Issue link: https://maltatoday.uberflip.com/i/926403
8 News MEDICAL and educational tourism are the two niche sectors, the La- bour government has championed since it came to power almost five years ago. For four years, the international in- vestments in these two areas formed the basis of the government's re- sponse to criticism that it failed to attract new economic sectors. The roping in of a private investor to upgrade and run three State hos- pitals and the creation of a new pri- vate university were, along with the financial turnaround at Enemalta, put up by the government as proof of its ability to attract foreign invest- ment. And all this was happening against a backdrop of above-average GDP growth, falling unemployment, a growing labour market and a dimin- ishing deficit in public finances. But the two key projects involving Vitals Global Healthcare – in the hospitals niche – and the American University of Malta – in the educa- tion niche – appear to have lost their lustre. Mired in controversy since their inception over the credentials of the private investors behind them, and in AUM's case, the environmental concerns of developing a campus on land outside the development zone, both projects have hit serious snags. The problems both projects face appear to be far deeper than the teething troubles that one could ex- pect in new ventures. Vitals Global Healthcare had to in- vest more than €200 million to build a new general hospital in Gozo and completely revamp the St Luke's and Karin Grech hospitals. The aim behind the project was to have the private company attract foreign patients to Malta. Vitals would also make money off the State by selling beds for use in the public health service. At the same time it would relieve the government of the massive initial outlay to regenerate the three hospitals. Apart from the spin-off created during the construction phase, the hospitals project would have gen- erated medical tourism on a mass scale, contributing to economic growth. But now, less than two years into their 30-year concession agreement, VGH are trying to sell out to Ameri- can company Steward Healthcare. The deal has not been sealed yet maltatoday SUNDAY 14 JANUARY 2018 When the ship takes KURT SANSONE The part-privatisation of three public hospitals and the American University of Malta were fl agship projects for the incoming Labour administration of 2013. They now appear to be sinking ships. Kurt Sansone writes.