The debate in parliament on Malta's relations with the European Union and the membership negotiations concluded last December in effect did not shed much new light on the issue. The certainties that result from the membership negotiations and the implementation of what is referred to as the acquis communautaire are at this stage fairly known. The only certainty about the alternative idea to membership, being referred to as partnership, is that no one really knows what such a partnership would entail.
In fact, I do not dare call it an option because for an option to be effective there must be some certainties about its features. In this regard there are no certainties at all. Yet, it is seen to be a good idea by some because it does not place on us the obligations of membership and as such takes into account Malta's special circumstances (mind you, neither does it give us the benefits of membership no matter how special our circumstances may be).
There are references in documents published by the European Socialist Party and in the documents of the convention on the Future of Europe that mention the possibility of a partnership arrangement.
However, these references are made in relation to those North African countries that had expressed a wish to become members of the EU but cannot because they are not European. These countries wish to have an ever closer relationship with the EU and the EU accepts that in order to have peace and stability in the Mediterranean it requires to have such a close relationship.
Thus the partnership idea was born and the convention that is discussing the future of Europe accepted references to it because it is something it could offer as a second best alternative to membership. So the partnership idea is not meant for those that do not wish to become members of the EU but for those countries that want to become members of the EU but cannot do so.
The special circumstance that the partnership arrangement takes care of is the fact that the countries involved are not European, and therefore precluded from membership under the current EU treaties. Hence, the applicability for Malta is itself doubtful.
Moreover, if one were to ask anyone what this would entail for Malta, no one would really give you a definite answer.
The best example that we can get of the type of agreement we can strike with the EU if we were to opt out of membership is the agreements that the EU has with countries like Norway and the Switzerland. These do have a free trade agreement with EU guaranteeing them access to its market, but in return for this guaranteed access the EU has asked these countries for a contribution to its structural and cohesion funds.
In other words, they did not get guaranteed access for nothing; they had to pay for it. If Malta opts for membership then the guaranteed access to the EU market and with all countries that have a free trade agreement with the EU for our businesses is for free.
And this brings us to what is probably one of the key points of membership. One of the special circumstances that is cited by those that oppose EU membership is our high level of imports and exports of goods and services. These together make up nearly twice our gross domestic product at factor cost. EU membership is claimed not to be beneficial to a country that is so heavily reliant on international trade.
I believe the opposite is the case. For a country that needs foreign direct investment and to export most of what it produces to grow at a fast pace, tariff-free and guaranteed access to markets is critical. Hence, EU membership for Malta is critical.
One may argue that staying out of the EU could attract investors that are not keen to abide by EU rules of competition, health and safety, workers' rights, taxation, etc.
It is only fair to ask whether Malta wants to have such investment located here. Do the trade unions want government to attract such investment? Is it fair on the Maltese population to attract such investment?
It is also pertinent to point out those European countries with whom the EU has concluded a free trade agreement have had to apply the competition rules of the EU, meaning that the assistance given to businesses must comply with EU rules. This again indicates that Malta's special circumstances require the country to join the EU.
The same applies to tourism. EU membership has been judged to bring positive effects to the tourism sector by two investors in this country.
It has been reported in the media that the general manager of InterContinental Hotel Malta said that "European Union membership would be advantageous to the hotel business and tourism and to Malta".
Another key foreign investor in the travel industry in Malta claimed that EU membership would bring additional travellers to the country. Therefore, the claim that Malta's economy depends to a significant extent on the tourism industry and that this special circumstance means that Malta should stay out of the EU is not based on fact.
Another economic issue is the single currency. Malta's membership of the EU would eventually also mean the replacement of the Maltese lira by the euro. Such a change would save Maltese businesses huge sums of money in bank charges, but more importantly hoteliers, tour operators, exporters, importers, investors would not be exposed to currency exchange risk, thereby giving more stability to our economy. In effect our economy requires the country to join the EU.
Yet another aspect is the access to EU funded programmes of education, training and research, again for free. Malta is too small to be able to afford participation at a cost in educational exchange programmes, multi-country training programmes or international research programmes.
The funds required for such activities are simply too great that we do not have the critical mass to fund them ourselves. The ultimate benefits of all these programmes would eventually go into the economy, and so we have yet another case where our small size requires us to join the EU.
The opposite is also true. Because of our special circumstances we cannot afford to stay out of the EU. The EU presents us with a great number of certainties which any small economy would need, while the alternative idea provides us with no certainties at all.
The country and in particular the economy cannot take the risk of staying out of the EU.