I fear we might be misinterpreting the true meaning of hedging with the result that we are possibly unnecessarily politicising the national fuel policy.

A hedge, when practised by competent and honest professionals, is nothing more than a financial tool intended primarily to offset or minimise potential losses when making long-term commitments.

In simple language, a hedge locks into a fixed price for a given period irrespective of the daily price (sometimes referred to as the spot price) of that commodity on the international markets.

As always, you win some and you lose some but hedging is useful to stabilise prices over the medium term. I don’t think one can state a priori that hedging is a bad thing.

I have, in my business career, often used forward contracts (another form of hedging) to secure a fixed rate of exchange, ensuring the cost of a product/service will not increase due to currency fluctuations.

Of course, if the spot price drops below the rate at which you have hedged, you are technically a ‘loser’.

It all boils down to whether one wishes to take a prudent stance and pre-empt potential losses due to an unexpected hike in international fuel prices or whether one wishes to ‘play the market’ hoping the price will fall over the given period.

We are here talking about tens of millions of euros, so I think it wise to adopt the prudent approach and hedge rather than ‘gamble’ on the market.

The controversy over the City Gate project continues unabated. I was a critic of the Renzo Piano project primarily on the basis of cost and location.

I maintained that Parliament could have been sited elsewhere in Valletta and the area (Free-dom Square) should have been turned into a beautiful square (like Pjazza San Ġorġ) and overlying a massive under-ground carpark that would have virtually freed the city from most vehicular traffic.

I am, however, pragmatic enough to accept that once the project has been completed, nothing should be done to detract from the buildings’ architectural design.

Often, civil projects lack that little finishing touch that can make all the difference

I don’t think one need to be an aesthetic genius to agree that placing a permanent flea market within a few metres of the capital city’s entrance and the Parliament building should never have been on the cards, although it now appears that both big political parties promised to do this prior to the last election. Valletta and Malta deserve better.

I need hardly comment on the stall ‘design’, other than to say that we must come up with something infinitely more attractive that that proposed.

In times like these, I have always advocated hopping on a plane and having a look at what other countries are doing with their markets.

It seems that we continue to suffer from a false sense of inferiority lest we are accused of ‘copying’ someone else’s ideas.

Often, civil projects lack that little finishing touch that can make all the difference but finishing off the City Gate project by placing the monti in the middle of it will surely take the cake.

I respectfully appeal to the Prime Minister to intervene in this matter and find an alternative site for monti hawkers.

Finally, a word on Air Malta and its ‘flying baguettes’. I have used the airline twice since the introduction of a baguette (or rather a roll served with a small bottle of mineral water and no glass) as the standard meal and, on each occasion, I heard several negative comments from tourists and locals alike.

To me, this has done more harm than good to the airline’s name and reputation. Surely this cannot be the way to save the airline in the long term.

Air Malta might have been thrown a lifeline by the falling fuel prices but even this is not the long-term solution so sorely needed. What happens when fuel prices rise again?

A long-term solution/strategy needs to be found.

Let me quote some figures to bring the true scale of the problem into perspective.

Ryanair has become Europe’s largest airline and has a workforce of about 9,000 people to operate a fleet of 300 aircraft: an efficiency (cost) level of 30 employees per aircraft.

Air Malta, on the other hand, has 10 aircraft and close to 1,000 employees, that is, in the region of 100 workers per aircraft.

Air Malta thus employs three times as many employees torun each of its aircraft as Ryanair does. Need I say more?

Unless Air Malta can drastically improve its ratio of employees per aircraft (not necessarily to match Ryanair), its chances of survival are slim at best.

This, unfortunately, is the bottom line.

Alternative employment will, of course, need to be foundfor those affected by a drastic downsizing.

It is obviously going to be a difficult and painful decision to make but, when all is said and done, it might be better to secure the future of 500 or 600 employees at Air Malta rather than being forced by the EU to close the airline down in a couple of years’ time with the loss of 1,000 jobs.