Few would deny that the property development industry in Malta suffers from a poor image with the public and not just with environment NGOs. It was, therefore, no surprise that about 90 property developers came together to set up the Malta Developers Association. They appointed Michael Falzon, a former government minister, as their president.

The association has the prime objective of “promoting the interests of developers and liaise with the government, building regulators such as the Malta Environment and Planning Authority, the media and non-government organisations”. The timing for the formation of this association is indeed opportune. As Mr Falzon confirmed, “developers are facing difficult times”.

One can understand the frustration of those who feel that past excessive property development is one of the main reasons behind the deterioration of the environment. They argue the time has come to have more reasonable expectations on how much this industry should be allowed to grow so as to preserve the natural beauty of village cores and what is left of the countryside.

But, surely, the property development industry cannot be held solely responsible for all that has gone wrong with development planning. Leaving the industry to grind to a halt in the coming few years is not the ideal way forward. Property development can still be an important motor of economic growth.

The association is taking the right approach in lobbying the government to bring about more favourable fiscal and regulatory conditions to enable the industry to recover from its present slump. It also showed maturity when it made a clear statement in favour of the publication of donations to political parties to address the dangerous perception that there is some kind of unhealthy relationship between big business and politicians. The proposal to draw up a code of ethics to regulate the behaviour of members with clients is another positive objective of the association.

The more contentious aspects in the formation of this association relate to the expectations that developers may have about the support the industry can expect from the government. Over the last decade, the property development industry enjoyed good profitability, as reflected in the substantial rise in property prices. But economic bubbles are never sustainable and rarely desirable.

So, the way forward has to be one based on the property development industry continuing to contribute to economic growth without relying too much on significant incentives that are ultimately financed by taxpayers. The expansion of this industry has also to be based on a growing sensitivity to the risks being faced by the environment as a result of over-development.

The fact that there are an estimated 40,000 unoccupied properties highlights the importance of balancing demand for new property with the existing overhang of supply. The latest report by Standards and Poor’s has once again warned about the risk Malta will face “if there is a downward revision of property prices”.

It must be acknowledged that, like every other sector in the economy, property development has an important role to play in the generation of jobs and prosperity. But market forces must be allowed to work so that taxpayers are spared the pain of sustaining uneconomic practices.

If the leaders of the newly-formed association take on board such considerations and help to stimulate reforms within the planning authority and the financing of political parties in Malta, then property developers will merit the appreciation that may have been denied to them in the past.