The Christian Democrat and Social Democratic parties of Germany on Friday published a 27-page memorandum of agreement on policies that will be driven by the coalition to be set up in the next months.

Agreement among these major parties on policies has been a very long and painstaking process. They still have to negotiate Cabinet posts and many other details before the new coalition government will be formally launched, and much can still go wrong in these negotiations.

They are not yet there.

I, together with most commentators, am very confident that the major hurdles have been overcome and it is only a matter of time until Angela Merkel is confirmed as chancellor for her last stint. In this role, she will concentrate on relaun-ching Europe.

Some may recall that in early December of last year, I published an opinion piece on how much was at stake for Europe and, indirectly, for Malta, in this coalition-building process in Germany.

I prophesied that Martin Schulz, the former president of the European Parliament and leader of the SPD Party in Germany, would understand how important it was for Europe that a strong German government with a forward-looking European integration and unification policy be formed. He swallowed his pride and accepted forming such a strong coalition with Merkel.

For those who read German, here is the link to the original text of the document published last Friday: http://app.handelsblatt.com/downloads/20841270/2/gesamtdokument_sondierung.pdf.

For those of us weak in German, I would only like to indicate one prominent item in the agreement, namely ‘Europa’, the first and most important policy for this new government.

Of course, the agreement between the parties also deals with purely local issues like pensions, healthcare, immigration, housing, transport and the environment.

However, its main thrust and the main reason that the SPD has agreed to join the coalition, in spite of the fact that it has lost them votes in the past, is the belief that a strong and unified Europe is the only way forward for peace, stability, growth and security for all countries whether small, like ours, or big, like Germany.

There are many lessons in this document for us in Malta.

Malta should read the part of the programme dealing with the future of Europe very carefully

The first item, covering two pages and five paragraphs, deals with the future of Europe. Malta should read this part of the programme very carefully, especially since it sounds the death knell for money laundering, tax competition and tax evasion programmes in the EU.

Under the heading ‘We want a Europe of opportunities and justice’, paragraph IV demands a Europe of social justice, with job and wage fairness and equality and an end to wage-dumping practices.

The main item that interests Malta, Ireland, Luxembourg and The Netherlands is, however, the section that states: “We will fight tax dumping, tax evasion, other tax avoidance methods and money laundering, both internationally and within the EU. We support a just taxation of larger multinationals, including the internet companies like Google, Apple, Facebook and Amazon.

“Companies cannot be allowed to continue to avoid their social responsibility by playing the different systems in the Member States against each other. Tax dumping must be forbidden.

“We support a common and consolidated taxable basis and a minimum corporation tax rate. Moreover, the basic principle for taxation should be that the country where the profits are generated should be the country where these are taxed.

“We want to engage with France to launch an initiative in this sense and to ensure that we provide a European answer to the international challenges in this area, not least towards the USA.

“Finally, we also want to enact a substantial tax on financial transactions.”

Furthermore, they express the intention, echoing the vision expressed last year by French President Emmanuel Macron, to relaunch the Élysée Treaty between France and Germany to work together to create the new EU, starting with the eurozone’s complete integration.

We must remember that Schulz also launched the vision of a United States of Europe by 2025 with the proviso that any country not willing to sign up would have to leave the European Union.

I hope that our politicians and the new chairman of the Malta Financial Services Authority will read this programme carefully and commence to realign our offerings to the international community rather than continuing to play the ostrich by burying our head in the sand and sticking our middle finger in the air.

John Vassallo is a former ambassador of Malta to the European Union.