highest standards of safety and operational efficiency.”

David Fenech, Commercial manager at Medelec, said: “We are grateful to MFT’s chief engineering officer James Peter Alsop and his engineering team for the confidence they placed in Medelec and for the excellent cooperation shown throughout every stage of this project. Our team is proud to have contributed to another important milestone in Malta Freeport Terminals’ continued development.”

The successful completion of the project further reinforces Malta Freeport Terminals’ ongoing investment programme aimed at strengthening operational resilience, supporting future growth and ensuring the terminal continues to operate to the highest international standards.

The post Malta Freeport Terminals and Medelec complete major upgrade of primary distribution substation first appeared on The Malta Business Weekly.