Malta keeps scoring high points in economic terms with performance buoyed by a string of factors that now include the benefits from the sharp fall in the price of oil. Concurrently with news from Brussels that the island shares the eurozone’s positive economic sentiment, and a generally favourable report from a Canadian credit rating agency, local official figures show a surplus in public finances, pushing down the national debt.

Since the deficit has now been reduced to below the three per cent threshold, as required under EU rules, Malta expects the excessive deficit procedure against it to be lifted soon.

With economic circumstances in Europe now seen to be improving, the country should do even better if it continues to play its cards right and if it manages to remove obstacles to growth.

Despite all the work done over the past months to reduce bureaucracy, it does not seem the country is making much headway. The finance minister has just gone on record saying, for instance, that bureaucracy remains a major obstacle.

Confidence in the eurozone’s economy has risen for a fourth straight month, with economists suggesting that the weak euro and lower oil prices are helping to spur the economy. The eurozone economy is now expected to grow by 1.3 per cent this year and 1.9 per cent in 2016.

As regards Malta, the European statistical agency reported that the island registered the second highest confidence and economic sentiment across the EU last month, ranking just below Croatia. This tends to confirm the European Commission’s forecast that the island’s economy is expected to grow at a higher rate than the EU average over the next two years.

According to the European Commission, growth this year is expected to be similar to that of last year, 3.3 per cent. It is forecasting a slight drop for next year, to 2.9 per cent. The deficit in the government’s finances was expected to continue to fall, paving the way for the lifting of the excessive deficit procedure.

Meanwhile, a Canadian rating agency, DBRS, has given a rating that “reflects strong growth performance and eurozone membership”. However, it has also thrown the spotlight on a matter that ought to be kept under control, that is rising costs.

Describing productivity growth as relatively weak, it said output per worker since 2007 had underperformed most other southern EU countries. Labour costs had risen in excess of 25 per cent, compared with roughly 10 per cent in France, Italy, and Spain.

To add to the somewhat uncertain situation in manufacturing industry, Eurostat reported that the increase in industrial confidence slowed down to 2.5 per cent, from 6.7 per cent. Industries had negative expectations for export order books and saw growth in employment expectations slowing down to 18.8 per cent from the 39.3 per cent registered in February.

As Europe now appears to be taking a turn for the better, industry may stand a better chance to improve its prospects so long as it remains competitive. The cut in energy tariffs for industry and business is a boost. In all, the two sectors will be saving some €50 million a year from these tariff cuts. However, a greater effort would need to be made to attract new investment in industry and expand export trade.

Manufacturing industry deserves all the support it can get. Although it makes good sense to continue developing the services sector, industry still has a role to play, particularly if it continues to branch out in the making of value-added goods.