therealbudget.com ta' ras Kurt Farrugia
Can it get any worse?
Perhaps the flaccid and inept Joseph Muscat and his large-headed (a total waste, given that his brain is the size of a lizard’s) dwarf jester Kurt Farrugia might like to Tweet this out to their ‘followers’ on Twitter.
It would make a change from cribbing Gordon Brown or hot updates on the state of that weakling’s leg.
timesofmalta.com, earlier tonight
Fitch confirms Malta’s credit ratings
Ratings Agency Fitch has affirmed Malta’s long-term foreign currency and local currency Issuer Default ratings (IDRs) at ‘A+’, respectively. Both ratings have Stable Outlooks.
Fitch also affirmed Malta’s Short-term IDR at ‘F1’ and Country Ceiling at ‘AAA’, which is the common Country Ceiling for the euro area.
“Malta’s rating affirmation reflects its smooth passage through the recession, with limited fiscal damage, demonstrable financial sector resilience and signs of a strong economic recovery,” Chris Pryce, Director in Fitch’s Sovereign Group said.
“The domestic banking system required no financial assistance from the government. This is a consequence of the conservative approach to banking and its supervision adopted by the two main political parties, the governing National Party and the Labour Party.”
Fitch noted that Malta improved its public finances ahead of euro zone accession in 2008, with the fiscal deficit falling from almost 10% of GDP in 2003 to just over 2% of GDP in 2007.
“Once Malta became a member, fiscal discipline was relaxed through the approval of capital spending, and the onset of the global financial crisis made it difficult to reverse this deterioration.”
Nontheless, it said, Malta’s fiscal deficit is still low compared to peers (at 3.8% of GDP in 2009), but debt is double that of the ‘A’ rated cohort (at 69% of GDP in 2009) and stands out as a rating weakness.
Fitch observed that most public debt is held locally, and the financial sector is a large purchaser of government debt. This ‘captive market’ allows Malta to sustain a high level of debt, which Fitch expects to stabilize at around 70% of GDP in 2011-12.
“However, long term debt sustainability is clouded by Malta’s ageing population and projected future pension liabilities. The government has not yet demonstrated sufficient resolve to address this issue,” it said.
The agency added that the domestic banks in Malta survived the international banking crisis and recession virtually unscathed. There was some small deterioration in capital and non-performing loan ratios and government assistance was not required, in marked contrast to the position in most other European countries.
“Its conservative approach to banking and its supervision has served Malta well, especially the high proportion of lending financed from retail customer deposits. Credit expansion, which had been high, has begun to tail off since 2008. The international banking sector is much larger than the domestic sector and large in comparison to Malta’s GDP, but it is not integrated into the domestic economy and mainly provides services for foreigners. There is little overlap with domestic banks and in a crisis the foreign parent banks and home governments would be expected to provide support. The ramifications of such a crisis within Malta would be contained.”
Fitch said that Malta also ranks highly in the traditional international governance indicators reflecting stable government, effective civil institutions and lack of corruption. GDP per head is above the ‘A’ rated median. Euro area membership is a source of strength that protects the island from currency crises and limits the impact of its poor record in international merchandise trade. Unlike manufacturing, its service sectors, including business and finance, are buoyant, as is foreign direct investment which more than covers Malta’s perennial current account deficits.
Fitch said it conservatively assumed that some cooling in the rate of expansion will give an increase for the year of about 2.4%. On past experience, a somewhat higher rate, above 3% pa, should be attainable in the following years if European recovery becomes well established and the government continues to press forward with industrial restructuring and the reduction in subsidies.
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This is too much in one single day.
They must have run out of Imodium and will require an intravenous infusion urgently to replace the fluid loss.
I wonder whether Fitch roped the piddly calculator into its equation. I very much doubt it.
How dare Fitch not include a mention of the BSE (Burmarrad School of Economics) in its assessment?
I look forward to the reaction from the Nouriel Roubinis at Blata l-Bajda.
