Fitch Ratings has affirmed Malta’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘A+’ with a Stable Outlook. The rating is supported by high per-capita income and a pre-pandemic record of strong growth and sizeable debt reduction. However, the small size of Malta’s economy, which is highly vulnerable to external developments, and a recent deterioration in public finances with large fiscal deficits, have led to a sharp increase in the moderate public debt burden.

The Maltese economy expanded rapidly at 6.9% in real terms in 2022, outperforming the rest of the EU. Growth came mainly from investments, which were heavily impacted by the acquisition of imported aircraft equipment. Private consumption remained sound, supported by the accumulation of past savings and favourable labour market conditions. Key sectors driving growth were online gaming, information and technology (ICT), and professional services, while construction contracted quite sharply. Recovery in the tourism sector continued narrowing the gap of tourist arrivals relative to 2019 to around 17% in 2022.

Fitch forecasts growth to slow to 3.5% in 2023, due to the projected economic slowdown in Malta’s main trading partners and as evidenced by a moderation in economic indicators. Growth will be close to potential in 2024, reaching 3.7%. The lifting of international travel restrictions has helped support the return of foreign workers, further uplifting domestic consumption and potential growth while somewhat easing structural labour supply shortages.

Overall, Fitch estimates that Malta’s fiscal deficit narrowed to 5.8% of GDP in 2022 from 7.5% in 2021. While sizeable energy and food subsidies weighed on the budget balance, these were offset by the government’s ad-hoc spending review during the summer and the continued phasing out of Covid-19 expenditure. The 2023 deficit is projected to reach 5.4% of GDP, close to the government’s budget target of 5.5% but exceeding the ‘A’ median of 4.1%. The European Commission has yet to approve the bailout package for state-owned airline Air Malta, and the timing and total cost of any state aid to the airline remains unknown, although some restructuring costs are already priced into the budget at close to 0.4% of GDP for 2022/23.

Click here for a more detailed overview: https://bit.ly/3Kueo0M

Source: www.fitchratings.com 

The practise of establishing assets offshore is swiftly gaining ground among South Africans reluctant to “keep all their eggs in one basket”, preferring instead, to take advantage of the Reserve Bank’s increased foreign investment allowance, by diversifying into harder currencies as the South African Rand is under pressure with the greylisting.

Whether you are preparing for retirement, planning a once-in-a -lifetime holiday or international education, BRICS weakening currencies are a driving factor to move wealth offshore.  Alongside other NON-EU (third country) nationals, South Africans too, are looking for environments that offer economic and political stability, a low level of crime, and friendly English speaking locals in European jurisdictions for EURO investments. This does not have to include cumbersome residency options but purely solid property investments.

In this era of “Work from Anywhere” Digital Nomads, it is important for mobile societies to have a secure property investment that is easy to manage, without excessive overheads or taxes, and to ensure reliable, healthy returns with favourable taxation that provides an asset base—especially for first-time buyers and retirees who want to be travelling.

Trends are now shifting from a multi-functional lifestyle, to countryside living.

Having lived in secure fenced estates in South Africa, such as Silverhurst Estate Constantia, Dainfern Estate Bryanston, Heritage Val Riche in Mauritius, we now are extremely comfortable living in an apartment in Malta. The island is now our playground, the sea our swimming pool, the environment our garden, and the village our neighbours.

It’s remarkable to observe how people from top lifestyle estates in South Africa such as Mount Edgecomb; Zimbali; Val de Vie; Steyn City; Fancourt; Steenburg; Peacon Wood and Waterfall Estate in towns like George; Camps Bay; Stellenbosh; Johannesburg; Pretoria; Hartebeesport;  Plettenberg Bay; Hermanus and Cape Town alike, find something special about Malta and Gozo. Whether it’s a modern lifestyle development such as Pender Gardens; Tigne Point; Portomasso; Fort Cambridge, or a house of character, a penthouse or farmhouse, there is so much to choose from in Malta.

Still a hidden secret to many who do not know where Malta is on the map, those in the know are recognising the beneficial value of investing in the lucrative property market in Malta, a beautiful small island EU nation, conveniently located in the middle of the Mediterranean Sea, with easy access to mainland Europe.  The diverse economy—driven by i-gaming, financial services, tourism, aviation and boating—provides for a vast need for rental properties. It is also home to Bet365, Lufthansa Technik Malta, servicing Airbus & Boeing to mention a few.

