Malta celebrated the twentieth anniversary of its EU membership this year. Roderick Pace writes that while the country’s experience as a member state has been largely positive, it has not always been smooth sailing.
Malta’s experience as an EU member state has been largely positive, leading to strong public support for EU membership. The Spring 2024 special Eurobarometer survey shows that 59% think that EU membership is a good thing while 6% say it’s a bad thing compared to the EU-27 average of 60% and 12% respectively.
Despite facing challenges such as financial crises and the impact of COVID-19, Malta’s economy has remained resilient, leading to low unemployment rates. Economic growth is expected to reach 5% in 2024 and 4.3% per annum in the next two years. The drivers of this growth are tourism and consumption, but economic success means that immigration will also be boosted to address labour shortages. While initial predictions suggested that Brexit would negatively affect Malta, the actual impact turned out to be mild.
The Erasmus programme enabling students to complete some of their studies and training in the EU, the introduction of the euro in 2008 and membership of Schengen a few days before, as well as lower travel costs have made the EU popular in Malta. Entry into the single market and the removal of protectionist barriers has also opened the door to a wider choice of goods and services.
Not all smooth sailing
However, not everything has been smooth sailing in Malta. The EU has unexpectedly boosted economic growth in sectors such as tourism, financial services and online gaming. After joining the EU, Malta opened its doors to low-cost airlines to compete with other Mediterranean destinations. Low-cost air travel is traceable to EU Air transport liberalisation in the 1990s. As a result, inbound tourism rose from around one million to more than three million between 2003 and 2024.
The rise in tourism, construction and gaming, coupled with a decrease in natural population growth, highlighted shortages of labour in many sectors. Consequently, labour was imported from both the European Union and third countries. By 2022, the proportion of foreign nationals surged from 5.5% in 2012 to 25.3%. Net immigration may have plugged holes and maintained the economic rhythm, but migrant rights remain appalling and their inflow may have had a dampening effect on wages.
Economic progress brings both benefits and costs such as externalities imposed on future generations. The pressure is being felt in many sectors such as the transport sector, crowded health facilities and waiting lists, the disposal and recycling of waste and several other unintended consequences that are challenging to resolve.
There are growing calls for a new economic model that prioritises sustainability and reduces overreliance on tourism. For small island states, a knowledge-based, green economy presents better prospects. The EU offers possibilities for the success of a new economic model, but this depends on the Maltese political elite grasping the opportunities which it presents.
Considering that Malta’s economy has been spared the tribulations of its southern European neighbours since 2008 and its rate of economic growth has been one of the best in the EU for more than a decade, the percentage of people at risk of poverty remains rather high at 19.8%. Although this is slightly below the EU average and better than the figure for Greece, Italy and Spain, it is relatively high for a successful economy.
Located at the heart of the Mediterranean – one of the fastest-warming regions in the world – Malta needs to accelerate its transition to renewable energy sources. Currently, Malta ranks second last among EU member states for renewable energy use, with only Ireland below it.
Civil rights and reform
Since joining the EU, Malta has made significant progress in several areas related to civil rights, particularly LGBTIQ freedoms. Divorce was introduced in 2011 and same-sex marriage became legal in 2017. However, Malta still lags behind some of the leading EU member states when it comes to the rule of law, corruption and transparency.
The political scene in Malta is unstable because while the governing Labour Party commands a comfortable majority, there are still unresolved problems related to the rule of law, media freedom and delays in the judicial process to bring to justice those involved in the murder of journalist Daphne Caruana Galizia in 2017. The murder had significant repercussions both within Malta and internationally, but unfortunately it did not lead to a comprehensive reform process to address systemic issues in the Maltese state. Many of those allegedly involved in the assassination remain at large and the judicial process has been frustratingly slow.
Pressure for constitutional reform, primarily in relation to the separation of powers and the independence of the judiciary, has come mainly from the Council of Europe’s Venice Commission and Group of States against Corruption (GRECO), as well as domestic sources. In 2024, GRECO highlighted that precious few of its recommendations have been implemented. A 2019 constitutional conference proposed by the Head of State has been set aside. Surprisingly, the EU has had relatively little influence on political reforms although the country has witnessed the strengthening of civil society in the last 20 years.
