It is a pity that the Minister of Foreign Affairs did not take us in his confidence - as a Foreign and European Affairs Committee - the same way he did over the illegal immigration issue.

Had he done so the parliamentary debate on the fisheries zones issue could have been even more focused, dealing with the need to put our good relations with Libya and Tunisia on an even sounder footing.

When I claimed that relations between Malta and Libya appeared to be too formal and static I said so out of genuine concern that there did not seem to be the deep sense of mutual trust that is necessary to spur such relations forward.

It was in this light that I proposed that the long-planned visit by Libyan leader Muammar Gaddafi could serve as a stimulus to inject a new lease of life into these relations.

Even were we to put apart the fisheries zone issue and the illegal immigrants issue over which some positive movement can be detected in both cases, there are various bilateral issues between Malta and Libya that need to be addressed in the hope of serving as catalysts to give added momentum to these relations.

I have a strong feeling that although the Libyans reluctantly admitted that the imposition of visas was inevitable due to our accession within the European Union, Malta sent the wrong signal when it seems to have refrained from negotiating with the EU to phase in this process rather than imposing it overnight the way it did upon accession. As a consequence I still continue to receive complaints from Maltese businessmen that they are still encountering some visa problems although admittedly the process has been speeded up and improved upon compared to what it was a few months back.

The weak arguments brought up in the House by Minister Austin Gatt as to why Malta has decided to refrain from purchasing any more oil from Libya in preference to opting for the open market, under the pretext that former refinery arrangements were murky and lacked transparency, did little to justify the apparently strategic decision to stop purchasing oil from Libya. That is unless the government has reversed its policy since the matter was last raised in Parliament by me a few months back.

The future of the Libyan Arab Maltese Holding Company (LAMHCO) remains uncertain in the sense that my parliamentary claim that the Libyans were interested in setting up a joint fishing venture with Malta only to meet Maltese disinterest was not contested by government ministers in the House.

The government must have sent the Libyans the wrong signal when it indicated a couple of years back that it wanted to privatise this company. Did it consult the Libyans before making such a statement? I say so because this company is jointly owned by the two governments and, given the feasibility of certain projects, the Maltese and Libyan governments could continue to support any new business initiatives by this holding company on which I was honoured to serve between 1982-86 as a director.

As far as I know it was originally government strategy to help LAMHCO consolidate its position through an investment programme to capitalise upon the opportunities that were expected to ensue from both Malta's EU membership and the new positive realities that are taking place in Libya. I am aware that both LAMHCO and its subsidiaries do have such plans underway but in order to clear the air once and for all it is imperative for Minister Gatt to declare publicly whether the company is one of those earmarked for privatisation by the end of next year. Particularly in the light of his recent sweeping statement to a foreign TV station that the government intends to become the first EU member state to divest itself of all state holdings by the end of 2006.

Progress on outstanding Libyan dues is another healthy indicator although final settlement of such dues still has some way to go.

Through its own economic initiatives Malta should be directly contributing to Libya's efforts to diversify its economy while improving the standard of living of its people.

Although it is difficult to keep track of the reform process without actually visiting the country, Libya set itself a daunting task when it submitted its bid for membership of the WTO - a move that must be seen and appraised within the big picture of reforms underway in this friendly neighbour country.

Another area which, apart from the commendable Corinthia investment, seems to have been under-tapped is the tourism sector. We have so much to offer by way of direct investments, entrepreneurial skills, marketing capabilities and management know-how.

While continuing to encourage Libya to integrate itself within the Euro Med process when it best deems fit, we need to have a more clearly defined bilateral strategy. If it does exist we as an opposition are not privy to it.

Gone are the days when Libya thrived solely on earnings from the petrochemical sector. While actively endeavouring to set up a competitive and resilient manufacturing sector, it is taking banking reforms seriously while at the same time working hard to create the right environment that will be even more conducive than so far to foreign direct investment.

I am not expecting the government to do everything single-handedly. Gone are the days when massive state intervention was the be-all and do-all of such relationships. But on the other hand it needs to visibly act as a facilitator both for Maltese service providers and producers of manufactured goods.

The idea of setting up a Business Council between Maltese and Libyan entrepreneurs has our support but the government should strive to ensure that this process is carried forward with sufficient impetus.

On their part Maltese entrepreneurs should show enough courage to consider investment in Libya's retail trade or else as using Libya not only as a manufacturing base but also as a stepping stone to other Arab markets nearby.

Given the sluggish economic growth in Europe, while continuing to explore and exploit our trade and investment opportunities with both EU and non-EU European countries, we need to focus even more firmly than in the past on economic, commercial and financial relations with Libya, a country which through no coincidence is our major trading and investment partner in Africa.

Leo Brincat is the main opposition spokesman on foreign affairs and IT.

leo.brincat@gov.mt