‘Buy to Rent’ property investments are easily identified and managed by our team who can offer an array of rental properties in various locations on the islands—from renovated city apartments, to luxurious country homes—at competitive prices.

What better way to secure your future, your child’s education, or your retirement, than with a bricks and mortar that isn’t a liability due to non service delivery and high local council taxes. Never mind no inheritances taxes in Malta (only 5% on immovable property), and double taxation treaties with multiple countries.

We’ll see you in May!

Merle Whale will be visiting South Africa in May 2023 and may be in your area presenting seminars or hosting private meetings.  As a South African expat, now living in Malta, I can put you in touch with all the right people here, and show you the ropes.

So, with all the odds stacked in its favour, Malta is proving to be an attractive, trusted option for secure, offshore property investments.  If you would like more free information and advice on investing in the Maltese property market, I’d like to invite you to meet with me for a discussion, any time in Malta, or when I visit South Africa in May this year. Please contact me here to arrange a meeting. I look forward to hearing from you.

Regards from sunny Malta!

While the global community desperately deals with crises from earthquakes, floods and fires, it is rather unfortunate that South Africa is now in a State of Disaster. This, alongside other push factors, is causing many South Africans to look further afield for stability in their careers and a secure future for their families and funds. In the Radio 702 MoneyShow, Bruce Whitfield, in discussion with Andrew Woodburn, MD of Amprop, describes what South Africa is experiencing as “Brain Drain version 2.0.” Additional push factors such as a soft currency, systemic challenges, daily living and safety concerns, leadership in government, high personal taxation and social security, all fuel the growing need of astute people to seek better alternatives.

Malta continues to be a desired destination for South Africans going offshore and getting onto the world stage. Pull factors, such as European business and currency; Schengen freedom of movement; English as an official language; 300 days of sunshine annually; a safe living environment; its proximity to Europe with well-connected commercial airlines, have contributed to the increase of South Africans settling in Malta and taking up residency and property investment opportunities. Additional financial factors, such as favourable taxation, no inheritance tax (5% on property) NO local rates and council taxes. Quality, free education and medical services, are also provided to those working in Malta.

Merle Whale, who, for over 10 years, has assisted South Africans relocate to Malta says, ‘there continues to be a steady flow of fellow SAFFAS wanting to increase their global footprint, explore options of living abroad, retire in a central friendly location, as well as adventurers including Malta in their ‘trek’ in life. There has been an increase of activity on SAFFAS Malta Facebook group—over 20% increase in just 60 days. Whilst integrating into Malta is relatively easy at times, there is a yearning for “braaivleis, rugby, sunny skies and Chevrolet”. We regularly meet up and this year will certainly be more exciting with the Rugby World Cup 2023 being held in France, just a quick flight from Malta.

South Africans are renowned top thinkers and skilled entrepreneurs, able to deliver despite high levels of ambiguity. They are masters of operating in emerging markets and crisis environments, and are quickly successful in Europe. Whilst some may have the benefit of European ancestral roots, many are smart enough to invest in the different visa options available.

The Malta Permanent Residency Programme is an investment visa that benefits fast-moving families with membership of the European Union, and ease of movement within the Schengen regulated areas. This programme is extremely sought after due to its flexibility and clearly defined regulations. As per the Malta website, residency applicants must show they have capital assets of not less than €500,000, out of which a minimum of €150,000 must be financial assets. Once vetted, the applicant pays the government a contribution fee and a donation are made to a registered NGO. Private health and travel insurance must be acquired and a registered agent engaged. There are other programmes too, such as the Nomad Digital Visa, Global Residency Programme, StartUp Residency Programme and now also open to non-EU members, a reasonable Retirement Programme.

As a South African who has explored and lived in other places including Mauritius and Gibraltar, and investigated Portugal and Cyprus, I assist SAFFAS in determining which programmes are best for them, the process and procedures, as well as the pitfalls to avoid. Also, after consultation together, we can ensure that all matters are handled legitimately, alongside Foreign Exchange activities, taxation and meeting diligence requirements. I can help you identify your needs and set goals to successfully accomplish your European future’.v

South African face-to-face appointments will be opening for May, and face-to-face seminar dates will soon be announced. Online consultation and events are also available. Be sure to make contact via our website www.maltalifestyle.com to obtain information on all the above, or email Merle directly merle@maltalifestyle.com.