DBRS Ratings Limited (DBRS) confirmed the Republic of
Malta's Long-Term Foreign and Local Currency – Issuer
Ratings at A (high) and its Short-Term Foreign and Local Currency
– Issuer Ratings at R-1 (middle). The trend on all ratings is
Stable.
KEY RATING CONSIDERATIONS
The Maltese economy remains one of the euro area's top
growth performers, with economic growth accelerating to 6.4% in
2017. Albeit remaining strong, DBRS expects economic activity to
decelerate gradually, with downside risks mostly stemming from the
external sector. Benefitting from strong citizenship scheme
(Individual Investors Programme or IIP) proceeds and Malta's
tax-rich economic growth, the fiscal surplus reached 3.9% of GDP in
2017, surpassing its target. Against this backdrop, the government
debt-to-GDP ratio dropped 5.5 percentage points to 50.7% of GDP.
DBRS expects the debt ratio to continue declining related to the
primary surplus and the favourable debt snowball effect.
