Rating agency DBRS has confirmed its long-term ‘A’ rating for Malta with a stable outlook, saying it expects the country to continue growing at a solid pace despite political “turbulence”.

The Canada-based agency said that its decision was based on the expectation that Malta would continue to grow at a good rate faster than the EU average, with its debt-to-GDP ratio continuing to improve, a buoyant labour market and economic momentum that remained “very strong”.

It however registered concerns about the country’s reliance on corportate tax, the reputational hit Malta has suffered due to its lax compliance with anti-money laundering measures and institutional shortcomings to ensure the rule of law.

Malta’s rating could improve if the government continued to cut public debt, effectively implemented good governance reforms and showed that it was working to make Malta more resilient to external shocks, such as international changes to tax law.

The country’s rating could fall if GDP growth faltered, fiscal indicators took a downward turn or contingent liabilities materialised, the agency said.

Read more about DBRS' Malta rating.