Malta is expected to be one of the first EU members states to have to impose obligatory austerity measures next year to get its public finances in order after the island registered the highest deficit in the EU for 2021.
According to the latest statistics compiled by the EU, and which will serve as European Commission’s benchmark for assessment and projections later on this year, Malta ended 2021 with a deficit of €1.2 billion, equivalent to 8% of GDP.
On average, the EU’s deficit stood at 4.7%, just over half Malta’s.
Chart showing Malta’s deficit over the years.
This means that Malta’s current deficit is five percentage points higher than Euro Area rules usually permit (3%). These have been temporarily relaxed for the duration of the Covid-19 pandemic, but are expected to be re-enforced next year.
Brussels sources told The Shift that with this level of deficit, Malta is expected to be included in an Excessive Deficit Procedure (EDP) next year, once the rules, better known as the Maastricht criteria, are back.
According to the latest published figures, while Malta increased its revenue to €5.4 billion in 2021, it spent more than €6.6 billion, having to rely on around €1.2 billion in new loans.
Chart showing Malta’s increase in debt since 2018.
The government’s measures to keep the economy afloat last year also increased substantially, meaning expenditure rocketed to 45.5% of GDP, an increase of as much as 10% since Robert Abela became Prime Minister.
While registering the EU’s highest deficit last year, Malta’s record is closely followed by Greece (-7.4%), Latvia (-7.3%) and Italy (-7.2%).
As a result, Malta’s general debt also shot up, reaching €8.2 billion by the end of 2021, equivalent to 57% of GDP.
In the last two years, helped by the government’s dependence on loans to boost the economy, Malta increased its debt by 17% or more than €3 billion.
Still, in this area, Malta remains on ‘safe ground’ – EU debt alarm bells only start chiming once a country rises above the union’s threshold of 60% of GDP.
Although Malta’s debt levels are increasing at a steady pace, they’re still well below the EU’s average, which stood at 88.1% in 2021.
All those free cheques and an overstuffed cabinet!! When the pre-election bribe was announced, they maintained they had more money than expected. Now they’re in for another 5years, the gahans will have to start feeling the pain!!
Free Cheques…lol!!! the gahans will have to start feeling the pain!!
Free cheques my foot. Only red eyed persons received them. Blue eyed never received anything.
It is of no solace to know that the debt is below the EU average. Debt is debt and has to be payed back. The government should spend less and start by reducing the number of ministries. A Cabinet of 23 persons is extravagant.
Idiots and liars paid as if they were geniuses.
Not a day goes by that one does not have to be ashamed of this “government”.
If I compare the 100 largest cities in Europe with Malta, then Malta is in 93rd place. So small.
When I see the Bloody Golden Passport…. So outrageous.
When I see the ROBBER Abela with his businesses. It is so sad. He is the wrong one!
We don’t even have a place for corruption and money laundering. So disgusting.
Corrupt Idiots and liars paid like they are geniuses.
People always get the government they deserve.
I don’t deserve it, but unfortunately I got it!!!!!!
You are right, I am enjoying a seat in the same sinking boat.
We have a propaganda television disguised as public television.
We have propagandists for the PL disguised as journalists, paid by Maltese money.
Please do not condemn the ordinary people, condemn these manipulations.
No, this government is not a government for Maltese people.
It is a kind of Mafia. No one deserve a Mafia as Government. No one.
The people allow it, so, they are conspirators.
Malta’s GDP can be considered as ‘creative’ as it is inflated with the remuneration given to around 1,000 additional persons employed in the public sector for political reasons, that is ‘jobs for votes’, and not because there was a ‘business case’ for additional employees.
Without this additional ‘created’ income, the GDP would have been lower, and the deficit expressed as a percentage of GDP, would have resulted in a percentage higher than the 8% reported.
That’s right. More than half of employees in the public sector are useless. How is it that one day you are selling pastizzi and the next you have a 40k salary with Transport Malta as Manager or Senior Manager?
GDP my foot!
So now labour will realise that you cannot fool all of the people all of the time. The only problem is that thanks to labour’s rotten policies most of us will suffer. Not the mafiosi of course.
WELL THE FREE MONEY EXTRAVAGANZA IS OVER AND NOW FOLKS, ITS TIME TO FACE REALITY…TAXES