In a message on the eve of Christmas Day, President Myriam Spiteri Debono stressed the importance of collective responsibility, urging all citizens to recognise their duty to contribute positively to society.

The President emphasised that understanding our past is crucial for building a better future, stating, "the present we inhabit is a result of a history filled with sacrifices, and our future depends on our collective actions". However, so far, notwithstanding its limitations, Malta has made notable strides, particularly through its role as a non-permanent member of the United Nations Security Council and as Chair-In-Office of the Organisation for Security and Cooperation in Europe (OSCE).

Leaving our shores, we note how next year, the president-elect Donald Trump is a wildcard in the economic outlook, especially because of his campaign promise to impose high and broad tariffs on imports, especially those from China. However, economists believe that heavy tariffs, in line with Trump's promise, could drive up prices for all kinds of products, push inflation and drag down the world economy.

Still, Goldman's forecasters are among the more optimistic and expect the US economy to grow at a healthy 2.5% annual rate in 2025. Economists define "development" as a force for good, implying change resulting in growth and advancement to improve the quality of life for all citizens.

Sustainable development can be given an economic definition: one that makes a country wealthier, better educated, healthier. If this is the case, why do so many vociferously complain about excessive local property development, nepotism and its impact on society?

Is it true that development has rendered Malta more beautiful since Independence? The answer is yes if development serves as a driver for sustainable property expansion; however, the opposite holds true - it becomes harmful and diminishes the quality of life. The government and others tarnish with a broad brush NGOs and activists of being against unsustainable development. It is naïve at best to argue that activists are against a growth that betters society as a whole and makes it more prosperous.

The recent approval by the PA to bulldozer the majestic British barracks (a national heritage in Gozo) in Fort Chambray speaks volumes how greed has been allowed to cloud our virtues. Again, other examples follow.

Populists embrace a definition of higher growth which targets rises in gross domestic product, which in turn reflects a higher level of economic activity. Our economic model is primarily based on numbers - cars, tourists, building permits, hotel rooms, property sales, income - all measured in monetary terms (not its harmful effect on ecology, air purity and in cases destruction of our heritage). Sociologists warn us to be cautious.

Another headache for future productivity is our low fertility index and ageing population which both lead (in different ways) to enhanced TCNs immigration.

Notice how western economies have a combination of labour output spiced with a large number of low-wage third country nationals. In Malta, imported cheap labour is extenuated to reach up to one in six of the population.

Again, last month the social service ministry announced the amount of 97,000 families earning a low income. Castille maintains that by embracing the skills and abilities that TCNs offer, this helps the business community to address unfilled vacancies.

Naturally, unions advocate for fair and inclusive employment practices. In the private sector, as AI improvements in productivity flourish, a smaller labour force will be needed to meet higher manpower in 2025.

My New Year's wish is for the island to continue to improve exports and reduce the present budgetary policy to borrow high to service growth in domestic demand. On a positive side, all rating agencies have congratulated us on quality commercial success.

This reads, having a galloping GDP exceeding €23bn. For next year Miriam Dalli promised €60m to support businesses and start-ups investing in research and innovation, skills, digitisation and energy efficiency.

These will be disbursed through schemes by Malta Enterprise and include the continuation of myriad schemes such as Business Development, Business Start, Innovate - Innovation Aid for SMEs, Rent Subsidy Scheme, Research and Development, Skills Development, Smart and Sustainable Investment, Start-Up Finance Scheme, Micro Invest and the Get Qualified scheme. But the bigger impact of the post-pandemic lockdowns, Russian war and Middle East hostilities has applied brakes on the demand side.

Our focused budget policies are designed to help ensure that public debt-to-GDP ratios remain compliant with Maastricht rules. Yet current results do not alarm the Commission so long as we are reporting an annual deficit not exceeding 6% of GDP. Still we are being faced in 2025 with an order from the Commission to mend our ways in a structured approach to curb our excessive deficit mechanism.

The government gingerly aims to reach a level of €13bn in national debt by the end of the legislation. This is not sustainable, unless future generations pull up their socks and skip the queue by exploiting AI mechanisms and robotics; alongside with working harder and doing more with less.

Best wishes for a prosperous New Year to all

George M. Mangion is a partner in PKF Malta