Issue link: https://maltatoday.uberflip.com/i/1528842
maltatoday | SUNDAY • 3 NOVEMBER 2024 BUDGET2025 SPECIAL FINANCE minister Clyde Caru- ana said Malta will continue to subsidise energy prices, fuels, and cereals despite pressure from the European Commission to cut these subsidies. "This decision stems from the belief that people should not bear the brunt of external events, and is made possible by responsible economic management that has yielded positive results." A positive economic momen- tum was expected to continue, with real GDP growth projected at 4.9% by the end of 2024, driven by domestic demand. The Maltese economy is forecast to grow by 4.3% in real terms and 7.0% in nominal terms in 2025. Domestic demand will continue to be the primary driver of eco- nomic growth, contributing 3.4 percentage points. This growth is expected to be re- flected in the labour market, with projected job increases of 4.6% in 2024 and 4.1% in 2025. Inflation is predicted to moder- ate to 2.5% in 2024 and 2.1% in 2025. Global economy Despite initial pessimism, the global economy experienced growth in 2023, reaching 3.3%, while inflation began to decline towards the target of 2.0%. The IMF predicts continued global economic stability, with growth projected at 3.2% in 2024 and 3.3% in 2025. However, this growth is uneven- ly distributed among countries, with the US driving global growth while the UK economy remains weak. Persistent challenges in- clude inflation, rising interest rates, climate change, and the conflict in the Middle East. Me- dium-term growth prospects are expected to be historically weak. The European Union econo- my stagnated in 2023, with some economies experiencing mild re- cessions due to the lingering ef- fects of high energy prices. The EU economy showed signs of recovery in early 2024, driven by private consumption support- ed by rising disposable income. Growth is projected at 1.5% in 2024 and 1.8% in 2025. Economy forecast to grow by 4.3% in 2025, well above the EU average Energy, fuel and cereal subsidies to continue