Malta is a well-positioned in terms of foreign direct investment island state. Being a member of European Union and the Euro zone, Malta has interesting strong point for foreign investors.
First of all, we should underline that Malta offers a highly-skilled, English-speaking labour force at a competitive cost. Moreover, it holds a privileged geographical position that helps the development of the trade economy. More specifically, it is like a natural hub for companies involving doing business with the southern part of Europe and Northern Africa.
In addition to this, is offers a stable political environment that provides fiscal incentives for new businesses. Furthermore, Malta has a modern infrastructure and a well-known international airport providing direct flights to thirty seven major cities in the world.
Although Malta has a small domestic market as well as an economy with no natural resources, it provides incentives in many sectors to attract foreign direct investment mainly in manufacturing, transshipment and servicing industries, in particular the manufacturing of generic pharmaceuticals, information technology and financial services. Some of the most generous tax incentives are the preferential taxation rates that limits up to 5% as well as the tax credit on investments including up to 50% tax credit of the amount invested of 50% of the first two years’ salary of new jobs created.
To sum up, Malta government offers generous tax incentives for investments in industrial projects. This fact in combination with the geographical location gives Malta the comparative advantage in the field of foreign investments.