Liberalisation is a long word. Its full meaning and large impact are also long in coming about. Whether there will ever be full liberalisation in operation is doubtful. That is not surprising. The European Union, initially an economic union built on free trade, restricted the meaning of the term to intra-union trade exchanges. Liberalisation did not extend to the outside world, where suppliers had to jump trade barriers to enter the EU, particularly so with regard to agricultural products.
The American and European apostles of free trade have always tended to pay little more than lip service when it came to opening their markets to the outside world. American protectionism with regard to steel and related products and EU protectionism to cosset the agricultural sector already referred to are notorious examples of double-speak.
The US has recently given a fresh example of where it really stands on the issue during the now almost defunct discussions under the World Trade Organisation umbrella.
Trade history is replete with examples of the rich industrialised nations interpreting liberalisation and free trade to mean that much poorer countries had to open up their markets.
In Malta, too, the term liberalisation has a mixed history and a persisting unclear or contradictory meaning. Consumers rose up in arms against the protectionism practised by the Labour governments of the 1970s and 1980s. Rightly or wrongly the powers that be felt at the time that they could create jobs by protecting the local industrial sector against competition from import substitutes.
That protectionist argument was flawed in a reality sense, more so than in principle.
The domestic market was and remains far too small to allow application of what was referred to as the infant industry situation. That held that if young industries were protected in their early stages, they could be nurtured into strong entities, eventually becoming able to compete with imports.
Aside from operational flaws in the argument itself, the case required a sizeable market which infant industries could exploit, albeit at the cost of the domestic consumer. The obvious trade-off was between jobs and price plus quality.
If, in the 1970s and 1980s, consumers were against protectionism, bulk buying and such like, not a few elements within the industrial and commercial communities did quite well out of the unpopular system. Just how well is still emerging now, through the complaints of business people who are singed or worse by the heat of the freedom of importation. That was the primary and most political meaning of liberalisation - lifting restrictions on, and controls of, imports. Even as that heated discussion was raging, few paid much attention that there was a lot of embedded restriction to trade regarding which few objected and fewer still raised outcries of the like raised against tariff and physical barriers (through licensing) to imports.
The case of hearse owners is a prime example. Restrictions on the numbers of taxis, buses and horse-drawn cabs are other long-standing examples in the same category. When the government woke up to the need to tackle those protected sectors, largely under the sharp prod of European Union regulations, hell began to break loose because of resentment at the belated challenge to long-established positions.
It may well be that the process has only just started. EU trade rules are clear and relentless. So are rules regarding the type and extent of subsidies which governments can or cannot give. So far that particular debate has reached the Drydocks, and little else. The government says it cannot subsidise the shipyards beyond the end of this year. An MEP suggested that it could try, though it was not very likely to succeed.
Little is said about other sectors which receive subsidies from the government with little fuss or ado - in fact, with the silence of the grave - when compared to what is said about the Drydocks.
Buses are one major area. Thousands - nay, millions - of old-fashioned liri have been poured into the transport sector to subsidise a partial changeover to low and modern buses over the last 13 years or so. Now, we are told, there has to be an exercise to transform public transport into an energy-efficient, relatively emission-free sector. Don't ask where the money is coming from, for you'd get a stupid answer to a stupid question. The EU will chip in, but tax revenues will pour out as well.
Liberalisation, then, has not been a long and effective exercise. Moreover, the authorities have yet to show that it is working in the area where it can best be measured - prices. Malta continues to run a level of already high prices that is rising faster than in the rest of the EU. Trade liberalisation has had a distinct effect on the price of household durables, but, apparently, not on much else.
Before spouting further about how much this road has been travelled in our small islands, the authorities might do worse than carry out an exercise to show the real effects of whatever liberalisation has been implemented.
The concept is good and consumers are all for it. But they need convincing proof that it is working in their favour.
The American and European apostles of free trade have always tended to pay little more than lip service when it came to opening their markets to the outside world. American protectionism with regard to steel and related products and EU protectionism to cosset the agricultural sector already referred to are notorious examples of double-speak.
The US has recently given a fresh example of where it really stands on the issue during the now almost defunct discussions under the World Trade Organisation umbrella.
Trade history is replete with examples of the rich industrialised nations interpreting liberalisation and free trade to mean that much poorer countries had to open up their markets.
In Malta, too, the term liberalisation has a mixed history and a persisting unclear or contradictory meaning. Consumers rose up in arms against the protectionism practised by the Labour governments of the 1970s and 1980s. Rightly or wrongly the powers that be felt at the time that they could create jobs by protecting the local industrial sector against competition from import substitutes.
That protectionist argument was flawed in a reality sense, more so than in principle.
The domestic market was and remains far too small to allow application of what was referred to as the infant industry situation. That held that if young industries were protected in their early stages, they could be nurtured into strong entities, eventually becoming able to compete with imports.
Aside from operational flaws in the argument itself, the case required a sizeable market which infant industries could exploit, albeit at the cost of the domestic consumer. The obvious trade-off was between jobs and price plus quality.
If, in the 1970s and 1980s, consumers were against protectionism, bulk buying and such like, not a few elements within the industrial and commercial communities did quite well out of the unpopular system. Just how well is still emerging now, through the complaints of business people who are singed or worse by the heat of the freedom of importation. That was the primary and most political meaning of liberalisation - lifting restrictions on, and controls of, imports. Even as that heated discussion was raging, few paid much attention that there was a lot of embedded restriction to trade regarding which few objected and fewer still raised outcries of the like raised against tariff and physical barriers (through licensing) to imports.
The case of hearse owners is a prime example. Restrictions on the numbers of taxis, buses and horse-drawn cabs are other long-standing examples in the same category. When the government woke up to the need to tackle those protected sectors, largely under the sharp prod of European Union regulations, hell began to break loose because of resentment at the belated challenge to long-established positions.
It may well be that the process has only just started. EU trade rules are clear and relentless. So are rules regarding the type and extent of subsidies which governments can or cannot give. So far that particular debate has reached the Drydocks, and little else. The government says it cannot subsidise the shipyards beyond the end of this year. An MEP suggested that it could try, though it was not very likely to succeed.
Little is said about other sectors which receive subsidies from the government with little fuss or ado - in fact, with the silence of the grave - when compared to what is said about the Drydocks.
Buses are one major area. Thousands - nay, millions - of old-fashioned liri have been poured into the transport sector to subsidise a partial changeover to low and modern buses over the last 13 years or so. Now, we are told, there has to be an exercise to transform public transport into an energy-efficient, relatively emission-free sector. Don't ask where the money is coming from, for you'd get a stupid answer to a stupid question. The EU will chip in, but tax revenues will pour out as well.
Liberalisation, then, has not been a long and effective exercise. Moreover, the authorities have yet to show that it is working in the area where it can best be measured - prices. Malta continues to run a level of already high prices that is rising faster than in the rest of the EU. Trade liberalisation has had a distinct effect on the price of household durables, but, apparently, not on much else.
Before spouting further about how much this road has been travelled in our small islands, the authorities might do worse than carry out an exercise to show the real effects of whatever liberalisation has been implemented.
The concept is good and consumers are all for it. But they need convincing proof that it is working in their favour.