Deputy Prime Minister and Tourism Minister Ian Borg on Thursday announced a series of tourism-related measures and proposals aimed at improving the quality of Malta’s tourism product and supporting investment across the hospitality and cruise sectors.

The measures were announced during a press conference in St Julian’s attended by Borg, Parliamentary Secretary Alison Zerafa Civelli and Labour candidate Cressida Galea.

Among the key announcements was an increase in the eco-contribution charged on tourist overnight stays.

Zerafa Civelli said the fee will rise from 50 cents to €1.50 per person, per night, as from 1 July, 2026. The move is a measure which had been announced for this year’s Budget.

She also announced that 50 cents collected from each contribution will be allocated directly to Local Councils, with funds distributed according to the impact of tourism activity on each locality.

Borg said that the tourism industry has reached a stage where operators are reporting strong results even during the traditional shoulder season, prompting the government to shift its focus towards improving quality standards within the sector.

As part of this approach, the government is proposing a new tax credit scheme for tourism accommodation providers investing in renovation projects, higher standards, and improved customer experiences.

The scheme is intended to encourage upgrades to existing tourist accommodation establishments.

Another proposal targets Malta’s restaurant industry, which Borg described as a highly diversified and high-quality sector that must remain competitive.

Government said it plans to establish a €30 million fund dedicated to investment in restaurants.

Independent restaurants will be eligible to apply for grants of up to €300,000 to improve their product offering, enhance customer experience, train employees, or renovate their premises.

Borg also outlined plans to continue investing in cruise liner infrastructure at the Grand Harbour as Malta seeks to expand its home-porting operations and attract more luxury cruise liners.

Borg said that Malta has become a strategic pillar in the Mediterranean cruise industry, with close to one million passengers using the country’s ports annually.

He said voyages beginning or ending in Malta generate greater economic value for the local economy compared to transit visits.

Addressing questions from journalists about whether the new measures amounted to an acknowledgment of over-tourism in Malta, Borg rejected the suggestion and defended the importance of the tourism industry to the country’s economy.

Borg said the government would not accept statements that “undermine business, undermine investment, and undermine a sector that is crucial to our country’s economy.”

He said the government remained conscious of tourism numbers and the need for sustainable growth, while noting that many countries aspire to attract similar visitor figures.

“It is important that we grow intelligently and grow with quality,” Borg said, describing this as the main challenge facing the sector moving forward.

The post Malta to triple tourist eco-contribution from July first appeared on The Malta Business Weekly.

Malta’s payments landscape is undergoing a steady transformation driven by digital innovation, evolving customer expectations, and developments at European level. The increasing availability of instant payments and other electronic solutions is reshaping how individuals and businesses transfer money, placing greater emphasis on speed, security and convenience.

Within this context, the Central Bank of Malta (‘Central Bank’) continues to promote a gradual transition towards more efficient and resilient payment methods, while ensuring that existing instruments remain fit for purpose. The updates to Directive No. 19 on the Use of Cheques and Bank Drafts (‘Directive’) should be seen against this backdrop, ensuring that cheque usage remains proportionate, transparent and aligned with a modern payments’ ecosystem.

As background, the Central Bank acting in its capacity as the authority responsible for safeguarding the stability and efficiency of Malta’s payments landscape, first issued Directive No. 19 in 2021. The Directive came into force on 1 January 2022 and was subsequently amended in 2024.

The Directive was introduced to address recurring risks and operational challenges associated with the issuance and negotiation of cheques and bank drafts, including misuse, inefficiencies in processing and delayed settlement. By setting out clear obligations for issuers and beneficiaries it supports improved governance in the use of such payment instrument while complementing Malta’s broader shift towards more secure and efficient digital payment channels.

In 2025, the Central Bank published an analysis on The Usage of Cheques in Malta, that revealed a sharp decline of 78% in cheque usage between 2019 and 2024. This trend reflects a widespread take-up of digital alternatives based on the implementation of European regulatory frameworks.

In light of these developments and based on the Eurosystem’s comprehensive payments strategy which embrace innovation and forward-looking approach in payments, the Central Bank felt the need to update Directive No. 19. The amendments to the Directive will come into force on 1 January 2027. These updates aim to refine existing procedures and align cheque usage with evolving operational and security requirements, ensuring consistency with current practices. The key changes are outlined below.

Minimum cheque amount raised from €20 to €50

Effective 1 January 2027, cheques may only be issued for amounts of €50 or above. This adjustment is designed to shift routine, low‑value transactions towards digital payment options, such as instant payments, which offer quicker processing and greater convenience.

Limiting this payment instrument to higher‑value payments helps manage resources more efficiently by reducing manual handling costs incurred by institutions and lowering the likelihood of processing errors. For beneficiaries, this shift also promotes the use of digital payment methods, which offer stronger security, faster processing and clearer transaction records. This measure preserves the usefulness of cheques and bank drafts for significant transactions while encouraging more modern, efficient payment behaviour for everyday needs.

Cheques valid for three months

The updated framework shortens the validity of cheques from six months to three months. This reduces the risk that a cheque remains outstanding for an extended period, where it may be misplaced, misused, or simply not presented in a timely manner. A shorter validity window also supports a more efficient movement of funds, as the clearing and settlement process begins more promptly once the cheque is presented for processing.

A shorter validity period for cheques lead to a smoother settlement cycle, giving beneficiaries faster access to funds and a clearer view of their account activity. At the same time, institutions benefit from streamlined operational workflows, simplified account reconciliation, and fewer outdated instruments requiring follow‑up. Collectively, these improvements applicable on 1 January 2027, contribute to a more predictable and reliable processing environment for all parties involved across the payments chain.

