Central Bank forecasts 2023-2025 GDP to grow at a more moderate pace

Malta’s gross domestic product (GDP) is expected to grow by 3.7% this year, down from just above 7% in 2022 and to edge down to to 3.6% by 2025, the Central Bank said Thursday. This implies a downward revision when compared to the Bank’s previous projections, a CBM statement said. 

In 2023, net exports are expected to be the main contributor to GDP growth, while domestic demand is expected to lower growth due to a base effect from extraordinary investment in 2022 which offsets positive contributions from consumption. From 2024, domestic demand is expected to be the main driver of growth.

Employment growth is set to moderate in the projection horizon, while wages are expected to pick-up due to relatively high inflation and a tight labour market.

Annual inflation based on the Harmonised Index of Consumer Prices is projected to stand at 5.9% this year, only marginally lower from 6.1% in 2022. It is thus foreseen to remain elevated due to lingering indirect effects through the response of wages to recent increases in input costs and profit margins.

The general government deficit is set to decline throughout the projection horizon, while the general government debt-to-GDP ratio is set to edge up, and to reach 54.7% by 2025.

On balance, risks to economic activity are tilted to the downside for 2023 and balanced thereafter, while those to inflation are to be balanced for the entire projection horizon. On the fiscal side, risks are on the downside (deficit-increasing) particularly in 2023, mainly reflecting additional support measures related to Air Malta and higher than expected outlays on electricity distribution and compensation for blackouts.

This publication also includes two boxes. The first box documents developments in inflation persistence estimates and their implications on the projections. The second box assesses recent developments in profits and their forecast implications.

Number of outbound tourists up 35% in second quarter 

Total outbound tourists for the second quarter in 2023 were estimated at 189,443, an increase of 35.4 per cent over the corresponding quarter of 2022. Total nights spent amounted to 1,252,385, the NSO said Friday.

January-June 2023

Total outbound tourist trips for the first half of 2023 numbered 347,623, an increase of 52.4 per cent over the same period in 2022. Total nights spent by outbound tourists went up by 45.1 per cent, surpassing 2.3 million nights. In addition, total estimated outlay by resident tourists stood at €297.3 million, 62.7 per cent higher than that recorded for the same period of 2022.

BNF Bank p.l.c. appoints new Chief Risk Officer

BNF Bank p.l.c. has appointed Glen Smith as its Chief Risk Officer. Hailing from the UK, Smith boasts over 30 years of experience in financial services and banking, specialising in risk and regulation, and occupying various senior management roles in both retail and corporate banking across various markets.

Prior to his appointment at BNF Bank, Mr Smith held the role of Senior Risk Manager with HSBC Continental Europe, based in the Paris Head Office. He was responsible for the management and oversight of wholesale credit risk activities, reporting, and regulatory and risk controls covering France, Germany and Malta, among other territories.

Chief Executive Officer Mr David Power welcomed Mr Smith to the Bank’s executive team, saying that this appointment will not only further strengthen the team, but also the Bank’s position in the market. The implementation of sound risk strategies aligns to the organisation’s over-arching agenda of being one of Malta’s strongest systemic financial institutions. “With seasoned leaders in place to scale and execute our plans, we can be confident in building on our customer-first strategy, offering a greater breadth of integrated solutions to support customer success.”

On his part, Mr Smith said he was looking forward to drawing from his experience and expertise to execute business models that advance the Bank’s profitability in a sustainable, cautious manner while contending with the staple changes in trends, markets and technologies. “I am eager to embrace the Bank’s vision and values, and to work closely with my colleagues to ultimately deliver the best products and services to the Bank’s loyal client base.”   

BNF Bank p.l.c. is a mainstay in Malta’s financial sector a key player in the community.  With a network of branches across Malta and Gozo, dedicated business centres and a trading room, the Bank offers financial products targeting individual and business needs, underpinned by personalised service excellence. 

 

Malta Company Announcements:

Tigne’ Mall plc

The Directors of Tigne’ Mall declared a record net interim dividend of €0.0136 per share payable on 7^th September 2023 to all shareholders as of close of trading on 23th August 2023.

Main Street Complex plc

The Directors declared a net interim dividend of €0.0072 per share, payable by Tuesday, 12^th September 2023 to all shareholders as at close of trading on Monday, 28^th August, 2023.

Trident Estates plc

The Board of Directors is scheduled to meet on Wednesday, 13th September 2023 to consider and approve the results for the six-month period ended 31^st July 2023.

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