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EU weighs in on corruption

It is not just European Parliament members and top media houses abroad that have taken notice of the rampant claims of corruption and wrongdoing but the European Commission too is now adding its voice to those of many others calling for action.

Turning guns on Nationalist MEP David Casa or on others for their efforts in making the deteriorating situation in Malta known abroad is puerile. Neither the top media houses nor the European Commission are likely to express their views without first looking closely into the matter.

The government has lost no opportunity over the years to flaunt the European Commission’s periodical reports lauding the island’s economic progress. The Prime Minister, on Sunday, told Labour supporters Brussels had recognised the government’s efforts to fight money laundering and corruption, which contrasts sharply with what was actually said in the report.

The stench of wrongdoing has reached centres of influence that Malta can now only ignore at its peril. What is most harmful is not the impact this state of affairs can have on the party in power, because governments come and go. It is its impact on the reputation and image of the country that is at stake.

The government is resting its case on the string of inquiries that have been opened but, in the meantime, it is not doing enough to remove the cloud hanging over the island, particularly following the assassination of Daphne Caruana Galizia. Seven months into her murder, there is yet no clue as to who masterminded the assassination.

The European Commission has measured its words well in its country-specific recommendations but its remarks leave no room for doubt that it is fully aware of the Malta situation. It says it all in just one paragraph: “The justice system continues to face challenges with regard to its efficiency and a strengthened legal and institutional framework to fight corruption is necessary to ensure a high-quality business environment. Governance shortcomings in the anti-corruption framework may adversely affect the business climate and weigh negatively on investment. The effectiveness of Malta’s efforts to fight corruption needs to be further improved, especially with regard to the investigation and prosecution of corruption. Improving the governance framework is crucial to preserving Malta’s reputation and attractiveness as an international investment destination.”

The Commission’s call on the government to ensure the sustainability of the health and pension systems does merit serious consideration but, at this point in time, it is the bad image the island is getting over claims that Malta is being increasingly used as a money-laundering centre that is most worrying.

Significantly, EU governments are in the process of considering new rules to counter money laundering after alleged wrongdoing at two banks, one in Malta (Pilatus) and the other in Latvia, flagged risks to financial stability. The arrest in the United States of the former chairman of the Malta-registered Pilatus Bank and the freezing of its operations have greatly intensified attention on the island.

The situation becomes somewhat intractable when also considering the many other stories that surfaced since the news of the opening of the Panama offshore companies by Cabinet minister Konrad Mizzi and the Prime Minister’s chief of staff, Keith Schembri.

The spotlight on Malta is likely to get stronger unless it cleans up its act.

This is a Times of Malta print editorial

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