Updated | Tax sovereignty essential for economic growth - PL

Updated at 15:50

Charles Mangion, Labour spokesperson for the economy said statistics on economic growth for the first nine months of 2011 confirm an economic slowdown. "In fact, the predicted growth was revised downwards from 2.6% to 2.2%."

"The detailed analysis reveal that in real terms, productive investment in the first nine months was down by 27% when compared to the same period last year. This confirms Moody's negative prediction regarding our economy," Mangion said.

The Labour MP said that exports of goods and services and real term imports decreased to such an extent that exports of goods and services were down by more than 11%, which translate into almost €160 million.

"These indicators show that the causes of decreased competitiveness have to be addressed, mainly, the high expenses caused by administrative inefficiency. This includes energy bills which remain among the most costly in EU countries. The same applies for the excessive bureaucracy which hampers investment," Mangion said. 

Mangion added that necessary reforms needed to be implemented seriously since our country is completely uninfluential on the international scene. "We need to ensure better results are achieved in education, reach sustainability by giving more importance to the so-called green economy and encourage new markets in services such as maritime industry, which can create new job opportunities," he said.  

"It is essential that such measures are complimented by government's initiatives to decrease administrative costs and useless delays by implementing long due measures which have been on the government's agenda for years."

On tax harmonisation. Mangion said: "It is essential to retain tax sovereignty and protect Malta's competiveness in financial services from financial taxes which only apply to a small number of countries. These few tools at our disposal should be defended in order to retain the advance achieved in the financial sector."

In reaction the PN described Mangion's statement as "unbelievable". The PN accused Labour of a lack of ideas and said that during the past three years "never once did it utter one serious, and concrete proposal on how Malta can continue to create jobs and enhance its economic growth."

The PN said "Charles Mangion hails from a party which is light on policy, but very rich in buzz words. Which explains the press statement he issued today. Hollow, is the best word to describe it."

"Charles Mangion's party would better pull up its socks, and instead of employing its time in hollow press statements, comes up with some serious proposals for the benefit of Malta and its people," the PN said.

The PN said "Charles Mangion should have the decency to admit that last year, whilst Europe was experiencing a sharp drop in foreign direct investment Malta registered a significant 37% increase."

On the other hand the PN pointed out that "Cyprus, the country which Joseph Muscat wanted us to adopt as our economic model, had a 15% drop."

The PN added that 2011 was the best year since 2007 for Malta Enterprise, which launched 35 new projects which resulted in the creation of 700 new jobs and €145million in investment in three years.

The PN said "Despite the worst economic crisis since World War II, unemployment went down by 1.5% and Malta has the fifth lowest unemployment rate in the EU."

The PN said it is aware that much more needs to be done to ensure that Malta continues to weather off the current economic and financial crisis and added that one wrong decision would have a devastating effect on our economy.   

"Lawrence Gonzi's sound economic policies, and the peoples' resilience, were, and remain, the main ingredients thanks to which Malta is managing to navigate successfully through the fierce waves caused by the economic storm," the PN said.