13 January, 2026
Local business leaders remain upbeat amid steady fiscal outlook as Malta’s deficit narrows and confidence stays high
PwC Malta has recently released its latest CEO Confidence Tracker and Economic Outlook with a particular focus on the recently announced 2026 Budget. Together, these two reports offer a view of Malta’s business leaders’ sentiment and an analysis of the local economy’s performance and trajectory.
CEOs remain upbeat on business performance and outlook, yet generally unenthusiastic by 2026 Budget measures
Our latest CEO Confidence Tracker suggests that local business performance remains strong. Nearly seven in ten CEOs (69%) reported stronger results in the recent quarter compared to the previous one, continuing the positive trend seen in earlier surveys. Despite global challenges including the geopolitical uncertainty and ongoing trade tensions, 92% of respondents expect economic conditions to stay stable or improve over the next six months. In the context of the recent 2026 Budget, CEOs were asked about the anticipated business impact. Nearly three-quarters (73%) of leaders stated that the measures are expected to have minimal impact on their operations. This is a notable increase from the 2024 survey, where at that point 64% felt the same about the 2025 Budget. This year-on-year change suggests a growing belief among CEOs that budget measures are not significantly altering their business landscape.
Malta’s budget balance projections indicate a gradual improvement over the period but remain in deficit throughout
In the meantime, the Budget 2026 Economic Outlook revealed steady improvement in Malta’s fiscal outlook. The country’s deficit, which was -3.5% of GDP in 2024, is projected to narrow to -3.3% in 2025 and -2.8% by 2026; below the EU’s 3% threshold. The debt-to-GDP ratio is also expected to decline, from 49.5% in 2024 to 47.1% in 2025, well below both the Euro Area average (88.3%) and the Maastricht ceiling of 60%. This provides fiscal flexibility for the years ahead. Government estimates for 2025 show that expenditure is set to increase by 8.8% above 2024 levels, outpacing government revenue which is expected to increase by 2.1% this year. This trend is expected to be reversed next year, as Government is projecting total receipts to grow by 4.9% in 2026, compared with expenditure growth of 2.8%.
Government’s ability to reign-in growth in recurrent expenditure in the coming years will be crucial in achieving the targeted reduction in deficit to below 3% of GDP, especially if economic growth slows. Lucienne Pace Ross, Territory Senior Partner at PwC Malta, commented: “Malta’s business landscape continues to demonstrate notable resilience. Strong performance and high confidence, alongside improving fiscal metrics, enable organisations to pursue strategic planning with more certainty. At PwC, we’re here to support leaders convert these insights into actionable strategies that promote growth and stability.”
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