The system functions in such a way that, in a by-election, all candidates who fall during the counting process start from zero if the candidate ceding the seat was elected with no inherited votes from other candidate, irrespective of their first preference votes given to them by the electorate. Moreover, the reachable quota is half the official quota in the district plus one. The system is somewhat complex because, in the case of the seat vacated by Dr Grima, all candidates started at zero, and the same applied to that of the Prime Minister. However, if the ninth district had been counted before the second district, I would have started with 340 votes that I had transferred to Dr Falzon before my name fell on the day of the counting. This is a tricky part, and I would like to explain it further. On the day of the casual election, the Electoral Commission, in agreement with the Party’s representatives, follows a draw. It is literally like a Super Five chance. The order in which the districts of those who ceded their seats are counted is determined by sheer luck.

In my case, the first counting started with the seat vacated by Dr Grima, in which Rebecca Buttigieg was elected ahead of me with almost 90 votes. Then the second district followed, which was the seat vacated by the Prime Minister. In this case, I was not expecting to be elected after a few counts because the strategy employed during my campaign was to ask for the third and fourth preferences of other co-candidates rather than the second preference. The reason was that the first preference was always expected to be given to the Prime Minister, and the second preference to candidates who had toured and worked the district longer than I had. However, the game changer was the third and fourth preferences, which I asked many of my supporters and people on the ground to give me for an eventual by-election. And those were the third preferences of Ministers Clyde Caruana, Byron Camilleri and others. Indeed, the strategy worked, as I managed to garner most of the third preferences of the other candidates, in addition to extra second preferences after the Prime Minister. When the by-election of the Prime Minister opened, I was at around 1,250 votes. In the final count, I was elected from the second district, taking the seat vacated by the Prime Minister. Indeed, I am humbled.

After the second district was counted, the ninth district ensued. Obviously, my name was eliminated from the ninth district since I had already been elected on the second district. This opened the space for other candidates, in particular the mayor of Għargħur, Mariah Meli, who was the runner-up. If the ninth district following the by-election of Dr Falzon had been drawn to be counted before the second district, the story would have been different. Why? Because I would have been elected from the ninth district, while in the second district there would have been another name, given that my name would have been eliminated from the second district. Therefore, in truth, luck does favour you in such instances. This process is somewhat complex, and for this reason strategies differ from one candidate to another. In my case, since I submitted my nomination as a PL candidate later than others, it was not easy to compete in a district known for the big names. However, given that my profile and branding were already public due to the MEP elections campaign two years earlier, people seemed to have responded and voted for me as well, even if they were third and fourth preference. In truth, in the MEP elections I had around 36,000 second and third preferences and leveraged on this. Besides, I kept on listening to people’s concerns over the past two years and tried my best to assist where it was merited.

Certainly, I must thank the people who helped me achieve this result in just 21 days. We were a small group of volunteers across both the second and ninth districts. I did not even have an office when I submitted my nomination. In fact, we met at a restaurant in Marsaskala to devise a plan on how we would proceed with the campaign. Gradually, people started joining the team. We managed to achieve remarkable results in 21 days, even setting up my office in Bormla, which I own and which had been in a bit of a dilapidated state for two years. Thanks to my brother and a childhood friend, we completed it in a week. I must express sincere gratitude to several people, especially three close friends in the ninth district who truly supported me, and together we managed to garner around 562 first-count votes in that district. The people of the ninth district received me with enthusiasm, and that is something I truly cherish. It is a district that I will continue to represent for the next five years, just like the second district.

Lastly, I would like to make an appeal to those who were not elected. I firmly believe that you still have a lot to contribute. Had I given up after the MEP elections, I would not be here today. It is true that I was not originally planning to run for the current general election, and it is equally true that I was in the background supporting the PL. However, when the Prime Minister asked me several times to put forward my name as a candidate, I accepted. In the end, when the Party calls, we all contribute. Whether we contribute as frontline candidates, in logistics, customer care, or social media, we all play a role. And that is what truly matters. Your contribution is certainly valuable.

The post When loyalty is rewarded – thank you, Districts 2 and 9 first appeared on The Malta Business Weekly.

