For example, during my teenage years, I befriended someone from San Ġwann and became familiar with much of the Mensija area. I continue to spend Saturday mornings in San Ġwann, where I have established relationships with several residents while running errands. Swieqi is another locality where I have spent considerable time with close friends, fostering an attachment to the area. Għarghur, where Ray’s maternal family originates, holds particular significance for me, evoking memories of Auntie Vitor and Ray’s mother, Żarena. Choosing another district proved challenging, as I felt it would be unfair to run in a district alongside colleagues I had recently supported. So, it was natural to choose the ninth district.

After more than three weeks of campaigning, I have observed that the second and ninth districts require distinct policy approaches. The second district faces urgent social housing challenges, particularly regarding the timely completion of units in Hanover (Bormla). Over the past four years, I have advocated for the prompt delivery of these units. The PL’s manifesto addresses affordable housing within the current economic context, an issue I am deeply committed to and have consistently campaigned for. As someone hailing from the second district, I am acutely aware of the community’s needs. Many residents seek little more than secure shelter and the opportunity to improve their lives. Some face insufficient income to maintain a decent standard of living or are excluded from qualifying for social housing. I recognise that social housing should not be a permanent entitlement. Individuals who experience improved circumstances should be provided with a transition period and, if appropriate, transition to affordable housing options. Addressing these issues is essential in the short- to medium-term.

Conversely, the ninth district requires targeted economic and environmental policies. In Swieqi, for example, residents struggle to open their windows during summer due to bitumen production coming from distant but yet close zones, which negatively affects their air quality, and the quality of life. I have engaged with residents who contacted me through social media and email, and I fully support their concerns. It is imperative that authorities intervene to ensure collective interests are protected over private gains. This is not a topic I am speaking about now. I have been advocating for better environmental management, and social matters for more than four years.

In Swatar, the community awaits a decision on a significant development project originating from the 2006 rationalisation under a PN government. The transformation of ODZ land in this valley raises concerns, particularly regarding the inclusion of a sufficient green buffer space. While private land development is understood, proportionality must guide such decisions to safeguard residents’ quality of life. On the other hand, in Pietà, increased traffic and problematic traffic lights in Msida and other areas exacerbate congestion. It is essential that residents are consulted before implementing pedestrian projects. This is what I believe, and compromises must be the norm not the exception.

Certainly, additional issues remain to be addressed, and time constraints prevented me from covering every locality in detail. I have valued the opportunity to engage with residents and learn about the realities of both districts. I respectfully request your support and assure you of my continued commitment to residents, regardless of the outcome. Observing how both districts evolve in the coming months will be insightful, particularly if the PL is re-elected. While some individuals express disappointment with certain candidates, ministers, or parliamentary secretaries, I encourage you not to abstain from voting. Instead, consider supporting new candidates on the PL’s ticket to effect change. Abstaining may inadvertently enable those who have disappointed you to be re-elected. Therefore, I urge you to participate in the election and make an informed choice. Furthermore, it is important to acknowledge the PL’s contributions to economic growth, social support, and national stability over the past few years.

Finally, I think Dr Robert Abela deserves another chance. His leadership contributed to continued stability. And frankly, Dr Abela has had to govern under exceptionally challenging circumstances, from shifting geopolitical realities and a global pandemic to yet another energy crisis stemming from the Middle East. Surely, we need to choose between stability and the unknown. And people stand to lose what they have achieved in the past years. The PL in government delivered most of its promises and improved people’s lives. Risking everything for an unknown recipe is not the best option. Hence, choose wisely.

The post Examining some of the realities of the second and ninth districts first appeared on The Malta Business Weekly.

Certainly, I had some time to read through the Nationalist Party’s pamphlet. One of the proposals that struck me was the paternity leave proposal under the Social Policy Chapter, proposal number 2. Here, the Nationalist Party is proposing a six-week fully paid paternity leave. However, those with a memory of an elephant remember that on Mother’s Day, the Leader of the Opposition proposed an extension of fully paid paternity leave of four weeks. The information is in the public domain; just Google Net News online. And legitimately, we ask, which version is correct?

Another contradiction concerns the proposal for renewable energy. Here, the Nationalist Party’s pamphlet states, under the Clean Energy Chapter, that it aims to reach a 30% renewable energy target by 2030, specifically under proposal number 8. However, under the Chapter Innovation, R&D and Digital Sectors, specifically proposal number 24, the Nationalist Party is proposing a 50% renewable energy target by 2030. The day after publishing their pamphlet, the Nationalist Party issued a statement correcting the figures after the media flagged them. I am mentioning it as it’s only fair to be true to what we are analysing and not to mislead our readers. Here, we can state that the Nationalist Party was not ready for a general election, despite its insistence that it would be ready whenever the general election was announced.

