Malta: Investing in Malta
Malta is well positioned in terms of foreign direct investment appeal, fueled by a welcoming and progressive regulatory environment and a strong iGaming sector. According to UNCTAD's World Investment Report 2023, FDI inflows to Malta reached USD 4.24 billion in 2022, in line with the figure recorded one year earlier. In the same year, the total stock of FDI was estimated at USD 225.1 billion, almost thirteen times the country’s GDP. According to the NSO, foreign direct investment inflows were estimated at EUR 9.9 billion during the first six months of 2023. The main contributors were financial and insurance activities, accounting for 88.8% of the total. The aforementioned sector accounts for 97.7% of the total FDI stock (NSO).
The country offers a number of advantages to foreign investors: it is an EU member; offers a highly-skilled, English-speaking labor force at a competitive cost; holds a geographical position that gives it privileged access to the Mediterranean and North African markets; and has developed niche economies, especially in the area of pharmaceuticals. Malta has signed double taxation treaties with more than 50 countries, and the Government has also established a global pro-investment policy. Even if the corporate tax rate is set at 35%, the tax is actually much lower due to the participation holding shareholders are allowed to have. On the other hand, the country has a small domestic market, it is heavily reliant on the tourism sector, and has sizeable incoming/outgoing financial flows (offshore finance, online gambling industry, citizenship by investment programme). In line with EU Regulation 2019/452, in 2021, Malta enacted the National Foreign Direct Investment Screening Office Act, which gives the Office authority to screen, assess, investigate, and eventually authorize foreign direct investments carried out by non-EU persons that may affect the security or public order in the country. In June 2022, the Financial Action Task Force (FATF) removed Malta from its grey list. The country ranks 25th among the 132 economies on the Global Innovation Index 2023 and 50th out of 184 countries on the latest Index of Economic Freedom.
Foreign Direct Investment | 2020 | 2021 | 2022 |
FDI Inward Flow (million USD) | 3,921 | 4,116 | 4,240 |
FDI Stock (million USD) | 240,950 | 231,499 | 225,185 |
Number of Greenfield Investments* | 7 | 14 | 17 |
Value of Greenfield Investments (million USD) | 99 | 236 | 182 |
Source: UNCTAD, Latest available data
Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.
Malta is a member of the European Union since 2004 as well as the Eurozone since 2008 and has interesting advantages for foreign investors:
The main weaknesses of the country are:
Malta provides incentives in many sectors to attract foreign direct investment. Most investments are in manufacturing, transhipment and servicing industries, in particular the manufacturing of generic pharmaceuticals, information technology and financial services. The government offers generous tax incentives for investments in industrial projects:
Additionally, Malta has a free trade zone, Malta Freeport, which offers companies operating within it reduced taxation and investment tax credits.
In 2014, Malta introduced a citizenship programme, entitled the “Individual Investor Programme” (the “Citizenship Program”), which is targeted towards non-European Union nationals. The Citizenship Programme permits the acquisition of Maltese citizenship by a certificate of naturalisation to foreign individuals and families who contribute to the economic development of Malta.
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Latest Update: November 2024