The budget has been lauded as a good budget by the Malta Employers’ Association as it consisted of a sprinkling of benefits and fiscal incentives to stimulate domestic demand. However, it criticised the increase in optional leave as a frivolous measure with the consequence that it will unnecessarily erode the national competitiveness.
The MEA added that this was not a ‘voucher budget’. Although, the vouchers were targeted interventions that have been effective in helping the catering sector, and the re-issuing of these vouchers is positive but this measure, costing €30m, should be seen against a backdrop of a national budget that exceeds €4bn.
“The higher the numbers of cases and the longer the duration of the pandemic, the less likely tourism will recover. There is also the question of whether the construction industry can keep up its coming momentum in the coming year,” the MEA said.
It said that the outcome of Moneyval is also a critical factor which will determine the rate of recovery and of the financial services sector in 2021 and beyond.
“Overall the budget focuses on the immediate concerns due to the COVID pandemic through a set of carefully designed and targeted measures, but needs to be supplemented with a longer term vision for the country through identifying new economic sector that offer economic potential,” the MEA explained.