Prime Minister Lawrence Gonzi and Finance Minister Tonio Fenech this afternoon warned at a GRTU conference against knee-jerk reactions over fears from the current international financial and economic crises.

Dr Gonzi said Malta had built a solid base and was well equipped to overcome the challenges ahead, but it had to act prudently and maturely and it could not allow fear to rule decision-making.

Earlier, Mr Fenech, borrowing a Churchillian phrase, said the only thing to fear was fear itself. He said that Malta had emerged form the financial crisis relatively unscathed but it was on its guard from the impact of the economic crisis, which was affecting Malta's main tourism and export markets. It was for that reason that the government had announced a range of measures and schemes in the budget and was also launching new infrastructural projects.

Dr Gonzi said the country should not be scared of the challenges ahead, but should also not fear bringing in the changes that were necessary for future growth. That, he said, included the change of mentality needed with regard to the energy tariffs , where the accent was on stopping the subsidisation of waste.

He stressed that the new formula of utility prices was such that prices would be revised. Prior to the next revision, however, one had to be see what the impact of the planned deep OPEC oil output cut would mean.

He said the economy was looking resilient, but growth was expected to slow as other countries fell into recession. In line with what was happening in other EU countries, the Maltese government had also announced new infrastructural projects.

The government was also continuing to invest heavily in education and in energy security, two elements which potential Czech investors had spoken to him about during his official visit to Prague last week. Indeed, more discussion was needed on how tertiary education could be refined to ensure that Malta had the required number of graduates for the economic sectors which most needed them.