The US Department of State recently issued a travel ban on “former Maltese public officials Konrad Mizzi and Keith Schembri due to their involvement in significant corruption”.
A ban on two disgraced public officials is not just a grave inconvenience for the individuals concerned. The reality is that it will create a ripple effect for years to come that will only become more pervasive. A quick Google search will indicate that the news of this ban was reported by various global media that generally find little to say about Malta because of its small size.
Potential foreign investors plan their moves on where to locate their economic activities carefully, as a wrong decision could cost them dearly. Experienced investors jealously defend their good reputation and look beyond cost savings when deciding where to invest.
The government is not particularly transparent in informing the public about the impact of the various incidents of corruption that have shocked the country over the last few years. The implications of high-profile, highly visible condemnations by, for instance, the Financial Action Task Force, the European Banking Authority, the European Parliament and, now, the US Department of State are only granted a cursory comment by Prime Minister Robert Abela, as though they were isolated minor incidents and not part of a growing pattern.
The US travel ban is the latest rebuke to Malta’s perceived lack of urgency in tackling corruption. It constitutes only the latest episode in Malta’s ongoing reputational failure, which the government would like to minimise in the eyes of the public.
Despite its small size, Malta is considered a thorn in the side of some countries that could influence how direct foreign investors take decisions. The Department of State, for instance, argues that Schembri and Mizzi “were involved in a corrupt scheme that entailed the award of a government contract for the construction of a power plant and related services in exchange for kickbacks and bribes”. What reputable firm would decide to invest in a country with such a tainted reputation?
The EU is just as determined to combat corruption, especially when European taxpayers’ money is used for mega projects that it promotes. The €200 million grant being requested by the government for a gas pipeline project that would benefit Electrogas would have to pass the scrutiny of the Union’s anti-sleaze watchdogs before it is even considered.
The prime minister’s mantra of promoting continuity in the high-risk economic strategy adopted in the last few years will only ensure that the scrutiny of international institutions and foreign governments will get tougher.
The European Commission, for instance, has repeatedly told the government to scrap the golden passports scheme even if the legality of this directive is debatable. In politics, however, size matters. If a large nation feels that the money-raising policies of a small country threaten its security, it will use its clout to ensure that it protects its interests.
It would be dangerous for the government to ignore the dynamics of realpolitik in international affairs by failing to acknowledge the risks that its golden passport scheme could pose for other member states.
The US travel ban on Schembri and Mizzi has shown how the effect of corrupt practices cannot be contained but ripples out to the wider world, with all the negative consequences of that.
This ban is not just about these disgraced politicians.
It is about the lingering distrust of foreign institutions and governments in Malta’s commitment to the rule of law.