Euro will raise prices - Sant

The introduction of the euro will cause confusion and inflated prices to the detriment of the consumer, Labour Party leader Alfred Sant reiterated yesterday.

Speaking during a political activity at Ta' Qali in connection with May Day, Dr Sant attacked the government's roadmap leading to the introduction of the single European currency.

He asked why the government had opted to introduce the dual pricing system in January 2007 - a year before the planned introduction of the euro - when most other EU states were doing so just six months prior to adopting the single currency.

While the Labour Party agreed with the introduction of the euro, it was objecting to the timing, because it believed the economy was not in a position to take the impact.

Dr Sant gave three examples to show that retailers were already quoting different rates. In all three cases, the consumer will end up forking out more money when the euro is introduced, he said. By way of example, he displayed a receipt for the purchase of electronic equipment marked at Lm61.67, whose price was dually displayed at €150.42.

But, Dr Sant said, once the official rate comes into play, the consumer would be paying Lm64.57 for the same item, an increase of 4.7 per cent.

The Labour leader once again questioned the costs which could be incurred by the Central Bank because of excess liquidity. Last week the bank denied claims that Malta would have to pay a Lm10 million annual fine when the euro is introduced.

Dr Sant said the government was in such a quandary that it was now even considering the introduction of price orders, when in the 1970s it dismissed such a move as nonsense. Turning to tourism, Dr Sant accused the government of "paralysis" where low cost airlines were concerned.

He laid the blame on the government's decision to privatise Malta International Airport, which effectively meant that airline tariffs were not reduced. MIA's shareholders had no intention of reducing the tariffs since they were reaping a good profit.

Dr Sant said that the privatisation process was taking place with no strategic planning. Once Bank of Valletta was sold off, the government would have no tool to steer economic growth and would end up in a worse state of paralysis.

While appealing to supporters to attend the Labour Party's demonstration in Valletta this afternoon, Dr Sant said his party wanted to give a clear signal today that it was representing people's aspirations.