Furthermore, the validity of bank drafts will remain 6 months given that this particular payment instrument is mainly used for larger transactions such as property purchases. Bank drafts are considered as more secure when compared to cheques given that the Bank issuer locks the funds upon issuance and thus provides certainty that funds are available.

Mandatory deposit of cheques into a payment account

To enhance transparency and improve the traceability of payments end‑to‑end, the new amendments will require all cheques and bank drafts to be deposited directly into a payment account rather than having the option to encash over the counter, a requirement that comes into force on 1 January 2027. This ensures that each cheque transaction is fully recorded within the banking system. It also supports anti‑money‑laundering controls by ensuring that all fund movements are captured within the payments’ infrastructure.

For beneficiaries depositing cheques and bank drafts into an account it ensures a standardised clearing process, and clearer indications of when funds shall be available, facilitating cash‑flow management and reducing uncertainty. Institutions likewise benefit from reduced cash handling, lower operational and security risks, and improved audit trails, resulting in a more controlled and efficient processing environment.

This update also aligns with Malta’s broader policy objective of strengthening transparency in payment practices. Recent amendments to the Employment and Industrial Relations Act (Cap. 452) require wages payable to third‑country nationals to be settled exclusively by bank transfer or through an electronic transfer executed by a licensed financial institution. Both developments move in the same direction: enhancing transparency, reducing risks of abuse, and supporting stronger oversight across the payments landscape.

Funds credited instantly in the case of over‑the‑counter deposits

Under the new amendments, cheques deposited in person at a branch of the issuing bank should be credited instantly, allowing immediate access to the funds, including cash withdrawal from an ATM. This procedure will also apply from 1 January 2027. By contrast, cheques deposited via an ATM of the same bank will be credited no later than the end of the following business day. The same rules also apply to cheques issued by the Central Bank on behalf of the Government of Malta, including tax refunds and government bonus cheques.

For beneficiaries, such changes provide quicker access to money and clear timeframes that support cash‑flow planning and reconciliation. For institutions, it enables more efficient in‑house processing, reduces risk exposure, and limits cash handling steps.

Key Takeaways

Overall, the updated Directive reflects a balanced approach between preserving payment choice and encouraging the adoption of more efficient alternatives. While cheques and bank drafts will continue to serve specific use cases, particularly for higher-value transactions, their role in everyday payments is expected to diminish further over time in favour of faster and more secure electronic solutions.

Looking ahead, the Central Bank will continue to support initiatives that strengthen the efficiency, resilience and strategic autonomy of the payments’ ecosystem. This includes fostering the uptake of instant payments and promoting solutions that enhance transparency, reduce risk, and align Malta with broader European developments in retail payments. In this evolving landscape, the Directive forms part of a wider policy direction aimed at ensuring that payment services remain accessible, secure and future-ready.

Dr Stephanie Gatt is Deputy Head Legal Department at the Central Bank of Malta

Gianella Azzopardi is Principal Expert Payments Policy and Compliance Office at the Central Bank of Malta

The post Cheque payment instrument: Key updates to Central Bank of Malta Directive No. 19 first appeared on The Malta Business Weekly.

I understand that it is not easy to re enter politics once you exit. I thought it was going to be a short lived experience, given that I ruled it out back in 2024, right after the MEP elections. However, when the PL presented the manifesto, I realised that it would have been a shame to be left out of what I have been campaigning for – inter alia, affordable housing and aid for those in need. The idea of a 25% interest free loan to cover accommodation is indeed commendable. Certainly, the policies that the PL is currently proposing are designed to address some of the anomalies, as well as those pockets that are not reaping the benefits of economic growth.

When people ask me whether these proposals are sustainable and whether they will add to the country’s debt, the answer must be given in relative terms. This means that if the economy keeps growing, and we address these pockets to improve the quality of life of many, then it is sustainable. We always speak of additional economic growth, but we fall short in asking what it comes at the expense of. Seeing the PL’s manifesto addressing these lacunas and pockets is indeed commendable. True, after the MEP elections, I wasn’t keen on re entering politics. However, my passion to aid people and serve the country, as I did in previous posts before joining the private sector, made me reconsider. Surely, what I campaigned for was simply to stand shoulder to shoulder with families, especially those less advantaged. I am not here promoting laziness. I am promoting what we must do as a state to provide the tools to elevate people. I can express this because I grew up in a deprived environment. Material well being wasn’t the norm. We struggled to make it in life, especially in Bormla and Cottonera. The stigma was certainly untoward and unfair to us. However, when given the right opportunities, we exploited them and moved forward.

My vision is wider, and I want to see the PL’s manifesto executed if the electorate gives Prime Minister Robert Abela another chance. Many observers argue that Dr Abela has demonstrated leadership, keeping Malta afloat through economic storms and geopolitical shocks over the past few years. Surely, having a manifesto that offers a well being index tied to all the policies presented is unprecedented. Commentators note that no other political party has ever achieved such a milestone. This aligns with what I have campaigned for in the private industry, in banking and finance. So, I think it is important to keep pushing these ideas against the backdrop of Malta Vision 2050. One of the proposals I pushed for over the past two years was proper remote working, as well as flexi time. I tied this to improving efficiency in terms of time and reducing emissions. The proposal can help alleviate some of the traffic problems. It is also in line with the EU’s direction on decarbonising the continent.

