During the last few years, several contrasting developments were registered. On the one hand, the headline rate of economic growth for Malta was more or less within the parameters expected from an economy still trying to bridge the differences with the main economies in the European Union. Growth in employment, at least in terms of head-count, has also increased, although the employment rate is still the lowest in the European Union, especially with regards to female participation rates. Overall, these developments should be marked as positive ones.

On the other hand, there was a drastic deterioration in the quality of employment. Precarious working conditions became the norm for certain employment categories while those on the minimum wage have increased drastically.

Any increase in economic activity was certainly not transferred to the majority of people. Indeed, there is a very strong perception that the common individual’s standard of living is lower than it was a few years ago.

Despite the current administration’s efforts in trying to create and maintain the impression that wealth is being created and that people are better off than they were in the past, there is a strong feeling that these are mere fabrications.

People know that they are doing much more just to make end meets. The income that they are receiving is not enough. This is also another category of households that is at the very margin.

To generate income, as a nation, we must sell our products and services. To do so, people with money and ideas must be put in a position to achieve their goal that is to invest.  Thus, it is the duty of the administration to create the right environment for this aim. This role goes beyond the legal framework.

Government attitudes toward business operations are essential. Excessive bureaucracy and red tape, overregulation, corruption, dishonesty in dealing with public contracts, lack of transparency and trustworthiness, and political maladministration impose significant costs to businesses. Investors will simply look elsewhere.

A recently published report by the World Bank deals precisely with this. It looks at the relative ease with which companies can start and run businesses in several countries. The concept behind the World Bank’s Doing Business Report is that daily economic activity of countries is shaped by the laws, regulations and institutional arrangements put in place by governments. The Report then delves into how long it takes and how much it costs to comply with regulations, for example time and money needed to enforce contracts, file for bankruptcy or trade across borders.

The report found that Singapore and New Zealand continue to lead the rankings for the Ease of Doing Business and for Starting a Business respectively. Belarus and Morocco had the best year-on-year performances, jumping 22 and 21 positions respectively in the Ease of Doing Business ranking.

From a local perspective, the report found that Malta is, in fact, the most difficult place to do business in the whole of Europe, candidate member states included. Out of the economies of 185 countries analysed in terms of the ease of doing business in them, Malta is ranked in a most dismal 102nd place.  Greece, in a far better 78th place, was the second-most difficult place to do business in Europe.  Denmark, in a global fifth place, was the EU’s easiest place to do business.  The majority of EU member states are found to be at least twice as easy to do business in compared to Malta. The report also found that Malta is the most difficult EU country for businesses to obtain construction permits, where it takes 237 days and 18 procedures to obtain a permit, putting the country six notches below Poland, the next worse performer in the EU.

Malta's indicator rankings put us in the 150th place for ease of starting a business, 167th in obtaining a construction permit, 111th in getting electricity, 80th in registering property, 176th in the ease of obtaining credit to start a business, 70th in protecting investors, 27th in paying taxes, 34th in the ease of trading across borders, 121st in the enforcement of contracts, and 67th in resolving business insolvency.

Faced with such dismal results, the authorities tried to shoot the report down, simply by pointing to some other study which presented a slightly more positive picture. Unfortunately, we have reached a situation where such a reaction is expected.

Instead of facing reality and working to shake off the impediments to growth, this administration is just happy to continue alienating people.

Dr Refalo is PL spokesman for Gozo