Malta’s central government debt rose by more than €0.5 billion in the first two months of 2026, reaching €11.4 billion, according to new data published by the National Statistics Office.

The increase of €509.3 million compared to the same period in 2025 was driven primarily by higher issuance of Malta Government Stocks, which rose by €443.1 million. Additional increases were recorded in Treasury Bills (€120.1 million) and euro coins issued by the Treasury.

The rise in debt was partly offset by reductions in certain instruments, including the 62+ Malta Government Savings Bond and foreign loans.

Despite the increase in borrowing, government finances showed a significantly improved position overall. By the end of February, the Government’s Consolidated Fund recorded a surplus of €229.6 million, compared to a €95.1 million deficit during the same period in 2025.

The improvement was driven by a sharp increase in revenue. Recurrent revenue reached €1.56 billion, up €482.7 million year-on-year, with strong gains in income tax, VAT and grants.

Income tax receipts rose by €306.5 million, while VAT revenue increased by €94.3 million, reflecting continued economic activity and consumption.

Government expenditure also increased, though at a slower pace. Total spending reached €1.33 billion, up €158.1 million compared to the previous year.

Recurrent expenditure accounted for the majority of the increase, rising by €119.9 million, largely driven by higher spending on social security benefits, healthcare and EU contributions.

Capital expenditure rose to €72.9 million, with increased investment in road infrastructure, digital initiatives and public assets.

Meanwhile, interest payments on public debt totalled €51.3 million, slightly higher than the previous year.

The data highlights a dual trend in Malta’s public finances: rising debt levels alongside strong revenue growth and an improving fiscal balance.

While borrowing continues to increase, the return to a surplus position suggests that government revenues are currently outpacing expenditure growth — at least in the early months of 2026.