Deputy Prime Minister and Minister of Foreign Affairs Dr. Tonio Borg signed the Agreement between Malta and Switzerland for the Avoidance of Double Taxation with respect to Taxes on Income, during an official visit to Malta by H.E. Ms Micheline Calmy-Rey, Minister of the Swiss Federal Department of Foreign Affairs. The Agreement was signed in the margins of a bilateral meeting held at the Ministry of Foreign Affairs.

This is the first visit by a Swiss Foreign Minister to Malta. Deputy Prime Minister Tonio Borg described this visit as a new impetus to the relations of the two countries at a political level.

The purpose of this Agreement is to avoid double taxation and prevent fiscal evasion and covers direct taxes on income and capital and enables both countries to exchange information for a more effective stand against tax evasion. The Agreement will enter into force following ratification by both countries.

Dr. Borg said that this Agreement has the primary objective in making the two countries more attractive for entrepreneurs and believed that Maltese-Swiss economic and commercial cooperation will improve further. He also said that the signing of this instrument represents a major and important step forward in the bilateral relations between both countries and represents a significant addition to Malta’s existing network of double taxation treaties. The trade volume between the two countries shows a marked year to year increase for these last four years. The latest statistics for 2007 show that imports from Switzerland rose to € 66.7 million (mainly pharmaceuticals, jewellery, electric machinery), while Malta’s exports rose to € 7.9 million (mainly machinery and pharmaceuticals).

Minister Borg also underlined that the Ministry of Foreign Affairs will continue to promote stronger economic relations and serve as a catalyst for the growth of trade and investment in its bilateral contacts with other countries. In this regard, Minister Borg mentioned a number of priority sectors for the Government such as healthcare, pharmaceuticals and medical related products, information, communication and technology, including electronics, mechanical engineering, knowledge-based services, including back office operations and skill based support operations, logistic based services and renewable sources of energy. The Smart City project was also highlighted.

This year Malta has steadily increased the number of double taxation treaties with trading nations from both the EU and non-EU countries. The purpose of such Agreements is to ensure that residents of both trading nations do suffer double taxation and covers direct taxation on income and capital.

The EU is by far Switzerland’s most important trading partner. 60 % of all Swiss exports go to the EU while 80 % of all goods and services that Switzerland imports originate from the EU.

Malta, as Switzerland, lacks raw materials and bases its prosperity on labour skills and expertise in manufacturing, as well as earnings from the services sectors, such as tourism. In this regard, Switzerland is considered as a potential investor in Malta in sectors such as the chemical industry, pharmaceuticals, ICT and other various manufacturing areas such as the plastics industry.

The trade volume between the two countries shows a marked year to year increase for these last four years. The latest statistics for 2007 show that imports from Switzerland rose to € 66.7 million (mainly pharmaceuticals, jewellery, electric machinery), while our exports rose to € 7.9 million (mainly machinery and pharmaceuticals)

Tourist figures from Switzerland for these last five years stabilized at around 22,000 arrivals. The figures for 2007, however, show an increase of 2.9% over the previous year.

There exist 458 active companies registered in Malta with Swiss Shareholding, either in form of Swiss companies or individuals. These companies conduct operations in the manufacturing, services and ITC sectors. It should be noted that there exists in Malta one company – Siegfried Generics, which operates in pharmaceuticals with a significantly large Swiss investment. Other major investments are in the electronics and electrical sectors. There also exist 5 Collective Investment Schemes, which have Swiss managers, custodians or administrators.