The government may be delivering on its promise to reduce energy tariffs, its most important undertaking in the 2013 general election, but just 19 months into office it is facing a patch of rough weather.

One year after the departure of Arriva, it has not yet solved the public transport problem. Air Malta is expected to make a loss of €16 million in the current financial year instead of breaking even. Its ‘flagship’ promise – the building of a gas-fired power station by a private consortium by March next year – is not going to be fulfilled on time and the completion date of the new Parliament building in Valletta has been delayed too.

Besides all this, industrial production is down, import and export figures are the worst in the European Union and the island is among the worst performers in intra-EU trade.

Counterbalancing these setbacks is the economy’s resilience. The number of people in employment is up and, just weeks before the presentation of the Budget for 2015, the Finance Minister has said the government will be able to reduce the deficit to 2.1 per cent of gross domestic product.

It will take time for the overall picture to become clearer. In any case, this is not expected to happen before the deal with China over its intention to take a financial stake in the energy corporation, Enemalta, is done and dusted. Of course, the deal with the Spanish company over the running of public transport is very important too because the government is pumping millions of euros into the service.

Credit rating agency Fitch did not mince words in its latest report on Malta when it drew attention to expenditure slippages in healthcare, social security, and transport. Yet, despite the fact that financial burdens appear to be piling up, the Finance Minister does not seem to be unduly worried; or, if he is, he is not showing it. The economy was doing well, with the growth rate last year well above that registered both in the European Union and the euro area.

In fact, according to the pre-Budget survey, Malta’s economic performance exceeded the projections made by credit rating agencies and other institutions. In the Budget for next year, the government plans to take further measures to reduce welfare dependency, certainly not a bad idea. It is also planning to further expand its shift from direct to indirect taxation, a move that has both advantages and disadvantages.

Since it is not touching value added tax, it would be prudent to first see what shape new indirect taxes will take before commenting further on this. According to the minister, the shift to indirect taxation is the secret to job creation in Malta. He would need to back up this argument with facts and figures.

As to the deficit in the government’s finances, the minister is pinning his hopes on the conclusion of the deal with China. Through this deal, Enemalta would be in a position to pay part of the huge sum it owes to the government in excise duty, which it has not passed over. But the deal has to be concluded first and the minister made it clear it is crucial that this is done by the end of this year.

However, in light of recent experience, the government would be well advised to desist from using the expression “on track” when speaking of progress being made in projects in which it is directly involved or in which it has an interest.