Malta has always had good relations with both Britain and Italy despite periods of tension that were always resolved by the goodwill shown by all sides. The links of friendship were strengthened when Malta joined the EU and sat at the same decision table with neighbouring Italy and former colonial master Britain.
Today both Britain and Italy face challenging political and economic situations that can have a profound effect on their relations with Malta. Britain should be leaving the EU in March. Up to now, it is not clear whether this break will be a soft one with cooperation agreements in place to ensure that future political, trade, security and cultural ties remain in place with the EU.
True, today’s EU summit in Brussels is expected to pave the way for such a deal to be reached between the two sides; however, should Prime Minister Theresa May fail to get the accord approved by the UK Parliament next month, the alternative will be a hard Brexit that is likely to lead to much uncertainty.
Whatever the outcome, Europe will still need Britain as much as Britain will need Europe after Brexit. The cooperation between European countries that has promoted economic prosperity as well as peace in the continent for more than six decades must not be abandoned despite the political stress that is afflicting most of Europe.
Italy faces different political and economic challenges. The populist Italian government blames the EU bureaucracy for everything that seems to be dysfunctional in the country that faces economic stagnancy. The EU has strict fiscal rules in place to ensure that Eurozone countries do not repeat the mistakes of the past where the government in Greece, Spain, Portugal and Ireland built debt mountains and fiscal deficits that were unsustainable.
Italy’s politicians argue that rather than austerity their country needs a fiscal stimulus to encourage economic growth. They have therefore presented a budget that is built on more public spending.
The Commission’s Vice-President, Valdis Dombrovskis, said this week that “With what the Italian government has put on the table, we see a risk of the country sleepwalking into instability”. The Italian leaders are sticking to their high-spending goals even if the political language has been toned down, prompting Brussels to take the first step in sanctionng Rome, which is in nobody’s interest.
The distress of Britain and Italy is further complicated by the timing of the crises they are facing. In May 2019 European voters will elect new representatives at the European Parliament where it is possible that populist parties of the right and left will make gains. This development could create further stress on the political stability needed to tackle future relations with Britain post-Brexit and the ongoing fiscal crisis in Italy.
The European Council, made up of the political leaders of the Member States, takes the crucial decisions in the EU. This forum is where Malta’s voice will be most effective. The European Council will do well to promote excellent relations with Britain post-Brexit. The hard work of implementation should not be hindered by excessive bureaucracy by both Britain and EU countries.
Similarly, the Council should take in consideration the debilitating effect that austerity has had on Italy that has also been affected recently by natural disasters including the collapse of the Morandi Bridge – a vital transport artery in the North of the country. Giving more time to Italy to sort out its fiscal problems is not inconceivable.
So far financial markets have not punished Italy unduly for its failure to observe EU fiscal rules. However, this may change and start a financial crisis that would also affect other countries perceived to be struggling with their fiscal management.
The Maltese government needs to ensure that in this turbulent scenario our relations with both Britain and Italy are not jeopardised. Malta’s agreements with Britain on the treatment of patients with serious illnesses must be kept intact. Similarly, the opportunities of Maltese students to further their studies in Britain post-Brexit need to be enhanced rather than curtailed. Tourism between the two countries should continue to be as strong as ever even after Britain leaves the EU.
The government also needs to mend bridges with Italy on the issue of migration. We must defend our interests with strength but without ignoring the rights of other countries. Similarly, Maltese regulators should step up their cooperation with Italian regulators and law enforcers to stem abusive practices by criminal operators who are using Malta to launder money.
The relations between ordinary Maltese people and their counterparts in Italy and Britain have always been excellent. We share so much history and culture that we can claim to be friends rather than just neighbours or members of the same Union.
What is needed now is right tactical moves by Malta to ensure that this friendship with Britain and Italy is enhanced during and after this period of economic and political distress.
This is a Times of Malta print editorial