Prime Minister Lawrence Gonzi told Parliament yesterday that if Malta found itself in financial difficulties it enjoyed the same rights as all the other eurozone members to receive support from the European Stability Mechanism. However, he was quick to point out that there was no indication Malta would find itself in such circumstances and ask for these guarantees.
He quoted the President of the European Council Herman van Rompoy as saying that each eurozone member had a right to apply to the mechanism and not if the whole eurozone was in danger.
Dr Gonzi was answering questions by the acting leader of the opposition Anġlu Farrugia and by Labour MPs George Vella, Carmelo Abela, Alfred Sant, Luciano Busuttil and Owen Bonnici and an interjection by Jean Pierre Farrugia (PN).
The Prime Minister said that percentagewise Malta was shouldering the same financial burden to the stability mechanism as Germany. The situation was clarified after Cyprus, supported by Malta, presented a note to the minutes of the council. He said this note was not meaningless, as alleged by Dr Sant, because the other heads of state had on record that the clause in the ESM applied to all member states. This note was not contested.
The same guarantees that applied under the European financial stability fund would be offered under the ESM, although there would be adjustments to the scheme.
Malta’s share in the ESM was to be 0.073 per cent in cash and guarantees to the €700 billion-fund. This meant that in cash Malta would be contributing €51 million to the fund over a period of five years.
He also told Dr Sant that he would consider tabling the consolidated plan to be presented to the EU on the fiscal deficit for the June council meeting. This plan formed part of the national reform programme which was agreed to by all the social partners.
Dr Gonzi repeated that Malta did not have the same problems on indexation of wages related to the cost of living increase as other countries. This did not mean that Malta should not make its utmost to be attentive to remain competitive.
There was no agreement between eurozone members on the common consolidated corporate tax base. This meant there was no tax harmonisation. Malta was ready to consider any proposal as long as this was revenue-neutral and Malta did not lose any of its competitiveness.
On the fiscal deficit, the Prime Minister said that Malta had registered a 3.7 per cent increase in the GDP and that its unemployment rate was under control. Hopefully, by the end of the year the fiscal deficit would drop to less than three per cent of the GDP.
The Prime Minister also answered questions relating to the situation in Libya.
He said that the Libyan Deputy Foreign Minister Abdul-Ati al-Obeidi had asked, through the Libyan Embassy in Malta, to meet him after visiting Greece and Turkey to clarify the position of his government. Dr Gonzi confirmed that he had contacts with the head of the Libyan Transitory Council in Benghazi, Mahmoud Jabril. There were members in the council who had been Muammar Gaddafi’s close associates. He said that the Libyan people should be given the chance to decide their future.
Dr Gonzi also confirmed that, despite pressures on the island’s resources, Malta was ready to receive a number of seriously wounded civilians from Misurata for treatment.
The ceasefire in Libya would take place on condition that the Gaddafi family relinquish power, the Prime Minister said. Col Gaddafi had lost his legitimacy and the end was inevitable.
The EU adopted a common foreign policy on the Libyan situation. There was a difference between the political and military position. Germany had chosen not to participate militarily in imposing the no-fly zone. Malta had made its position clear that its international airport could not be used for military purposes.
Malta had, from the start of the conflict, offered its support for humanitarian reasons. He confirmed that Malta was giving logistic support for the transportation of medical and other supplies from private organisations to Misurata and Benghazi. Dr Vella said the opposition also agreed with this.
The Prime Minister said that the European Council did not discuss investments in Libya negatively affected by the crisis.
On immigration, Dr Gonzi said that the council’s conclusions were positive. The number of migrants entering Malta within 24 hours was a mass influx and Malta was to continue insisting for intervention under the established EU mechanisms. Malta’s argument on the issue was value-based. France and Germany had taken migrants from Libya but other countries had stopped at offering solidarity only.
Malta also managed to establish that migrants be directed to the first safe port of call even if they were in the search and rescue area controlled by Malta.
In reply to other questions, Dr Gonzi said the council had pronounced itself on tests that had to be made to nuclear plants in EU countries to ensure safety standards. Malta had the necessary equipment to measure radiation levels but fortunately it was not affected by the fallout of nuclear radiation from Japan.