WASHINGTON: The International Monetary Fund’s Executive Board concluded the Article IV consultation with Malta whose economy continues to weather the global crisis well.
Spillovers from turmoil in international financial markets have been contained due to low reliance on external financing by the government and banks. The macroeconomic outlook is favorable. Growth is expected to remain robust in 2015–16, supported by domestic demand. Inflation is projected to remain subdued. The current account surplus will likely persist.
In the euro area, real GDP growth has been one of the highest since the beginning of the crisis, supported by relatively diversified exports, a recent recovery in domestic demand, and a stable banking sector. Unemployment is close to historical lows and among the lowest in the euro area. The external position is strong, and progress has been achieved in reducing the budget deficit.
As regards financial sector policies, the regulatory and supervisory frameworks have been strengthened in several areas. On structural policies, steps have been taken to increase labor participation and improve the judicial system. The authorities have taken action on multiple fronts. Regarding fiscal policies, the Fiscal Responsibility Act was enacted, and restructuring of various state-owned enterprises are ongoing.
