Malta is classified as an advanced economy together with 32 other countries according to the International Monetary Fund (IMF). Currently, Malta’s major resources are limestone, a favourable geographic location and a productive labour force. Malta produces only about 20% of its food needs, has limited freshwater supplies because of the drought in the summer and has no domestic energy sources, aside from the potential for solar energy from its plentiful sunlight. The economy is dependent on foreign trade (serving as a freight trans-shipment point), manufacturing (especially electronics and textiles) and tourism. Film production is a growing contributor to the Maltese economy.
In preparation for Malta’s membership in the European Union, which it joined on 1 May 2004, it privatised some state-controlled firms and liberalised markets. For example, the government announced on 8 January 2007 that it was selling its 40% stake in MaltaPost, to complete a privatisation process which has been ongoing for the past five years. In 2010, Malta managed to privatise telecommunications, postal services, shipyards and shipbuilding.
Malta has taken important and substantial steps to establish itself as a global player in the cross-border fund administration business. Competing against countries like Ireland and Luxembourg, Malta has a unique combination of a multi-lingual workforce and a strong legal system. Malta has a mixed reputation for transparency and a DAW Index score of 6, although both are expected to improve as Malta increasingly adopts more comprehensive legislative framework for financial services. Malta has a regulator, the MFSA, with a strong business development mindset, and the country has been successful in attracting gaming businesses, aircraft and ship registration, credit-card issuing banking licences and also fund administration. Service providers to these industries, including fiduciary and trustee business, are a core part of the growth strategy of the Island. Malta has made strong headway in implementing EU Financial Services Directives including UCITs IV and soon AIFMD. As a base for alternative asset managers who must comply with new directives, Malta has attracted a number of key players including IDS, Iconic Funds, Apex Fund Services and TMF/Customs House.
Malta and Tunisia are currently discussing the commercial exploitation of the continental shelf between their countries, particularly for petroleum exploration. These discussions are also undergoing between Malta and Libya for similar arrangements.