The PL presented several proposals that aim to help families. When you consider these policies in light of what is happening abroad, one might question their feasibility. However, when seen in isolation and relative to economic growth and public finance management, one realises that it is indeed possible to implement the policies presented so far. What we need to ensure is that the PL clearly explains the policies to the public, as they are doing. My role is to aid the PL in promoting such policies. As you all know, I have never had any problem criticising government policies when needed, and I have been quite blunt and explicit. We need to ensure that whatever is promised to the electorate is executable and well thought out.

What is being proposed on the other side is a different story. I have not been convinced by the energy proposal, which many analysts consider crucial for stability. The solar panel proposal seems half-baked. The refuelling hub proposal is to consider LNG, which is seen as a source of clean energy in transition by 2035. Thereafter, we would need to rethink how to do business. An investment that will take years to realise and become outdated before it is even realised in terms of EU policy direction. Some experts would have considered other energy sources in line with EU policy.

To conclude, what I said this week on TV is that if Dom Mintoff were still alive, he would be shoulder to shoulder with us, campaigning for this manifesto. It is a manifesto that promotes socialist leaning policies. And for this, I must thank the Prime Minister and the PL for listening to us, and to the public, when designing it. Thank you. I am happy to be part of the PL’s formidable team. Let’s do this.

The post Re-entering politics first appeared on The Malta Business Weekly.

My proposal or set of proposals are less costly and more targeted.

As many of you know, I work a lot with family businesses. Family businesses remind me of the infamous speech given by late Sergio Marchionne at the Confindustria Young Entrepreneurs Conference in Santa Margherita Ligure, Italy, on June 9, 2012. In this speech, he famously discussed the balance between “the epoch of rights” and the “sense of duty”. In a family business the “right” to a salary or a position is often secondary to the “duty” of ensuring the business survives for the next generation.

The family business owners are frequently the first to arrive, the last to leave, and the ones who forgo their own “rights” during lean times to protect their employees. Marchionne’s warning that “if we live of only rights, we will die of rights” resonates deeply with family business entrepreneurs because they know that a business cannot be sustained by what it demands from the market, but by the sacrifices and commitment it pours into the business. It is this background and reality I see on a daily basis through various family businesses, that inspires my proposal.

The transition of the ownership of the family business and assets used in the family business, from one generation to the next, often poses a significant financial threat, particularly when substantial fiscal burdens are involved. Recognising this, government has extended a pivotal fiscal incentive, even in the 2026 Budget, allowing for the transfer of business ownership and related property at a significantly reduced stamp duty rate of 1.5%.

This measure aims to bypass the standard 5% duty that typically applies to the transfer of immovable property and the 2% or 5% duty (trading company vs property company) on marketable securities (shares), ensuring that capital remains within the business to fuel growth rather than being diverted to the taxman during a sensitive transition.

Where a business is transferred during the owner’s lifetime (Inter Vivos), the law provides a pathway to this reduced rate under the Duty on Donations of Marketable Securities and Immovable Property used for Business (Exemption) Order.

The 1.5% rate is not universal; it is a targeted incentive for intra-family succession. Qualifying recipients include Spouses and partners in a civil union and descendants in the direct line (children, grandchildren) and their spouses.

With regards qualifying assets for the 1.5% rate, there are two primary asset classes that benefit from this stamp duty reduction i.e. the shares in the family-owned business and the real estate used specifically for the business (e.g., a factory, retail outlet, or office). To qualify, the property must have been used by the business for at least three years preceding the transfer.

To prevent abuse of the system, the law mandates that the recipient must not sell or transfer the family business or property for at least three years following the donation. In the case of property, it must continue to be used for the business for a minimum of three years post-transfer.

Based on all the above, my proposal is made of a number of fine tunings to ensure that family businesses are preserved in the critical juncture of succession. Moreover, whilst I personally preach and advise family businesses to prepare and plan for succession at an early stage, I am aware that there will always be cases whereby succession needs to happen because the unexpected has happened, like the unexpected, sometimes early, death of a family business owner and leader.  Ultimately there is an element of family business continuity that is a public good, regardless of the specific degree of kinship or minor administrative delays. Thus, the goal of my proposals is to ensure that when coming to the legitimate family business transfer there is an established safety net rate for scenarios that currently fall through the cracks.

Currently, if no ‘inter vivos’ succession transfer has taken place and, hence, a ‘causa mortis’ type of family business transfer has to be done, this would not qualify for  the reduced 1.5% stamp duty, but the standard 5% stamp duty rate would apply. My proposal is to have a safety net rate which is higher than the reduced 1,5% stamp duty rate for ‘inter vivos’ transfers and lower than the 5% standard rate. This, in my opinion, would spare  family businesses passing through a tragic situation from being ‘punished’ unnecessarily, without taking away from the more favourable reduced rate of duty for family businesses to plan ahead and go for an ‘inter vivos’ type of succession which, in the end, can bring more benefit to the family business and its future prospects.

