The international credit agency Standard & Poor’s has confirmed the A rating for Malta and its positive prospects and said these trends will continue if the authorities strengthen the regulatory framework for financial services and if this happens it may well revise and increase Malta’s rating over the next six months.
In their analysis the agency’s economists said Malta’s economy is expected to grow an average of 4% annually up to 2022. It was stated the rating reflects the country’s economic growth as well as the fact the Government is achieving a financial balance while there is a growing indication of a drop in National Debt when compared to the Gross Domestic Product.
The agency warned the rating may be reduced from positive to stable if it results that the Government’s financial position deteriorates and if actions are not taken to reduce the risks of financial instability. The agency further maintained that the monetary policy of the European Central Bank in maintaining low interest rates is not ideal for Malta in the light of its current economic rhythm and the country’s economic growth.
The agency’s economists said they take into consideration the vulnerability of Malta’s economy in that it is a small and open economy as well as a lack of transparency and accountability in the financial sector.