Malta: 3 sectors of the economy that are growing the fastest against the backdrop of the pandemic

June 17, 2020
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Malta: 3 sectors of the economy that are growing the fastest against the backdrop of the pandemic
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Malta has reduced stamp duty for buyers and sellers of real estate. The new rates apply to homes worth up to €400 thousand and are valid until March 2021. The tax reductions are part of the new economic stimulus package following the pandemic.

Health, consumer and IT sectors in Malta are growing faster than other industries following the pandemic crisis. This information can be useful for investors who are planning to invest in local companies or start a business in the country.

Industries that are recovering faster than others

Three industries performed better against the backdrop of the pandemic: IT, consumer sector and healthcare.

Information Technologies

The IT sector has outperformed all others – stocks are traded at the February highs. They benefited from the pandemic, as many people switched to remote work, more frequent social networking and online shopping.

Many companies have increased their software and hardware costs to create an infrastructure for employees to work remotely.

Finally, there is an increased demand for 5G equipment to increase the speed and bandwidth of networks. This was necessary to meet the rapidly increasing need to use the Internet in a short time.

Consumer sector

The consumer sector suffered severe damage during the crisis due to the pandemic. However, it is recovering rapidly and has already surpassed the February figures.

It is noteworthy that there is a high demand for products and services that are usually considered luxury. They become popular in periods when the economy is growing.

As the Maltese Government is taking measures to stimulate the economy, consumer spending is increasing. People spend money on entertainment and purchase goods for home at online shops

Good performance is demonstrated by companies that packaged goods. This is especially true for food packaging – companies are actively working to meet increased demand.

Healthcare

During the pandemic, demand for respirators, medical masks and antiseptics rose sharply. Pharmaceutical and medical companies are growing, especially against the background of news of any signs of progress in the invention of a vaccine against COVID-19.

Companies are developing in biotechnology, medical distribution, diagnostics and research. In general, the health sector has been successful even in the face of economic uncertainty.

The state of the economy of Malta

From March to May 2020, Malta’s economy experienced a downturn caused by the COVID-19 pandemic. The value of shares in local companies declined. The market bottomed out on 23 March 2020, after which it began to recover

The Maltese Government had taken a number of measures to stimulate the economy. It had granted business a number of tax incentives and the Central Bank had reduced interest rates. This contributed to the growth of markets.

Markets have further strengthened as the constraints imposed to contain the coronavirus pandemic have been lifted. Assumption that the downturn would not be as severe as originally expected played a positive role. Investors are not focusing on the current situation, but on the rapid recovery of Malta’s economy in 2021.

Earlier we said that construction in Malta was almost unaffected by the pandemic. At the same time, real estate prices have fallen. The government has introduced preferential tax rates to stimulate market recovery. Now investors can profitably invest in facilities for participation in citizenship programs and residence permits of Malta.

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