The country may be small, but the tourism industry is a vital component of the economy. In 2005, the small, but densely populated country attracted 1.49 million international visitors who generated some 614 million euros in tourism revenues. WTTC figures show that in 2006, the travel and tourism sector will generate over 26% of Malta’s GDP. Unfortunately, Malta’s dependence on tourism makes it highly vulnerable to the economic conditions and changing tastes of tourists from its four main source countries, namely the UK (which accounts for almost one third of all international travellers), Germany, France and Italy.

Recognising that Malta’s traditional offerings of sun and sea are under siege – tourists can find beach holidays elsewhere and often at cheaper prices – the Malta Tourism Authority (MTA) and its private sector partners are turning their attention to promoting niche products such as cultural tourism, family travel, diving holidays and meetings and conventions. Those have been part of the tourism mix for a good number of years, but new advertising and marketing campaigns will give greater exposure to the wide choice of activities available to visitors.

The cruise sector is doing well. Valletta’s waterfront is undergoing a massive regeneration project which includes a new passenger terminal. During the summer of 2006, Star Cruises, a leading cruise line, is using Valletta as the home base for one of its mega ships (with the possibility of a second in 2007), which will bring more fly/cruise passengers to Malta’s shores. Last year, 320,104 cruise passengers stopped over in Malta, a figure that is expected, by the end of 2006, to surpass 400,000.

Malta is well placed to attract well-heeled travellers who seek high-end accommodation. The islands are experiencing a building boom. (Some would say an overbuilding boom.) Over the past 10 years, investors, developers and international hotel chains have constructed over 30 five and four-star properties, up from only five luxury hotels in 1996.