Additionally, Malta has been grappling with other challenges, such as a stalled media law that has been languishing in parliament for over two years and a promised white paper that has not been published. State media still exhibit bias toward the party in government, and journalists often face difficulties obtaining information under the Freedom of Information Act.
Malta has the highest number of Strategic Lawsuits Against Public Participation (SLAPP) per capita. The Daphne Caruana Foundation and other NGOs slammed the implementation of the EU anti-SLAPP directive. Going forward, the EU needs to progress on the reform of Article 7 TEU to ensure that member states fully respect the values and objectives enshrined in the treaties and the EU Charter of Fundamental Rights, particularly the rule of law, to be in a better position to take action against member states.
While Malta has few serious infringement procedures within the EU, there are a couple of notable exceptions that warrant attention. Malta’s International Investment Programme (IPP) is before the Court of Justice of the EU (CJEU) and the final outcome might have a lasting effect not only on Malta but also on definitions of European citizenship.
The other issue concerns the extension of Malta’s derogation on spring hunting of quails, on which the European Commission intensified its infringement procedures in 2023. In September 2024, the Court of Justice of the EU ruled that Malta’s trapping of protected finches for “research purposes” is illegal. This issue could affect Malta’s internal politics in many ways.
Malta in the EU
Since joining the EU, Malta has adopted the EU’s acquis communautaire in all policy areas and the transposition of EU law into national law has not met serious difficulties. Maltese representatives at ministerial or official levels in the institutions have regularly participated in the decision-making process.
The negative publicity following the dismissal of the Maltese Commissioner in October 2012 was weathered and in 2017 Malta successfully completed its turn holding the presidency of the Council of the EU. It has also managed to use most of the funds extended it to from the EU budget.
Malta has fully supported the development of the Common Foreign and Security Policy, including the Common Security and Defence Policy (CSDP), while remaining faithful to its constitutionally enshrined neutrality. It strictly observes military non-alignment but upholds a stance of “active” neutrality.
Malta remains attached to the Mediterranean region and cooperates with the Med-9 in promoting the Mediterranean in the EU Council. Malta has also enlisted the EU’s help in managing irregular migration in the central Mediterranean but has not completely freed itself of criticism concerning push backs and poor treatment of immigrants.
In the 2011 Libyan civil war, Malta did not offer any military facilities to NATO but concentrated on the humanitarian task of evacuating foreign civilians from Libya. When Russia invaded Ukraine in 2022, Malta joined fellow EU member states in condemning the invasion and constructively abstained when EU leaders approved military aid to Kyiv from the European Peace Facility, providing its equivalent share in the form of non-lethal, civilian aid.
Malta has not joined the EU’s 2017 Permanent Structured Cooperation in Defence (PESCO) but kept the door open to join later. It has an active relationship with NATO through the Partnership for Peace. Neutrality continues to enjoy overwhelming public support and it is unlikely that Malta will follow Sweden and Finland into NATO.
The Maltese public was split down the middle on EU membership in 2003, but once the issue was decided, dissensus has morphed into consensus mainly because the Labour Party shifted its position. Since then, public attitudes towards membership have become more entrenched. There is a widespread belief that the country’s progress and security in these turbulent times depends on EU membership.
Small-state politics
Malta has been somewhat silent on the future of Europe, except to oppose further treaty reform. There is certainly an apprehension about giving up unanimity in certain policy areas like taxation because of the financial and gaming sectors, as well as on European defence because of Malta’s neutrality.
However, the influence of small states on the EU’s evolution is often underestimated. Any changes to the EU treaties have to be ratified by the member states according to their individual constitutional requirements and the domestic politics of small states can therefore have a strong impact on the grander ambitions of the Union.
EU membership provides small states with opportunities to strengthen economic progress and buttress their citizens’ attachment to the EU. But this permissive consensus can flounder at short notice on the pernicious rivalries of small-state politics.
This article is part of a series organised by Eli Gateva on Rethinking Europe’s East-West Divide – 20 Years since the Big Bang Enlargement.
Note: This article gives the views of the author, not the position of EUROPP – European Politics and Policy or the London School of Economics. Featured image credit: Kim Willems / Shutterstock.com
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