Around six years ago, Malta was striving hard to make its next step in its political history, that of joining the eurozone and adopt a currency that was to be an anchor of stability and that was to prove essential in turbulent economic and financial times in guaranteeing stability that attracted investment and jobs.
Joining the euro was no easy task because strict economic and financial criteria had to be met. The Government was not, however, alone in this endeavour and was supported by the majority of the population and of businesses and civil society organizations that considered this opportunity to further cement Malta’s role in Europe as crucial for our future economic and social development.
Against this backdrop, one voice expressed doubts, not on whether the euro would have been a good thing or not but whether Malta was able to achieve the targets set out by the European Union. This person was Edward Scicluna.
When asked, only a few months before the final verdict on Malta’s accession, whether he believed we would make it or not, he replied that “the examiner would say that, overall, there are too many risks and uncertainties, suggesting to us to give it another year”. The rest is history and Malta went on to join the euro on January 1, 2008.
Fast forward six years and Scicluna, now a Labour candidate following Joseph Muscat’s request and one of his frontmen on economic and financial affairs, tackled the country’s economic performance and expressed his belief that Malta would remain in negative territory for more than two consecutive quarters. Barely 48 hours went by that Scicluna was proved wrong again.
National Statistics Office figures showed not only a real growth rate approaching one per cent, at a time when the European economy contracted, but key economic sectors contributed in no small way to this result. Indeed, a closer look at the numbers churned out by the statistics office show that different sectors, including financial services, ICT, retail and wholesale, tourism and other professional activities, have all remarkably grown, as did exports and investment.
What is more important to our families is that economic growth is being translated into more and better jobs.
Unfortunately, these are not the only two occasions were Scicluna – touted as Muscat’s preferred choice for Finance Minister – has expressed his economic thoughts. He views investment in our future – through the stipend system – as unsustainable, a remark he also made with regard to our free health sector. More recently, he suggested we should recall Mintoffian economics as a way to manage our economy.
All this is truly worrisome because it reflects Labour’s traditional approach towards the economy: the state as the focal point of economic activity and job creation. This is what truly distinguishes the Nationalist Party’s economic way of thinking from Labour’s. This has been the strategy that has transformed Malta into a vibrant, modern economy that has generated thousands of new jobs in the private sector.
Our economic policy is based on the value of investing in our people by giving them the necessary skills to match the jobs that are being generated as a result of investment in infrastructure, in incentives that attract new emerging economic sectors and investors towards our shores.
Today, we tend to take for granted the over 6,400 jobs that exist in ICT, which would not have been possible had we, years ago, not made significant a infrastructural investment, extended financial assistance through different grants and implemented tax credits and other support measures and secured the level of education and training provided within this area.
Another sector where investment in our country and in our people yielded benefits is the aviation sector. Hundreds of graduates of the Malta College of Arts, Science and Technology are each year finding better opportunities at one of the aviation companies clustering themselves in Malta in the newly-inaugurated Aviation Park, which is also a result of our economic vision.
This is also the nature of our approach towards the local business owner. We have invested in a number of tools that have given space to small- and medium-sized businesses to expand and grow. It is positive to note that over €50 million in funds available for loans at advantageous rates, through the Micro-Credit scheme known as Jeremie, have been practically exhausted within less than a couple of years since its inception.
This is but one of the many tools we have established during this legislature, crowned with a one-stop shop, Business First, that has welcomed over 7,200 contacts in under a year since it started operations.
As minister responsible for the economy, these numbers are the best certificate of confidence our economic management strategy could receive.
In a few months, we will be called for an important electoral choice. Political parties may differ on their way of interpreting economic figures but there is a fundamental difference in our approach to economic management.
Labour views the state as the centre of economic activity and while, so far, it was on the receiving end for failing to repudiate the failed economic planning tools of the 1980s, Muscat and Scicluna have recently resorted to actually glorify such approach or, better, was termed Mintoffian economics.
We believe in freedom of enterprise, where the private sector takes centre stage, with the Government acting as enabler and facilitator to growth. This is why our commitment is to continue to focus our resources and energy to keep sustaining the necessary momentum in terms of an environment conducive to creating the better opportunities that we all have a right to continue aspiring to.
Tonio Fenech is Minister of Finance, the Economy and Investment