Malta’s economy shows mixed signals as property market slows
Malta’s economy is showing mixed signs, with strong tourism spending and consumer confidence contrasting with sluggish business conditions, a cooling property market and rising inflation, according to the Central Bank’s latest economic update. Tourist expenditure rose by 14.9% in August, reflecting higher spending per night and per visitor, although tourists stayed for shorter periods. Consumer sentiment also remained strong, particularly regarding households’ willingness to make major purchases over the coming year. Industrial production and services recorded marginal growth in recent months. However, business conditions remained below their long-term average, while residential permits continued to decline after a period of exceptionally strong activity. Residential deeds and promise-of-sale agreements also fell, although commercial permits increased in September. Unemployment remained stable at 3.4% in August, with 1,328 people registered as unemployed, 301 more than a year earlier. Meanwhile, inflation rose from 2% in August to 2.4% in September, pointing to renewed price pressures. (Times of Malta)
Economy Minister says higher costs for foreign workers will push businesses towards automation
Businesses must choose between investing in automation and continuing with labour-intensive operations, Economy Minister Silvio Schembri said, explaining the government’s decision to increase costs for third-country nationals. Speaking at a press conference on Thursday, Schembri said the measures were intended to discourage labour-intensive economic activity and encourage a shift towards a value-based economy. He argued that making an activity more expensive could discourage it, while incentives could encourage businesses to invest in productivity. The 2027 Budget introduced several measures affecting non-EU workers, including the removal of free public transport and childcare and higher driving licence fees. Schembri said these measures formed part of a broader economic transformation. He also announced a 60% tax credit on eligible investments in automation, artificial intelligence and digitalisation, expected to begin by the end of 2026. The government is allocating €120 million to the scheme, with each business eligible for a maximum benefit of €15 million over four years. (Maltatoday)
Spiteri Gingell proposes week-long strike to highlight Malta’s reliance on foreign workers
Governance consultant David Spiteri Gingell has urged trade unions and the Third-Country National Alliance to coordinate a week-long strike involving non-EU workers, arguing that it would demonstrate Malta’s dependence on foreign labour. In a LinkedIn post, Spiteri Gingell criticised political rhetoric portraying foreign workers as dispensable, a burden on public services or responsible for wider governance failures. He argued that Malta needed to confront its economic reality, particularly as an ageing population and low birth rates increased the importance of foreign workers to the labour market. A seven-day walkout, he suggested, could cause significant disruption across essential sectors, including healthcare, public transport, retail, elderly care, construction and hospitality. The suggestion highlights the potential economic consequences of measures that make employing or living in Malta more expensive for non-EU nationals, amid wider debate about population growth and the country’s economic model. (The Malta Independent)
