‘Malta’s deficit low compared to the rest of Europe’ - Gonzi
Government doesn't need to implement strict austerity measures to reduce Malta’s deficit, Prime Minister Lawrence Gonzi said in an interview this morning with party journalist Keith Micallef on Radio 101.
27 June 2010, 12:00am
Martina Said
Martina Said
2 min read
Malta’s deficit of 3.9% must be reduced to 3% by next year, as advised by the European Union, Prime Minister Lawrence Gonzi said today. But Malta’s deficit "is nothing" compared to the deficit of other countries like Germany and France which has reached heights of around 11%, the prime minister added.
The strict austerity measures which are being implemented in various European countries, such as the reduction of salaries and and the increase in taxes, are not necessary yet in Malta, Gonzi said. “The decisions we took last year on water and electricity were tough, but were the result of increased international oil prices. We do not need strict measures, but need to keep moving forward.”
He also said the debts of other member states resulted from increased borrowing at high interest rates. This problem does not affect Malta, because “our government and banks don’t need to borrow from others, but rather benefit from bonds and stocks issued here,” Gonzi said.
The microcredit scheme introduced by government in November’s budget, which is intended to provide financial assistance to small and medium enterprises and the self-employed, has been criticised by the EU for giving a competitive advantage to retailers which other companies in the EU market do not have. “We needed approval from the EU for this scheme, and approval from the European Investment Bank, which we got,” Gonzi said.
Malta’s tourism sector has increased to 45% in the first quarter of this year, compared to 2009. “In order to maintain this, we are spending more money on austerity packages to promote Malta and increase routes with low cost airlines,” Gonzi said. He also said that the embellishment project of Bugibba, with new pavements, beach facilities and new lighting systems, is a result of such investment.
Patrick Calleja •
Dr Gonzi knows that the cliff's edge is around the corner; he and his Party, have tip toed us, to the precipice.
Charles Caruana •
The European Union did say that Gonzi's spending habits are unsustainable. A technical hitch-(Government's ows money to local banks and individual Maltese-and not to sensitive foreign banks) should not be a cover-up to continue borrowing from our children's future. The day of reckoning is three years away or so; Dr Gonzi should not continue to keep Malta's young generation's future, hostage to his political career.
Alfred Galea •
The NSO reported last week that the national debt in the first 5 months of 2010 went up by about 10% when compared to the same period of 2009. It is now over 70% of GDP, about 4.12 BILLION.
Is the PM waiting for the point of no return before he removes the smirk off his face and start addressing the problem?
The G20 decided to cut their debt by 50% by 2013....will he try to do the same??
Luke Camilleri •
Dr. Gonzi is truly amazing; to come out with a statement that Malta’s deficit is “nothing”, and using it as a benchmark with other economies as consolation! Where is the promeised pre-electoral surplus he promised?
Dr. Gonzi has also stated that giving away some 200 tumoli of Prime Malta , is also “Nothing” to Dr. Gonzi, like it was “Nothing” to his predessessor the Lm10,000,000 being lost in a dal to selloff Mid-Med Bank, or the “Nothing”m the LM10,000,000 piece of land given in selling of Maltacom.
It is not only the Malta Deficit that Dr. Gonzi should be best addressing but the Deficiencies and incompetence of his Cabinet which costing the Maltese Tax-Payers and generations to come thousands of €s in taxes with decisions taken without forethought foresight and accountability and not giving them his support.
