Missing: A vision for Malta’s future – Jerome Caruana Cilia, PN spokesperson for Finance

When one of the local Big Four firms published a survey showing that more than 70 percent of Maltese young people would rather live elsewhere, many commentators took social media by storm. Truly, survey numbers need to be taken with the customary pinch of salt, but the extent of such numbers certainly calls for an in-depth understanding of what is wrong in Malta.

JEROME CARUANA CILIA, PN SPOKESPERSON FOR FINANCE

Corruption,lackofequalopportunities,trafficcongestion,environmental degradation – all factors leading to our younger generation expressing a desire to be somewhere else. A true pity.

It is also against this background that the most disappointing element in this year’s financial exercise is that once again, it does not plot the map of Malta’s immediate economic growth. Expectations that Budget 2023 would finally show government’s economic vision were high for a number of reasons. We are hopefully at the tail end of a two-year pandemic. Countries across the globe seek rapid yet sustainable planned economic regeneration to regain lost ground and to take the opportunity to make the quantum leap towards the economy of the future. EU member states, including Malta, are also looking at the extensive opportunities offered by an unprecedented wave of funding, aimed particularly to support them in implementing a twin transition of going digital and sustainable.

Yet, sifting through the Finance Minister’s marathon speech, there’s no clarity as to where the country is heading. Its seems that Government sole intent is to survive and live another day.

Let me be clear. There’s no doubt that the increased subsidy to maintain stability in energy prices is a step in the right direction and will help businesses cushion the impact of other increases they are facing – some of which, but not all, are beyond our government’s control.

At the same time though, the Finance Minister and Government in general, have failed to heed the call of the Opposition and of several constituted bodies not to burden entrepreneurs with the full impact of an unprecedent cost-of-living adjustment. This will very likely create a second-round inflationary impact, thereby exacerbating the cost-ofliving increases for businesses and consumers alike. This vicious circle will grow tighter and continue to strangle our growth opportunities for a longer period.

The Finance Minister is on record admitting that the political and economic mantra of supporting economic growth through population increases has failed. In this context one would have expected Budget 2023 to reconsider this direction. We were looking forward to seeing roadmaps with plans to invest in new industry verticals and existing industries such as iGaming, Maritime, Aviation, Financial Services, Information Technology and Pharmaceuticals.

This country is crying for a solid plan highlighting how to strengthen its unique selling proposition with the clear objective to increase value added jobs, increase the average salary, and increase the net contribution to Government.

This last point brings us to what probably is the biggest concern which so far has enjoyed few headlines: our spiralling debt. Malta’s debt levels reached a staggering €8.3 billion last year with government projecting a further €2 billion increase between 2022 and 2023.

While a strong growth rate is keeping debt levels at a moderate percentage level, such increases will eventually come back to haunt us during milder economic times. Strong and sustainable finances are a key selling point of any nation when investors consider their potential

“This country is crying for a solid plan highlighting how to strengthen its unique selling proposition with the clear objective to increase value added jobs, increase the average salary, and increase the net contribution to Government.”

investment avenues and these increases do not bode well. This is not fiction, it is fact - we already have almost half of foreign investors based in Malta saying that they do not see the island as an ideal investment location.

The Maltese Government has a fundamental responsibility, a moral obligation, and a constitutional duty to look to the future with courage, invest where it truly matters, keep finances in check and champion a sustainable future for us all. On the counts vision and finances Budget 2023 failed to deliver and was truly a budget in the red. n