A year on, generating economic growth has marked a significant footstep in this government’s roadmap which was approved by the vast majority of the Maltese electorate during the last general elections. Concurrently, this government is completely focused on the implementation of all its electoral promises and this can be witnessed through the various initiatives being launched by members of the Cabinet.
Achieving economic growth that will benefit everyone is central to the Labour Government’s economic policies. It is through economic growth that new employment opportunities can be created. That in turn, will contribute towards increased economic activity which will leave more money in people’s pockets and thus increasing their purchasing power. It will also contribute towards an increase in government revenue through income tax and VAT receipts that will be invested in education, health and social services amongst others.
Earlier this week, the European Commission expressed itself on all this and its’ economic forecasts show that GDP growth is estimated to have reached 2% of GDP during 2013, a trend which is being forecasted to remain on the same mould in 2014-15. Deficit is also expected to go down from 3% in 2013 to 2.7% in 2014 and a slight drop of unemployment - from 6.5% to 6.4% - further underlines the right direction this government has embarked upon. Almost in sync, Standard & Poor’s too, have revised outlook for Enemalta from negative to stable.
These economic objectives are not achieved without planning. The electoral manifesto identified a number of specific actions, some of which have already been implemented while others are in the pipeline. One of the government’s first act in office was to honour its promise to implement the budget prepared by the outgoing Gonzi administration, including the promise to reduce income tax. This was a wise decision meant to avoid economic uncertainty and to contribute towards political and economic stability – something which is so vital in attracting foreign investment and which was sadly lacking in the final years of the Gonzi administration.
Another electoral promise which has already been implemented and which will greatly benefit the business community and similarly all Maltese citizens has been the appointment of a Commissioner for simplification and for the reduction of bureaucracy. This position is meant to be a catalyst for change in public administration so that the citizen and the businesses can be efficiently taken care of. His challenge is to reduce bureaucracy by 25%. He is guided by the maxim that simpler is better.
Meanwhile, a Global Residence Programme aimed at allowing people who can buy high value property and pay taxes in Malta to benefit from a residence permit has also been launched. This scheme has once again rekindled interest amongst foreigners who wish to purchase property in Malta following the previous scheme introduced by the former Nationalist administration which proved to be a complete failure.
The Individual Investor Programme that is meant to attract foreign investment to the tune of €1 billion Euros is now in place with the full blessing of the European Commission. Come to think of it, this was a very simple but innovative scheme that has already generated a lot of interest in various parts of the world. Unsurprisingly, the Nationalist Party has taken a very strong and staunch position against this scheme mainly because of envy and nothing else.
Other initiatives are expected to give a new lease of life to businesses and to the small and medium sized enterprises who are the main drivers behind economic growth. This activity will further underline the Government’s position and sends a strong signal to local and foreign entrepreneurs that Malta has a business-friendly government.
All this came to mind last Sunday while listening to the Prime Minister who was outlining this Government’s achievements when it comes to creation of new employment opportunities in the first ten months of this legislature compared to what was achieved in the last seven years of the previous administration. He supported this stance by announcing an impressive record number of projects that have been approved by Malta Enterprise since March last year and which are expected to create around 2,600 new jobs in the coming three years.
This contrasts very sharply with the very poor track record at Malta Enterprise under the previous administration. All that Malta Enterprise has to show for its largesse with people’s money are the comfortable offices for the Chairman at the former Saint Luke’s Hospital which cost the taxpayer around €4 million.
The shortcomings carried out by Malta enterprise prior to March 2013 are being replaced by good governance that is fully focused, committed and more importantly results-driven.
This drive gives us the confidence and the right momentum to achieve what we have set out to do - generate economic growth.
Dr. Ian Borg is the Parliamentary Secretary for EU Funds and EU Presidency 2017