Poor Lawrence and Tonio. Their heads are going to expand so much they will require a Spitz-Holter valve (Google) soon.
The timing of this news could not be worse for Joseph Muscat. How can he be credible in his criticism of the government and the Maltese economy in his reply to the Budget speech on Monday?
Heard earlier tonight in Parliament: “Fitch Gonzi taghkom!”
This must have been a miserable week for Joseph.
First a no-frills nor shocks budget lacking the much-longed-for austerity measures. Then Bloomberg puts us at par with Germany in terms of competitiveness improvement, followed by an improvement on the corruption perception index complied by Transparency International and just to rub in the misery further this report by Fitch.
Add to this some worrying physiological issue by one of the triad, and he must be feeling pretty hot under the collar (maybe that is an inappropriate choice of idiom).
There was a woman complaining about the electricity bills yesterday night on Super One with Joe Debono Grech. Remember him from those nice old days in Vietnam Malta?
She said the bills hit them hard because they’re both living fuq il-pensjoni. She can’t cope ghax she’s not going to issallab it-tifel ghax xtara karozza and her husband had to stop working to help her because she had five children and couldn’t cope.
Mela sewwa – she doesn’t want money fom her own son but from us taxpayers because her son bought a new LIGHTCAR miskin!
And beleive it or not they told her that Labour will address this very important issue! Do you believe these people? ANGLU MAXIMUS FARRUGIA you are our only hope!
You sure it was a lightcar they bought, not a minibus? She said five children.
The only pity is that to the man in the street Fitch means nothing. Hence, come next election, your average man in the street will not vote because Malta’s credit rating is still very high in spite of all the odds but because “Joey ha jrahhsilna l-kont tad-dawl” and any other whimsical promise which he will make on the even of that fateful day.
And this is what I see as Gonzi’s biggest failure. He’s really very good at leading, and he’s got a proven and shining track record, I would say. However, he does not communicate Malta’s achievements to the people in the street, the poeple who judge a government’s track record by whether a pot-hole in their street has been filled in or whether MEPA has given them a permit to develop an ODZ plot of land.
I am not referring to One TV followers. Those are lost anyway. However, most so-called floating voters (if they indeed are) and most “disgruntled” Nationalists need to be shown that we’re forging ahead not through some stellar fortune but through sheer hard work and solid policy.
Having said that, I’m bracing myself for 2013.
Isma jaqaw dawn il-Bloomberg, Fitch u l-ohrajn haga wahda ma’ Gonzi?
Jahasra x’ nies. Din il-praspura qala wiehed gewwa gnien pubbliku dalghodu flimkiem ma’ ohra li fil-budget Gonzi naqqas il-pagi.
X’ naghmlu b’ dawn in-nies? Jista xi hadd jghidli?
The Labour Party is back to the time of KMB – 20 years back. No wonder they have a Grima emblem.
Nibghatuhom fuq FILFAL.
It seems that even the PL Business Forum has ignored this news.
PL Business Forum criticises Big Government
http://www.maltastar.com/
Maltatoday is providing a link to http://www.therealbudget.com – so stupid.
[Daphne – I imagine it’s paid advertising, the Labour Party having taken a calculated guess that your typical Malta Today reader is mifni bil-lanzit, like those who produce it.]
Kurt didn’t post that on Twitter because he wouldn’t know how to fit such news into 140 characters.
Can you imagine what the Maltastar guys would say if this had to happen to us?
http://www.telegraph.co.uk/news/newstopics/politics/david-cameron/8089826/David-Cameron-refuses-to-back-down-on-housing-benefit-cap.html
I think our own government is too forgiving!
What is Toni Abela doing with his hands in this photo? Restraining it?
“Can it get any worse?”, asks Daphne. Yes it can, I answer. That picture could have its sound turned on. “Lill-mittilkless intuwwa l-lifink wejc li jixirqilha….”
Wouldn’t be so sure about Fitch’s ratings after the mess they made with Lehmann Brothers.