The “conservative” leaders of the EU have failed to inspire confidence on the international markets and must take decisive action to address the unprecedented economic changes, Opposition leader Joseph Muscat said yesterday.

He pointed out that while the international press had reacted strongly to the fact that America’s credit rating fell from AAA to AA+, little was being said in Malta.

“This affects the whole world,” he said, pointing out that whereas usually the US told other countries what to do, the superpower was now having to receive advice from China.

“We need decisive action by the EU. Up until now, the conservative leaders have had one emergency summit after another but have not offered a direction or vision that has convinced the markets.”

He said the prime ministers who attend the meetings seemed to be the only people who were pleased by their efforts.

His party agreed that everything possible must be done to save the euro.

Dr Muscat also criticised Finance Minister Tonio Fenech for failing to read “the signs of the times”. Just last month Mr Fenech said he was not worried by the situation in Italy, which was now facing a looming crisis.

“Today the Prime Minister is saying the opposite (of what Mr Fenech said). But the situation in Italy did not develop over a month. Having our Finance Minister and our Prime Minister giving different versions does not send the message that the government knows what it is doing.”

Dr Muscat said that the country’s financial situation has been in the hands of Nationalist governments for almost 24 years.

“Whenever the government proposes an austerity measure and says that if we do not accept, our economy will fail, we need to ask: where were you in the past 24 years?”

He said the Labour Party was ready to provide a solid economic leadership without being populist but by ensuring that difficult decisions were taken with social justice in mind, rather than casting the burden on taxpayers.