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18 maltatoday EXECUTIVE EDITOR Matthew Vella MANAGING EDITOR Saviour Balzan Letters to the Editor, MaltaToday, Vjal ir-Rihan, San Gwann SGN 9016 E-mail: dailynews@mediatoday.com.mt Letters must be concise, no pen names accepted, include full name and address maltatoday | SUNDAY • 14 JULY 2019 15 July, 2009 IMF: Maltese economy to contract by 2% in 2009 THE International Monetary Fund (IMF) is projecting that the Maltese economy will con- tract by 2.0% this year, with "a modest recov- ery" in 2010. In an unprecedented move until now, the IMF yesterday published its concluding state- ment at the end of its annual mission to Malta, a sort of an interim report on the local eco- nomic situation. The predicted contraction is a harsher pros- pect than the one made in the European Com- mission's Spring Economic Forecast last May, which was projecting a contraction of Malta's GDP rate of 0.9% in 2009 and a return to posi- tive territory in 2010 with a GDP rate of +0.2 per cent. Moreover, the IMF report estimates that Malta's budget deficit would fall below the 3% threshold set out by the EU's Stability and Growth Pact only in 2013, with public debt reaching 70% of GDP. In the Spring Economic Forecasts, Malta's budget deficit was forecast at 3.6% for this year, falling to 3.2% in 2010: just 0.2% short of the threshold set by the EU. As for the public debt figures, the EC has also forecast a growth beyond the 60% limit set out by the Stability and Growth Pact, with 67.0% for 2009 and 68.9% for next year. In its report, the IMF warned that Malta's economy was facing "its first test following successful EU entry and euro adoption." The prospect of euro area membership "pro- vided a useful anchor for reforms until 2007, and the common currency has helped Malta navigate troubled waters since then," the IMF explained in its interim report. "Yet, the unfavourable external environment is now challenging the economy's resilience, threatening to unravel past efforts at fiscal con- solidation, and possibly holding back the re- form impetus, even as the convergence process remains incomplete." For Malta to "fully grasp its growth oppor- tunity going forward and close the income gap with the euro area, the country needs to build consensus around a renewed reform strategy. "The mission projects a growth contraction of around 2% in 2009, followed by a modest recovery in 2010." …. The IMF Mission was forecasting that, "not- withstanding the disappearance of substantial spending one-offs related to the liquidation of the Shipyards, the general government deficit in percent of GDP would only marginally im- prove from the 2008 outcome." The IMF was highly critical of the Maltese authorities' decision to tolerate late tax pay- ments from companies with cash flow diffi- culties, as well as inviting hotels and banks to work on debt restructuring. MaltaToday 10 years ago Quote of the Week Sleepwalking into an emergency Editorial "I'm here to state that we respect institutions and that we are not engaging in battles that lead nowhere" Foreign Minister Carmelo Abela in London confirms that a public inquiry into the assassination of Daphne Caruana Galizia will be set up READERS and commenters on social media who debate the effects of our summer heat- waves and the irregularity of weather during the winter, should not be fooled by the blindness and comfort of denial. If there were any doubts about the reality of climate change, five or 10 years ago, the science today and global consen- sus, especially from recent IPCC reports, is that the world has moved beyond a certain point in the levels of CO2 in the atmosphere. Climate change is inevitable and very much our present – as a report this week predicted, with Maltese temperatures expected to turn into Middle East climes in the future. And that also warrants a different way of talking. From global 'warming', we should speak of global 'heating', of a climate emer- gency, and that we no longer have the power to mitigate but to adapt to the rising temper- atures that are becoming the new normal. This is an emergency that must concern us, the Maltese, and our political leaders – even though we find nobody who can translate the scientific knowledge into a political discourse that puts climate change high on the agenda, with all its effects on society, on agriculture and food safety, on health, on jobs, on trans- portation… A recent study from the University of Mal- ta forecasts a global rise in sea-levels, esti- mated at between 0.7 and 1 metre, which sci- entists stress is high for Malta. Some coastal areas will be severely affected: the Sliema and Ghallis coastlines, for instance, with major implications for the road network and traffic. Then there is the threat of increased salinity levels of the soil, a problem already with us due to over-extraction from the water table. Secondly, another major implication con- cerns the increase in flash-flooding – not be- cause of more rain, because annual precipita- tion will most likely be less, especially in the arid conditions predicted for Malta. But the rainfall will come down in more concentrated bursts, over shorter periods of time. Such floods will entail a loss of soil, with serious implications for agriculture. Indeed, it is clear to everyone in Malta, that our policymakers and legislators are doing the opposite, by widening roads and introducing more concrete that prevents rain from being captured and retained by the soil, with run-off instead going into the sea. Governments think mainly in terms of only five years, and without the climate emergen- cy becoming part of our political discourse, with its importance placed akin if not above to that we give to economic growth, we are condemning future Maltese generations to an island ill-equipped to mitigate the effects of its rising temperatures. Politically, climate change has to become a subject of national urgency. Our model of economic growth is intimately tied to the construction industry, tax planning and leg- islative fluency that allows foreign companies and major employers to find a friendly foot- hold on the island; with them comes the peril of overpopulation, and its effect on national infrastructure, rising carbon emissions, stress on power generation and water provision, food stocks, and the Maltese people's general well-being. But Malta needs a vision to prepare itself for the climate emergency that is evident elsewhere in the world. It needs a vision that can prepare it not only for the internal threats that climate change creates, but also for the external effects from increased migra- tion prompted by climate displacement. Which political leader will wake up to the nightmare of climate change and make Malta's preparedness part of their legacy, and perhaps their legacy of their tenure as prime minister inside the European Union? Malta actually led the international discussion on climate change, when it first started 40 years ago. It is right that one asks what difference tiny Malta can really make with regard to CO2 emissions. Yet it is a fact that the emis- sions of our massive shipping industry and registration regime, for example, are not cal- culated in Malta's official emissions rate; our central role to the trade of cryptocurrency should also open our eyes to the contribu- tor to emissions that the mining of coins – carried out by large computer rigs always switched on to solve ever more complex algo- rithms – create globally. Labour is now committing itself to dig a tunnel from Malta to Gozo, a proposal at odds with the idea to turn Gozo into an elec- tric car island. This is a lack of consistency which even Labour ministers are aware of, but they have yet to pronounce themselves against the tunnel project which they abhor. Yet those who lack the courage to stand out and take 'unpopular' stands that turn com- mon 'wisdom' on its head, should not be the ones to take the leadership of their country. Politically, this is an issue that should in- form Maltese people's wishes for their next leader. If Joseph Muscat makes his exit as planned, will his successor be a tone-deaf short-termist 'manager', or a game-changing visionary who can marry economic survival with climate adaptation? Unless the people start demanding this change in vision, we are nowhere near to getting what we deserve.