Malta » Outlook

International Property Brokers forecast that the objective of adopting the euro by 2008 looks gradually more likely to be achieved, provided there is not an unexpected alarm.

The timing of the next general election is likely to be associated to the objective of adopting the euro and will probably be held in late 2007, after adoption is confirmed, but before it is implemented. Economic growth during the outlook period is projected to remain below 2.3%. Inflation is projected to rise and then ease, although it is still expected to remain well above 2.4% in 2007. In the meantime, the current-account deficit is predictable to contract, partly because of the fiscal consolidation procedure.

In 2007 a slight loosening of fiscal policy will take place as the general election approaches and because fiscal developments in that year will not be considered in relation to euro implementation.