Malta’s deficit narrows to 2.1% of GDP, but debt climbs to €11.4bn

Malta’s government deficit fell sharply in 2025, but public debt continued to climb, reaching €11.4 billion by the end of the year, according to figures published by the National Statistics Office.

The deficit stood at €505.7 million, equivalent to 2.1% of gross domestic product, down from €814.9 million, or 3.5%, in 2024.

The improvement brought the deficit below the EU’s Maastricht Treaty’s 3% reference value. Yet government debt increased by €789 million, with the debt-to-GDP ratio edging up from 46% to 46.3%.

The smaller deficit reflected revenue growing faster than expenditure. Government revenue increased by €831 million to €8.65 billion, while spending rose by €521.8 million to €9.15 billion.

Spending therefore continued to increase, even as the gap between income and expenditure narrowed.

The figures also show why a falling deficit does not necessarily translate into a comparable slowdown in borrowing.

Debt increased by around €283 million more than the annual deficit. The NSO attributed the difference mainly to increases in government cash and deposits and holdings of equity and investment fund shares, partly offset by other movements.