Fenech invites submissions on competitiveness, says surcharge rise inevitable
Finance Minister Tonio Fenech this afternoon invited the member organisations of the Malta Council for Economic and Social Development (MCESD) to submit proposals on how they feel Malta can retain competitiveness and how the cost of living could be reined in, despite an environment of rising international oil and food prices.
Mr Fenech delivered a presentation to the council where he said that the oil price had risen by almost 90 percent in a year, and it was inevitable that the power surcharge in Malta would have to rise after June. He said some oil purchase contracts for next year had already been made, at a rate which was 40 percent below the current oil price, but he could not, at this stage how much the surcharge increase would be.
Referring to the cost of living, Mr Fenech recalled that when presenting the budget late last year, the government had anticipated the problems which the world economy was facing and had therefore reduced taxes and awarded a wage increase which was higher than the formula of the cost of living adjustment. That forward adjustment appeared to have achieved its purpose and there was therefore no panic on the impact of higher inflation on Maltese households.
Vince Farrugia, who represented the GRTU at the meeting, said the association was calling for the price of diesel to be reined in because it had an inflationary impact across the economy,
GWU general secretary Tonio Zarb said the impact of any increase on the surcharge needed to be discussed.
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laurence schembri
May 23rd 2008, 21:15
@ Karl Abela
Sorry but you still don`t see my point. Simple economics? Does this mean that because Maltese like to dine out the restaurarteur take people for a ride and charge whatever figures come up in his head?. I guarantee that in summer months restaurants in Malta rake in more than 300% per head in profits. Last summer in a good country restaurant the fare was Lm8.50 per head and that is exactly what I was charged for a `three egg omelette` that one of my guests chose to eat. If that is not blantant extortion, then we are not living in the same world. A bottle of good Maltese wine marked in the shops at Ln4.80 came to the princely sum of Ln13.50c, when I queried the price I was simply told by the owner `it`s corking price`, of course this restaurant is off my list ,like a multitude of others. It is simply cheating.
Karl Abela
May 23rd 2008, 20:26
Mr Schembri, this is simple economics. Demand = Supply. Just like in the hotel business. Lowest rates are in January and outrages rates are in July, August and September. Since you mention the restaurant business, it is a fact that most decent restaurants are 'bombarded' by Maltese because we love to dine and use any excuse to make it an occasion. Price doesn't even seem to be a factor because no matter what the price increase is it is still difficult to get a table without booking in advance. Any business man who fails to comprehend and capitalise on the demand & supply factor is not a business man at all. And this doesn't just apply to restaurants, but to anything. January, for example. is regarded as the slowest month in the economy and that is why we see price discounts all over the place.
laurence schembri
May 23rd 2008, 18:35
Is Tonio Fenech living in the same country as I am? His job must take him all over Europe.
Why is it that in most European countries food prices are at least 10% lower than they are in Malta. I am European and naturally I like anything European. The European continent is my hunting ground, I enjoy the food, wine, beer, their way of living, Museums (mostly art galleries), I marvel at beautiful buildings, being Italy, Germany, Poland and so on. I also compare prices so I am talking from experience. For example restaurants in Malta are at least 15-30% higher than in Germany and Poland, beilieve it or not even in Italy you can dine cheaper than in Malta and the quality of food is undisputable.
We keep harking on about world prices, so why is it that vegetables in Malta (home grown) are twice the price of that in Germany? The get rich quick factor is something that is purely Maltese and we can not get away from it. In the meantime the consumer will suffer.