[CLSTR]
< Back to all clusters
[BUSINESS] · Malta · 6 sources

started · updated

Part of situation: Fiscal pressure from fuel subsidies in Angola and Malta (5 clusters)

Malta energy subsidies expected to cost €400 million annually

energy subsidies Malta economy government borrowing fuel prices fiscal deficit

Malta's Finance Minister Clyde Caruana has announced that energy and fuel subsidies are expected to cost the government approximately €400 million this year, with costs projected to remain at similar levels in 2027. The minister emphasized that these subsidies are essential to shield households and businesses from international energy price volatility, warning that removing them could lead to an ‘economic catastrophe.’ Over the past five years, the government has spent €1.35 billion on such subsidies.

In addition to energy costs, the government is planning new borrowing through stock issues of between €300 million and €500 million. This move could result in annual interest payments for taxpayers ranging from €12.9 million to €22.5 million. The Malta Fiscal Advisory Council has cautioned that the national deficit might exceed forecasts unless spending growth is significantly reduced.

Despite these fiscal pressures, Malta's economy is forecast to grow by 3.7% in 2026. Caruana noted that while energy spending fell in recent years, it is expected to surge again due to geopolitical tensions. The government also plans to earmark €75 million for energy infrastructure investment.

Entities

Clyde Caruana · European Commission · Malta · Malta Fiscal Advisory Council · Robert Abela

Claims

What the coverage asserts, and how many sources carry each claim.

  • [○ 1 SOURCE] New government stocks offer annual interest rates of 4.30% for 2037 maturity and 4.50% for 2041 maturity.
  • [○ 1 SOURCE] Total spending on the energy sector, including subsidies and infrastructure investment, is expected to reach €500 million next year. businessnow.mt
  • [● 2 SOURCES] The cost of subsidies is expected to remain at approximately €400 million next year. businessnow.mt · lovinmalta.com
  • [○ 1 SOURCE] Malta's economy is projected to grow by 3.7% in 2026. lovinmalta.com
  • [○ 1 SOURCE] The deficit may exceed forecasts unless there is a substantial slowdown in spending growth.
  • [○ 1 SOURCE] The government has spent €1.35 billion on energy subsidies over the last five years. lovinmalta.com
  • [○ 1 SOURCE] Energy and fuel subsidies for the current year are expected to cost the government €400 million. businessnow.mt
  • [○ 1 SOURCE] The government plans to issue between €300 million and €500 million in new stocks.

Sources

Clyde Caruana misses deficit target by €312 million [theshiftnews.com]
If the economy is so good why is the birth-rate so low? [themalteseherald.com]
Subsidies expected to hit €400 million, minister warns of ‘economic catastrophe’ if stopped [businessnow.mt]
Finance Minister pledges continued fuel support but gives no. . . [maltabusinessweekly.com]
Malta To Spend Around €400 Million On Energy Subsidies Again In 2027 [lovinmalta.com]
€23bn, 23% and 3 VAT rates: The brutal maths blocking cheaper fuel [www.thejournal.ie]