Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure MT-2022-25/3155 – measures in Malta
|Country||Malta , applies nationwide|
|Time period||Temporary, 16 June 2022 – 31 December 2023|
|Context||War in Ukraine|
|Type||Other initiatives or policies|
Supporting businesses to stay afloat
– Access to finance
|Author||Luke Anthony Fiorini (University of Malta) and Eurofound|
|Measure added||04 May 2023 (updated 07 November 2023)|
The war in Ukraine impacted several sectors in Malta. In order to limit the impact on businesses and consumers, the government introduced a number of support measures. These measures include support for organisations that import grain and access to financing for organisations impacted by the war.
In addition to other measures aimed at tackling energy and fuel prices, the government introduced the Liquidity Support Guarantee Scheme - Measure B (LSGS-B) through the Malta Development Bank. This scheme provides working capital loans to organisations that import fuel oil and that were affected by the war in Ukraine.
The measure aims to provide liquidity to importers of fuel and oil and ensure the security of supply and stability of prices of oil and fuel by purchasing them in greater amounts.
The measure provides a portfolio guarantee for loans via an intermediate commercial partner credit institution. The guarantee covers 80% of each facility and each loan is eligible for an interest rate subsidy of up to 2.5% on the outstanding amount. However, an undertaking's loan cannot exceed 15% of the organisation's average total turnover over a period of three years, and 50% of energy costs over the 12 months preceding the application for support.
The term of the loan is valid for up to six years.
Guidelines for the measure state that credit institutions must provide a significant reduction in the average interest rate to organisations when compared to similar facilities provided before the introduction of this scheme.
The Malta Development Bank announced that €50 million had been made available for this measure.
As of September 2022, no facilities had been approved under this scheme (Malta Central Bank, Q1/2023).
The September 2023 Economic Update by the Malta Central Bank makes reference to the current measure as well as one designed to provide financing support to all undertakings affected by the war in Ukraine. It notes that "By the end of August 2023, a total of €24.5 million was approved under one of these schemes, unchanged from a month earlier. The facility was withdrawn in full, and the outstanding value of loans stood at €24.5 million by end-August." It is not stated, however, which of the two measures was approved and disbursed.
|Does not apply to workers||
||Does not apply to citizens|
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Consultation through tripartite or bipartite social dialogue bodies||Consultation through tripartite or bipartite social dialogue bodies|
Social partners' role in the implementation, monitoring and assessment phase:
The measure was designed and is managed by the Malta Development Bank. While evidence of specific social partner involvement could not be found, two independent directors appointed by the Minister on the recommendation of the Malta Council for Economic and Social Development (MCESD) are part of the board of the Malta Development Bank.
The MCESD is Malta's main body of tripartite social dialogue and includes representatives of Malta's largest employer associations and trade unions.
Views and reactions to this specific measure were not identified. However, during the reaction to the 2023 budget several employer associations spoke about the difficult inflationary conditions currently facing the country and the importance of government measures in reducing the impact of inflation on citizens and organisations. They noted that one challenge was the rising cost of oil and fuel. The Malta Chamber of Commerce stated that Malta needed to move away from its dependency on unsustainable oils and fuels.
|Economic area||Sector (NACE level 2)|
|D - Electricity, Gas, Steam And Air Conditioning Supply||D35 Electricity, gas, steam and air conditioning supply|
This case is not occupation-specific.
Eurofound (2023), Liquidity support guarantee for importers of fuel and oil , measure MT-2022-25/3155 (measures in Malta), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/MT-2022-25_3155.html
30 January 2023
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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.