The Malta Chamber of Commerce, Enterprise and Industry has welcomed the reaffirmation of Malta’s A (high) credit rating with a stable outlook by DBRS Morningstar, describing it as a “strong vote of confidence” in the country’s economic performance.

However, The Malta Chamber stressed that the latest rating also comes with a clear warning: Malta’s long-term resilience depends on urgent and credible action to strengthen public finances and governance.

DBRS Morningstar’s latest assessment, published on 10th October, confirmed Malta’s long-term and short-term ratings at A (high) and R-1 (middle) respectively, citing eurozone membership, a robust banking system, and a strong external position among the country’s key strengths.

The agency highlighted Malta’s ability to maintain solid growth and a manageable debt burden despite global headwinds, forecasting GDP growth of 3.9 per cent in 2025 and 3.5 per cent in 2026.

Yet, the report also carried a note of caution. DBRS warned that Malta’s slow pace of fiscal consolidation – driven by sustained public expenditure, energy subsidies, and income tax cuts – risks undermining the country’s fiscal trajectory.

The agency also flagged governance challenges, including issues around government effectiveness and control of corruption, as potential constraints on Malta’s economic resilience.

The Malta Chamber echoed these concerns, underscoring that while Malta’s short-term performance remains strong, its “long-term resilience is fundamentally conditional” on addressing fiscal and governance weaknesses.

“Sustainable prosperity requires a swift political commitment to rein in spending and elevate the governance levels in Malta,” The Malta Chamber said, warning that continued delays could “have a large impact on Malta’s future economic resilience.”

This mirrors DBRS Morningstar’s own assessment that persistent deficits and structural governance issues could weigh on Malta’s credit profile if not addressed decisively.

The Malta Chamber also noted that the same message has been reiterated in recent assessments by S&P Global Ratings, Moody’s, the IMF, and the European Commission, highlighting a broad international consensus on the need for fiscal prudence and institutional reform.

While Malta’s public debt remains moderate – projected to rise only slightly from 46.2 per cent of GDP in early 2025 to 48.7 per cent by 2026 – both DBRS and The Malta Chamber emphasised the importance of credible fiscal consolidation to preserve confidence and ensure future policy flexibility.

The Malta Chamber’s statement adopts a markedly different stance to the Government’s more optimistic tone following the rating announcement.

Prime Minister Robert Abela had described the DBRS reaffirmation as a “testament to our economy’s resilience,” attributing Malta’s stability to its decision to avoid austerity measures during recent global turbulence.

Nonetheless, the latest comments from both DBRS Morningstar and the Malta Chamber suggest that fiscal responsibility and governance reform remain central to sustaining Malta’s economic credibility in the years ahead.