Malta’s FDI flows rebound, yet remain outpaced by ODI flows in 2018

Although both foreign direct investment (FDI) flows and Malta’s FDI stock showed a year-on-year growth by the end of 2018, the FDI flows into the country had been on the drop from 2014 to 2017, offering a slight rebound in 2018, according to the most recent figures published by the National Statistics Office (NSO). Nevertheless, the island nation’s FDI stock has still stayed above the outward direct investment (ODI) stock, despite ODI flows outpacing FDI flows in recent years.

By the end of 2018, FDI flows into Malta grew by a year-on-year €353m to €3.3b, up from 2017’s €3b, offering a slight rebound. Nevertheless, according to NSO figures, FDI inflow had been dropping from 2014’s €8.5b to €4.6b in 2015 and €3.7b in 2016, as the cover image of the present article shows.

On the other hand, ODI flows had been on the rise, from -€1.7b in 2014 — which signals divestment — to €4.6b in 2015, €4.8b in 2016, €6.3b in 2017, reaching €6.2b by the end of 2018.

Despite ODI flows outpacing FDI flows, the country’s total foreign direct investment stock was on a gradual rise by the year, while direct investment stock position roughly stagnated, chiefly due to divestment in manufacturing, NSO statistics suggest.

By the end of 2018, Malta’s FDI stock reached €180.9b — a year-on-year increase of €8.8b —, while the ODI stock dropped by €0.7b to €61b, NSO figures suggest.

Financial and insurance activities dominated both FDI and ODI flows in 2018, by covering 97.1% and 99.4% of the total, respectively. The vertical was the most significant contributor of both FDI and ODI between 2014 and 2018 with its share remaining well above 90%.

In foreign direct investment flows terms, financial and insurance activities roughly halved from 2014’s €8.4b to 2015’s €4.2b, dropping further to €3.2b in 2016, €2.7b in 2017 and €2.9b in 2018.

In an outward direct investment flows approach, however, after 2014’s -€1.7b — signalling divestment —, the financial and insurance activities sector jumped to €4.7b in 2015, growing further to €4.8b in 2016, €6.3b in 2017 and another €6.3b in 2018.

EDITORIAL NOTE: The present article is based on figures the National Statistics Office (NSO) has recently published in its annual publication, available for public view on their official website.