Throughout Europe, tax relief for causa mortis (upon death) family business transfers is designed to prevent the fragmentation of small and medium enterprises and ensure operational continuity. Most jurisdictions recognise that high inheritance taxes or stamp duties can drain a company’s working capital, potentially forcing a liquidation or sale to external investors. For instance, Germany offers a robust “business succession” exemption where heirs can receive up to 100% relief from inheritance tax if they continue the business for seven years and maintain specific payroll levels. Similarly, the Netherlands utilises the Bedrijfsopvolgingsregeling (BOR), which provides substantial exemptions—often exceeding 80% of the business value—to ensure that tax liabilities do not jeopardise the company’s liquidity. The United Kingdom recently updated its Business Property Relief (BPR) to provide 100% relief on the first £2.5 million of combined business and agricultural assets, with a 50% relief thereafter. These measures collectively yield significant positive effects: they encourage long-term investment, protect local employment, and foster generational stability. By lowering the fiscal barrier to succession, European states effectively incentivise the survival of the family-owned model, which serves as a cornerstone for economic resilience and social cohesion across the continent. These reliefs ensure that the successor’s focus remains on strategic growth rather than servicing a sudden, massive tax debt during an already difficult period of transition.

Another issue that should also be addressed relates to the transfer of immovable property from the family business to a family member. As a practical example, let’s assume that a family business acquires a new warehouse but as part of the succession plan inter vivos, the owner chooses to pass that warehouse to one of his descendants. Should he choose to transfer the warehouse out of the business and to a family member, such a transfer would be subject to the full 5% duty because they missed the 3-year “pre-transfer usage” window by a few months. My proposal is to at least allow for a pro-rata reduction. If the property was used for less than 3 years but more than 1 year, the duty should be capped at a lower rate of 2.5%, provided the heirs commit to using it for the business for the subsequent 5 years.

In conclusion, the survival of a family business is important as these businesses are the bedrock of our economy, fuelled by family business owners who are fully committed to their business, often sacrificing everything to ensure the security of their employees and the future of their kin. By refining our tax laws to include this reduced duty safety net, we can ensure that we do not dismantle decades of hard work, by supporting the actively trading family businesses who pour their commitment into our community, ensuring that when the torch of leadership is passed, it is not extinguished by a tax burden, but remains a guiding light for the next generation.

The post My proposal first appeared on The Malta Business Weekly.

Last year, as has been the case with other Med resorts, Malta also had an increase in arrivals.  Statisticians tell us there is safety in numbers, yet so far nobody bothers about over capacity.  

MHRA, of late woke up to point out the danger of over tourism and the need for better control on new licenses for hotels.  The island could see an additional 483 hotels crop up if all the planned tourism accommodation projects in the pipeline ever come to fruition.  But who cares.  These facts were shared during the Malta Hotels and Restaurants Association, latest hospitality forum (sponsored by Bank of Valletta) during which a presentation was delivered by Deloitte.

A pivotal aspect was the latest situation of hotel occupancy.  Inter Alia, the study revealed how a vast majority of planned new accommodations (41%) are designed to be 3-star offerings, which means such projects might not necessarily align with the national vision to accommodate “high quality” tourists.  Currently the per capita spend by tourists is a low €15.9 daily.  

At this junction, the reality of hosting a deluge of “hamburger” class arrivals, one may stop and question why are we kicking the can?  Deloitte exclaimed concern about how the incidence of 3-star and other planned accommodations which are set to have less than 100 rooms, throwing into question whether these can survive in the long term. 

Doing the sums, unless they employ more low-wage TCN’s, even new 5-star accommodations may not be sustainable.  For many years, established hotels and other stakeholders in the tourist industry are concerned seeing their share of the cake dwindling.  

This share is diminishing with the planned permits for large scale new builds.  Another MHRA study revealed a shocking message that the island would need to see 4.7 million tourists a year to keep its present occupancy rates afloat.  It is good to remind readers that regrettably we see Comino (with a unique blue lagoon beach) being flooded with day trippers, dirtying its environs, all dancing to loud dance music provided by five licensed kiosks selling spirit imbibed grapefruits.  

Blue Lagoon operators running kiosks, water sports activities, deckchair rentals and other commercial services will likely face higher encroachment and permit fees starting in summer this year.  Speaking on Times Talk last month, the new tourism minister Ian Borg vowed to “clean up” Comino, add sanitary facilities and introduce stricter and fairer concessions for boat, kiosk and deckchair operators.  He felt committed to issue tenders (instead of direct orders as was the previous practice) for all future concessions guaranteeing transparency and fairness.  

Another parallel problem facing the island is over-population which again last summer has led to persistent power cuts (sporadically supplemented by portable noisy diesel generators parked outside residential areas and clinics).  No doubt, such blackouts add to infrastructure pressures resulting from chaotic traffic and sewage issues. 

Sewage blockage issues is a key problem, with stakeholders saying sewage networks are operating “vastly beyond designed capacity in certain key areas” which often results in sewage seeping into the sea.  The consequences of Iran war have targeted Middle East resorts such as Cyprus which is very popular with British tourists.  

Some may consider Malta and eventually add to our over-capacity dilemma.  Can we do something to turn the clock back to serenity?  Yes, just notice how competitors in the central Mediterranean, such as Spain and Venice started a policy to disincentivise excessive tourism in certain periods, in line with the fragility and uniqueness of the resorts.

Needless to remind readers about rallies in the Canary Islands where residents have highlighted problems of over-tourism.  They also increasingly want a better type of tourist: one who respects local culture and nature, not one who drinks cheap beer on the beach and leaves their empty bottle behind with a cigarette butt stubbed in the sand. 

According to tourism researcher and Aalborg University professor Carina Ren, there have always been badly behaved tourists; it’s just that there are more of them now than ever.  

In Spain’s Balearic Islands, renowned for nightlife destinations such as Ibiza and Magaluf, restrictions on alcohol have come into force in a bid to regain control over its disorderly streets.  Moving on, we note how in heavily visited Venice, day trippers now are charged a fee to try to stem the flow of unending visitors.  

