VALLETTA, Aug. 26 (Xinhua) -- DBRS Ratings Limited (DBRS) has affirmed Malta's credit rating at A while upgrading the trend on the ratings to positive, announced Maltese government on Saturday.
This comes weeks after credit rating upgrades by Standard and Poor's and Fitch.
DBRS declares the rating is supported by Malta's Eurozone membership, its solid external position, a favorable public debt structure, and the robust financial position of households.
"Following a fiscal consolidation process since 2013, Malta's fiscal outturns came in better than expected in 2016. Both the headline and the structural deficits turned into surpluses, and the government debt ratio, already 12 percentage points lower than its 2011 peak, fell below 60 percent of GDP," stated DBRS.
DBRS attributes the improvement in public finances to "strong revenues as well as moderation in expenditure, and supported by a strengthened fiscal framework".
At the same time, it warns that Malta's contingent liabilities remain a source of vulnerability, and its economy is exposed to external shocks and pressures from the rising age-related costs, which, if unaddressed, could pose a concern for pensions.
"Four years ago, we had promised to work on upgrading Malta's credit rating which would make our country more attractive to foreign investors. In contrast with the past deteriorating state of public finances with ballooning deficit and debt ratios, we directed our efforts to addressing such issues, bringing about an upgrade to Malta's rating, and hence honouring our promise," said Malta's Finance Minister Edward Scicluna.
