Credit crunch, Maltese style

One appreciates the move by the concerned minister to reassure the Maltese public that the global credit crunch is quite far from hitting the Maltese banking sector, and also in assuring bank deposits.

But one also has to bear in mind that, rightfully or not, the local banks do not give credit unless it is protected and/or guaranteed. This in itself created a strong financial system from the banking aspect. This seems to have resulted in an ever increasing credit exposure in business to business transactions, where monies due are taking way too long to be settled.

This is the main difference between our country and our western world's counterpart. The local credit crunch does not lie with the financial sector, but rather with the business institutions themselves. This is where our political gurus must dedicate their attention in order to evade our own credit crunch.