Country Economic Forecasts > Malta

GDP rose 1.1% in Q3 2015 (with annual growth of 5.6%), down from 1.4% in Q2, making Malta the second-fastest growing economy in the Eurozone after Ireland. Growth is expected to have reached 5.1% in 2015, the fastest pace since 2000, driven by a surge in investment. The jump in investment is a one-off related to the construction of a power plant, so we expect capital spending to return to more sustainable levels. We see the pace of activity slowing gradually, but we still forecast above-average GDP growth of 4% in 2016 and 3% in 2017. Further ahead, we expect growth of around 2.3% a year in 2018-19. Unemployment is about half the Eurozone average and tourism has solid momentum, helped by ongoing recovery in the EU. Strong service exports and the lower oil import bill are supporting the current account surplus. Although we expect this trend to remain, the current account surplus will ease as capital goods imports rise due to energy sector projects. The long-term outlook remains solid, however, supported by a relatively strong fiscal position.