View from EY Malta
In his opening address at the Malta Future Realized Conference, Ronald Attard, EY Malta Country Managing Partner, reflected on the island’s transformation and its journey over the past two decades. “Twenty years ago, Malta’s official population stood at just over 400,000. Today, that number is close to 540,000,” he noted, highlighting the significant growth in both population and economic output, with GDP rising from US$6 billion in 2004 to over US$20 billion now.
Attard addressed the fluctuating attractiveness of Malta for FDI, acknowledging a recovery from the lows of 2019–21, but also a slight dip in attractiveness this year. “Telecommunications infrastructure has been a resounding constant positive over the years,” he stated, while also pointing out that other previously attractive criteria have lost their appeal.
“The stability of social climate has scaled down from the peaks experienced when we started undertaking our research,” Attard remarked. He emphasized the challenges posed by increased labor costs and the need for a stable political, legal, and regulatory environment, which, despite improvements, still fall short of the highs from a decade ago.
Attard remarked that “Leveraging Malta’s strengths in telecommunications infrastructure and technology, not least the significant skills base on the island built through the growth of the gaming industry, may be part of the answer. Last year, we referred to calls from a number of groups for an adjustment or change to the island’s economic model, to one that emphasizes substantial, tangible improvements in infrastructure, the labor market and holistic economic sustainability beyond mere numerical growth. And those calls are more pronounced this year.”
Looking ahead, Attard commented on the need for infrastructure and education investment, with various respondents also emphasizing long term economic planning. “Against this background of economic growth, we are losing ground in two of the most fundamental areas that potential investors assess — workforce skills and availability, as well as stability of the political and regulatory environment,” he said.
Despite the challenges, Attard revealed a positive outlook among investors, with 70% believing they will still be in Malta in 10 years. He identified tourism and technology, including gaming, AI, and FinTech, as key areas identified by respondents for Malta’s future. “Technology is viewed as the major driver for change, overtaking sustainability,” he said, adding that the availability of necessary skills is also considered more important than government support by the FDI community.
Attard concluded by emphasizing the importance of engaging with innovative technologies and making strategic choices to manage growth efficiently. “We will, during the forthcoming year, continue the debate through specific sessions focused on build, share, engage, change, and generate to support Malta in preparing to face the challenges brought about by rapid growth, as well as the opportunities that changes in technology provide”.