The European Commission is expecting a better economic situation in Malta in the coming two years according to the winter economic forecasts published this morning in Brussels.

According to the Commission, real GDP growth is estimated to have reached 2 per cent of GDP in 2013 and is projected to maintain the same pace in 2014-15.

Domestic demand is seen as being the main driver of growth, largely on the back of recovering household consumption.

Brussels said that the general government deficit is expected to decrease from 3 per cent in 2013 to 2.7 per cent this year.

No change in the deficit is expected for 2015.

The Commission  expects a slight drop in unemployment this year, from 6.5 per cent in 2013 to 6.4 per cent next this year.

Commenting on the budget presented by the government for this year, the commission said that it includes mostly revenue increasing measures, a new programme to grant Maltese citizenship to foreign individuals and families against the payment of a fee and investments in the country and the introduction of a new tax regime for rental income.

On the expenditure side, the budget envisages some restrictions on recruitment.