Compiled via the Short-Term Quarterly Economic Forecasting Model (STEMM), official figures project Malta’s real GDP to expand by 3.7% in 2026. This aligns perfectly with projections from the IMF and the Central Bank of Malta. However, underlying drivers have mutated significantly. Output in 2026 is driven entirely by domestic demand (+3.8 pps), while net exports act as a drag, subtracting 0.1 pps . This dynamic reflects a deteriorating international climate triggered by military conflict in the Middle East from late February 2026, which closed the Strait of Hormuz and disrupted global shipping lanes.

While Malta’s direct trade exposure to the Gulf region is minor—representing 2.5% of goods exports (€84.6 million) and 0.7% of imports in 2025 —secondary transmission channels are pronounced Surging transport costs, freight shocks (reflected in a 20%+ increase in the Baltic Dry Index), and supply chain disruptions penalize primary trading partners. Growth projections for major Eurozone markets, particularly Germany (which commands 20% of Malta’s total export demand), have been sharply downgraded, compressing external demand for Maltese goods and service.

While validating headline GDP, the Council highlights explicit concerns regarding the balance of domestic expansion, noting strong tension between projected investment and consumption patterns.

• Private Consumption (+3.9%): Highly resilient, backed by a tight labour market, public-sector collective agreements, and revised parental tax brackets.

• Gross Fixed Capital Formation (+6.5%): MFIN expects a major turnaround from recent investment contractions, driven by an ambitious nominal public investment target of €900 million (+18.6% nominal increase) and robust private sector expansion (+7.0%).

• Government Consumption (+5.7% Real / +8.0% Nominal): Elevated, led by a 4.1 pps expansion in employee compensation, though decelerating slightly from 2025.

The Council cautions against institutional over-optimism. Over the past three fiscal years, actual public investment consistently fell short of targets by an average of €200 million annually, hitting a rigid delivery ceiling of roughly €750 million per year. This reflects deep capacity constraints and execution challenges across advanced infrastructure programs. Conversely, notable upside risks reside in general government consumption. State models assume intermediate consumption growth will fall to 4.1%, contradicting the 16.2% average annualized growth seen over the past three years. Given relentless demand pressures across state medical systems and public service contract indexing, the Council expects government consumption to exceed estimates, offsetting underperforming capital outlays.

Malta’s 2026 data reveals a deeply embedded structural contradiction—a core friction in the current economic architecture. This friction is best understood through cost-driven pricing pressures, full employment tightness, and the business cycle output gap.

Headline HICP inflation is projected to reach 2.9% in 2026, a 0.7 percentage point upward revision from autumn baselines . Crucially, this spike is not an excess demand byproduct; it is purely cost-driven and structural, reflecting global import pipeline shocks. Rising freight metrics (the Baltic Dry Index jumping over 20%) and a 50% spike in international agricultural fertilizer costs have driven up production cost bases globally. Core inflation tracks closely at 2.8%, proving that import pipeline pressures flow steadily into local services and consumer goods Malta’s headline rate would be much higher without state intervention as government maintains strict price caps on domestic energy utilities and retail fuel via open-ended fiscal subsidies. While this shields household budgets, it shifts a heavy financial burden onto the state balance sheet, generating an accumulating fiscal liability demanding future consolidation.

Simultaneously, the labour market runs exceptionally hot, featuring historic highs in labour utilisation and negligible slack. Full-time equivalent employment is forecast to expand by 3.6% in 2026, absorbing a net 12,326 workers into the economy  and holding national unemployment at an ultra-low 3.2%. Because the domestic labour supply is fully utilised, this relentless demand has triggered robust wage acceleration (+4.4% nominal compensation per employee). Furthermore, since local headcount cannot expand organically, further expansion relies entirely on foreign inward migration, worsening spatial and infrastructural strains.

The core of the MFAC report is a detailed critique of Malta’s long-term reliance on factor accumulation—specifically demographic expansion—to fuel GDP growth. Over the last decade, real GDP growth averaged an exceptional 6.5%, driving a successful real convergence that brought GDP per capita to approximately €35,000 in 2025. However, a decomposition of this growth shows that it was disproportionately driven by labour supply increases rather than structural efficiency. Between 2015 and 2025, expanding labour force participation accounted for 2.0 pps of real GDP growth, while raw population growth contributed 2.8 pps. In sharp contrast, labour productivity per hour worked contributed a modest and highly volatile average of only 1.6 pps.

