[WATCH] Muscat welcomes Hollande’s endorsement that ‘Malta not tax haven’

Prime Minister Joseph Muscat welcomed French President Francois Hollande's endorsement of the legitimacy and integrity of Malta's banking sector.

Muscat was speaking following a meeting with Hollande in France on Wednesday, during which both leaders discussed the ongoing EU financial downturn, and the latest developments concerning Cyprus - and how these affect Malta.

In comments to the press following the meeting, Hollande endorsed Malta's economic and banking systems, saying that while they have established themselves as economic, touristic, and cultural havens, Malta is not a tax haven.

In a brief comment to the press, Muscat welcomed Hollande's endorsement, saying that its significance goes beyond the Malta-France bilateral context, but have a bearing on European levels.

"This is because you have a statement from the leader of one of the largest countries and who are most involved in the leadership institutions of the European Union," Muscat said.

"Hollande's assertion that Malta is not a tax haven goes a long way towards dispelling the notion that - as some international medias were trying to suggest - there is some sort of impression of a parallel between Malta and Cyprus, insofar as our banking sector is concerned."

He also noted that Hollande's statement needs to be considered within the context that France is currently in the process of devising a new law that attempts to crack down on fiscal evasion.

"He is saying that France does not see Malta as a place where those seeking to evade tax run to but as a legitimate place for legitimate investment," Muscat said.

Addressing Maltese and French journalists following the meeting, Hollande noted that also Malta wants to play a full role in the EU banking union, and said that while there is agreement that the banking union is introduced next year, the framework behind it needs to be more reasonable and realistic.

Muscat insisted that the deficit should not be the only consideration in the equation, and that while controls are necessary both Malta and France are advocating proposals aimed at addressing issues that could hinder economic growth.

Muscat also fielded questions regarding potential Excessive Deficit Procedures against Malta, saying that it is not yet certain whether such a procedure will be launched.

He however insisted that Malta remains committed to bring down the deficit below the 3% threshold by the end of the year.

Muscat also extended an invitation to Hollande to reciprocate the visit.

The meeting was held at the end of a two-day visit of the Maltese delegation in France.

On Tuesday, Muscat attended a concert entitled ´Joseph Calleja: Le grande voix de Malte´, organised by the Maltese Embassy in Paris, where he also delivered an address in French.