Malta

Investing in Malta

FDI in figures | Why you should choose to invest in Malta | Procedures relative to foreign investment | Finding assistance for further information

FDI in figures

Malta provides incentives to attract foreign investments. Its advantages for foreign investment are based on the following: EU membership, competitive wage rates, a highly-skilled English-speaking labor force, access to Mediterannean and North African markets and pro-investment government policies.

Foreign Direct Investment	2005	2006	2007
FDI inward flow (millions USD)	675	1,865	959
FDI stock (millions USD)	4,315	6,498	7,457
Performance Index*, ranking on 141 economies	10	6	4
Potential Index**, ranking on 141 economies	54	55	-
Number of Greenfield investments***	3	3	9
FDI inwards (in % of GFCF****)	58.7	150.0	69.3
FDI stock (in % of GDP)	73.0	101.8	100.7

Source: UNCTAD

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk. *** Green field investments are a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. **** Gross fixed capital formation (GFCF) measures the value of additions to fixed assets purchased by business, government and households less disposals of fixed assets sold off or scrapped.

Why you should choose to invest in Malta

Strong points: Malta, member of the European Union and Eurozone since January 1, 2008 has strong points for foreign investment among which its geographical location (making it a natural "hub" for companies seeking to do business in Southern Europe and Northern Africa), a stable political environment, competitive labor costs (with respect to other European Union countries), fiscal and investment incentives, a modern infrastructure (Malta freeport services 115 ports worldwide, the international airport has direct flights to 37 major cities in the world) and telecommunications system (wireless internet connections, VOIP, Wimax). In its 2006 report, the United Nations listed Malta as a "frontrunner" in the high foreign direct investment potential category. Foreign direct investment inflows over the past 5 years have generally followed an upward trend, reaching 10% of Gross Domestic Product (GDP) in 2005.
Weak points: Malta offers a small domestic market and the country's population has limited purchasing power with respect to other European Union countries.
Government measures to motivate or restrict FDI: Malta provides incentives in many sectors to attract foreign direct investment mainly in manufacturing, transshipment and servicing industries especially generic pharmaceuticals manufacturing, information and computer technology and financial services.

The government offers generous fiscal as well as other incentives for investment in industrial projects:

-preferential income tax rates (5% instead of 35%)

-investment tax credits (up to 50% of the amount invested or 50% of the first 2 years wage costs of new jobs created)

-reduced tax on reinvested profits

-incentives for job creation

-soft loans for promoters of industrial projects

-work permits (indefinite work permits is granted to shareholders holding more than 40% of the equity).

Besides, it should be noted that Malta has a customs-free zone, Malta Freeport, which offers for companies operating within it, reduced taxation and investment tax credits.

For more information concerning these measures, please visit: Malta Enterprise and CC Advocates.

Procedures relative to foreign investment

Freedom of establishment: Freedom of establishment is guaranteed.
Acquisition of holdings: The acquisition of holding is possible in Maltese law.
Obligation to declare: Licenses should be obtain when dealing with investment services. For more information please visit http://www.qubeservices.com/04investment.asp
Competent organization for the declaration: Malta Financial Services Authority
Requests for specific authorizations: All fields of the economy are virtually open to investment. Certain sectors dominated by the State, are currently being liberalized because of EU requirements and therefore energy distribution still remains at the hand of a parastatal company.