Malta is member of the European Union and Euro zone.
Non Tariff Barriers
There are no particular non-tariff barriers. However, in conformity with the EU legislation, licensing requirements are needed for the following:
-Common Agricultural Policies (CAP) (needed for imported foodstuffs).
-Trade Services Division Licenses (DTI)
-Ministry of Rural Affairs and Environment Licenses (for goods such as meat, poultry ,eggs which should undergo a veterinary checking at arrival)
-European Union License (for the import of depleting ozone substances and products).
Customs Duties and Taxes on Imports
As a full member of the European Union, Malta imposes customs tariffs on imports from non-EU countries. Rates of duties are contained in the Import Duties Act which may be accessed at: here.
Since its accession to the European Union on May, 1st of 2004, Malta has adopted the EU Common External Tariff. Consequently, trade with Malta is totally free from customs duties, provided that the country of origin of the goods is one of the other EU Member States. Nevertheless, textile imports in Malta will undergo customs duties until 2009.
When the country of origin of the goods exported to Malta is not part of the European Union, customs duties are calculated Ad valorem on the CIF value of the goods, in accordance with the Common Customs Tariff (CCT).
Duties for non-European countries are relatively low, notably for manufactured goods (4.2% on average for the general rate), however textile, clothing items (high duties and quota system) and food-processing industry sectors (average duties of a 17.3% and numerous tariff quotas, CAP) still know protective measures.
In order to get exhaustive regulations and customs tariffs rates regarding their products, exporters shall refer to the TARIC code and its database, including all applicable customs duties and all customs trade policy measures for all the goods.
For further information, please consult the information document published by the European Commission about the impact of EU enlargement on customs policy.
As an EU member, Malta applies the EU Customs Code for import and customs clearance processes. "TARIC" contains all references to the relevant import and export laws and regulations that apply within the EU, including commodity codes for 65,000 products.
Imported goods in Malta should be accompanied by the Single Administrative Document (SAD). The supplier's invoice should also be joined for customs clearance.
As part of the "SAFE" standards set forth by the World Customs Organisation (WCO), the European Union has set up a new system of import controls, the "Import Control System" (ICS), which aims to secure the flow of goods at the time of their entry into the customs territory of the EU. This control system, part of the Community Programme eCustoms, has been in effect since January 1, 2011. Since then, operators are required to pass an Entry Summary Declaration (ENS) to the customs of the country of entry, prior to the introduction of goods into the customs territory of the European Union.
Samples can be entered in the country with the same documentation procedure as other goods. For customs clearance, the samples must be accompanied by a commercial invoice stating 'samples without commercial value".
With a GDP per capita of USD 31,580 (IMF, 2021), the Maltese consumer is now among the wealthiest in the Mediterranean (after Italy and Spain). The population is growing marginally (0.75% in 2021) and the median age was 42.3 years old in 2020 (CIA World Factbook's estimations).
Most of the population live in cities (94.7% urbanisation rate in 2020 - CIA World Factbook) and there are no significant income inequalities among different regions or social groups with Malta having one of the lowest Gini index scores in the world (28 out of 100 in 2019 - Eurostat, latest data available).
Malta has a more vibrant consumer market than the regional average. All markets perform better than the EU average (meat, non-prescription medicine, fruit and vegetables in particular), except for books, magazines and newspapers, and entertainment goods, which are in line with the average (EU Consumer Markets Scoreboard, latest data available). Consumer confidence increased until January 2020, but following the COVID-19 crisis, it fell sharply, in November 2020 the consumer confidence index was -10.7 points and was -7.9 points in March 2021 (Eurostat). Maltese consumers are increasingly online, the internet penetration rate in Malta stood at 91% in 2020 (Kepios), and are turning to e-commerce. According to the Malta Future Consumer Survey, conducted in 2020 by EY, the general perception is that in the future, once the pandemic is over, there will be a return to pre-COVID-19 spending levels in almost all categories. However, affordability remains a concern, with 67% of respondents saying they are cautious about spending and 45% saying they will postpone major purchases. In addition, retailers need to remain aware of the growing interest in contactless delivery and payment systems that were highlighted by respondents. 54% of consumers prefer to shop online, rising to 78% for people up to 40 years of age; while 53% expect contactless payment and delivery.
Malta offers a full range of sales channels to consumers, with various distribution methods depending on the type of product offered. These methods range from wholesalers selling to traditional shops which then sell to the public, to more sophisticated methods such as large department stores which have become increasingly popular outlets.
The Maltese retail distribution sector is mostly made up of small local retail shops and street vendors (fruits and vegetables). Most of these are family owned. However, entry into the EU and the adoption of the Euro have changed the face of traditional local retailing and have paved the way for large European retailers and franchises to expand on the islands. While the retail industry in Malta is still by and large dominated by small trading companies, Malta’s entry into the EU has forced local traders to re-think their distribution strategies by opening the local market up to foreign competition. In fact, the last ten years have witnessed takeovers and mergers of local domestic shops with larger international entities.
