Prime Minister Joseph Muscat said this evening that the Memorandum of Understanding signed with China last week put Malta ahead of other countries in seeking closer economic relations with China.

He said the MoU covered all sectors of economic growth. It also gave Malta the opportunity to consider various forms of the permanent link which could exist between Malta and Gozo and the breakwater between Valletta and Marsamxett.

Opposition Deputy Leader Mario de Marco said such developments were welcome, more so as Eurostat figures issued today showed a 12 per cent drop in industrial production in May.

He said relations between Malta and China went back many years and the MoU in fact referred to a trade and cooperation agreement of 1997 and an agreement on scientific cooperation in 2003. A double taxation avoidance agreement was also signed a few years ago.

The MoU, he said, spoke in generic terms on cooperation in several sectors but government statements later mentioned the Marsamxett breakwater, the Gozo bridge and a direct air service between Malta and Gozo. He asked how concrete these projects were, once they were not mentioned in the MoU.

He also asked what progress had been made in the sale of an Enemalta stake to Shanghai Electric and for how much.

Tonio Fenech (PN) also stressed that this was not the first MoU and the Chinese prime minister had come to Malta in 2009 to sign a number of agreements. He asked, therefore, where the added value of the new MoU was in terms of tangible results.

The MoU, he said, referred to agreements reached by other governments and promised best efforts to fully implement them. He also asked whether infrastructural projects would be handled by Chinese companies, at the expense of Maltese contractors.

George Pullicino (PN) reiterated calls for the prime minister to publish Sai Mizzi's contract. He also asked Dr Muscat whether he had raised concerns about human rights in China.

Kirsty Debono (PN) asked, among other things, whether the government had discussed Chinese shareholding in a Maltese financial institution.

Carm Mifsud Bonnici (PN) asked whether talks had been held on wind farms and land reclamation.

Beppe Fenech Adami (PN) said the MoU looked like an exercise of cut and past of previous agreements. He asked the government to explain references to monorail and housing construction.

Opposition leader Simon Busuttil said the Opposition welcomed all inward investment, including that from China. But what was ground-breaking in the new MoU? What were the tangible results?

During the Chinese Vice President's visit in 2009, six agreements were signed in a day, covering cooperation on judicial affairs, international crime, culture, promotion of investment, grants and the setting up of a Confucius Institute.

Furthermore, was this a commercial agreement? Had the EU been consulted about it? Was the EU consulted about the planned air services agreement? Had a decision been actually been taken on the Gozo bridge?

As it were, Dr Busuttil said, the MoU was a wish list.

Replying, Energy Minister Konrad Mizzi said the agreement with Shanghai Electric Power had already yielded €320 million and would yield more millions this year, while bringing a turnaround for Enemalta.

Following the agreement, Enemalta would become a plc and its workers would be grouped in Engineering Resources Ltd and deployed according to requirements. Their jobs and conditions would be unchanged and no one would be required to work abroad against his will. The Petroleum Division would be hived off and become an independent entity.

As for the Enemalta share transfer, a Chinese delegation was in Malta to discuss valuation and governance and the process for the transfer of assets was well under way. The process would be completed in the autumn. Studies were also well in hand to transform the BWSC plant to gas as soon as the gas facilities were completed.

Dr Muscat said the foreign minister had not accompanied him because of a meeting of ambassadors in Malta. Dr Debattista had accompanied him because this was not just a government of ministers.

Dr Muscat said the government had been assured by the Chinese government that the MoU was the first of its kind between China and other countries.

On the reference in the MoU to a monorail system, Dr Muscat said it was worth remembering that the former government even allocated Budget funds for a tramway. As for social housing, was the Opposition doubting the need for investment in this area?

The MoU was far from being a collection of former agreements, but in any case, the difference was that in the past the agreements were not realised, whereas under the present government, results were already being achieved, such as the investment which saved Enemalta.

Dr Muscat said that with regard to human rights, the discussion was open in the same manner as under the former government. If it was concerned about human rights, how had the former government reached a cooperation agreement with China on judicial matters? Were such concerns raised with the Emirates ahead of the agreement with SmartCity?

Dr Muscat said Dr Busuttil showed a servile attitude when he expected that Malta should have sought EU permission before discussing investment with China.

Dr Busuttil said the EU had competence on commercial matters and this was not about being servile.

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