Whereas, in Malta citizens simply grumble in silence, regularly air their grievances in social media, yet they never unite and march to Valletta voicing their anger against a noticeable degradation in the environment.  Can we learn from other resorts to live a quieter life and protect our sensitive ecosystem.

A sustainable model requires planning, restraint and the willingness to say ‘enough’ when systems reach their limit.

The post Can we control the tide of tourist arrivals first appeared on The Malta Business Weekly.

As the financial services landscape grows increasingly digital and complex, the need for informed decision-making by citizens has never been more vital. To lead this effort locally, Sarah Pulis has been appointed as Malta’s Financial Literacy Ambassador. In this capacity, she joins an elite network of experts across the continent supporting the EU’s Savings and Investments Union, a flagship initiative designed to make financial markets more accessible and transparent for everyday citizens.

Tasked with bridging the gap between high-level policy and the “man on the street,” Pulis aims to demystify the world of finance for the Maltese public. In the following interview, she discusses her vision for the role, the specific challenges facing local households, and the roadmap for building a more financially resilient nation.

As Malta’s Financial Literacy Ambassador, how will you go about your duties?

Financial literacy isn’t confined to policy documents or classrooms; it plays out in our everyday lives. It is used when someone receives their first salary, considers taking out a loan, decides whether to start investing, or tries to understand if an investment offer is genuine.

As Malta’s Financial Literacy Ambassador, my role is to make these moments less confusing. This means working with Malta’s many stakeholders, including government bodies, regulators, and social policy actors, while engaging directly with the public. Clear communication, trust, and consistency are key.

What are your main priorities?

My priorities come from what we see happening in everyday life in Malta.

One key priority is helping people move from saving to informed investing. Maltese households are disciplined savers, but many people hold back from investing because they simply do not feel confident enough. Building a basic understanding of risk, diversification, different types of financial products, and the benefits of long-term planning is essential.

Another key priority is keeping people safe in a fast-moving digital environment. Scams are more sophisticated than ever and they affect people across all ages and backgrounds. Awareness needs to be practical, timely, and continuous, given the speed at which scams evolve.

Reaching people at different stages of life is also important. Financial literacy is most effective when it meets people where they already are, whether through media, schools, workplaces, or community settings, rather than expecting them to seek out purely formal education environments.

What do you perceive to be the biggest challenges the man on the street faces vis-à-vis financial literacy? How can you help?

A common challenge is uncertainty. Financial products, terms, and conditions can appear complex, and many people fear making the wrong choice, which can lead to inaction.

My role is not to advise individuals or simplify decisions for them, but to help reduce barriers to engagement by promoting clear, neutral, and consistent information. Encouraging people to ask questions, take time to consider offers, and seek reliable sources can already make a meaningful difference.

There is also a tendency to rely on familiar options, sometimes without reassessing whether these remain suitable. Promoting a basic understanding of risk and limitations can support more balanced decision-making without prescribing specific outcomes.

Digitalisation adds another layer. While many people are comfortable using digital tools, they may not always fully appreciate the implications of what they agree to online. Helping people recognise warning signs and understand where to find trusted information is an important part of the broader effort.

In February, the MFSA, in collaboration with the European Commission’s Reform and Investment task force (SG REFORM), the Organisation for Economic Co-operation and Development (OECD), and the Ministry for Finance of Malta, presented findings of a survey on the financial literacy and investment behaviours of Maltese retail investors. Those results showed that Malta’s overall financial literacy levels are slightly above the OECD average, reflecting strong budgeting and saving habits. But they also revealed persistent gaps in investment knowledge and participation. How do you intend to tackle this?

The survey results from the EU-funded Technical Support Instrument project tell an important story. Malta performs well overall, particularly in budgeting and saving, but clear gaps remain in investment knowledge and participation. Addressing these gaps starts with getting the basics right, such as explaining how risk and return are linked and why diversification matters. There are also widespread misconceptions about certain financial products, such as bonds, guarantees, and perceived safety, which need to be tackled directly.

Addressing this does not mean encouraging greater risk-taking. It means supporting a better understanding of basic investment concepts, while also addressing common misconceptions around perceived safety. The objective is to help people understand their options more clearly so that any decisions they take are better informed and aligned with their individual circumstances.

In March, the EU’s Commissioner for Financial Services and the Savings and Investments Union, Maria Luís Albuquerque, convened the first virtual meeting of national financial literacy ambassadors. Can you tell us what was discussed and any plans of action agreed upon?

The first meeting of EU Financial Literacy Ambassadors made it clear that Malta’s experiences mirror those seen across Europe. Digital fraud, low investor confidence, and gaps between awareness and understanding are common themes.

There was strong agreement that financial literacy plays a central role in building trust in financial markets and supporting the EU’s broader goals under the Savings and Investments Union. Ambassadors were seen as important bridges between policy-level objectives and practical, everyday realities. Going forward, the focus will be on sharing practical experiences, aligning messages where possible, and learning from what works across Member States.

Why is financial literacy such a big focus of the European Commission?

Financial literacy is a major focus of the European Commission because it is essential to achieving the EU’s objective of a genuine Savings and Investments Union. When citizens understand how to save, invest, and manage risk, they are more likely to participate confidently in financial markets, allowing household savings to be channelled into productive investments that support growth and innovation across the EU. At the same time, stronger financial literacy helps protect consumers, promotes inclusion, and builds trust in the financial system, all of which are critical for a resilient and integrated European economy.

Looking ahead

While the road to financial literacy is a long-term journey, Pulis remains optimistic about the impact of these collective efforts.

