When it comes to Malta's economy, 'we can't live in a fool's paradise'

Labour MP Edward Scicluna was this morning addressing a MEUSAC conference on the Europe 2020 growth strategy, when he dampened previous speakers' tributes to the Maltese economy, by saying that the island was "living in a world of myths."

“We seem to not have the appetite for change, which makes us cling to a number of myths,” Scicluna said, adding that the greatest myth of all in Malta was that it believed itself to have been the least country affected by the recession.

“Eurostat data shows that the export rate fell by 25% - the third largest fall amongst EU countries; Tourism bed nights fell by 40%, whereas the average EU fall marked 9%; retails sales fell by 7%, against the 2% fall in the EU; employment fell by half as much as the EU average,” Scicluna said.

Nationalist MEP Simon Busuttil, speaking on the economic crisis, said the global shock had moved Europeans out of their comfort zone, "in the moment that they were expecting it the most.”  Busuttil went on to say that now governments have to be disciplined to do what is truly right.  “Discipline, if necessary, requires deteriorating budgets and create a better economic governance through the use of measures such as sanctions and incentives.”

Prime Minister Lawrence Gonzi, who opened the conference, said that “the financial and economic crises have reminded us that all countries and economies are interdependent. This interdependence is one of the key strengths of the European integration process itself.” He defined the Europe 2020 as a strategy that builds on Europe’s strengths, and also chose to chip in his own version of progress, Vision 2015.  “Europe 2020, in the same line as Vision 2015, will seek to transform the economy into a smart, sustainable and inclusive one.”

EU Commissioner John Dalli said that Europe 2020 constitutes long-term growth, the main focus being on stronger collaboration between entities. “Unlike the Lisbon Agenda, it is not a one-size-fits-all strategy,” adding that Europe 2020 proposes an ambitious plan to provide tangible outcomes of employment, economic and social cohesion. “The strategy will empower consumers, turning the economy into a demand driven innovation.”

One of the core targets of the new European Strategy 2020 is for job growth. It headlines improving conditions for research and development in particular with the aim of raising combined public and private investment levels in this sector to 3% of GDP.

Anton Bartolo, Director for Corporate Research and Knowledge Transfer at the University of Malta, put forward a Knowledge Transfer Partnership proposal which aims to promote collaborative research between university and industry. “However, KTP  faces a number of challenges in Malta . The industry for University and R&D services is low in Malta because R&D and innovation are not a priority to Maltese industries, unless it is done privately and there is not a culture of communication between University and companies,” Bartolo said.