GUEST POST/Labour is not just corrupt. It has also failed to add value to the Maltese economy.

Published: May 5, 2016 at 1:47pm

Written by Matthew S

Thirty years ago, Kiev hosted a grand May Day parade. The Soviet leaders swore that the motherland will always look after its citizens, and they pronounced the state of the Union to be just fine. Except that it wasn’t, and the leaders were lying through their teeth.

Days earlier, Chernobyl had experienced what would become known as the greatest nuclear accident in history. The Soviet Union thought that this was bad for its image, so instead of handing out gas masks and evacuating people, it hushed up the story, silenced the media and pretended that nothing was untoward. Many of those who attended the May Day parade went on to die of radiation-related illnesses. And within two years, the Soviet Union itself collapsed.

I could not help thinking about all this while watching the May Day celebration in Valletta last Sunday. While the Maltese and international media raged on in disbelief about the Panama Papers and the reshuffle that never was, Joseph Muscat and Konrad Mizzi walked in to a hero’s welcome and assured the adoring crowd that everything is just fine. Ignoring the high levels of radiation, they claimed that Malta is making progress. Lying through their teeth, they said that Labour has ushered in a new economic boom.Gas masks are in order.

In an act of desperation following the revelations that Konrad Mizzi and Keith Schembri (and Brian Tonna) began the process to set up companies in Panama and the British Virgin Islands days after Labour got into government, a scandal compounded by other revelations in the Panama Papers, the government is tacitly pushing the message that, yes, Labour is corrupt but we should not complain because it has done much for the economy. This is a bare-faced lie.

The economy is doing well in spite of Labour and not because of it. By 2013, the Maltese economy was doing very well. Labour was not elected to fix the economy. It was elected to add value to it. It has patently failed to do this.

Labour’s whole plan, its roadmap, for adding value to the economy can be summarised as proving us wrong about the European Union and proving Mintoff, Mifsud Bonnici, Sant and Muscat right about China, Libya, Azerbaijan and the rest of the non-democratic world. This has been a complete flop, largely because the only reason those corrupt and undemocratic countries want anything to do with Malta in the first place is because it belongs to the European Union.

The Labour Party’s signature policy is the building of a new power station. This power station is supposed to lower electricity prices for businesses, reduce the debt burden on the state and leave more disposable income in everyone’s pockets. But prices have been reduced thanks to the BWSC power plant and the interconnector built by the previous government – and not because of the new power station which is nowhere to be seen.

Suffering major delays, the bankruptcy of one of its three main shareholders, experiencing cost overruns and mired in corruption scandals as it chases financing round the globe and ends up back in Malta for a loan from the cosy Bank of Valletta guaranteed by the desperate government trying to save its own political neck, this white elephant is going absolutely nowhere.

Labour used to talk about the power station as a means to an end. Now the power station has become an end in itself. Getting it built and operational, getting it commissioned, is the goal regardless of what Malta will have to go through to get that done. Something that was supposed to create an economic boom has instead become a massive liability, hanging by a thread from the likelihood of catastrophe, with taxpayers acting as guarantors on 360 million euros of private debt, with public land given to a Chinese state corporation for free, with 700 employees foisted onto the public payroll where they are not needed, and with secretive clauses in the contract which may yet turn this supposed part-privatisation of a company into a re-nationalisation exercise.

Even if it is ever up and running, that power station must qualify as the mother of all failures, and that’s before even looking at the links between the project and those companies in Panama.

The second biggest policy has been, as Joseph Muscat periodically reminds us when he goes off to some Third World country to promote it, selling Maltese citizenship. We were told that this will attract to Malta people of great talent who will contribute to making Maltese society better and wealthier. Yet the only person who we know to have bought a Maltese passport is Lalit Modi, a man wanted in India for corruption and money-laundering, who did so through Brian Tonna’s agency. Meanwhile, we have also got to know that this Brian Tonna, who has a desk in the prime minister’s office, and who has set up or restructured companies in Panama and the British Virgin Islands for Konrad Mizzi, Keith Schembri, and the managind director of Allied Newspapers, also set one up for himself, in which he can hide money made off the passport-hawking scheme.

Then there’s the American University of Baksheesh (except that we’ve now been told it’s against the law to call it a university), which was sold to the public as another great enterprise which adds value to the Maltese economy. But it is neither a university nor American, and we have no idea what the Jordanian builder whose project this is, Hani Hasan Naji Al Salah, paid to whom to get that large tract of seaside land. This would not be of much concern if Al Salah were wasting his own money and building on his own land in an urban area, but he is not.

Then there are those strange memorandums of understanding which the government signs from time to time and promotes in press conferences. As Libya was falling apart, its government lost control of Tripoli and oil production in that country fell to historic lows. But this did not stop Joseph Muscat signing a laughable MOU on buying cheap oil.

Recently, it was Algeria’s turn and a memorandum of understanding about health services. Now I don’t know what health services Malta can offer to Algeria or what health services Algeria can offer Malta in return, but what I do know is that President Abdelaziz Bouteflika, who is 79 and in poor health, is always being wheeled in and out of some hospital in Paris. I fail to see how the Francophone Algerians who can travel to Europe would ever choose Malta over France for their health requirements. Another hollow memorandum of understanding, perhaps.

To add to all this misery, now we also have to contend with the battering that Malta’s financial services industry is taking following the involvement of a cabinet minister, the Prime Minister’s chief of staff, and a man with a desk in the Office of the Prime Minister (Brian Tonna) in the biggest financial scandal of the century, the Panama Papers.

In short, it is wrong to think of corruption and government performance as two separate issues. They are interminably intertwined and the most corrupt countries are also always the most inefficient. Even when they do well economically, they tend to be underperforming and one big scandal away from complete disaster (see Brazil as an example). Malta is doing well now because it was doing well right up to March 2013. But the sleaze and corruption will eventually catch up with us and no May Day celebration will then be enough to cover up the nuclear meltdown.

Konrad Mizzi and Joseph Muscat strike another deal, this time in highly corrupt Montenegro

Konrad Mizzi and Joseph Muscat strike another deal, this time in highly corrupt Montenegro