AD urged the government to take care before all state control over local banks was ceded into private hands. While AD recognises the benefits of strategic privatisation and/or partnering, it is concerned that if such a sale goes through the government will have near-negligible influence over lending policy to businesses and individuals. At such a crucial stage in the country’s economic development, and with so many small businesses restructuring, AD believes that at present it would be wiser for the government to hold on to its ownership in BOV.

AD finance spokesman Edward Fenech said: “At this stage it would be wise for the government to stall such privatisation until local businesses have adapted to the economic realities of European Union membership. A measure of healthy state influence over the banking sector is necessary in such a small economy undergoing so much change. We believe that the total loss of state control over the banking sector is at this stage risky and premature.” He said if the government needed to raise revenue it should consider the sale of agricultural land to tenant farmers – a measure AD has been suggesting for a while.

“In any case, proceeds from privatisation should not be applied to artificially lower the fiscal deficit, but should be used to pay back government debt,” he concluded.