There is an emerging consensus amongst policymakers, social partners, businesses and citizens that Malta needs to chart a new economic path forward.

Certainly, the present economic model has served this country well and we should not take this for granted.

Over the span of a decade, average living standards in Malta, as measured by GDP per capita in PPS, converged to the EU average, rising from 81% in 2009 to 98% in 2018. This means that Malta has reached EU standards.

However, if there is one important strategy that has enabled the country to prosper, this has been the diversification of the economy which supported the emergence of new economic activities and new jobs as older sectors matured.

This has been an important element in our developmental path since Independence as successive Governments sought the creation of new niches of economic activity to create jobs with an outward-looking focus.

Presently, we are at a similar juncture.

We need to look closely at the basis of our competitiveness and renew our toolkit with a view to ensure that Malta remains an attractive location for foreign direct investment.

At the same time, the pressures associated with the economic growth of recent years are felt across the board. The emerging consensus on the economic way forward rests on the creation of economic well-being.

It is clear that traditional economic measures such as Gross Domestic Product or consumption suffer from serious limitations since non-market outcomes that contribute to wellbeing are not explicitly considered.

The Agenda for Sustainable Development has been with us for some time now and countries already report on their progress towards the attaining the UN Sustainable Development Goals.

But in truth, progress towards internalising the sustainable development goals framework in policymaking has been slow and uneven. At the same time, it is evident that challenges related to sustainable development are becoming increasingly important, as the latest Standard Eurobarometer lists immigration, housing, the environment, climate, and energy issues as the top concerns of the Maltese.

This provides Malta with an opportunity: to turn sustainable development from a challenge, to a source of competitive advantage.

But this transition has to come twofold: Malta has to show that it can credibly transform its policymaking through the integration of sustainable development goals to be in a position to provide a platform for the establishment of sustainable business in Malta. By introducing the polluter pays principle, one can the. Channel funds earmarked in the budgetary process to finance new green initiatives.

Indeed, sustainable development reflects the realisation that social, environmental and governance considerations are good both for national wellbeing, and also for the economic bottom line.

This calls for a national approach that builds integrated policies to accelerate and sustain broad-based economic growth that benefits everyone, while also regenerating natural resources.

It is no secret that some of the challenges in climate may require policies that span multiple electoral cycles.

For this reason, we need a different approach towards development, spread over the longer term, in order to adequately integrate sustainable development goals.

National debate and also a shared understanding in Parliament should inform the national priorities for policy development in Malta.

The closer that sustainable development goals are brought to the heart of decision-making, the higher are the chances of successfully integrating these goals in the policy process.

Sustainable development is clearly not about tree-hugging: it has deep transformative potential to enhance wellbeing but also to provide opportunities for economic growth.

The European Commission estimates that in order to achieve the current 2030 climate and energy targets, an additional €260 billion worth of investments would be required on an annual basis. The EU budget is expected to play an important role in providing funding as at least 30% of the InvestEU Fund will contribute to fighting climate change. At the same time, as outlined in the European Green Deal, the private sector will be key in financing the green transition through a number of initiatives that are underway.

The present debate on the economic way forward provides a window of opportunity for Malta to position itself as a platform for the establishment of sustainable business in Malta.

Clearly, the economic growth of recent years has delivered jobs and rising income but it has also brought to the fore new challenges that need to be addressed.

In that regard, integrating sustainable development goals into the budgetary process has the potential to effectively entrench sustainability concerns into policy-making in Malta.

Furthermore, it is also clear that policy processes are underway at the European level that are effectively intended to support the Green transition, whilst at the same time providing opportunities for further economic growth for businesses, including in the financial sector.

Malta should act quickly in harnessing these opportunities and reorient its economic model to one that rewards sustainable entrepreneurship.

Aaron Farrugia is Parliamentary Secretary for European Funds and Social Dialogue