Finance minister warns of saturation point in tourism

Finance Minister Clyde Caruana has warned that Malta risks reaching saturation point in tourism, saying the country must focus on attracting higher-spending visitors. 

Speaking to MaltaToday in the wake of Budget 2026, Caruana said the government and industry alike need to recognise that there are limits to how many tourists the island can sustainably host. 

“The sector itself will also have limitations to growth. If this country ends up attracting four million tourists, will it really afford to bring in more people? If the numbers continue to rise, the quality of a holiday in Malta will surely deteriorate,” he said in an interview being published today. 

He said this is already somewhat the case. “In summer, you go to a beach and can hardly find a place to lay down your towel on the sand. This is why certain measures were already taken in Comino,” he said, referring to a visitor cap implemented to protect the Natura 2000 site.  

“It will be difficult, but we need to make sure that the tourists coming to Malta have deeper pockets. It makes no sense to keep chasing quantity tourism from Europe,” he said.  

Caruana also said the government is now adopting an economic policy that encourages productivity and capital investment rather than continual population and employment growth. 

Traffic and mass transport: ‘Behaviour must change’ 

The minister also addressed mounting public frustration over traffic, acknowledging it as a key concern that will remain as long as Malta’s population continues to grow.  

He said better traffic management, investment in ferries, and improved public transport could ease congestion, but warned that “no matter how much you try to ease it, traffic remains a key concern”. 

On proposals for a mass-transport system, whether it be a metro or tram network, he said that he’s not against the idea but wanted to be fully convinced of the numbers—the operating expenses, revenue, demand, subsidies.  

“I won’t accept a situation where people use their car and this metro,” he said. “If this goes wrong, the Maltese taxpayer will pay for it.” 

He also said the issue goes beyond bipartisan support. “Let’s say the project will cost €300 million a year. Between that and public transport, we’d be spending €400 million. Should we even spend that much money on this? I’m just asking. Or should that money go towards buying new medicines, the price of which is always increasing? It’s a matter of priorities.” 

Productivity and a four-day work week 

Caruana repeated his concerns about a four-day work week, saying any reduction in hours would require higher productivity and a better-educated workforce.  

“We haven’t matured enough as an economy to start promising things like this,” he said. 

He’s not outright against the idea, but said Malta can only start to consider a four-day work week by investing far more in capital. “There are already companies in Malta giving workers a lot of flexibility or possibly even lower hours, but that’s because those workers have such high skills that the company can afford to give them those things.” 

He insisted that students and youths need to have a higher level of education. “I repeat this in every interview. I find it difficult to accept that, after 13 years of schooling, over 40% of students fail to attain six O levels.” 

Caruana emphasised individual and family responsibility on this too. “Families need to give more value to education. We need to recognise that the world is changing,” he said. 

Keith Schembri contact ‘nothing more, nothing less’ 

Asked about reports that he remains in contact with former OPM chief of staff Keith Schembri, the minister confirmed that Schembri occasionally reaches out to discuss the economy. 

“Keith Schembri occasionally texts me or speaks to me, asks how I view the economic situation,” he said. “He asks my opinion. Nothing more and nothing less.” 

It was Schembri himself during an interview who name-dropped Caruana as one of the people in government he regularly communicates with. Schembri also named the prime minister as a person he is helping.