Any deal over the Greek crisis at today’s emergency meeting of eurozone leaders must not jeopardise Malta’s economic success, the Prime Minister has said.
Joseph Muscat said that Malta, along with Germany, was the most exposed country to Greek debt.
“We want the best deal for Europe, Malta and Greece... The issue for us is how to ensure that what was achieved over the past two years is not undermined by what happens in Greece,” Dr Muscat said.
The Prime Minister will be attending the emergency summit in Brussels, billed as a last ditch attempt to reach an agreement with Greece.
Unless creditors release bailout funds, Greece risks defaulting on a €1.6 billion payment to the International Monetary Fund by June 30.
A default would set Greece on course to exit the euro and possibly the EU.
Greece presented a new proposal to solve the immediate crisis late last night. The chief-of-staff to European Commission President Jean-Claude Juncker called the proposal a "good basis for progress".
This morning, Dr Muscat said the new 'comprehensive reform package' presented by Greece was a positive development but the details had to be discussed further throughout the day.
"This is not ideal, but it would avert a problematic situation," he said.
He said Malta would insist that what it loaned Greece should be paid back, but, he said, there was a subtle line in that if Greece failed, there would not be no money to make repayments..
He said Malta does not agree with concessions that propose a haircut in loans, but extensions of repayment terms.
Dr Muscat said other proposals that were being made at EU level included floating interest rates for Greek debt tied to GDP growth.
No one would win if Greece left the eurozone, but even pledges made by the Greek government were unrealistic, he said.
Malta could not accept a situation where it lost its money because of another country's profligacy.
Malta’s exposure to Greece amounts to some €177 million and is a mixture of bilateral loans and guarantees to the European financial stability mechanism, which was set up after the crisis first broke in 2010.
As a ratio of GDP the exposure puts Malta on the top rung along with Germany. However, unlike other eurozone countries, Maltese banks have very little or no exposure to Greece and there is very little trade going on between the two countries.
On this week's second EU summit, on Thursday,Dr Muscat said he expects the conclusions to include some form of timeline on the renegotiation of the UK's EU accession package.
The migration issue has been overshadowed by the Greek crisis, he acknowledge.
The reduction in migrant arrivals in Malta was a result of greater cooperation with Italy, a country that understood our limitations. He described this as a political understanding between Malta and Italy.