Because Malta’s labour force participation rate (82.6%) now significantly exceeds the EU average (75.7%), the historical cushion of activating underrepresented demographics has largely been exhausted. To sustain a baseline growth rate of roughly 4.0% under the current structural model, Malta would require an unsustainable net influx of 14,000 new workers every year . To avert the resulting capacity constraints, the Council outlines two explicit, binding recommendations.

Recommendation No. 1: Transitioning to Productivity-Led Growth. Malta must break its structural dependence on demographic expansion. In several high-growth periods (including 2016, 2018, and 2019), labour productivity growth actually turned negative, proving that economic expansion was achieved by adding raw hours rather than generating efficiency gains. The Council emphasizes that future policy must pivot entirely toward maximizing output per hour worked. This requires a comprehensive strategy across education and training to resolve deep skills mismatches in the local economy. It also requires targeted labour market strategies that encourage job mobility away from low-margin, labour-intensive activities and toward high-value-added sectors.

Recommendation No. 2: Scaling Up Productive Investment & Capital Intensity. A primary driver of labour productivity is capital intensity—the volume of advanced technology, equipment, and modern infrastructure backing each worker. Malta’s aggregate capital intensity remains low relative to peer EU economies, limiting its capacity for structural efficiency. The Council advises a clear reallocation of capital away from short-term consumption expenditure and into productive investment. While Malta performs well in software and database acquisition, its domestic investment in Research and Development (R&D) is critically low, standing at an investment-to-GDP ratio of just 0.3% . Policy efforts must prioritise :

• Broadening fiscal incentives, such as accelerated tax depreciation and investment tax credits, to support the rapid adoption of digital technologies, automation, and cybersecurity.
• Encouraging the private sector to leverage advanced AI-related technologies to optimize production and service delivery streams.
•  Mobilising public capital to execute the ‘twin transitions’ of deep economy-wide digitalization and environmental sustainability.
• Optimising the quality and composition of public expenditure to crowd-in high-value private investment, thereby easing structural bottlenecks without generating fiscal waste.

The Malta Fiscal Advisory Council’s 2026 assessment confirms that while the nation’s immediate economic momentum is secure, its long-term resilience cannot rely on population growth. Transitioning from factor accumulation to a high-efficiency, capital-intensive economy is no longer optional; it is a structural necessity. By channeling public and private capital into R&D, structural digitalization, and targeted human capital development, Malta can protect its competitive edge, preserve its fiscal sustainability, and build a highly resilient economy capable of thriving through future global shocks.

The post The needed paradigm shift first appeared on The Malta Business Weekly.

As oil trading resumed after a brief pause in fighting, the price of Brent crude, the global benchmark, reached nearly $120 a barrel. It is up by 42% since hostilities began. The Iranian regime, despite more than 120 days of being bombed and blockaded by the world’s top military superpower and its Israeli ally, is emboldened.

Claiming that talks with Iran had been “brought to the highest level of Iranian leadership and approved,” Trump said he had “cancelled the planned strikes and bombings against Iran last week.” In response to the US strikes, Iran’s Islamic Revolutionary Guard Corps struck US targets on bases in Kuwait and Bahrain and hit and partially destroyed Sheikh Isa Air Base. Nothing is stopping the Iranian state from retaliating against its Western invaders.

Only recently, Iranian media said the army had conducted drone strikes targeting communications antennas and radar facilities belonging to the US Fifth Fleet in Bahrain. Add to this a recent air raid alert issued in Bahrain, where residents were urged to head to the nearest safe place. Notice how Kuwait temporarily closed its airspace as its military said its air defence systems were working to intercept hostile aerial targets.

In response to the US strikes, Iran partially destroyed Sheikh Isa Air Base. Readers may ask: what was the effect of the effective closure or minimal traffic in the Strait of Hormuz since early 2026? The short answer is that it has forced production curtailments and highlighted vulnerabilities.

