Thursday, 9th October 2008

Utility bill changes could cost STMicro €7.3m a year

The government decision to remove the surcharge capping on utility bills could mean an additional shortfall of about €7.3 million - or $10 million - annually for STMicroelectronics.

The company already has annual shortfall of $58 million.

ST Malta hit the headlines in early summer as fears grew that the company, Malta's largest exporter, could close its plant due to rising costs and a tough euro-dollar exchange challenge.

Industry sources said the increased shortfall was especially worrying when one considers the prevailing international economic situation.

The plans to remove the capping are part of a proposed reform package for Enemalta unveiled by the government at the Malta Council for Economic and Social Development last Wednesday.

The measures have attracted strong criticism from the constituted bodies, with both employers and unions saying the new tariffs would shock the economy.

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Article © Allied Newspapers Ltd., printed on Saturday, November 21, 2009. This article is for personal use only, and should not be distributed.

Comments

Nigel Lawrence (on 9/10/08)

So this article is telling us that we subsidise ST for 10 million bucks a year! I don't believe it!

Joseph Ellis (on 9/10/08)

This story does not give the source of its affirmations. Can ST publish its audited accounts to see what this alleged shortfall of $ 58 million is all about ? I hope that this is not a question of transfer pricing of which multinationals are notorious.

In spite of its size, I fail to see why ST should be subsidized 7.3 million euro a year through capping. I understand that it already benefits from substantial states incentives but it should carry the W & E burden as everyone else. I think that it was wrong to introduce open-ended capping and it should have been introduced as a transitory measure on a reducing scale.