Moody’s has express concern about Malta’ tourism prospects for next year and beyond following Ryanair’s announcement that it ‘will offer fewer flights on its Madrid to Malta route next winter in tandem with other flight cuts from Spain’s capital and from Barcelona after Spain’s government said it would double taxes at the two airports’.
Moody’s stated ominously’ Reducing the number of flights will diminish Malta’s tourist arrivals, a credit negative’. Malta’s rating by Moody’s at present is pegged to the A- level with a negative outlook.
Other airlines flying to Malta have also cut the number of flights to Malta. Moody’s reports that Alitalia (that is also restructuring) has cut three weekly flights from Rome to Malta. EasyJet cut routes during the winter months as a result of high oil prices, cancelling all the airline’s flights from Rome and Milan to Malta thereby contributing to the decline in Italian tourists visiting Malta.
‘Once cut, reinstatement of routes generally lags the improvement in economic activity and traveller demand, diminishing Malta’s ability to benefit from any eventual improvement in European consumer sentiment’ Moody’s maintains.
With Air Malta going through its own restructuring process, further route cuts are not being excluded. Operators in the tourism industry have for a long time insisted that the reduction in airline seat capacity will inevitably depress the industry which continues to struggle to improve profitability.