Yet, the flow of oil out of the Gulf needs alternate routes, so many attempts are underway to dig and lay new delivery pipelines that circumvent the export of crude through the Strait of Hormuz. One such project, code-named ADNOC, was approved in mid-May 2026 by Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed. This is not a walk in the park, since construction in a tense region carries security and logistical risks, though parallel routing leverages existing rights-of-way for faster build times.

Long-term, this re-routing of crude encourages diversification but does not fully eliminate global market expectations. One cannot omit mentioning Saudi Arabia’s East-West Pipeline (Petroline). This is a mature, high-capacity bypass system that has been rapidly ramped up and proven resilient during the 2026 Hormuz disruptions, contrasting with the UAE’s ongoing expansion of its smaller-scale Fujairah route.

Saudi Arabia’s system is much larger (7 mb/d versus the UAE’s current 1.5–1.8 mb/d, growing to a future 3.6 mb/d). Naturally, this reflects Saudi Arabia’s vastly higher production base. It provides immediate, battle-tested relief. Together, both pipelines, when fully operational, mitigate but do not fully replace Hormuz volumes (about 20 mb/d pre-crisis). Saudi Arabia benefits more from short-term export continuity, yet the UAE’s expansion aligns with its capacity ambitions.

These efforts build on existing infrastructure but have been accelerated due to the ongoing Strait of Hormuz disruptions. Pressure is mounting on Trump to solve the dispute, particularly from American motorists now paying over $5.10 for a gallon of petrol on average.

Let us look for an alternative crude supply away from the troublesome Gulf area. Can the eastern and central Mediterranean basin prove to be an alternative source? The answer is not in the next decade. In fact, there is a low and declining share of oil produced from the central Mediterranean area (offshore around Sicily and the Sicily Channel). This represents a relatively small part of overall crude-oil output.

Most of Italy’s domestic oil production in recent years has been onshore (notably Basilicata – e.g., Tempa Rossa) and in the Adriatic Sea. One can deduce that the central Mediterranean offshore plays a minor role by volume compared with Gulf areas. Eni is the major Italian player in offshore hydrocarbon activity, including exploration and production around Sicily. Other companies and operators may hold smaller stakes or operate onshore and in the Adriatic; however, Italy is a substantial net importer of crude and petroleum products.

There has been ongoing exploration interest, including licence rounds and seismic surveys such as those in Malta, in the central Mediterranean. However, successful large oil discoveries and subsequent high-volume production in the central Mediterranean have been limited. Much of the recent investment has focused on gas rather than crude extraction. Regulatory sensitivities and public opposition surrounding offshore drilling – particularly concerning coastal tourism, fisheries, and environmental concerns – limit easy expansion in nearshore zones.

Back to the fragile situation of crude deliveries out of Hormuz, one expects that a short-term solution is to bypass it via pipeline installations, yet this takes time. In a post-resolution scenario, these would complement the reopening of the Strait by providing redundant and secure export routes.

In summary, can we conclude that oil riches have once again spurred a second turbulent Gulf war?

The post Oil again is the cause of global turbulence first appeared on The Malta Business Weekly.

Buoyed by a summer schedule featuring more than 110 destinations, including three new routes inaugurated last month, this momentum continued into May as Malta International Airport welcomed 1.08 million passengers, MIA said. 

Additional flights contributed to an increase of 18.6 per cent in seat capacity. Despite this double-digit growth, a robust seat load factor (SLF) of 83.5 per cent was recorded, showing a strong appetite for travel to the Maltese Islands. This reflects a wider trend identified by the European Travel Commission, which found that southern European and Mediterranean destinations were Europeans’ preferred choice for summer travel this year. The most popular markets remained largely unchanged from previous months, with the United Kingdom topping the leader board with a market share of 21.3 per cent. Italy, Poland, Germany, and France rounded out the top five markets, recording growth rates that ranged between 8.0 per cent and 62.5 per cent.

The post MIA among Europe’s strongest performers in April first appeared on The Malta Business Weekly.

Against an uncertain global backdrop due to the Middle East conflict, the Maltese economy is expected to present some degree of resilience to these effects in 2026, though a marginal delayed impact on GDP and prices is envisaged to materialise in 2027.

