Discipline and flexibility provided the mantra of Malta’s economic success, Prime Minister Joseph Muscat told German fellow social democrats as he spurned both fiscal rigidity and laxity.
Dr Muscat was the keynote speaker at the left-leaning foundation Friedrich-Ebert-Stiftung in Berlin during a lecture on the future of social democrat parties in Europe.
Taking with him the same message he delivered at a meeting with German Chancellor Angela Merkel, Dr Muscat insisted that there was no contradiction between fiscal discipline and policies that promoted growth and employment.
“It is admittedly not easy to reconcile the two objectives; it is certainly difficult but it can be done. We are attempting to do it and not without success,” he told his audience as he gave a positive overview of Malta’s key economic and social indicators.
Dr Muscat said social democrats across Europe had to be more open to business.
There was a tendency of running Europe like a school with insistence on obeying rules without placing importance on the outcome, he added.
“Europe has to be run like a business... Getting things done and seeing rules as a means to an end rather than an end in themselves should be the way forward,” he said, insisting economic growth was important to generate jobs and wealth that could be redistributed.
Asked about the victory of the populist far-left Syriza party in Greece, Dr Muscat said election results were grounded in the realities voters faced on a daily basis.
“We have to understand why voters opted for an extreme idea but it would be a mistake to say Greek voters are extreme. Their leaders may be extreme but they are not.”
He called for a more flexible approach towards Greece’s obligations but insisted debt forgiveness was not an option.
“For moderate social democrats it would be a big mistake to accept debt forgiveness or the abandonment of reforms because it would send out the message to voters elsewhere that moderate mainstream parties could not deliver but irrational extremists produced results,” he said to applause.