The business community is fretting about the government’s attempt to describe the greylisting of Malta by the Financial Action Task Force (FATF) as an almost inconsequential event that could be addressed by further administrative changes in the creaking governance system of the country.

In business, as in politics, perceptions are often more important than reality. The way that others look at us at present does not coincide with the way we look at ourselves.

The Malta Employers Association surveyed a good cross-section of local businesses to gauge how they believe the greylisting will affect the economy and their business. Eighty-eight per cent believe that the FATF decision will hit the Maltese economy, with 64 per cent anticipating strong repercussions.

While many would agree that the sooner Malta is removed from the grey list, the better it would be for the economy, it would be mistaken to believe that the damage done to Malta’s reputation can be eliminated anytime soon. Investors and international institutions have a long memory. The perception that Malta is not a country trusted to abide by anti-financial crime regulations might persist for a long time after the country leaves the grey list.

When presenting the survey results, the MEA director general, Joseph Farrugia, made a very valid argument that articulates the long-term risk of the greylisting: “Ultimately,” he said, “the biggest threat is not the greylisting itself, but the conditions which caused it.”

The government has failed to acknowledge the root causes of this crisis created by the previous Labour administration. The business community rightly called a spade a spade when it identified money laundering activities, a defective rule of law and justice system, institutional corruption, lack of transparency and weak institutions as the reasons behind the devaluation of Malta’s reputation.

The country’s more daunting challenge is not getting out of the grey list as soon as possible but dismantling a governance structure that promoted the abuse of power by politicians, some corrupt businesses, and public officials who believed they were above the law.

Admittedly, changes have started to be made. But the country has still much to do to convince the international business community that the tone from the top has indeed changed.

Unfortunately, there are too many indications that the government is still not fully committed to hardwire a culture of integrity in public governance. Justice Minister Edward Zammit Lewis made the most insensitive comment when he told parliament that the sun will still rise after the FATF decision to greylist Malta.

Rosianne Cutajar still sits on the government benches after having been found guilty of a breach of ethics by the Standards Commissioner. The prime minister has now put her on notice to sort out her tax affairs – but the message that such conduct will not be tolerated is still not strong enough.

Senior public officials who failed in their duties in some public governance structures were reassigned to other posts rather than be sacked for failing to adhere to high standards of professional behaviour.

So long as the government continues to put partisan political expediency ahead of a commitment to reform public governance in more than a superficial way, the country’s reputation will continue to suffer.

In the reform of public governance, what is needed is not continuity but a root and branch reform to dispel any doubts about Malta’s dedication to making a fresh start and coming fully in line with internationally recognised good governance practices.