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‘We do have a long-term vision’ : Economy minister dismisses PN MPs' warnings

Opposition MPs Claudio Grech and Kristy warn that economy is too reliant on volatile markets, but economy minister Chris Cardona insists Labour government has a long-term plan to diversify the economy 

tim_diacono
Tim Diacono
1 November 2016, 9:28pm
Economy minister Chris Cardona delivers a speech in Parliament
Economy minister Chris Cardona delivers a speech in Parliament
Economy minister Chris Cardona struck a bullish tone, when faced with warnings by Opposition MPs that the government lacks a long-term economic vision.

Speaking in Parliament during a debate on the 2017 Budget estimates on the economy ministry, Opposition MPs Claudio Grech and Kristy Debono both criticised the government for focusing too heavily on short-term economic gains, while falling short on measures to ensure long-term economic sustainability.

Debono cited a recent warning by economist and Misco managing director Joe Zahra that the Maltese economy is too heavily dependent on volatile markets such as property, remote gaming, and the sale-of-passports scheme.

“We shouldn’t stick our heads in the sand and ignore such constructive economic criticism,” the Opposition MP said. “Regional political changes and new laws in neighbouring countries can shift the economic climate dramatically and deal the property market a sudden hit.

“We should look beyond the ends of our noses and come up with a long-term vision that will render us prepared for any future problems.”

However, Cardona insisted that the government is committed to diversifying the economy – in particular identifying niches such as logistics, health, education, and digital gaming.

He cited the American University of Malta and Bart’s Medical School projects, the partial privatization of the Gozo, St Luke’s and Karin Grech hospitals, Crane Currency’s decision to open shop in Malta.

He added that the government will soon launch a strategy on modern technological infrastructure, that will include plans to attract Fintech industries to Malta, and that the planned logistics hub at Hal Far will only be the first step “to turn Malta into an international logistics centre”.

Cardona alsosaid that Malta Enterprise will in the coming months launch several schemes to incentivize local business – a scheme to incentivize people to use abandoned buildings for business purposes, tax credits for developers of digital games with a cultural theme, and financial aid for “disadvantaged people” to set up their own businesses. 

He lambasted Opposition leader Simon Busuttil for claiming that the government has “allowed De La Rue to close and fire its workers, and then bring another company [Crane Currency] instead of it.”

“Coming to Parliament to spout out lies against a company that has been in Malta for decades and that employs hundreds of people without a care as to what implications such comments can have on that company amounts to nothing but gross irresponsibility and cheap politics.”

‘Government lacking a long-term economic vision’

Opposition MPs Claudio Grech and Kristy Debono both criticised the 2017 Budget for focusing too heavily on short-term economic gains, while falling short on measures to ensure long-term economic sustainability.

Grech urged the government to introduce more initiatives to encourage IT-enabled businesses to invest in Malta, and to incentivize university students to set up their own start-ups while they are still studying.

He lambasted as “unbelievable” the fact that the government’s capital expenditure has shrunk from €500 million in 2014 to €361 million as envisioned in the 2017 Budget during a period of rapid economic growth.

Grech also called for the government’s marketing of Malta should be more unified, rather than split up among different agencies such as Trade Malta, Finance Malta. 

“We must market Malta as a place where technically and academically talented people are welcome to study and work,” he said. “Our future economic growth will hinge on us fostering this type of mentality.

Opposition MP Kristy Debono warned that Malta's economy could be too reliant on volatile markets
Opposition MP Kristy Debono warned that Malta's economy could be too reliant on volatile markets
Debono urged the government to “seize the opportunity” of Brexit by attracting FinTech companies currently based in the UK to Malta, and to start training people to work in a planned logistics hub.

She reiterated the PN’s call for a fresh cut in electricity tariffs, arguing that the Labour administration is currently benefitting from factors that weren’t present a few three years ago – such as the BWSC power station and the interconnector, and the fact that the international price of oil has plummeted to between $40 and $50 a barrel.

The Opposition MP also lambasted the government for replacing eco-contribution tax with excise duties on toiletries, accusing it of applying “old-school economics”.

“Excise duties are renowned across the world as regressive taxes on the level of taxes on the same level as taxes on alcohol and cigarettes,” she said. “These taxes will directly increase the cost of several products that families consume on a regular basis.”

She dismissed the government’s frequent claims that it is pro-business, noting that Malta was the worst-ranked EU country in the World Bank’s most recent Ease of Doing Business report.

“The Labour Opposition had attacked the bureaucracy that had existed under the previous PN administration, but such bureaucracy is still present and might have even increased,” she said. 

tim_diacono
Tim Diacono is a journalist at MaltaToday
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