Social partners sitting on the Malta Council for Economic and Social Development (MCESD) yesterday emerged from a meeting generally satisfied with the government's efforts to rein in inflation.
The subject remains a cause for concern with the risk of perceived inflation coming from the euro changeover which takes place in January and predictions of a two per cent rise by next year, coupled with an unpredictable oil market.
Just yesterday, prices for crude inched back up to over the US$90 range after a brief lull earlier this week following tough talk from the US on Iran, Opec's second largest oil producer.
Yet, most of the representatives who spoke to the press immediately after the meeting said they were satisfied with the detailed explanations they had been given regarding the government's price monitoring exercises. General Workers' Union general secretary Tony Zarb said the presentations showed there was cause for concern over the price of certain medicines but he added that recent hedging efforts by Enemalta in respect of crude oil had had positive effects.
The meeting was convened by the government precisely to give a detailed overview of inflationary trends in different sectors of interest.
During a marathon five-hour session at the Excelsior Hotel, the representatives of the large constituted bodies were given detailed presentations on key sectors affecting inflation, from the soaring international prices of crude oil, cereals and dairy products to specifically local price increases in certain medicines, poultry, fish and clothes, for instance.
Addressing a press conference shortly after the meeting, parliamentary secretary Tonio Fenech said inflationary trends were a cause for concern which, however, the government had anticipated in the budget.
At a projected rate of some 2.4 per cent by the end of next year, Malta's rate of inflation would still compare very well with that of any EU member state, yet jumping from 0.4 per cent this year would still mark a significant leap.
"I have to say that we are not surprised with the price increases. We anticipated... we never denied it, but we also made allowance for it in the budget through an extraordinary Lm1.50 cost of living increase and measures such as cutting the income tax and increasing children's allowance which will improve people's spending power in the face of inflation," he said.
Naturally, some inflationary trends are purely local. And some are flukes, such as uncharacteristically high prices for fish, which was the result of bad catches this summer, Mr Fenech said.
But others, such as a spike in the price of poultry products, were unexpected and warrant further investigation, he added.
In one of the presentations given, a fixed basket of products and services monitored by the government's price watch unit showed a 2.8 per cent increase from Lm283.79 to Lm291.42 over a seven month period this year.