Economic Climate
Although small in physical size, Malta has a healthy, well-diversified economy with a variety of growing sectors. GDP, which in 2016 rose to €9.9 billion, registered an average growth rate of 6.9% over the past three years. The economy is essentially export-driven, both in physical goods as well as services, with exports per capita amounting to around €32,000 per annum. In this area, companies are assisted by Trade Malta, which works to facilitate trade flows. While the islands are possibly more well known as a popular tourist destination, they have been a home to a strong manufacturing industry for decades. Significant investment has also seen growth in other industries such as international education services, financial services, ICT, maritime and aviation, all of which offer opportunities for further development.
Setting up
Malta has been attracting FDI since the early 1950s and, as a result, both the public and private service providers are fully geared up with regards to the requirements related to setting up operations in Malta, resulting in a streamlined and simple process. The most commonly used service providers are those from within the private sector, who amongst others have a hand in overseeing processes such as opening bank accounts, registering companies and recruiting suitable and qualified personnel. Investors wishing to seek help from a public entity may speak to Business First, a specialised unit tasked with providing an efficient service by correlating various government departments into a single point of contact. Business First also offers some business advisory services.
Human Resources
As a small country generally lacking in natural resources, Malta’s primary resource is its own people. The quality of the human resource element has indeed been quintessential for the country’s economic growth. Many investors have described the workforce as one that is flexible, can think on its feet, and is productive, loyal and easy to work with. This makes Malta the ideal location for those companies who engage in high-value adding projects that require a highly skilled and motivated workforce. Within this context, it is no surprise that over the years the Maltese authorities have not only invested directly in education and training, but also provided significant support to help the private sector invest in this sector, thereby ensuring that this vital resource is always able to meet the changing demands which are placed upon it.
Tax
Malta offers an onshore competitive tax system that is transparent, straightforward and in full conformity with EU legislation. Under Malta’s system, tax rates can be lowered to 5% under certain circumstances, thus adding a great deal of value to any Malta-based operations. This is further complemented by a network of over 60 Double Taxation Agreements. The tax system is also supported through the existence of a highly professional financial service sector and a strong regulator which ensures the provision of high quality advisory services in matters relating to international tax systems. FinanceMalta, a public-private entity that works to sustain the growth of the financial services industry, is a source for further information about the tax system in Malta.
Communications
Malta provides a competitive communications infrastructure that comes equipped with a range of services. Broadband coverage is available across the entire country, while multiple cable links with mainland Europe provide multiple redundancy. This reflects the fast-growing software development and e-gaming industries in Malta, which depend on such services. Various service providers offer colocation, hosting, cloud and managed services, while the authorities have also embarked on a project to make Malta the first wi-fi state in the world. Further information about the communication services in Malta may be obtained from the Malta Information Technology Agency and the Malta Communications Authority.
Business Support Services
Education Malta strives to assist investors within the education sector, providing the necessary guidance and relevant information that is required to set up and operate an educational programme or institution in Malta. It also facilitates the interaction with other government organisations that may complement the assistance provided. Amongst others, these include the National Commission for Further and Higher Education (NCFHE), which acts as regulator for the education sector; as well as Malta Enterprise, which provides an array of support measures to investors, including tax credits against investments made, business development grants, access to finance, support for R&D, as well as allocation of operational space.