Finance Minister Clyde Caruana is a breath of fresh air. Comparisons are often odious. Caruana’s star shines brighter compared to some of his colleagues, who as elected officials leave much to be desired.
Caruana shines, despite the fact that pre-election he towed the party line imploring merit for the fake government ċejċa cheques, which remain simply income tax refunds.
Caruana has brought to our national attention the potential apocalypse, as recently declared in the Times of Malta, that “Malta’s population will have to balloon to 800,000 over the next 17 years if the country is to keep its economy growing and running at the current rate, unless a new economic model is devised”.
Caruana argues correctly that the country needs to overhaul its economic model in order to remain competitive in the face of local and international challenges.
“We don’t just need to rethink and reform, we need to reinvent ourselves. We need structural change, not mere reform,” Caruana said. Salient points that sensible people without their snout in the trough have long been asserting.
Considering the state of our economy and the inevitable crossing of the proverbial Rubicon, the following observations come to mind:
Firstly, labour market changes will accelerate globally. In Malta we take comfort from high levels of employment yet fail to take note of the severe social, cultural, environmental and economic distortion created by a large proportion of imported labour and the deteriorating size and quality of our domestic labour pool.
In reality, the Maltese are generally suffering a severe deterioration in the quality of their life while a few real estate-focused businesspeople benefit. The socio-economic balance must be restored. Caruana recognises the immediacy of the threat to Malta’s future.
Artificial intelligence (AI) is changing everything. Jobs – once thought desirable – are already being replaced by robotics. While I am confident humanity will come through, these distortions slow growth in many sectors.
Skills gaps will become more evident, and while lower wage earners will be the first to be impacted, we should not think this stops here.
It is already known that AI is better at financial portfolio management than highly qualified, experienced and very expensive analysts. AI is deeply into medicine and medical research as well as various engineering applications. The challenge is formidable, and as a united Malta we should chart our new course.
Like athletes on steroids, this new construction drive is proving unsustainable- Arnold Cassola
Malta has enjoyed ultra-high growth (relative to its EU peers) based on massive EU fund injections and government borrowing. We have little to show for it, other than urban and road sprawl. Like athletes on steroids, this new construction drive is proving unsustainable. Similarly, the feel-good factor of wealth and prosperity will prove elusive, revealing a thinly veiled charlatan’s trick that has increasingly exhibited the least socialist policies for a socialist government in the island’s history.
The local social and economic landscape is changing.
Despite what Michael Stivala tries to make us believe, construction has finally become imbued with resentment nationwide. Real estate development needs to pivot from the current sprawl to focus on conservation and restoration, with quality as a seriously enforced requirement.
This means a more intellect (engineering and design) focus on innovative restoration of existing properties, more skills employed in restoring stone and building embellishments, quality woodwork, subtly installed plumbing and ventilation.
These changes do not result in less profit, but require higher quality execution, giving skills, quality and dignity to our workers, preserving our culture and making our islands more appealing.
Secondly, green power must be embraced without encroaching on our scarce land footprint. This is tricky, as it requires the government to escape from the grip of developer ‘moguls’ who ride roughshod over it and the population.
Lastly, the public sector headcount must be strategically reduced. Malta has disproportionately high government employment, crowding out the private sector which imports labour across virtually all fields.
The current policy came into being in the post-World War 2 military rundowns, providing a necessary transitional buffer for our society, and is now unnecessary. Through education, training, apprenticeship schemes and financial incentives, as well as changes to minimum salary and work standards, the government must reposition the public/private sector balance.
Malta has been heading dritt għal ġol-ħajt since Joseph Muscat indoctrinated the Maltese with “make hay while the sun shines”.
If Caruana wants to be the leader he could potentially be, he should use his clout to bring about change now, knowing his actions will benefit future generations.
Arnold Cassola is former secretary general of the European Green Party and an independent candidate at next year’s MEP elections.