Editorial

Economic and political outlook for 2010

A new year usually triggers a dose of nostalgia but it also raises hopes of better times ahead, even though circumstances may cloud the prospects. The outgoing 2009 was a particularly difficult year for Malta as, indeed, for so many other countries, and 2010 may not turn out to be any easier, as, according to predictions, the island is only expected to come out of recession in the second half of the year.

The way the new year shapes up depends a lot on developments outside Malta. If the world's economy improves further, and if the economies of the countries of particular interest to the island continue to recover from the recession, the recovery prospects will, of course, be better than if the situation were to remain stagnant or get worse. Nevertheless, recovery also depends on the effort that is put in by the country's social and economic forces to beat the difficulties and tap new opportunities for economic expansion.

Unfortunately, the island ended the year with a feeling of doom, unwisely greatly heightened by the rise in the rates for water and electricity, which is expected to hit firms hard unless a way is found to cushion the blow. Even so, it would be wrong on the part of any of the social partners to whip up a sense of alarm over the matter, though it appears that the government is failing to think things out properly before coming out with new tariffs.

Though it is important for the island to do away with subsidies, the time of chipping further the subsidy on the water and electricity may be ill-timed in view of the fact that the country is still in recession. Maybe this is a reflection of the administrative weaknesses the government has been showing for quite some time now. When it started off in this legislature, after winning the general election by a very slim margin, it showed all the signs of unpreparedness to pick up from where it had left off in its previous term. This was clearly evident in the way it handled the privatisation process of the shipyards.

It had gone on to fare badly in the European Parliamentary elections, blaming, for this, illegal immigration, the rise in the utility tariffs, the uncertainty in the job market and public transport. But there were quite a number of other matters that had irritated the electorate, such as inflation, the long waiting time for operations at Mater Dei Hospital and the delay over the reform of the Malta Environment and Planning Authority.

The resignation of the PN general council president, disgruntlement among backbenchers, the Franco Debono case and the tactless way the Prime Minister is seen to be handling his own people have not helped make the life of the government any easier. Indeed, the government is showing distinct signs of fatigue. It badly needs some new blood, and ideas, to reinvigorate the Administration.

In the light of the economic downturn and the tribulations facing the government, Labour is winning greater political support but it is not yet showing that kind of political nous that inspires confidence in the possibility that a Labour government can do better at the helm than the Nationalists. On the contrary, its behaviour is proving quite the opposite. Will the Nationalists recover from their current bout of fatigue? Will Labour's new team mature enough to deserve power? The new year may provide the answers but do not bet on it.

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