Rating agency DBRS confirms Malta at 'A' rating with stable outlook
Malta has had its rating and long-term outlook confirmed at A and ‘stable’ by rating agency DBRS. The agency noted that while GDP growth would slow in 2023, it would remain higher than in most other EU peers and that Malta’s removal from the FATF greylist was a positive sign. Less encouraging is the size of Malta’s public deficit, which would remain among the EU’s highest due to the decision to subsidise energy prices. However, DBRS said it believed the government’s plan to reduce the deficit to under 3 per cent by 2025 is “credible”, given its track record of fiscal management, although it noted that nobody knows how long, or how intense, energy and inflation shocks can get. The agency spoke in broadly positive terms about the energy subsidy plan, saying support measures “have played a key role in shielding the private sector from the pandemic and energy shocks as well as limiting potential persistent effects.” Those support measures come at a cost, however, extracting 2.7 per cent of GDP this year and 3.6 per cent of GDP in 2023. DBRS said that Malta being removed from the FATF greylist after just one year was encouraging and meant the negative impacts of greylisting would be...