“One of my biggest challenges is maintaining momentum,” Pulis notes. “Financial products and digital risks evolve quickly, and our communication must keep pace. However, financial literacy is a shared responsibility. While institutions provide the tools, the goal is to empower the individual. In the long run, even small, consistent improvements in understanding can make a meaningful difference to a family’s financial resilience.”

The post Empowering a financially resilient Malta first appeared on The Malta Business Weekly.

An offshoot of US healthcare giant Baxter International is set to invest €150 million in a new pharmaceutical manufacturing facility in Ħal Far, Prime Minister Robert Abela announced on Wednesday.

The project will be operated by Vantive, a specialised healthcare firm focusing on therapies for vital organs. The announcement was made on Wednesday during a joint news conference held by government officials and company representatives.

According to the plans, the facility will be constructed on a 16,000-square-kilometre site, with works expected to commence later in 2026. Construction is projected to be completed by 2027, while the plant is targeted to become fully operational by 2029.

Vantive’s operations at the new site will centre on advanced treatments for organ care, with a particular emphasis on kidney therapies and dialysis solutions.

Speaking at the event, Prime Minister Robert Abela highlighted the long-term vision underpinning the investment, pointing to its role in creating around 250 career opportunities for Maltese workers.

“These are the types of investments that create careers for our students,” Abela said. “An investor will not commit €150 million in a country that lacks a clear vision for the future.”

He referenced the government’s long-term strategy, Malta Vision 2050, as a key factor in attracting such projects.

“We have given a clear direction of where we want to be in 25 years,” he said.

Abela also emphasised the broader societal impact of the investment, noting that the facility’s output will directly contribute to healthcare outcomes.

“This sector is one of excellence, and the products manufactured will improve people’s quality of health,” he said, adding that such projects are “tangible investments that contribute to the betterment of our society.”

Meanwhile, Economy Minister Silvio Schembri highlighted the significance of securing a major investment of this scale, noting that Malta’s track record and credibility continue to attract international players.

“It is not easy to secure investments of this level in our country, but we have built the experience and credibility to do so,” Schembri said. “With every challenge comes an opportunity, and we have brought an international company, Vantive, to operate in Malta.”

He added that construction on the site is expected to begin in the coming weeks and be completed by 2027, while encouraging students to prepare for future opportunities linked to the project.

“When you finish your studies, you can benefit from the opportunities we are creating,” he said, describing Vantive as “the type of investment our country needs.”

Schembri stressed that economic growth must translate into real improvements in people’s lives.

“Economic numbers are important, but they mean nothing if they do not better the lives of people. We want the economy to work for the people,” he said.

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The PL presented its first set of proposals the following day, including a 25% government loan of the property’s value to first-time buyers, interest-free and repayable over several years at a fixed rate. This measure is intended to support families with initial payments during their early years. Proposals for affordable housing to counter market speculation, such as those from the Foundation for Affordable Housing, may also be introduced. Another closely watched proposal concerns parental and maternal leave, offering additional weeks of leave to parents, a €5,000 birth bonus per child, and other measures targeted at families. Personally, I do not benefit from these proposals as I do not have children, nor do I benefit from the tax benefits announced during last year’s budget. Nonetheless, I appreciate that these measures were presented, as they seem necessary for the country at this time, even though my taxes subsidise such schemes. Furthermore, I welcome the proposal to increase pensions by €50 per week by the end of the next legislature, resulting in an increase of €200 per month over five years.

In addition, prior to this election announcement, the Minister for Transport launched Malta in Motion, a mass transport scheme connecting a rapid transit system along Malta’s Eastern coast, a bus shuttle service, a water transportation system, and cycling and walking lanes. This proposal aims to improve connectivity, ease congestion, and provide more sustainable travel options. I understand that many people were not amused by the proposal. Compared to the metro system proposal, it admittedly could be more ambitious, yet it remains the most feasible option presented so far. For the past four years, I have argued for connecting all transportation modes on our island, which measures 27km by 15km. The Minister for Finance has been clear. Approval depends on solid financial estimates of the costs, which is a prudent stance since we cannot afford mistakes. My position on social media has been that, by including the private sector and leveraging the budget through private capital, we could avoid funding the entire €2.8 billion from public finances. The remaining amount could be distributed over 15 years. This approach would ease pressure on public resources, and with moderate infrastructure adjustments – since further flyovers seem unlikely – the investment could be manageable if the economy grows as forecast by the European Commission and International Monetary Fund. Encouragingly, there is finally a national consensus that the economy is strong.

Another point, which was music to my ears when I listened to the prime minister, is that the PL’s electoral manifesto appears to be costed and provides a well-being index for the proposals presented. Indeed, the well-being index is highly commendable. Which measurements were chosen, as they are subjective and there are many forms, including the OECD, we still need to see. However, we are moving in the right direction, as this aligns with the Malta Vision 2050. The push, from now on, is to explain the well-being index to the public in layman’s terms, as it is quite subjective and intangible. Certainly, there are enough competent candidates, cabinet ministers, and MPs on the list who can articulate this easily to the public. Not to leave out the authors of the manifesto or those involved. Although it would have been interesting to see the reduction in emissions for this plan aligned with Europe’s decarbonisation strategy. Having a well-being index is already a great step in the right direction. Building on this is something we all aspire to, especially economists working in sustainability. The PL’s proposals so far are focused on family well-being. As time passes, we will see additional proposals announced.

