Editorial: Before the bubble bursts

Finance Minister Clyde Caruana had forecast that the population would reach 600,000 by the end of the legislature. He was spot on, especially when you consider that the population at the end of 2025 was 588,254 and that the average annual increase is 12,000 people. Had the legislature carried on until 2027, we would have hit that magic number. In a nutshell, Malta’s population has swelled by around 45 per cent in 20 years.

It is easy to swat aside the figures recently released by the National Statistics Office but it should be a wake-up call about many issues, from the fertility rate to the labour migration policy, from rising unemployment to articles describing Malta as Europe’s most overcrowded island.

Think about this last point: for decades Malta’s tourism operators have been trying to attract Americans to the island, and successive governments blaming the lack of a direct air link.

Now that we have one, through Delta Air Lines, the reputation of the island in the US was seriously undermined by the New York Post, which called it a “crammed, jammed vacation destination”.

Malta added just short of 14,000 people in 2025 with migration being the main contributor. Those not born here represented 31.1 per cent, pushing us over the 30 per cent barrier and putting Malta in second place behind Luxembourg.

This is a double-edged sword as it means tremendous positive input (especially where it comes to beef up our health care), but it has also led to high prices, a strained infrastructure and blatant racism.

Bear in mind that while foreign workers keep the country going, most do not stay here for long.

It is simply not worth it given the poor wages and high rents in Malta.

We also need to look into the impact of declining fertility, with a drop of 0.8 per cent in births – while there was a 1.4 per cent increase in deaths over the previous year.

It is perhaps too early (especially after the once-off impact of COVID) to conclude any trend, but the impact on the labour market, the housing market, schools, hospitals and homes for the elderly need to be monitored carefully. The implications on operations and investment, especially in the long-term, are considerable.

Experts have warned that Malta’s “eye-popping popularity may cause the country’s collapse”. And they are right.

Bear in mind that over and above the circa 590,000 resident population were around 70,000 tourists each and every day, bringing us up to 660,000 people on the island at any particular time.

And behind all of these numbers and statistics and averages are human stories: residents fighting against an influx of short-lets, commuters stuck in traffic, unreasonable prices, residents fighting dozens of building permits.

Earlier this year, the UN published a report called ‘Beyond GDP’, aimed at highlighting ‘a huge gap between what GDP measures and what people value’. We need to look for more than wealth to measure our well-being and we need to ensure that what we do is sustainable.

None of this is an argument against tourism, which remains the most essential pillar of Malta’s economy, nor is it a call to shut the door on foreign workers, without whom entire sectors would struggle to function.

But neither can we continue to pursue growth for its own sake while failing to provide the infrastructure, transport and enforcement needed to sustain it.

Nor can we ignore the social tensions that accompany rapid demographic change, from exploitation to the rise of racist sentiments. If population growth, tourism and labour migration are not managed with far greater foresight, the very economic success they have generated risks becoming their own undoing.

Bubbles do not burst overnight but they burst after too many warning signs remain ignored.