Malta’s financial stability was under significant threats during the past few months, and the fact that no sign of instability surfaced was good news, Finance Minister Edward Scicluna said this evening.
Speaking at his Gvern li Jisma’ public consultation meeting – in which he shared the stage with Energy Minister Konrad Mizzi – Prof. Scicluna noted that beyond the obvious topics of government revenue and expenditure, the Finance Ministry also had to deal with a more abstract matter: the stability of the country’s economy.
The minister noted that the situation in Cyprus greatly threatened Malta’s own since immediately – perhaps due to misinformation, perhaps due to malice – unfair comparisons between the two countries were drawn. The government drew on expertise – local and foreign – to ensure that Malta’s stability would not be threatened, he said.
Prof. Scicluna said that daily monitoring took place to ensure that risky deposits from Cyprus did not end up in Malta, and that there was also fear of money flowing out of the country due to fears that the local banking system would share Cyprus’ fate.
However, he said, Malta managed to reassure investors, and the situation was now much calmer.
The minister insisted that the decision to retain the previous government’s budget – with some adjustments – also aimed to prevent uncertainty from affecting Malta’s economy, which was doing well.
Prof. Scicluna stressed that the previous government was solely responsible for Malta being placed under excessive deficit procedure once more this year, since the deficit exceeded the 3% of GDP threshold last year, even though he stressed that the new government skilfully avoided new regulations which would have seen the European Commission impose specific budget cuts.
He refuted speculation that the figures were tampered with, pointing out that he never interfered in the work of the National Statistics Office – which is still being led by the same people who worked under the previous government.
The minister remarked that the only way Malta could have avoided excessive deficit procedure – he earlier noted that the government sought, in vain, to persuade the Commission not to recommend it – was to conceal the true state of the country’s finances.
He pointed out that this meant deceiving Maltese taxpayers as well as the EU, and noted that this was what Greece had done before its economy fell apart.
Prof. Scicluna emphasised that through a specially-appointed board, the government was monitoring its expenditure month-by-month to ensure it stuck to its targets. He noted that while any serious company analysed its projected expenditure, he found out, to his surprise, that the previous government did not.