Malta registered the third-highest deficit in the European Union last year, Eurostat data shows.
Measured as a percentage of GDP, Malta’s deficit in 2020 stood at 9.7%, topped only by Spain at 11% and Greece 10.1%.
In monetary terms, Malta’s deficit clocked in at €1.2 billion.
The increased spending saw government debt shoot up to €6.9 billion last year, up from €5.7 billion in 2019.
Government deficits and debts increased markedly across the EU, as countries increased spending to fight the COVID-19 pandemic.
The increased pandemic spending led the EU to suspend rules aimed at keeping government spending in check.
The Maltese government spent a total of €392 million on assisting business, including the wage supplement.
According to national statistics office data, a further €160 million went to the tax deferral scheme, €129 million were spent on the COVID-19 guarantee scheme and €125 million on added health spending and repatriation flights.
The real estate assistance schemes, the government vouchers, COVID-19 social benefits, added education spending and refunds of licenses and charges added up a further €123 million.
Deficit figures are projected to hit the €1.6 billion mark this year.
In 2022, the government deficit is expected to contract to 5.6% of GDP, though this is dependent on what some economists have termed as ambitious economic growth projections.
In his recent budget speech, Finance Minister Clyde Caruana noted that Malta was one of the few EU countries that kept the labour market intact, by increasing the number of people in employment and reducing economic inactivity.
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