By the time I wrote this article, I had not seen any PN proposals. I will write about them in upcoming opinion pieces. I only followed a press conference outlining what the PL failed to deliver during its term. Well, the Malta Flimkien manifesto was written for five years, not four years and two months. I will give a fair economic assessment of what is good and what is best for Malta from both sides. I was a candidate on the PL’s ticket in the last MEP elections. My allegiance is towards the PL, as I grew up within the party structures. Still, if there are good proposals from the other side or other parties, I will discuss them and state my views. I will also analyse PL’s proposals that I do not agree with.

During a general election campaign, our country must show maturity. I’ve already noticed divisive comments from both supporters, but we are all Maltese with mixed political family ties. Don’t let election fever harm family relationships over petty arguments. Support your party and discuss civilly within your family. Avoid political quarrels, especially among relatives. For now, everyone should remain calm as debates intensify. The PL currently leads in proposals. Perhaps next week, we can analyse the PN’s. Meanwhile, enjoy the election slogans, and I wish all candidates success as they meet voters and serve the people. I have been in that position before. Be honest and follow up on cases, as people are paying attention. If you need my help, I am here. Good luck!

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With the published accrual-based Government Deficit figure for 2025, the cash based Consolidated Fund Deficit figure published a few weeks ago has shrunk from €824 million to €545 million. How is this possible? The transition from the cash-based Consolidated Fund deficit to the accrual-based General Government deficit involves several significant accounting adjustments required by European methodology (ESA 2010). While the cash figure focuses on the timing of actual payments, the accrual figure reflects when the underlying economic activity occurred.

As can be seen in the below table, the primary and most significant adjustment was the so called “Time-adjusted cash transactions” that added €391.6 million back to the balance by aligning the recording of taxes and social contributions with the period they were earned rather than when they were collected. This large positive adjustment in 2025 indicates that while cash flow can be volatile, the underlying “accrued” revenue—what the government is legally owed—is growing more consistently than cash receipts might suggest. In fact Government revenue as a share of GDP has increased from 33.1% in 2022 to 34.8% in 2025. This indicates that revenue is currently outperforming the general growth of the economy.

Also, as can be seen in the below table also this is the first time since 2022, whereby the accruals based deficit ended up much lower from the cash based consolidated fund deficit, when the accruals adjustments where made. In previous year i.e in 2022, 2023 and 2024, this was never the case.

Thus, so far so good. With a final public deficit of €545 million and a 2025 provisional GDP at 24.53 Billion, we get a GDP to deficit of 2.2%. If the usual revisions are made to the 2025 nominal GDP, the GDP to deficit level could even go further down to around 2%.

As I had been repeating in my articles, considering the constant shocks the global economy is facing, resilience is key. Which is why beyond celebrating this excellent result, I believe we would do well to ensure that this can be preserved whatever comes our way.

The trajectory of Malta’s public finances from 2019 to 2025 illustrates a dramatic shift from a pre-pandemic surplus to a high-expenditure “crisis mode,” followed by a period of aggressive revenue-led consolidation.

Actually, the fiscal landscape can be divided into three distinct phases based on the data. There is first the pre-pandemic 2019 baseline. The period was when we had  a surplus of €67.1 million. Revenue and expenditure were closely matched at approximately 37% of GDP.

Then came the pandemic. As a response, Government expenditure surged to mitigate COVID-19 risks. In 2020, expenditure rose to €5,977.9 million (46.6% of GDP) while revenue fell to €4,677.8 million (36.5% of GDP). By 2021, expenditure peaked at €6,614.9 million.

Post 2021, the government entered a phase of rapid revenue growth. By 2024, revenue increased by €1,216.0 million in a single year to reach €7,784.2 million. By 2025, revenue reached €8,553.8 million, allowing the deficit to narrow to 2.2% of GDP, down from a peak of 10.1% in 2020.

The sustainability of this model depends on the relationship between revenue growth and the cost of maintaining a larger state apparatus. The data confirms that government revenue has, at times, grown faster than the economy itself. For example, in 2024, government revenue as a percentage of GDP rose to 34.6% from 32.0% in 2023. This rose slightly further to 34.8% in 2025. This suggests that revenue increases are not just coming from a larger economic “pie,” but also from more efficient tax collection. While the deficit-to-GDP ratio is shrinking, the absolute level of government expenditure has established a new, much higher “floor.” In 2019, the government spent €4,985.2 million. By 2025, expenditure had ballooned to €9,099.1 million. This 82% increase in spending over six years creates a structural dependency. If revenue growth slows while expenditure remains high due to social obligations or interest payments the fiscal position could quickly deteriorate.

In reality, continuous revenue growth at this velocity is unlikely for several reasons. Government Revenue remains heavily linked to GDP. While Malta’s GDP grew from €13.4 billion in 2020 to €24.6 billion in 2025, any cooling of the economy would immediately slash tax receipts. In 2025, government revenue boosts include “time-adjusted cash transactions” (an adjustment of €391.6 million in 2025) and surpluses from Extra Budgetary Units (EBUs) like the National Development and Social Fund. These may not be permanent fixtures of the revenue stream.

From an economic perspective, no economy can maintain high-percentage growth indefinitely without encountering structural limit. Growth requires labour and infrastructure. This puts the emphasis on productivity growth. If economic growth drops below 4% while spending stays high, the debt-to-GDP ratio will begin to climb again, potentially breaching the 60% limit in the long run. In conclusion, the current fiscal trajectory is sustainable as long as the economy avoids a slowdown or a recession. The larger, higher-spending public expenditure requires a high-octane economy just to maintain its current GDP-to-deficit and GDP-to-debt levels.

