# Fiscal pressure from fuel subsidies in Angola and Malta

> Live situation record from CLSTR: https://clstr.news/situations/fiscal-pressure-from-fuel-subsidies-in-angola-and-malta
> Updated: 2026-10-25T02:52:41.000Z. Sources: 15. Developments: 5.

Finance ministers in Angola and Malta have expressed concerns regarding the increasing fiscal pressure caused by fuel subsidies. In Angola, Minister Vera Daves de Sousa warned that public spending on these subsidies could reach 2.48% of the nation’s GDP by December 2026, noting that rising petroleum revenues are being offset by these costs. She has emphasized prioritizing debt servicing and existing budget expenditures over new projects.

In Malta, the government faces a significant budgetary challenge due to its policy of maintaining fixed fuel prices. While this has resulted in Malta having the cheapest diesel in the European Union, the cost to cover the gap between regulated prices and global market rates has surged. Finance Minister Clyde Caruana reported that forecasted diesel subsidy costs for 2026 rose from €30 million in May to approximately €75 million by late August. 

Overall, 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. Caruana emphasized that these subsidies are essential to shield households and businesses from international 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, exceeding the €800 million spent on COVID-19 related measures. 

To manage these costs, the government is planning new borrowing through stock issues of between €300 million and €500 million. While Malta’s economy is forecast to grow by 3.7% in 2026, the Malta Fiscal Advisory Council has cautioned that the national deficit might exceed forecasts unless spending growth is significantly reduced.

## Claims

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

## Timeline

### 2026-10-25: Malta prepares for Budget 2027 with tax relief and business proposals

Malta's upcoming Budget 2027 will feature doubled tax benefits for working parents and extended energy subsidies, alongside business calls for corporate tax cuts and AI incentives.

3 sources. https://clstr.news/cluster/malta-prepares-for-budget-2027-with-tax-relief-and-business-proposals

### 2026-10-04: Malta energy subsidies exceed COVID-19 costs, Finance Minister says

Malta's Finance Minister reports energy subsidies have cost €1.35 billion, exceeding pandemic costs. COLA is projected at €5 for 2027, while youth housing overcrowding remains among the lowest in the EU.

2 sources. https://clstr.news/cluster/malta-energy-subsidies-exceed-covid-19-costs-finance-minister-says

### 2026-09-30: Malta energy subsidies expected to cost €400 million annually

Malta's Finance Minister warns of economic catastrophe if €400 million in energy subsidies are cut, while the government plans new stock issuances of up to €500 million to manage fiscal needs.

6 sources. https://clstr.news/cluster/malta-energy-subsidies-expected-to-cost-400-million-annually

### 2026-09-26: Malta fuel subsidies reach 75 million euros as budget pressure grows

Malta's fuel subsidy costs have risen to an estimated 75 million euros this year, forcing the government to choose between budget stability and maintaining the EU's lowest fuel prices.

7 sources. https://clstr.news/cluster/malta-fuel-subsidies-reach-75-million-euros-as-budget-pressure-grows

### 2026-09-12: Fuel subsidy costs rise in Angola and Malta

Finance ministers in Angola and Malta warn of rising fiscal pressures as fuel subsidy costs climb due to global energy price volatility.

2 sources. https://clstr.news/cluster/fuel-subsidy-costs-rise-in-angola-and-malta

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Cite as: Fiscal pressure from fuel subsidies in Angola and Malta. CLSTR, https://clstr.news/situations/fiscal-pressure-from-fuel-subsidies-in-angola-and-malta