Issue link: https://maltatoday.uberflip.com/i/1482697
9 EDITORIAL BusinessToday is published every Thursday. The newspaper is a MediaToday publication and is distributed to all leading stationers, business and financial institutions and banks. MANAGING EDITOR: SAVIOUR BALZAN EDITOR: PAUL COCKS BusinessToday, MediaToday, Vjal ir-Rihan, San Gwann SGN9016, Malta Newsroom email: bt@mediatoday.com.mt Advertising: afarrugia@mediatoday.com.mt Telephone: 00356 21 382741 CONTINUED FROM PAGE 1 Stability in electricity prices and fuels is important because it allows businesses to plan ahead with ease, given that unpredictability has been removed from one of the major cost factors. Businesses have one less thing to worry about next year and if need be in the following years. Obviously, this hefty expense comes at a price. Malta's public debt is ex- pected to rise further but even so, Caruana is forecasting that the debt-to-GDP ratio will still remain one percentage point shy of the 60% threshold next year and will oscillate around that in the subsequent two years. e price to buy stability is still one the country can afford and one the government is willing to pay. Any comparison between the Maltese situation and Liz Truss's disastrous budget plans in the UK that caused market turmoil and political suicide are totally misplaced. Caruana is judiciously using all the leeway gained over the past sev- en years when budget deficits were turned into surpluses to maintain a steady course while navigating chop- py waters. In Keynesian economic theory, now is the time to run deficits and use debt to sustain families and businesses. And even here, the forecast debt-to- GDP ratio will still be below the 70% mark registered at the end of 2012. Debt levels will remain sustainable. is has to be viewed as well with- in an EU-wide context where many member states have debt levels that are way beyond the 60% threshold. Budget 2023 also placed emphasis on supporting the elderly and vul- nerable families, who are always the hardest hit by inflation. Apart from being shielded from energy price in- creases like the rest of the population, pensioners will see their pensions increase by €12.50 per week – the biggest increase yet, and vulnerable families will be awarded a cost of liv- ing benefit over and above the COLA increase of €9.90. e costs of these two measures will be borne by government and thus will have no impact on businesses. ese measures were important from a social perspective. Keeping the ship steady, however, has come at the expense of providing direction towards a new economic model that steers towards value add- ed rather than population growth. ere is little in the budget that suggests how government intends achieving this shift. No new incen- tives were provided to: Encourage more investment in research and de- velopment; and the upskilling and re- skilling of the labour force. And the promise to strongly diversi- fy Malta's energy production into re- newable sources remains too vague. e use of Malta's vast offshore exclu- sive economic zone to erect floating wind farms gets a brief mention on the lines that the private sector will be invited to participate in develop- ing this sector. However, no budget or timelines have been indicated. Government's flagship €700 million over seven years' investment in urban greening projects has not been con- cretised into a work programme. It appears that only €10 million will be allocated next year. One would have expected a clearer timeline and sig- nificant budget allocation to kick off this investment in earnest next year. Keeping the ship steady has come at a price 27.10.2022