In the context of such a sensitive climate, the issue of good governance has never been more pertinent and pressing. With this in mind, the Malta Chamber of Commerce, Enterprise and Industry published a policy document in January 2020 on good governance, ethical standards and practices for the country.
Titled Ethical Business Calls for Change – A manifesto for Good Governance by the Malta Chamber of Commerce, Enterprise and Industry, the document aims to offer valuable guidance to incoming Prime Minister Robert Abela, “in his efforts to tackle, at the earliest, the need to implement the necessary reforms.”
Chamber members who contributed to the manifesto weigh in with their thoughts on the way forward from here.
John de Giorgio Chairman, Shireburn Software Ltd
John de Giorgio, who contributed to the compilation of the manifesto, says that, at this junction, sending the right message to both the local and international communities is vital.
“There is a narrow window of opportunity to achieve this. Effectively, all must see that nobody remains above the law and we see an end to impunity.
“Concrete and effective action must be taken to thoroughly investigate contracts and people involved in both proven and suspicious activities. Heads must roll. Any magisterial investigations already underway must be concluded without further delay and in a manner that gives confidence regarding the outcome.
“A credible Opposition also needs to rise out of the turmoil. Only following this can the slow process of reputation rebuilding commence.”
Singling out key areas proposed in the manifesto, Mr de Giorgio highlights the importance of transparency, equality and enforcement, competence, and rebuilding Malta’s reputation, which call for serious constitutional reforms to be undertaken.
“Government needs to be supportive of business and enterprise while maintaining transparency. This calls for greater transparency in procurement, logging and publication of meetings and travel of Government leaders and senior members of the Civil Service and authorities, both while on official business as well as personal.
“All Government contracts need to be published in full and Government should be prevented from entering into contracts which bar publication, except in respect of issues related to national security,” he says.
“On equality and enforcement, everyone needs to be equal under the law and laws need to be enforced rigorously and fairly.
Marisa Xuereb - Managing Director, Raesch Quarz (Malta)
Marisa Xuereb, also Vice-President of the Malta Chamber, asserts that the smaller the country, the more pertinent and challenging it is to ensure good governance is practiced across the board.
“What happened in Malta lately is a consequence of years of disregard of issues of good governance that permeated all levels of Government, business and society, particularly at a time when the economy was booming, and everyone – not just businesspeople – was too busy with making the most of the prevalent favourable tide to bother about much else.”
“The events that unfolded shook us to the core, but following the installation of a new Prime Minister, the political response has been encouraging, save for a couple of instances of poor judgement that were quickly retracted.
“The current scenario is one of extreme caution on both the political as well as the business sides, to make sure we don’t fall into the same embarrassing pitfalls,” she states.
Ms Xuereb adds that we need to be careful when talking about business confidence, as in the medium to long term, overconfidence can be just as damaging as lack of business confidence, “and it is apparent that some sectors had become rather bullish.”
“The biggest adverse impact is in terms of international reputation and restoring this must be the top priority. If we manage to get this right, business confidence will gradually be restored,” she asserts.
“The impact of reputational damage on foreign investment flow is likely to be a little more prolonged, as investment decisions are made over time and reputation is easily lost but painfully regained.”
The Chamber Vice-President concludes “we have been enjoying years of apparent stability, peace of mind and prosperity. But as we have realised, we had become comfortably numb. So, what we should seek to restore is integrity, accountability and fair competition. Long-term stability, peace of mind and prosperity will follow.”
Stefano Mallia - Partner, EMCS, and incoming President, Employers’ Group, European Economic and Social Committee (EESC)
“There is no doubt that Malta’s reputation as a serious jurisdiction has been tarnished. This did not happen overnight,” states Stefano Mallia. The former Chamber President asserts that the events that unfolded at the end of 2019 “brought everything to a head. The damage done to the country’s reputation was unprecedented.”
“As a Chamber, we have been unequivocal with the new Prime Minister as to what we believe needs to be done. We put together a strong document listing no less than 60 measures which we believe need to be implemented with urgency,” he says with reference to the manifesto. “We have also offered our full support to assist the authorities in restoring Malta’s reputation.”
Mr Mallia believes that the time-window for the country to give clear signals that there is now a firm departure from the misdemeanours of the past is short. “These clear signals must be given first and foremost by the Prime Minister himself. Serious issues concerning the lack of independence of our key institutions such as the Police, the Law Courts, the FIAU and others must be addressed immediately,” he states.
“Key contracts such as the power supply contract and the hospitals contract over which serious doubts have been cast need to be investigated and all findings must be made public. Officials or former officials found to have acted illegally must be made to answer for their actions.”
Mr Mallia adds that the Chamber also asked Government to suspend the Individual Investor Programme (IIP), “which has caused a lot of damage to the image of our country.” Singling out the financial services sector, Mr Mallia states that operators agree over the serious challenges brought about by the reputational damage Malta has suffered.
“This sector is heavily regulated and is serviced by top notch professionals, however it is also very vulnerable because it depends on the soundness (perceived and real) of our institutions. We are all aware of how important this sector is to our economy, not only in terms of revenues generated but also in terms of jobs. In the past this sector thrived on a sound reputation. We need to work to bring that back.”
This is the second part of an interview featured on the February/March edition of the Commercial Courier.