Growth over the projection horizon is expected to be led by private consumption, which is projected to continue to grow at a brisk pace, in part supported by recent changes to income tax bands.

Employment growth is expected to moderate gradually to 2.3% by 2028. The unemployment rate is forecast to edge down to 2.9% over the projection horizon.

Wage growth is set to remain strong, driven by labour market tightness, but is set to ease to 3.9% in 2028 from 4.2% last year.

HICP inflation is projected to be impacted by the war in the Middle East, primarily through the channel of higher imported inflation, particularly in goods and food components as continued fiscal support mitigates the propagation of the energy shock on domestic energy prices. Overall HICP inflation is thus projected to increase to 2.5% in 2026 and is set to remain at that level in 2027. It is then expected to ease to 2.2% in 2028, driven primarily by lower services and NEIG inflation. Compared to the Bank’s previous forecast publication, overall HICP inflation has been revised up by 0.2 percentage points in 2026 and 2028 and by 0.4 percentage points in 2027.

The general government deficit-to-GDP ratio is projected to continue to decline over the forecast horizon, albeit in a more gradual manner. It is set to narrow to 1.9% in 2026, 1.7% in 2027 and to 1.6% by 2028. The general government debt-to-GDP ratio is expected to decline further from 46.4% in 2025 to 46.0% in 2026 and subsequently to 44.1% by 2028. 

Risks to growth are tilted to the downside. These risks largely emanate from the uncertainty surrounding the duration and intensity of the conflict in the Middle East which may lead to a weaker external environment and hence a more subdued trajectory in foreign demand. Disruptions to transport through the Strait of Hormuz have also raised concerns on fuel shortages in trading partner countries which may negatively impact tourism, aviation and the shipping industry. However, this downside risk to tourism could be mitigated potentially by the redirection of tourists towards safer destinations like central and western Mediterranean.

Risks to inflation are tilted to the upside over the projection horizon. Upside risks to inflation primarily reflect stronger disruptions to energy markets than assumed in the technical assumptions. Although the direct impact on domestic energy prices continues to be mitigated by the Government’s commitment to its fixed energy price policy, higher than envisaged global energy prices could generate stronger imported inflation, with potential further amplification via indirect effects on wages and profit margins. Inflation could also be higher than expected if supply disruptions were to spread to non-energy markets, although alternative supplies from other regions could mitigate this effect.

On the fiscal side, risks are assessed to be tilted to the downside (deficit-increasing). These predominantly stem from the possibility of slippages in current expenditure, notably higher-than-expected spending on energy support measures should commodity prices exceed assumptions. These risks are partly mitigated by the likelihood of higher-than-forecast increases in tax revenue, brought about by additional improvements in tax administration.

The post Central Bank forecasts growth to remain resilient despite global uncertainty first appeared on The Malta Business Weekly.

Following the identification of hundreds of subsea targets along the 99-kilometre submarine corridor, specialised offshore teams relocated 117 unexploded ordnance items, predominantly dating back to the Second World War. This complex operation prepares the strategic maritime route for the next phase of installation, ensuring the protection of personnel, the integrity of the infrastructure, and the long-term reliability of the network.

The Identification and Clearance campaign was initiated following the completion of the Detailed Marine Route Survey, during which 707 magnetic targets were initially detected along the 99-kilometre submarine cable route between Malta and Sicily.

Following rigorous desktop post-survey analysis, this figure was reduced to 393 targets requiring direct physical investigation through specialised offshore inspection and clearance activities.

During the offshore campaign, 84 of these targets were initially confirmed to be unexploded ordnance (UXO). Whilst this already represented a significant volume compared to standard offshore surveys, further engineering challenges arose as works progressed. Additional UXOs were identified buried directly beneath some of the previously detected objects, raising the final number of cleared unexploded items within the corridor to 117.

The uncovered munitions varied considerably in type, size, and physical condition, ranging from artillery shells and hand grenades to Hedgehog anti-submarine mortars. Due to the depths involved and the inherent safety risks associated with unexploded wartime ordnance, handling and clearance activities were carried out by specialised personnel utilising remotely operated vehicles and dedicated offshore equipment. These operations required detailed planning, continuous coordination with the Armed Forces of Malta, and strict adherence to established safety protocols.

