Doing Business in Malta - PowerPoint Presentation Example

Doing Business in Malta Economic Conditions: Malta has a favourable geographic location, as it is located at the centre of the Mediterranean at thecross roads of Southern Europe, North Africa and the Middle East. Hence the country is located favourable for economic activities. Moreover, Malta has a very productive labor force which adds to its geographic advantages. This is reflected in the GDP growth of 3.8% per annum in 2007 amounting to $ 9.4 billion. The country also has a relatively very low unemployment rate, which ranged around 3% in the last decade.

In spite of the global economic slowdown, Malta has registered only 5% unemployment rate in 2008. The main resources of the country include limestone, salt and arable land. However Malta has no domestic energy resource. Majority of the country’s power needs are met by oil. Malta is considered to be a comparatively lesser affluent country in the European Union, the main reasons being the lower GDP and absence of major energy resources. Exports is given due importance in Malta and accounts to $ 3.

288 billion of GDP in 2007. The major export markets served are Eurozone area, United States, United Kingdom and Singapore. Background Industry Information: The Services sector forms a major part of the GDP accounting to almost 65%, whereas the industrial production amounts to only 18% of the GDP. The major industries of Malta include tourism, ship building and repair construction, electronics, food and beverages, clothing, textile, shoes, apparel and tobacco. A major sector for Malta is the tourism industry.

The growth of low cost airlines and many cruises being added to the country’s shipping industry have increased the revenue from tourism and foreign exchange by as high as 26.6%, since 2007. The agriculture sector, however amounts to only 1.4% of GDP and focused on fodder crops, potatoes and onions. Foreign Direct Investment Rules: Foreign direct investment rules in Malta are very liberal as the country is keen on attracting investments and growing the economy. Malta guarantees freedom of establishment in the foreign direct investment ventures.

Foreign investors can also hold majority stock or share, as much as 100%, in a local company in Malta. Non-residents have to obtain an Exchange control authorization to invest directly in Maltese businesses from MFSA (Malta Financial Services Authority). However there is no exchange control required for companies operating under MFSC (Malta Financial Services Control) Act. Malta encourages investments in many segments including medical, bio-technology and pharmaceuticals, automotive and film industries, software development, etc.

Bibliography FDI.net (2009), Foreign Direct Investment in Malta, Accessed on 05 April 2009, Available at http://www.fdi.net/country/sub_index.cfm?countrynum=128 US Department of State (2009), Republic of Malta – Economy, Accessed on 05 April 2009, Available at http://www.state.gov/r/pa/ei/bgn/5382.htm