Malta has earned the trust of international partners through rule of law reforms but "must up its game" in other areas of the finance industry, Robert Abela has told a finance conference.
The prime minister admitted areas of the sector remain under the spotlight including how the country’s tax regime operates and the problems of maintaining relationships with correspondent banks.
Abela was speaking via pre-recorded message at FinanceMalta’s annual conference on Tuesday.
He said: "I believe that through the work we have put in reforming regulatory standards, we have earned the trust of bodies such as the Venice Commission as well as credit agencies. We believe we have earned the trust of our international partners."
Last week the Council of Europe’s commission welcomed rule of law reforms implemented by the government but criticised the “rushed” adoption for cutting short wider consultation.
Abela said an increased level of scrutiny on the country was due to issues over how Malta’s tax regime operates, the imposition of “higher government regulatory standards”, and the decline in correspondent banking.
The country “must do better” in terms of financial oversight, he said adding that "without trust no investment can be attracted towards the island."
He said the finance sector was one of the key economic contributors to Malta’s revenue, employing over 16,000 people who can boast of an income that is 40 per cent higher than the average salary.
Abela’s comments come as Malta struggles with the possibility of being grey-listed by the FATF, the financial action task force behind the Moneyval assessment which is due towards the end of this year.
Its final progress report was submitted earlier this month.
Igor Nebyaev, executive secretary for Moneyval, also sent a brief video message to the conference, outlining the difficulties smaller jurisdictions like Malta have with addressing organised crime.
"Smaller jurisdictions definitely need to increase their analytical capabilities, and more investment is needed to secure this," he said.
He said Moneyval's goal was to evaluate a country's trustworthiness, assess willingness to adhere to standards and then escalate accordingly with measures such as onsite visits.
Despite Moneyval's efforts, Nebyaev admitted that "many countries are still at the lower end of the scale" in terms of keeping to recommended procedures.
He said he believes that with greater collaboration, particularly with information-sharing between authorities, necessary improvements would be made across all jurisdictions.