Betsson group, a giant in the gaming industry, has long been seen as a bellwether for the industry in Malta. It employs over 1,000 people, making it one of the largest employers on the island.
This explains why its announcement that 160 jobs were being cut across the organisation, 130 of them from the local headquarters, made headlines. It was the most shared news item on social media. I’m not surprised.
Both government and Opposition were quick to issue press statements. Nationalist Party leader Adrian Delia, though his spokesperson for the sector Kristy Debono, refrained from politicising the issue. That was the right thing to do. They went one step further � making themselves available to ensure that the gaming industry in Malta is strengthened.
That press statement marked Delia’s new way of doing politics. And that is a welcome relief. Had he politicised the matter, it would have backfired on his party. Delia steered clear of that.
On its part, the government, through Parliamentary Secretary Silvio Schembri, issued a statement within the hour to stress that Betsson was still committed to Malta and that those made redundant would be immediately sucked up by the sector, which now employs some 9,000 people.
Yes, 9,000 employees – which translates into thousands of families, foreign and local, who depend on this industry for their livelihood. Thousands of others benefit from this sector through indirect means: property rental, hotels, restaurants, transport services, cleaning companies, catering and the entertainment industry, all of which depend greatly on the success of the gaming industry. This makes gaming a very sensitive and crucial sector for our economy.
Jesper Svensson, the CEO of Betsson, assured us that the downsizing was “unrelated to rule of law issue in Malta” and described the job-cutting move as “a company efficiency exercise”. To the initiated, that’s a politically correct way of saying: “we need to sack employees to cut costs and generate more profit”.
But that is not the purpose of this article, although that is what matters most to the unfortunate 130 employees who lost their jobs from the local HQ.
I have no reason to doubt Mr Svensson’s statement. But what happened at Betsson Malta should raise the alarm bells, for two reasons.
Firstly, our economy has become far too dependent on the gaming industry. Should this sector collapse, our economy would suffer a heavy blow. This explains why it is short-sighted to depend, heavily, on one sector.
What happened at Betsson should raise the alarm bells
Gaming and the construction industry, together with the Maltese passport scheme, are currently the three areas on which the government is banking hard. It is putting all the proverbial eggs in one basket. For, truth be told, there is little, if any, long-term economic planning.
In the past five years no new economic sector has been created. This is worrying, for a country’s economy depends on long-term planning not short-term gains. Today’s financial and gaming industries are the result of the long-term economic vision of the Eddie Fenech Adami and Lawrence Gonzi administrations. The Labour government failed to create a single new economic sector.
The government repeatedly boasts of an increased economic output. However, the distribution of the income generated is being increasingly concentrated among the highest income earners. Households at the lower levels of the income scale are benefitting to a lesser extent from the increased standard of living on a nationwide basis. Unemployment is down, and that’s a fact, but the quality of jobs has not improved.
Secondly, the alarm bells should be ringing in terms of Malta’s reputation. At the European Parliament we are repeatedly mentioned for the wrong reasons. The assassination of Daphne Caruana Galizia put Malta in a bad light. Yesterday, we were known for our economic resilience and sterling reputation. Today, we’re accused of being the backyard of Europe’s money laundering industry – and a country where impunity and the collapse of the rule of law have become the new normal.
Foreign MEPs, mostly Germans and French, have milked the situation to their favour, their agenda being precisely that of driving Malta out of business as they do their best to erode our tax system and the financial incentives that enable us to attract foreign investment.
There have been repeated efforts to undermine Malta’s gaming industry and our financial services industry. If they succeed, it would be an economic disaster for Malta and its people.
Admittedly, it is annoying that the only matter that gets to be discussed in relation to Malta at the European Parliament is the rule of law and corruption. But through its actions, or lack of them, the Maltese government leaves them with little if any option.
In Brussels, our MEPs should be lobbying to safeguard the interests and financial situation – through supportive policies – of our local industries: manufacturing, fishing, agriculture, small and medium enterprises and the hospitality sector, among others. Instead, the only thing they get to speak about is the rule of law – and for that, the government only has itself to blame.
The Betsson bad news should raise the alarm bells. I trust it did. Malta needs to look beyond the immediate and create new, sustainable economic sectors; and a good reputation – for the absence of that would ruin us all.
Frank Psaila is a lawyer. He anchors Iswed fuq l-Abjad on NET TV.