A striking 79 per cent of investors now view Malta as an attractive destination for foreign direct investment (FDI), according to the newly published EY Malta Attractiveness Survey 2025.

The result marks a sharp increase from last year’s 54 per cent, signalling one of the strongest rebounds in investor confidence since the survey began.

EY Malta’s Country Managing Partner Ronald Attard said the surge “reflects a broader recognition of Malta’s unique value proposition in a world where stability and predictability are increasingly sought after.” He noted that Malta’s appeal lies in its “readiness to embrace the digital age, favourable corporate tax regime, and strong social climate stability.”

Skills shortages and competitiveness remain key concerns

Despite the optimistic outlook, the report highlights significant challenges that could undermine Malta’s FDI appeal. Six out of ten investors (60 per cent) identified skills shortages as the top risk to investment attractiveness, overtaking tax reform (48 per cent) and cost competitiveness (42 per cent).

Around 67 per cent of respondents said they struggle to find specialised skills locally, while more than half (52 per cent) indicated that HR costs are only “slightly competitive enough” to retain their operations. This reinforces investors’ repeated calls for education reform and stronger talent development.

Education and skills remain the top priority for maintaining competitiveness, cited by 17 per cent of investors, followed by infrastructure and transport planning (14 per cent) and the development of new economic sectors (13 per cent).

Malta’s cost advantage endures, but growth pressures are emerging

While Malta continues to offer cost advantages compared to other European locations – with 62 per cent viewing its tax costs and 58 per cent its energy prices as lower or significantly lower – investors warned that rising demand for talent, property and services may narrow these benefits over time.

A total of 67 per cent said Malta is “as or more attractive” than other European locations, reflecting confidence in its overall investment climate. However, the report cautions that long-term competitiveness will hinge on how effectively the country addresses infrastructure bottlenecks and aligns its growth with capacity. Eight in ten investors identified infrastructure enhancement as “fundamental” to future success.

Future outlook

Looking ahead, 90 per cent of surveyed investors said they plan to either maintain or expand their operations in Malta within the next year – a strong indication of near-term confidence. Sectors expected to drive Malta’s future growth include tourism (70 per cent), gaming (58 per cent), and fintech and payments (48 per cent). Artificial intelligence (AI) also emerged as the single standout growth prospect, with 42 per cent of companies planning AI-related investments.

Still, the long-term outlook remains more uncertain. While 61 per cent of investors believe their company’s future remains in Malta over the next decade, one in three said they cannot say, citing talent shortages, infrastructure gaps, and global volatility.