Malta does not have any natural resource wealth or any heavy industry: the country thus depends entirely on imports to meet its requirements of basic products, industrial products as well as consumer goods. Though Malta is a small market, it is characterised by the active presence of a multitude of trade companies, often family-run businesses but very competitive towards each other. These companies generally undertake the import and distribution of goods at the same time. A few specialist importers also exist and they constantly seek to expand their field of action by extending their product range. Many European distributors have been partnering with Maltese firms to open franchises of fashion and food stores across the island over the last few years. For instance, supermarket chains such as SPAR, the discount chain LIDL, British mass retailers Marks & Spencer and, most recently, Matalan have entered the market. Some local operators have invested in modern mass retail, working directly with European retailers, while others have partnered to represent brands in North Africa.
By the end of 2017, Malta had a population of 432,089 people, out of which 360,056 were internet users, making the penetration rate 83.3 %. Despite being a small archipielago, Malta hosts a very advanced telecommunications network. Internet availability is widespread, with internet service providers such as Melita, Go and Vodafone offering multiple connectivity options, while both public and private sectors provide free internet access through several wi-fi hotspots. The Malta Communications Authority (MCA) manages more than 190 free wi-fi spots across Malta and Gonzo, including most public gardens. Compared to European countries, internet connectivity can be more expensive even though coverage is of high quality and there are no download limits. The highest level of the internet use was registered within the yougest share of the population, as 98.1% of people aged between 16 and 24 were connected, while those aged 65 to 74 recorded the lowest internet usage level (37.9%). Males use the internet more than females, as 87% of men are online, as compared to 75% among women. As for how they go online, 75.8% of Internet users accessed the internet away from home or work using either phone network or a wifi connection on their mobile phone. In recent years, the Maltese government embarked on a drive to grow the IT sector, ensuring high standards of services throughout Malta and Gozo. E-Government, a service maintained by the Malta Information Technology Agency, is the way the Maltese government provides public information and services electronically to citizens and business. Mobile devices (smartphone and tablet) are growing in popularity among consumers for accesing the internet. 87% of internet users are active on social media. Facebook is the most popular with all age segments, used by 320,000 people (88%), followed by Instagram (29%), Linkedln (20%), WhatsApp (16%), Pinterest (15%), Google+(15%) and Twitter (15%). As of September 2018, the most popular search engines in the country by market share were Google (95.62%), bing (2.34%), Yahoo! (1.61%), and DuckDuckGo (0.21%). As for browsers, the most popular ones were Chrome (66.38%), Safari (19.17%), Firefox (3.44%), Edge (3.36%), Samsung Internet (2.58%), and IE (2.38%).
E-commerce was slow to develop in Malta but it has evolved rapidly. According to the 2017 European Ecommerce Report, e-commerce sales were worth about EUR 39.6 million in 2017 (0.47% of GDP), which represented a growth rate of 15%. In 2014, the Government launched the Malta e-Commerce Digital Strategy, covering a seven year period until 2020 and aimed at ensuring that businesses have the necessary means and skills to capitalise on opportunities brought about by e-commerce. In 2017, 64% of Internet users have purchased goods or services online. Online buying is more popular with women than men, as 82% of female Internet users are e-shoppers, while 75% of male Internet users make purchses online. 80% of e-commerce users prefer to conclude their online purchases using a desktop or laptop computer. Paypal is the preferred method of payment (80%), followed by credit card (65%), debit card (16%) and cash on delivery (6%). 26% of digital buyers spend between EUR 500 and EUR 1500 in a year. Only 2% spend more than EUR 3000. While Maltese customers still prefer traditional shopping, microenterprises, SMEs and large businesses have realised the potential benefits of digital technologies. A study carried by the Malta Communications Authority shows that the internet is often the first resource for consumers wishing to gather information before making a purchase in-store or online, and 70% of internet users research products before buying them. Malta is the second best performing EU Member State for sales via electronic data interchange. Clothing and sporting goods are the most commonly acquired cross-border item category. The most popular countries among Maltese digital shoppers are the UK, followed by China and the United States. However, only a third of digital buyers purchase from domestic websites. The main reasons for not buying online from local websites are less competitive prices than those on foreign websites and limited choice of products. The top e-commerce Malta websites are theweddingsite.com (weddings), dealtoday.com.mt (tickets), klikk.com.mt (consumer electronics) and missguided.eu (clothing). Amazon remains the leading e-commerce platform, according to Enterprise Europe Network.
Organizing Goods Transport
Main Useful Means of Transport
Malta being an island, goods transportation operates by sea ; the maritime infrastructure of Malta is well developed and convenient.
For movements within the country, road transport is the best solution.
Key industry profiles for Malta are: pharmaceuticals and healthcare (mainly generics ; attractive because of the possibility to develop generic drugs in advance of patent expiry), ICT and electronics (software development), call centers (attractive because of the multilingual workforce), transport and logistics (maritime transport because of the location) and financial services (positive legislation towards the financial sector).
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