As everyone starts settling back at work following the peak holiday period, the talk of the town becomes the country's agenda for the next 12 months. It is only natural for this to happen since in the coming 12 months, in addition to the local councils elections, we are likely to have a referendum on Malta's membership of the European Union and a general election.

These two are closely linked to each other as a Yes vote in the referendum (meaning Malta should join the EU) and a Labour victory in the general election is likely to throw the country into a state of disarray with no idea as to which direction it should be heading.

The EU issue is not just a political issue (in fact, it would be wrong to transform it into a purely political issue) but also an economic and a social one. Thus the uncertainty of the situation is likely to emphasise the tensions that already exist.

However, the country's agenda should include more than just the political issues involved, even though one may accept that these would be at the top of such an agenda. There are other issues that must be aggressively tackled in the short term but with long-term implications, thereby having us run the risk of being not sufficiently prepared by the time we formally become members of the EU.

On the economic front, we are definitely not short of issues, and it would be impossible to put them into some order of priority. To this we have to add what some may call social issues, but would also have a significant economic impact.

One such issue is the environment. We will continue to suffer the consequences of wrong decisions taken in the past, especially the '70s and early '80s for decades to come.

On the other hand, we need to bring it under control; not the control of government but the control of the various interested parties, which would practically include everyone.

There should be no doubt in anyone's mind that an economy can only thrive if the environment is adequately protected and cared for. It is not just tourism that benefits from a protected environment but also manufacturing industry and the services sector as well. A number of initiatives have been taken, one of the more recent ones being the separation of domestic waste at source.

The business sector is also increasingly keen to support environment protection initiatives. Some major companies operating locally have set the right example.

Entrepreneurs have also discovered that activities in the field of waste management and waste recycling are not necessarily loss-making activities, as some have always tended to think. There are companies which today export whole shiploads of scrap material and require more space to expand their operation. Others are seeking to develop initiatives aimed at recycling waste and transforming it into material that can be used in the construction industry.

If we were to focus on purely economic issues, an important agenda item for the coming 12 months is most certainly the economy's competitiveness. Time and time again we have shown that Malta is not only very capable in attracting foreign direct investment but also to keep what it has and help it to grow.

The fact that practically all major manufacturing companies operating here have either expanded their operations in the last 18 to 24 months or are planning to do so in the coming months should be proof enough that their Maltese plants are still very competitive.

Some have even gone so far as taking the stand to transfer some of their head office operations to Malta. To this, one must also add the positive trends shown by some locally-owned firms producing for the export market, even in sectors where we had thought that our competitiveness was irrevocably lost.

Other examples include the inroads made by a number of local operators in developing market niches in the tourism sector, at a time when general tourism suffered greatly worldwide, and the increasing forays in the export market for services produced locally.

However, we have come to the stage where increases in costs must be matched by increases in productivity to maintain the balance that we have achieved to date. In this regard, the control of inflation must be addressed, and one way of addressing it is to let the internal market operate as freely as possible.

We are indeed in the most ironic of situations where the public sector is expected to reduce its operational activities in the economy and to reduce the impact it has on the cost base of the business sector, while certain segments of the private sector are still very keen to maintain their monopolistic position in the internal market and at times forcing companies to price themselves out of the market.

The various monopolies that have been straddling our economy for far too long must be dismantled, as there appears to be no economic reason for them to remain. The trend that was started towards market liberalisation with the removal of import barriers over the years must be taken to its logical conclusion to include the provision of services.

The greatest disservice that we could do to ourselves in the coming 12 months is to argue continually on the various political issues facing the country. They are critical issues no doubt, but just as critical are the economic issues involved. Ignoring them would be detrimental to the economy in the long term.