Malta has been unable to substantially raise tourists’ average daily spend after adjusting for inflation over the past decade, prompting industry leaders to call for a clearer strategy aimed at attracting higher-spending and luxury travellers.
The issue was central to a panel discussion organised by the Malta Business Network earlier this month, titled “Repositioning Hospitality: A New Value Equation for Malta”, which brought together senior figures from hospitality, investment, design and advisory to debate the future direction of the sector.
Opening the event, Deloitte Malta’s Transportation, Hospitality and Services leader David Delicata presented data comparing Malta’s tourism performance today with that of a decade ago.
Although visitor numbers have risen substantially over this period, he noted that average visitor expenditure in real terms has remained largely stagnant. The current volume-based model in Malta, he said, is unsustainable, and it is now essential to transition towards a higher-value, experience-driven approach that delivers benefits to both the economy and visitors alike.
While visitor numbers have risen sharply over that period, he noted that once inflation and other factors are taken into account, the average visitor expenditure has not grown significantly, raising questions about whether the island’s growth model is delivering long-term economic value.
AX Group CEO Michael Warrington argued that Malta’s tourism strategy has historically been driven primarily by volume rather than value. He recalled how Malta had originally positioned itself as a quality destination as far back as the 1960s, before later setting targets to reach one million tourists, a figure that has since quadrupled.
“It is not surprising that average spend hasn’t shifted significantly if the driving force has been volume,” Warrington said, adding that while Malta can pivot towards a higher-value model, this must be done carefully and with a clear understanding of what must be preserved.
He also questioned inconsistencies in Malta’s tourism offer, pointing to investment in heritage restoration while visitor experiences on the ground sometimes fall short of the desired standard.
A ‘hybrid’ model
Winston Zahra, CEO of Troo Hospitality, suggested that Malta could not pursue luxury tourism exclusively but rather adopt a hybrid model, citing destinations like Ibiza that successfully blend mass and high-end tourism.
First, however, the government and industry stakeholders should decide on a direction, and then build the strategy and enact it.
“The question is do we want to head in a particular direction or continue as we are doing at the moment?” he asked.
From a design and infrastructure perspective, Reuben Xuereb, Chairman and CEO of QP and DesignEQ, argued that Malta’s small size should be its greatest strength rather than a limitation.
“Less is more,” he said, warning that the strain of the current volume-driven model on infrastructure risks undermining the country’s appeal. Malta, he added, needs a clearer strategy that leverages its connectivity and airport strengths while being more selective about the experience it curates.
High turnover
Labour stability and public space quality also emerged as key constraints to moving upmarket.
Warrington noted that AX Group employs nearly 900 staff, of whom more than 80% are third-country nationals on one-year contracts. This, he said, makes it difficult to build cultural knowledge, service consistency and long-term commitment. “You cannot build a luxury product if your workforce has no certainty and no incentive to invest in the country itself,” he said.
Zahra summed up the challenge bluntly: “The answer to how we attract the right tourists is the same as the answer to what kind of country we want to live in ourselves.”
While panellists differed on how quickly Malta can reposition itself, there was broad consensus that the island needs a clearer, more coordinated tourism strategy:” one that balances growth with sustainability, experience quality and long-term value creation.
As Xuereb concluded: “Malta is not damned. But without a strategy, we are leaving our greatest advantages underutilised.”