The campaign was executed through Interconnect Malta’s main contractor, Nexans, with the direct support of specialised subcontractors NextGeo and Sub Service S.r.l., who provided the necessary vessels, equipment, marine expertise, and Explosive Ordinance Disposal specialists. Following the successful completion of the operation, Sub Service S.r.l. will issue the relevant safety certifications.

Miriam Dalli, Minister for Energy, the Environment and the Regeneration of the Grand Harbour, stated that, “the successful completion of the identification and clearance campaign represents a major technical milestone for the Second Interconnector, a project which is central to Malta’s vision to decarbonise the sector by 2050.”

Inġ. Ismail D’Amato, Chief Executive Officer at Interconnect Malta, acknowledged the critical external support provided throughout the operation. “The collaboration, technical assistance, and close coordination with the Armed Forces of Malta at each stage of the campaign, were essential to ensuring that the works were carried out safely and in line with the required procedures,” he said.

The project consists of a new 122km long 245kV, 225MW, 50Hz electrical cable interconnection between Malta (Maghtab) and Sicily (Ragusa) to be laid in parallel but at a safe distance to the existing HVAC cable link which was commissioned in 2015.

This €300 million project was approved for ERDF funding, specifically under Priority 2, ‘Promoting clean and fair energy transition, sustainable wastewater management, and green investment’, and Specific Objective 2.3, ‘Developing smart energy systems, grids, and storage outside the TEN-E network’.

The second interconnector will not only increase the security of the electrical supply but will also lead to increased investment in renewable energy, which will help Malta better handle the intermittent nature of green sources like offshore wind and solar. Once completed, the 245kV submarine cable will double Malta’s connectivity to the European energy grid. According to the project’s cost-benefit analysis, 13.5 million tonnes of CO2 emissions will be reduced, enhancing its significance in Malta’s long-term decarbonisation strategy.

This €300 million investment has been approved for ERDF funding under the priority “Promoting a clean and just energy transition” and contributes directly to smart and stable energy systems. The project has been recognised as an “Operation of Strategic Importance” in the 2021-2027 Programme, with €261 million allocated in European funding.

The post Major hurdle cleared for Second Interconnector as seabed route is secured for cable laying first appeared on The Malta Business Weekly.

Unlike traditional financing arrangements that may require substantial upfront payments, GO ENERGI is offering customers solar energy systems with no upfront investment and repay the cost through monthly instalments at 0% interest. This offer is open to everyone, even to non-customers of GO.

Established by GO in 2024, GO ENERGI combines solar installation expertise with flexible financing options intended to reduce the initial financial commitment often associated with renewable energy projects.

“Malta has made significant progress in solar energy adoption over recent years, but there remains considerable potential for more households to benefit from renewable energy solutions. With Government grants currently available for both solar PV and battery storage systems, many homeowners have a valuable opportunity to invest in technologies that can help reduce energy costs while contributing to Malta’s sustainability goals,” said Alison Mercieca, Chief Commercial Officer at GO plc.

Government grants are available to residential properties holding a residential ARMS bill, with eligible households able to apply for both photovoltaic and battery storage grants. Homeowners who previously benefited from a solar panel grant more than six years ago may also qualify for battery storage support.

For households that do not qualify under the current grant scheme, GO ENERGI also offers solutions through the Feed-in Scheme, providing alternative pathways to renewable energy adoption.

To further encourage uptake, GO ENERGI has extended its customer incentive programme, offering a €25 KLIKK voucher following a site visit and a further €200 KLIKK or GO voucher upon installation.

Malta’s transition towards renewable energy continues to gather momentum, with almost 35,000 photovoltaic (PV) systems now installed across the country, according to the latest figures published by the National Statistics Office (NSO).

NSO data released last year reported that 34,955 grid-connected PV installations were operational by the end of 2024, with the domestic sector accounting for more than 93% of all systems and that renewable electricity generated from PV installations reached 326.5 GWh during the year, reflecting continued growth in residential solar energy adoption.

The post GO Energi supports government grants for solar PV systems first appeared on The Malta Business Weekly.

