The EU Council of Ministers has at long last reached agreement about a directive that would launch the concept of a national minimum wage in all member countries. Strictly speaking, this is not a matter that forms part of the competences of the Union. Various member states contested it for this reason. Some (like Denmark) operate a system by which all wages are set in sole negotiations between the social partners.

However it now seems that the concept of a minimum wage is falling behind the social realities of many countries, Malta included. Everywhere absolute or relative poverty is spreading among people who are also in employment. The practice of importing and exploiting workers from abroad must be underpinning this development.

The idea that social protecton should hinge on wage levels that provide for a decent life has become more relevant. Also, the feeling is that rather than emphasize what wage levels should be, we should focus on the income necessary to live a useful life. The study which was commissioned recently by the General Workers Union and other organizations on this subject has investigated the Maltese situation from such a perspective. It should be given more attention than what it has been accorded up to now.

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INVESTMENTS

Many times I saw investments being made by the Maltese private sector whose rationale I just could not understand. To be clear: the same happened on the government side but here, decision makers would also have had political and social considerations in mind. When businessmen invest, their rationale is or should be financial and economic.

So in the past, I was surprised when some enteprises began to invest a lot of money in equipment meant to increase their output. This happened prior to Malta’s entry into the EU: they went down this route in the belief that accession would easily enable them to tap the “new” large markets being made available. They ended up losing all their outlays, or almost.

Today we are seeing something similar happening in the sector of new hotel construction.

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ENERGY

Fundamentally too much time has been lost by the EU in trying to reach a unified energy policy. As of last week, Germany was being “accused” of having proceeded on its own to cover its national interests. But actually almost all countries have stayed focussed on how to find the best solutions for their citizens and firms.

Given the sanctions that the Europeans declared against Russia it was obvious that the latter would retaliate, and that if the pressure was to be kept up by both sides, sanctions and countermoves in retaliation would stiffen. I agreed and still agree with European sanctions. But they had to be understood right from the start as a form of economic warfare – which is preferable to armed conflict. Still as in all wars, one has to prepare a defence against the blows that are bound to arrive.

The Europeans do not seem to have been well prepared for this. Calling the measures adopted by the Russians blackmail will get them nowhere. Anyway, they have remained for too long without a tight and complete agreement on energy policy that would be in the interests of all parties.