VALLETTA (MALTA) (ITALPRESS/MNA) – The Malta Fiscal Advisory Council (MFAC) has urged the government to move away from an economic model driven by workforce expansion and adopt a more productivity-focused approach. The council endorsed the government’s latest economic forecasts, presented by Finance Minister Clyde Caruana, while warning that current growth trends are placing increasing strain on infrastructure and public services.
The government is projecting economic growth of 3.7% in 2026, a figure the MFAC described as strong compared with other European countries. Growth is expected to continue being supported by domestic demand, particularly private investment, alongside a robust labour market and rising household incomes. However, the council noted that part of this growth is being fuelled by a larger workforce and inward migration. While acknowledging the positive impact on economic activity, it cautioned that the trend has intensified pressure on roads, housing, healthcare and other essential services.
The MFAC said the forecasts were released amid global uncertainty, with international agencies recently revising growth expectations downward and inflation forecasts upward following the outbreak of war in the Middle East earlier this year. To ensure sustainable long-term growth, the council recommended that government prioritise productive investment over short-term expenditure. It highlighted education, digitalisation, research and innovation, skills development and stronger infrastructure as key areas for future investment.
– photo IPA Agency –
(ITALPRESS).