The scope of the GBS is to gain deeper insights into sectoral developments and emerging trends, through semi-annual surveys. This business dialogue effort aims to foster regular communication with businesses operating in Gozo, gathering timely data on recent performance, business activity expectations, investment and employment trends, and pricing dynamics. By doing so, the GBS complements official economic indicators, which are often available only with a time lag.

Additionally, businesses are encouraged to share perspectives on sector-specific developments and current economic issues, providing qualitative feedback that allows both the authority and the chamber to understand the underlying drivers of present and future economic trends.

The sampling methodology remains the same over each period, together with the sampling stratification which reflects the economic composition of the Gozitan economy.

The key findings of the survey are outlined below.

Business conditions and expectations

Gozitan enterprises continued to record stable business conditions, with 58% of the participants stating that their situation remained unchanged in the preceding six months.

Businesses reporting worsening conditions were also lower than those recorded a year earlier, standing at 9% from 16%.

The net balance points to an improvement in sentiment, standing at 25%, which remains well above the 11% average recorded across all survey rounds, but five percentage points less than the all-time high of 30%, which was recorded in the previous survey round.

The secondary sector, consisting of manufacturing and construction enterprises, registered the largest share of improved business conditions, with a net balance of 38%.

The services sector also recorded a strong positive net balance, standing at 24%. Within this sector, accommodation and food service activities emerged as the category with the strongest positive sentiment, followed by the information and communication activities.

For the first time since the September 2023 survey round, cost pressures have emerged as the most pressing challenge for local firms, surpassing concerns related to staff shortages.

In the latest survey, 49% of participants reported cost pressures, an increase of nine percentage points when compared to that reported in the previous survey round. This was particularly evident within the transport and storage activities, followed by accommodation and food service activities, and construction.

Nonetheless, this survey round must be put within the context that it is the first to capture the potential implications of higher international energy and transportation prices driven by the escalated conflict in the Middle East. Although energy prices in Malta remain subsidised, higher global energy costs still feed through as they impact the prices of imported inputs.

The lack of suitable employees to support operations remains a very pressing challenge, with 48% of respondents flagging it. However, this represents a slight drop when compared with the September 2025 survey.

A slowdown in sales was cited by only 14% of respondents, an all-time low, although broadly in line with other March surveys.

Despite the global conditions, 48% of participants anticipate an improvement while only 10% foresee a deterioration in conditions. The remaining respondents (43%) expect conditions to remain unchanged. This results in the highest net balance recorded across all survey rounds, standing at 38%.

The strongest net balance, that of 44% was recorded in the knowledge sector, primarily made up of arts, entertainment and recreation category.

Prices

Cost pressures are also reflected in businesses’ price expectations, with 76% of respondents anticipating higher input prices over the coming six months.

This marks an increase over both the September 2025 round and the previous year, with industry, excluding construction, and transportation and storage activities reporting the strongest expectations of rising costs.

Despite expectations of higher input costs, these pressures are not yet being fully reflected in selling prices. Most respondents, 68%, expect selling prices to remain unchanged over the coming six months, while 33% anticipate an increase, a share broadly in line with previous survey rounds.

Employment

The vast majority of the businesses (63%) consider increasing their workforce in the short-term, whereas 38% of the sample indicated that they are not seeking additional employees.

The positive employment intentions were evident across all economic sectors.

Among the skills required one could notice strong demand for technical and operational competences.

Investment

64% of firms expect to make an investment in the coming six months, slightly exceeding the result of the September 2025 survey, with enterprises in the transportation and storage sector showing the strongest investment outlook.

A focus on external financing

The supplementary focus of the March survey was on external financing, with particular attention given to businesses’ access to suitable bank lending facilities.

64% of the respondents do currently have an external source of financing. Among these, bank loans and credit facilities represent the most common form of funding, accounting for 57% of the sample. A smaller proportion of businesses make use of bank loans or credit facilities supported by government or development bank schemes, which account for 7% of the sample.

30% of the surveyed firms stated that they do not have an outstanding external financing.

When asked about the ease of accessing external financing, the largest share (38%) highlighted that they lack sufficient information to provide an assessment, with 36% highlighting that this was an easy process, followed by 26% who highlighted that this was a relatively difficult process.

