Issue link: https://maltatoday.uberflip.com/i/747633
maltatoday, SUNDAY, 6 NOVEMBER 2016 15 counts for over 12% of our GDP and directly employs over 10,000 people..." However, de Marco denies that the reference to 'playground for the rich' was in any way related to the financial services industry. "Simon Busuttil was talking about an economy that values people on the basis of what they have to offer and not simply, on their net value. This remark has to be seen in the context of what is happening locally. We have a government that has put a price on Maltese citizenship. We have a government that is serving the rich and powerful, with flagrant disregard for the rights and ex- pectations of our citizens. This is not just the opinion of the Na- tionalist Party. This is the written opinion of the Auditor General. We are seeing an economy that unfortunately, over the past three years, has shifted into dangerous territory, where nothing seems to happen unless there is a finger of government lurking somewhere in the pie..." This establishes the PN's criti- cal opinion of the government's economic strategy... but it tells us little about how the PN would ad- minister the same sectors if it were in power today. What is the PN's economic vision for Malta? "We want to empower people. We want to create the right envi- ronment for ideas to flourish. We want to make sure that people are best prepared for tomorrow's economy. This is what trans- formed Malta from an inward looking economy in the 1980s into an economy that can stand on its own two feet. We did this; and by 'we' I do not mean only the Nationalist administrations of the post-1987 era. I mean we as a country, together as a people..." The government, he adds, has been regressive in this regard. "In its bid to appear pro-business, it is deciding who gets to do what. Consider this. Why was the gov- ernment involved in the takeo- ver of a private commercial bank by another private commercial bank? I can give other examples of course..." One other example I can sup- ply myself concerns the Paceville master plan: which has been criti- cised for proposing land reclama- tion and expropriation, mostly for commercial projects which will be undertaken by the private sector. The PN's response has so far high- lighted potential conflicts of inter- est: but what is de Marco's view of the project itself? "I do of course agree with co-or- dinating large scale development through master plans or other tools. The question is whether this master plan, as proposed, of- fers the best solution. I think the public outcry and the govern- ment's assertion that the plan is going to be changed, clearly show that the master plan fell way short of expectations. It failed to take into account the realities on the ground. It was described, I think quite effectively, as a desktop ex- ercise which ended up running roughshod over certain realities: including, I must say, legal realities that can make its implementation virtually impossible...." Among the more contentious is- sues is the expropriation of private property, which legally can only be done 'in the national interest'. How can a project like this, which clearly serves private commercial interests, qualify as a 'national pro- ject' in that sense? "Yes, this is in fact one of the le- gal minefields that the master plan chose to enter. There are others. I am not going to give my legal opin- ion on this matter, also because I think that you would rather have my political opinion. Transfor- mation projects of this nature are very delicate. We are not talk- ing about some green zone, but a densely packed area that combines an uneasy mixture of residential, commercial and leisure uses. The stakeholders should have been in- volved from the very beginning in this transformation process. This clearly did not happen. The legal means to achieve these shortcuts are highly questionable; the effec- tiveness of these means, even more so. If the government chooses to go down this route, it could very well end up with legal challenges that have the potential of delaying the whole development..." Turning to another PN criticism of Budget 2017: Mario de Marco recently said that the government needed to create 'new economy centres'. What sort of new sectors did he have in mind? "Again, this is a topic that was covered in our pre-budget docu- ment. We can and should be do- ing more to attract new businesses that operate in the green, blue, digital and creative economic sec- tors. This government has nothing to show in terms of attracting new business ideas to Malta. Its eco- nomic vision seems to have been limited to selling citizenship, and turning Malta into a rock-bed for concrete blocks. "Comparisons are odious, but one has to compare the dearth of ideas with what happened in the past when Malta managed to es- tablish new channels of business. I am of course referring to the financial services, iGaming, avia- tion servicing sector, maritime and shipping services, logistics and other lucrative areas of work. So when the government boasts of its economic achievements, it re- minds one of that cuckoo bird that lays its eggs in some other bird's nest because it was unable to build its own. "There is a danger to all this, be- cause our economic sectors are not immune to challenges. We built new sectors to replace those that fell due to loss of competitiveness. We have to assume that some of the sectors we have today will not be around forever. Hence the need to attract new lines of business..." One good reason to assume that the financial services sector may not be eternal is the fact that the European Union is actively considering a tax harmonisa- tion proposal. Labour and PN are united in opposing this plan. Yet the declared intention behind tax harmonisation is to avoid inter- nal competition when it comes to shopping around for favourable tax rates. Isn't there a contradic- tion here? The PN criticises the government for turning Malta into a tax haven... yet opposes an EU measure aimed at eliminating tax havens.... "The Labour government has lost all credibility on the subject of tax jurisdiction. This is a serious consequence of the Panama Pa- pers. The sooner the Prime Minis- ter realises this, the sooner we can clean up our image. Transparency International said as much when it tweeted that Malta has to clean up its act before taking over the EU presidency. The Panama debacle has thrown an unwanted spotlight on Malta, and the Prime Minister's handling of the situation limited our ability to fend off criticism. But fight we must; and fight we will, through solid arguments that show that onshore fiscal jurisdic- tions have served Europe well in the past. They are an intrinsic part of economic development and while there may be scope for fine tuning, it would be detrimental not just for some member states, but for the whole of Europe, if these ju- risdictions are abolished. And inci- dentally, we are not a tax haven..." Interview PN deputy leader MARIO DE MARCO likens the Labour government to the proverbial cuckoo, which lays its eggs in another bird's nest. Cuckoo's Nest PHOTOGRAPHY BY CHRIS MANGION