By speaking the way he did last Sunday, Labour leader Alfred Sant has once more pushed the debate on Malta’s entry into the euro and before that into ERM to the partisan level.
One may argue he never really left that level, after his comments months earlier about the possibility of devaluation.
Over the past weeks, the Governor of the Central Bank, Michael Bonello, first told an interviewer on The Times it was not true that the official reserves had fallen by over Lm80 million in the 12 months to January 2004. He stressed the total reserves were strong. Then, just over a week later, he pushed up interest rates – because the loss of reserves had resumed in March and early April.
Loose talk about a possible devaluation, not just by Dr Sant, was blamed, together with other causes, for a drain on reserves and companies holding their revenue outside of Malta.
Dr Sant last Sunday claimed that the government was about to bring much damage to Malta by the way it was treating the entry to the euro and expressed his total disagreement with this strategy.
But by issuing such a public warning, Dr Sant could be contributing to what he was warning about: lack of confidence in the country.
Observers also point out at the similarity between this latest Dr Sant stance and the attitude which led to Labour’s disastrous anti-EU membership stance over the past years, an attitude which Labour is still struggling to turn around. In both cases, it would seem, immediate political gain outweighed the long-term gain of the country as a whole. That attitude led Malta to a harrowing debate on EU membership which split the country in two when a national, joint, approach could have made life easier for all Maltese and helped Malta on its way to EU membership.