Malta’s debt reached a record €9.7 billion, or a staggering €4 billion more than what Prime Minister Robert Abela inherited upon taking office, according to new data published by the National Statistics Office (NSO).

When Abela replaced disgraced former prime minister Joseph Muscat, the island’s debt stood at €5.7 billion.

The latest NSO statistics show that between January and December of last year, Robert Abela’s government spent €909 million more than it could afford, even though revenue increased by over half a billion, mainly through more income tax and social security payments.

The increase in debt in the last two years occurred despite increasing revenue in state coffers.

Malta has been registering a higher GDP growth than the rest of the EU. Still, its deficit and debt continued to surge, NSO statistics show.

More worrying is the fact that, due to increased global interest rates, taxpayers are paying more and more to service the loans the government takes.

In 2023, taxpayers had to fork out a record €214 million in interest payments, an increase of €41 million over the previous year.

The situation is not expected to change. Finance Minister Clyde Caruana announced in the last budget that he was planning to borrow almost another billion this year.

The deficit is expected to put Malta in hot water with the EU as Brussels will reintroduce its fiscal rules this year after their suspension due to the COVID pandemic. According to these rules, member states with an annual deficit of over 3% of GDP will be under strict supervision and will have to reduce it over the years to come back in line.

The EU is expected to announce its decisions later this year.