November election talk has business wary of slowdown

Uncertainty surrounding a possible election during the pre-Christmas retail bonanza, is keeping businesses in limbo and unable to take certain decisions

It is open secret that an election for this year is being seriously contemplated by the Labour government. Although there has been a lot of beating around the bush on what remains the Prime Minister’s prerogative, a snap election right before Christmas would come to no one’s surprise.

This week both Prime Minister Robert Abela and the Deputy Prime Minister Chris Fearne were evasive over widespread speculation that a pre-Christmas election could be in the offing.

Speculation on a November election was rekindled following news that a papal visit scheduled for the end of November had been postponed, ostensibly due to the COVID-19 pandemic restrictions.

Debate on whether a November election was even possible is down to the fact that Maltese election campaigns tend to generate uncertainty within business circles, leading to a suspension of major purchases.

The director of Malta’s Chamber of SMEs, Abigail Mamo, agreed that the uncertainty surrounding a possible election during the pre-Christmas retail bonanza, is keeping businesses in limbo and unable to take certain decisions. “Ideally we should have clarity on whether the election will be carried out this year or not. Our preference is that an election is held next year,” said Mamo.

She said that many businesses had already spoken to the Chamber, having hoped for a strong festive season following a long and difficult pandemic period.

“November is a crucial period for businesses due to the Black Friday week, but unfortunately news of an election does disrupt the activity and takes the focus away from people. Election propaganda alienates people and ends up affecting consumption.

“Ideally, the election would not be held this year. We don’t foresee an imminent date. Economically, it makes more sense to be held in the first quarter of 2022.”

Mamo said the first quarter of a year following the Christmas season tends to be a quiet period for businesses. “We have been hearing about various election dates for so long and it is crucial for us to have a clear answer,” she said.

Her call for clarity is echoed by Chamber of Commerce president Marisa Xuereb, who said major businesses are aware that an election disrupts economic activity. But Xuereb remains sceptical of such an unorthodox election date: “No government ever dreams of having an election in December,” she said.

Xuereb said businesses plan a whole week of sales in November during the Black Friday week and that uncertainty over a general election during this period would not be in their best interest. “I expect clarity from politicians about such matters. Businesses having being dealing with and suffering the effects of various crises in recent years, including political turmoil, the pandemic and now the uncertainty of the election... We expect clarity, and that an election does not keep on looming over our heads. This is unfair on enterprises.”

The Malta Employers Association director Joseph Farrugia also said that business slows down over uncertainty on a forthcoming election. “It is always a prerogative of the Prime Minister to call an election but ideally it is carried out in a slow period for business. The closer it is to Christmas, the more damaging it could be”.

He said he hoped any election should be called as early as possible, or else after January.

The owner of a string of entertainment outlets, who spoke to MaltaToday on condition of anonymity, described an election close to December as “problematic”.

“January would be the ideal period. If it is held close to Christmas it could definitely have a negative effect on business... trade is now currently peaking in Valletta and St Julian’s, and the winter period is favourable to the entertainment industry. So any election should be held after the holiday season.”