RSM Malta

Doing Business in Malta

  1. Geography and climate
  2. History
  3. Population and language
  4. Political and legal systems
  5. Economy
  6. Industrial Climate
  7. Transport, communications and the media
  8. Malta Stock Exchange
  9. Entry visas and work permits
  10. International time
  11. Miscellaneous information
  12. Business hours and statutory holidays

 

Geography and climate

The Maltese Islands are located in the centre of the Mediterranean Sea, 93 kilometres from the southern coast of Sicily and 290 kilometers from the shores of North Africa. The Maltese archipelago consists of three islands – Malta, Gozo and Comino- covering a total area of 316 square kilometers. Malta is the main island in the archipelago and is approximately 15 kilometers wide and 27 kilometers long. Gozo lies to the north-west, less than half an hour away by ferry. Comino, which lies between Malta and Gozo is semi-uninhabited. 

The Maltese coastline alternates between sheltering inlets and cliffs. The coast of Malta is predominantly rocky. Malta’s Grand Harbour is one of the largest inlet on the Maltese shoreline. Valletta, the capital city, lies on a promontory between the Grand Harbour and Marsamxett Harbour, Malta’s two main harbours. 

Malta’s climate is mild with an average of 500 millimetres of rain expected each year, mainly during October to February. Temperatures may vary from an average maximum of 30 C, in the peak summer months of July and August to an average minimum of 9 C in January and February. There are about 300 days of sunshine each year. 

History

Malta has been populated since Neolithic times, over 8.000 years ago. Around 2,000 BC, the island was conquered by the Phoenicians and subsequently Carthaginians and Romans. In 60 AD, St Paul the Apostle, was shipwrecked in Malta and introduced the Christian Faith to the islands. Malta has since remained predominantly a Christian (Roman Catholic) island. In 870 AD the Arabs invaded Malta and ruled until 1090 AD when Count Roger of Normandy seized the island and made Malta part of the Kingdom of Sicily. 

The Order of Knights of St John (also known as the Knights of Malta) came to Malta in 1530, when Charles V of Spain offered Malta to them in an attempt to strengthen the southern frontiers of his domain against Islam. The Knights improved living conditions across the Island, stimulated trade and commerce and erected strong fortifications.

In 1798 Napoleon’s army drove out the Knights of St John and conquered the island. 

The British Crown took over Malta in the early nineteenth century and ruled the islands for the next 160 years. Malta became an independent sovereign state on 21st September 1964. In 1974 Malta was declared a republic. Malta became a European Union (EU) Member State in May 2004. 

The island is a member of the Commonwealth and of the United Nations.

Population and language

Malta is one of the most densely populated countries in Europe. Malta’s population in 2008 amounted to 413,000 with a population density of 1310 per square kilometer. Population growth in 2008 was fairly modest at 0.2 %.

Maltese and English are the two official languages in Malta. Maltese is a Semitic language in structure, written in Latin script.

Maltese and English are compulsory subjects taught at both the primary and secondary school levels. Most Maltese are bilingual and fluent in both languages. Italian is also widely spoken. 

Official publications, including laws, are published in both Maltese and English. Most business and commercial related correspondence, official or otherwise, is in English. 

Political and legal systems

Malta is a parliamentary democracy with general elections held every five years. Maltese citizens aged 18 years or over have the right to vote. The head of state is the President, who is appointed by Parliament. The President of Malta’s role is mainly ceremonial.

The Maltese Parliament (House of Representatives) has the power to legislate. The Prime Minister is the leader of the party that obtains the majority of votes in an election. The Prime Minister selects and appoints cabinet Ministers from amongst elected representatives.

The Maltese Constitution establishes the structures and powers of the court and lists the fundamental human rights and freedoms of individuals. Malta recognizes the right of individual petition to the European Courts of Justice. 

The legal system in Malta is firmly based on the rule of law and independence of the Judiciary. Judges are appointed by the Government and cannot be removed before retirement age, except for proven inability to exercise their duties properly. Removal requires a two-thirds vote in Parliament. 

Most financial, fiscal and commercial legislation is based on British laws.

Economy

Malta is a parliamentary democracy with general elections held every five years. Maltese citizens aged 18 years or over have the right to vote. The head of state is the President, who is appointed by Parliament. The President of Malta’s role is mainly ceremonial.

The Maltese economy, which is based on the free enterprise system, has expanded in particular during these past five years, following Malta’s accession to the European Union. Membership in the EU provides for the freedom of movement of goods, services, citizens and capital between Malta and the other EU member states, thus creating a single market of continental dimensions.

In January 2008 Malta adopted the Euro as its official currency.

Malta’s record of political, economic and social stability over the years has resulted in a steady increase in foreign investment. The Maltese Government encourages free enterprise with no restrictions on foreign ownership of business and repatriation of capital and income.

Malta has a diversified economy which relies mainly on tourism, manufacturing and financial services that collectively accounted for around 60 % of the GDP in 2008. 

In 2008 Malta’s GDP per capita in real terms stood at 312,000. The GDP in real terms grew at an average of 4.3% during the period 2006 to 2008 and contracted by 2.6% in the first six months of 2009. The inflation rate at April 2009 stood at 4.36% whereas unemployment stood at 4.7 % of labour supply. Around 28% of the gainfully occupied persons are in the public sector. 

The greater part of the economy is privately controlled however public utilities are provided by state controlled enterprises.

