I guess that it was chosen on purpose but I am unconvinced it’s the correct approach. The consultation document about the future of the Financial Services Authority is written in a general way, bland but dry to the point that it seems to lack all content. Probably, the idea was that like this, financial services professionals would feel totally free to make all the comments they wished to share.
However, these are well established people. Their proposals would be honed by long experience. In any event, they would not keep back from making their views known.
In the document one would have expected at least an analysis of the financial segments where Malta plays, as well as why some areas of activity have been a success, others not. What are the perspectives and threats in the successful segments? What prospects are emerging in new and old segments where we have failed to make inroads? Such a method of presentation would not have caused competitive harm, since operators and clients in financial services, both foreign and Maltese, would already know quite well just how market forces are shaping up.
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Overheating
When an engine revs up in a big way and goes non-stop, it runs the risk of overheating. So does an economy. The risk is certainly increasing that the Maltese economy could be moving towards such a state of affairs.
Still, on this point the available data is not worrisome. Contrary to what usually happens, inflation is well aligned with the average rate for the eurozone. This could be happening due to the prevailing oil prices, as well as the presence on the island of many foreign workers who are being paid relatively low wages.
On the other hand, there are indicators, mainly impressionistic, that are flashing a red light: residential rents, which are climbing steeply; congestion in roads; the current mayhem in land use planning and in construction.
Actually the economy is undergoing structural changes on lines that do not resemble at all how it did change in past decades.
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The arts
Statistics mentioned recently about the number of people who are getting employed in the arts and in cultural initiatives, are encouraging. They signal that a cultural development that had long been necessary has finally occurred in our society. It used to consider the arts and culture as sectors to be outsourced to dilettantes, as their pastime and for their recreational relief. Not any more.
Yet, one should realistically take into account the extent to which the jobs currently being held are self-financing on the basis of the activities they generate, as well as the extent to which they depend on public subsidy. One can never forget that all economies go through expansionary periods followed by a recession or other, so that sooner or later, public expenditure will need to be curtailed.
At that point, among the first sectors to be hit, and then quite severely, usually comes expenditure on the arts and culture. That’s what happened in European countries post the financial crash of 2008/2009. Many artists and cultural activists lost their jobs, and ended up angry and frustrated at what they felt was a betrayal.