Among those who did identify challenges, the most common concern was the administrative or documentation burden associated with the process. Other factors mentioned included lack of information or guidance, as well as the cost of financing.

The post Cost pressures major concern for Gozo businesses, survey finds first appeared on The Malta Business Weekly.

The Malta Financial Services Authority (MFSA) has published findings from its 2025 Outcomes-Based Supervision review of marketing communications in the insurance and investment sectors. The review identified shortcomings in governance, disclosures, monitoring and record-keeping, while also highlighting examples of good market practice.

The review formed part of the MFSA’s wider Compliance Outcomes-Based Supervision framework, which focuses on achieving measurable supervisory outcomes that support consumer protection, market integrity and financial stability.

Marketing communications identified as a supervisory priority

Marketing communications were identified as a key supervisory priority for 2025, reflecting the important role that advertisements and promotional materials play in influencing consumer and investor decisions.

The review assessed whether marketing communications issued by regulated entities are fair, clear and not misleading, and whether consumers are provided with the information necessary to make informed decisions.

Key areas for improvement

The exercise identified several areas where firms are expected to strengthen their frameworks and controls.

Among the key findings were shortcomings in the documentation of marketing policies and procedures, weaknesses in post-publication monitoring processes, deficiencies in record-keeping practices, and instances where disclosures relating to risks, regulatory status and external website links were not sufficiently prominent or comprehensive.

The review also highlighted the importance of ensuring that marketing communications remain accurate, up to date and appropriately targeted to their intended audience.

Examples of good market practice

Alongside the areas requiring improvement, the authority identified examples of good market practice across the sectors reviewed.

These included regular reviews of marketing policies, structured compliance monitoring programmes, standardised disclosure templates, marketing compliance checklists and enhanced oversight controls designed to support fair and transparent communications.

Supporting consumer protection and market integrity

Christopher P. Buttigieg, chief officer Supervision at the MFSA, said: “Consumers and investors should be able to rely on marketing communications that are fair, clear and not misleading. Through our Outcomes-Based Supervision framework, we continue to engage with industry to strengthen standards, promote transparency and support informed decision-making across Malta’s financial services sector.”

The Dear CEO Letters set out the authority’s expectations and provide guidance to licensed entities on addressing identified shortcomings and enhancing compliance with applicable regulatory requirements.

The MFSA said it will continue engaging with firms as part of its three-year supervisory cycle and will assess the extent to which the expected compliance outcomes have been achieved.

The post MFSA highlights marketing compliance findings from 2025 Outcomes-Based Supervision review first appeared on The Malta Business Weekly.

The strategies, unveiled on 10 June 2026, focus on improving connectivity, boosting economic resilience, and tackling structural barriers affecting islands across Europe.

ATTO chairman Joseph Bugeja said the initiative marks an important step for Malta’s transport and logistics sector, which has long argued that EU policies do not fully reflect the realities of operating from an island state.

“For years, Malta and other island regions have had to work within EU frameworks that failed to adequately address the higher costs, logistical difficulties, and competitiveness challenges linked to insularity,” Bugeja said.

He added that the Commission’s strategy validates concerns repeatedly raised by ATTO over transport inefficiencies, limited connectivity, and the disproportionate burden carried by island-based operators.

ATTO said the Commission’s priorities closely mirror the day-to-day realities faced by Maltese transport operators, who play a key role in maintaining supply chains and supporting economic stability.

The association also welcomed the EU’s commitment to engaging more closely with island stakeholders in future policymaking, saying it is ready to contribute to discussions to ensure Malta’s transport and logistics sector is properly represented.

While describing the announcement as a significant breakthrough, ATTO stressed that the strategy must now lead to concrete legislative and financial measures, particularly in areas such as transport, climate policy, and state aid.

“Only through effective implementation can the full promise of this strategy be realised,” Bugeja said, adding that ATTO looks forward to working with both national and EU institutions to ensure Malta’s realities as an island state are fully recognised in future policymaking.

The post ATTO welcomes EU island strategy for Malta’s transport sector first appeared on The Malta Business Weekly.