The General Workers' Union was having talks with a German company interested in expanding its operations in Malta and generating a further 250 jobs, union general secretary Tony Zarb announced yesterday.

Although he would not divulge the name of the company, Mr Zarb told The Times it was a manufacturing firm and discussions had been ongoing for the past weeks.

Addressing a conference on recession, Mr Zarb appealed to the government to ensure potential investors did not find closed doors when they tried to set up shop in Malta. Excessive bureaucracy did hinder their plans. He criticised the government for having introduced higher water and electricity bills in the middle of an international recession.

But Finance Minister Tonio Fenech argued that if the government continued to subsidise water and electricity, Malta would have seen its deficit spike and, like Greece, would have been forced to introduce austerity measures.

He said the financial problems Greece encountered had thrown the spotlight on countries in a similar situation, like Portugal and Italy, adding that the EU had no alternative but to help Greece get back in line. He emphasised the need for the EU to strengthen the institutional hold on other countries to avoid "a second Greece".

Mr Fenech said not helping out Greece was never an option because it would have had a negative effect on the whole European economy, causing ripple effects as had happened with the collapse of Lehman Brothers in 2008, which had kicked off the international financial crisis. However, it might have been better for the EU to send Greece to the International Monetary Fund when its fiscal problems started, he said.

Mr Fenech said it was extremely difficult to say whether the worst was over in the financial crisis. "The international crisis is still not over," he said.

Mr Fenech said it was imperative for Malta to have diverse strengths rather than focus on one particular sector, like finance, and he mentioned the government's vision for 2015. This aims to strengthen the island's financial services, information and communication technology, tourism, manufacturing, health and education sectors and also turn Gozo into an ecological island.

Opposition finance spokesman Charles Mangion said the Greece situation had emphasised the need to review the stability pact reached in 2002, when the first group of countries adopted the euro and established the criteria for bailouts.

Dr Mangion pointed out that whatever happened internationally would always have an impact on Malta while the island's impact on the global scenario was minimal.

He stressed the importance of remaining competitive and understanding was led to the island's failure to attract enough investment. He said local investors frequently complained they were not treated as well as their foreign counterparts and called on the government to rectify this situation.

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