The Minister of Finance may be hesitant to commit to massive, multi-year capital projects because the current fiscal stability is built on a “high-expenditure/high-revenue” dependency. If the government locks into long-term, multi-billion-euro infrastructure commitments, it permanently raises the expenditure “floor” even further. Because the current revenue model is so tightly linked to high GDP growth, any cooling of the economy would immediately slash tax receipts while those infrastructure costs remain fixed. This creates a true chicken and egg situation. On one hand, it could be that the Minister of Finance fears that without constant high economic growth, the debt becomes unsustainable while on the other hand without infrastructure investment, the very economic growth required to fund the state’s current size will eventually hit a structural ceiling.

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Imagine you are the manager of a football or a basketball team – a good and agile team does not always translate into having all top scorer players. Managers look for players with high potential and a diverse set of skills, with good foundations in terms of agility, ball control, position, shooting capability and speed. It is the diverse range of skills that makes a team comprehensive, and the concoction of skills determines the ultimate outcome of each game.

The workplace is no different. While specialized technical skills are essential, they are now simply the baseline. We might not realise immediately this, however in the age of AI and digital revolution expertise is being redefinedto an extent that emotional intelligence and soft skills are becoming imperative to success. This is predominantly the reason behind PKF Academy’s new portfolio of courses which are aimed at improving emotional intelligence, enhance leadership and employees’ soft skills at various hierarchical levels.

I have once read that emotional intelligence is simply the “operating system” whilst soft skills are simply the “interface” of ourselves; emotional intelligence is our ability to stay in control, regulated and aware whilst soft skills are how we interact and portray the image of ourselves relating to communication, teamwork and presence. Emotional intelligence is what keeps us in control in high-pressure and demanding environments.

A science behind moving up the corporate ladder

The importance of soft skills in a workplace is no news to the business community. As my interest in the subject grew, I’ve come across a study from 1918 by Charles Riborg Mann, published by the Carnegie Foundation. Over 100 years ago, Mann noted that soft skills are critical to the success of every organisation. Studies emphasising the importance of soft skills grew, indicating a growing demand by employers for non-cognitive skills, such as teamwork, problem-solving and decision making.

A more recent study by the Harvard Business Review[1] (August 2025), surveyed over 1,000 occupations across various US industries (2005 – 2019), capturing several skills segregated into foundational and technical skills. The researchers examined how employees’ skills developed across time, over the course of their respective career. The study notes that adaptability is imperative in the modern workplace; and those who fared strong on foundational skills – such as teamwork, empathy) moved quicker into more advanced roles and learn specialised skills quicker. The study goes to show that foundational skills made candidates more attractive for recruitment and determined their ability of how far the employees can climb the corporate ladder. At times, technical skills may become partly redundant over time, but the study suggests that employees who manage to master problem-solving skills, clear communication styles and teamwork tend to fare much better throughout their career.

In the graphic, Deming (2023) from Harvard University and NBER, notes what typical employers look for on resumes, which includes a combination of emotional and soft skills. Out of the 10 skills mentioned, only two can be classified as “hard”, and the rest are typically either a personal trait or evolved over time throughout a professional’s career path.

Rewiring for success

As AI is taking up the routine element of human work, and doing even more heavy lifting, the human elements of managing teams, performance management, interacting and communicating with clients and boards, executive command are all soft aspects which are becoming a professional’s most valuable currency alongside technical skills and competences.

AI is revolving expectations around deadlines and keeping the pressure on. With additional demands, the need for emotional intelligence becomes ever more imperative. Self-awareness, motivation and social skills are critical attributes that allow valuable teamwork and productive outcomes achievable. This is resonated by a plethora of mental health experts in the field, and a growing cohort of industry leaders are recognising that technical proficiency is no longer the sole gatekeeper of professional success. As AI seeks to optimise workflows and work on number crunching, it surely lacks the human touch that one expects to navigate the complexities of high-pressure environments.

At University, we are somewhat taught indirectly the soft skills that are ultimately used across organisations through academic groups, team projects and perhaps even participation in extra curriculum activities. Emotional intelligence is what distinguishes a professional from being a high performer to an impactful leader that is capable to be present in boardrooms, de-escalate conflicts, communicate effectively. That comes with an added responsibility – by fostering self-awareness and empathy, a high emotional intelligence can allow a sound professional not only to regulate its own emotions but also those of people around. Therefore, it becomes an irreplaceable asset and serves a good foundation for effective board or internal meetings, enhanced well-being and effective collaboration across teams. For client-facing individuals this becomes highly useful especially in conflict or disagreement situations with clients. Although we were typically brought up with the culture that the “client is always right”, it is simply more than that. Relying on this mantra may in fact stifle emotional intelligence as it prioritises a transactional win/loss dynamic over a human connection with the aim of resolving an issue. With emotional agility; a professional can recognise when the client is angry and perhaps whilst not right about the facts, the client would be right about their own feelings. It is therefore the ability of identifying the source of the frustration, and without sacrificing own boundaries.

Emotional intelligence and soft skills a are a set of flexible skills that are acquired, realised, practiced and strengthened at any point in a professional’s career. Whilst some individuals are naturally born with a strong emphatic character and a sense of self- awareness, the brain has the capability of rewiring our own natural pathways through intentional practice. As a professional realises self-awareness, self-regulation and social empathy the human brain can consciously change how to respond to stress, listen to others and handle difficult situations.

Miriam Sultana is Head of Advisory at PKF Malta

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