The Malta Independent 25 May 2024, Saturday
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Social partners submit 437 budget proposals, general economic outlook seen as positive

Jacob Borg Wednesday, 23 September 2015, 13:04 Last update: about 10 years ago

The social partners have submitted 437 proposals and recommendations for the budget, with the general outlook being that the Maltese economy is moving in the right direction.

Addressing an MCESD meeting, Finance Minister Edward Scicluna said the government will be building on the work done during the past two-and-a-half years.

Targets becoming more ambitious as time goes by, and the government becomes more restricted in its choices, the Finance Minister said.

On the proposals submitted, Professor Scicluna vowed to integrate all the good ones.

He said the budget is not meant to be sustainable by virtue of the Individual Investor Programme (IIP), but 30 per cent of the IIP’s funds will go towards the budget.

MCESD consultant Professor Joseph Falzon said that although the social partners agree the economic outlook is positive, certain weaknesses- or dragons as he termed them- need to be addressed.

Describing exports as the engine of economic growth, Professor Falzon said manufacturing is still the largest sector in terms of value added, and it is facing problems.

Growth in the tourism sector stems from increasing numbers rather than an increase in value added, with the sector facing “considerable challenges,” Professor Falzon said.

The financial services sector faces the threat of EU tax harmonisation, and Professor Falzon questioned whether a plan is in place to protect the e-gaming sector, which has had a significant effect on jobs and property rent.

The Maltese economy suffers from a lack of skills and lack of education, with Professor Falzon saying the education system has failed students.

He noted the calls for further reductions in energy tariffs, as well as suggestions for a long- term plan to reduce costs in the sector through the use of renewable.

The high cost of financing in Malta is serving to limit growth, and the lack of efficiency in government services acts as a drag on the economy, Professor Falzon said.

Transport, health care and pensions also need a long-term plan. 

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