Industrial climate

Malta’s modern infrastructure, flexible and educated labour supply, good work ethics, political and industrial stability and geographical location are but some of the factors that make Malta a very attractive location for industrial investment. Malta’s sectors contributing to the GDP include: services (80.6%), industry (18%) and agriculture (1.4%). 

The manufacturing sector consists of a mixture of large, foreign owned enterprises and numerous, smaller family run companies. Target sectors in the manufacturing industry include pharmaceuticals, electronics, light engineering, healthcare and other areas generating high value added per employee. A Government owned entity, Malta Industrial Parks, provides modern factory buildings in public industrial estates, at commercially attractive rates. 

All products exported to the EU have full tariff free access. Malta also benefits from trade agreements with an extensive network of non-member countries and trading blocs. 

The industrial sector benefits from a wide ranging fiscal incentives package. 

Tourism is another important sector in the local economy and accounts for around 30% of the GDP. Recent years were marked with improvements in tourist numbers and quality following the investment made in new, up market hotel properties and conference facilities mainly managed by international five star chains. In these last years annual tourist visitor levels hovered around one million mark. Recent Government policy in this sector concentrated on diversification of the tourist product from the typical ‘sun and sea’ destination to the more cultural and historical destination and the establishment of niche markets. The advent of low cost carriers in these past years has helped to boost the passenger seat capacity to Malta and open up new markets. 

The Financial Services sector has grown significantly since it was established in the early 1990’s and today accounts for around 12% of the GDP. Government investment services, call centers, e-commerce and others. 

The on-line betting industry is a new sector established a few years ago which has experienced steep growth in these last three years. Malta is estimated to host around 10% of the worlds’ on line gaming websites. Through a successful combination of various factors including a well established regulatory framework, good communications infrastructure and a skilled labor force the island is today regarded as a premier on-line gaming jurisdiction within the EU. 

Transport, communications and the media

Entry to Malta is either by sea or air. Malta’s international airport had a total of 3 million people passing through it in 2008. The Grand Harbour cruise liner terminal in Valletta regularly accommodates large passenger cruise liners. 

Malta has a Freeport terminal in the south which handles around 1.5 million TEUs annually. The island’s geographic position in the centre of the Mediterranean makes it a key player in the global warehousing and logistics chain. Malta Freeport is the third largest transshipment and logistics centre in the Mediterranean and is currently run by Marseille based CMA CGM. 

Public transport services include buses, mini-buses, taxis and ferries.

Malta boasts an excellent communication system. Communication by post, telephone, fax and internet is of a standard comparable with the best in Europe. The island has a sophisticated telecoms infrastructure with large bandwidth networks providing high capacity to and from the country. Networks are completely digital and international connections have been expanded through satellite technology and high capacity fibre optic cables linking Malta to Europe. Malta’s mass media in 2009 included over three daily and seven weekly local newspapers, some of which are published in English. There are a number of electronic newspapers, radio stations and TV stations. 

Malta stock exchange

In Malta there is currently one small stock exchange operated by Malta Stock Exchange plc (MSE) which is a public limited company incorporated in Malta and licensed by the Malta Financial Services Authority to provide the services of a regulated market and a central securities depository.

The exchange manages the trading of a handful of important stocks of Maltese registered companies and is the marketplace for Malta’s bond market. Malta Stock Exchange Index at 30 December 2008 stood at 3208.215. The MSE currently lists 19 equities, 34 corporate bonds and 34 government bonds. There are also a number of hedge funds listed. 

The MSE recently received recognised exchange status from the Inland Revenue in the United Kingdom which has sparked interest in listings from foreign and local companies because of the tax relief that such status offers investors.

Entry visas and work permits

Since 2008 Malta’s requirements on visas fall in line with EU policy and Schengen regulations. Malta joined the Schengen area in January 2008. Details of visaexempt countries and visa application procedures for citizens outside of the EU are available on the Ministry of Justice and Home Affairs website at: www.mjha.gov.mt.

Work permits are issued in Malta by the Department of Citizenship and Expatriate Affairs and are usually granted to those who are able to contribute skills or expertise not available in the local market. Employers interested in engaging foreigners (whether EU citizens or otherwise) have to make an application to obtain the permit in respect of the prospective employee. 

Applications relating to EU citizens are usually fast tracked and processed in an efficient manner. Applications in all other cases are considered on a case-by-case basis. Work permits are generally valid for one year and renewable thereafter. Applications for work permits must be submitted using the appropriate form supplied by the Employment and Training Corporation (ETC), together with three passport size photos and detailed curriculum vitae. 

International time

Maltese time is the Central European Time (CET) which is one hour ahead of the Greenwich Mean Time (GMT). In line with the CET, Malta goes on Summer Time, which is one hour ahead of normal time, during the last week of March to the last week of October.

Miscellaneous information

Weights and measures are based on the metric system.

Dates are written in the sequence of day, month and year.

In writing numbers, commas denote thousands and points denote fractions.

Business hours and statutory holidays

With few exceptions, employees generally work a 5-day, 40 hour week.

There are 14 public holidays in Malta which include:

New Year’s Day January 1
Feast of St. Paul’s Shipwreck February 10
Feast of St. Joseph March 19
Freedom Day March 31
Good Friday Variable
Workers’ Day May 1
Sette Giugno June 7
Feast St .Peter and St Paul June 29
Feast of the Assumption August 15
Feast of Our Lady of Victories September 8
Independence Day September 21
Feast of the Immaculate Conception December 8
Republic Day December 13
Christmas Day December 25
 

How can we help you?

Contact us on (+356) 2278 7000 or submit your questions, comments, or proposal requests.

Email us