Updated 2.12pm - Added PN statement
Regressing transparency was worrying businesses, Chamber of Commerce President Anton Borg told Prime Minister Joseph Muscat this morning.
In a meeting between chamber members and Dr Muscat, Mr Borg expressed concerns over the impact that diminishing transparency could have on Malta's ability to entice investment.
"Our business community is fearing that we are regressing on an important non-cost element of competitiveness. I refer to the country's reputation in terms of the transparency and the integrity of our institutions," he said.
Mr Borg told the prime minister the chamber was "duty-bound" to raise the issue as it had a bearing on local businesses' economic interests.
We express our utmost concern about issues of good governance
"The chamber cannot shy away from its responsibilities to express its utmost concern about the issues of good governance we are allowing to consistently persist," he said.
Clearly, Mr Borg added, Malta's international reputation had suffered, as could the island's future economic stability if the situation continued to deteriorate.
He referred to a recent attractiveness survey, which reported a 15 per cent drop over 2015 in the perception of Malta's political stability and regulatory transparency.
Malta, he warned, had also dropped 10 places to its lowest ever ranking in an international corruption index, issued by Transparency International.
The chamber president also heavily criticised the recent agreement on the transfer of land in St George’s Bay where the Institute of Tourism Studies is currently located.
He said that although the sale would provide a positive effect in terms of added investment, the actual mechanics of the deal were “cause for serious concern”.
“Indeed, the innovative model used in this agreement clearly departs from the normal procedure of selling public property,” he said.
The way the deal was carried out, without parliamentary resolution, could distort the market if it was adopted as a benchmark for future deals, he warned.
"We believe that agreements and procedures must be – and be seen to be – above board and transparent. People dealing in public land should act as if they were dealing with their own property,” Mr Borg said.
Investment is coming to Malta - Muscat
Replying, Dr Muscat attempted to quell the chamber's concerns, insisting businesses did not invest in corrupt countries. Investment, he said, had been attracted to the island, and was still being attracted.
Much of the chamber president's remaining speech provided a wish-list of condominium and social policies, especially concerns over the impact of a blanket increase in minimum wages. Dr Muscat assured those present the government would foot the cost of an increase this year with the social partners brought in to try and reach a consensus.
Dr Muscat stressed the government was committed to finding a positive deal for Air Malta, while on energy, he warned that messing with the current plan would see Malta's economy drop back to square one.
In his reply, the prime minister made no mention of the ITS deal.
'No constant scandals under my watch' - Busuttil
In a statement, the Nationalist Party said the Chamber's concerns were further confirmation that the country "cannot proceed in the direction it is heading under Joseph Muscat."
It noted that Malta had declined in Transparency International's corruption perception index and that an EY survey had found that investor confidence in local good governance and transparency had declined by 15 per cent.
PN leader Simon Busuttil promised a government under which "businesses would not be troubled with one scandal after the next."