Another proposal the Nationalist Party is pledging is to reward university students with the equivalent of National Contribution for the years spent studying, a measure already implemented and in place. The credit for years spent at university contributing toward our future pensions is already in place, so in truth, it is a redundant proposal. What we have here is a situation where the electorate must decide which party will provide stability for their families. I was also let down by not finding anything relating to IVF. Whereas the PL is pledging an additional two cycles, up to five, fully covered by the state. And this boils down to empathy, and assistance to families. Before 2013, families trying to conceive babies through IVF were left on their own. Thereafter, the situation changed, and the PL assisted in amending the laws and conditions to provide greater clarity and support to families.

There are other proposals of the PN, which I wanted to cover in this weekly column. However, I also need to talk about the PL’s proposals. As I have already stated, one of the proposals I am most passionate about is the Affordable Housing proposal. We acknowledge that the increase in GDP and our economic success has brought new challenges to our families. And we must follow this not through statistics but through empathy. Surely, we, as economists, know quite well what families require, because over the past 13 years, the PL has stood shoulder to shoulder with them and the business sector. And they did it out of conviction, not convenience. The PL’s manifesto is clear. We need to go to another level.

The Wellbeing Index is ingenious, and we must seriously consider what’s being proposed to improve the quality of life. The PL is now presenting a manifesto that addresses the challenges of economic success. Gone are the days of an economy of €7 billion. With an economy of €24 billion we can now provide better assistance to our families, not least increases in students’ stipends, assistance with tax credit to our businesses, and additional measures such as the super bonus, the increase in pensions up to €50 per week, the 25% interest-free for first-time buyers and those priced out of the market, the €30,000 tax exemption for the younger generation, and the list goes on. Besides, the PL is pledging a target of a 4% annual GDP increase per annum during the legislature. The idea is to increase economic growth through sectors that add greater value, such as FinTech, Gaming, and Advanced Manufacturing, Family Offices, Prediction Markets, as well as new sectors like eResidency. These require limited space in a small territory and a less labour-intensive supply.

And the electorate will be analysing while they watch us, politicians, debate ideas and discuss our proposals on TV. They know in their hearts that the PL generated significant wealth and distributed it to families and businesses. What they will be asking before they enter the voting booth is whether they risk losing what they have achieved over the past years under a PL government or step into an uncertain and unknown territory. And the analysis will be done not because the Nationalist Party’s proposals are better, but because the PL’s manifesto is superior, and they delivered on their promises from 2013 onwards, unlike preceding Nationalist Party administrations.

My interest is that the younger generation requires a financial and economic boost to achieve their aspirations and dreams when they finish their studies or drop out of school with brilliant start-up ideas. And that financial and economic boost can only be given by the PL in government. As we did with their parents, and the older generation, Gen Z, Gen Alpha and Digital Natives know that there is only one party in Malta that can fulfil their dreams. And that party is the PL in government. The PL was always open to new ideas. And the testament of this is its track record. I urge you to read the PL’s manifesto, the proposal therein, and analyse what’s in it for them and for you, too.

The post It is all about credibility! first appeared on The Malta Business Weekly.

After my submission, I was interviewed by the media. I was asked what my top priorities are for the second and ninth districts, which I am contesting. For the former, I campaigned for more affordable housing units and stronger social policies. For the latter, there are decisions to be taken in the near future, and my top priority in this district is protecting the environment and safeguarding nature and biodiversity. We cannot have a situation in this country where the PL is campaigning for a better living, and others disregard the country’s pledges. My top priority will be the environment, which I have been working on for the past four years in the banking and financial industry, alongside social and governance issues.

For the environment, I want to see better coordination between the multiple entities that govern this country. Also, I want to see better safeguards on how we decide on parcels of land, especially in highly urbanised areas. My pledge of the right to adequate green space in highly urbanised areas, which I proposed during the MEP campaign, is here to stay. I want to see a different Malta. A Malta that promotes the environment and nature before excessive development. I am happy to see people earning money, developing sustainably, and aiding their families and children. Who doesn’t? However, we need to have safeguards in place. And this is why the environment is a top priority for me. This ties with the social and the well-being of citizens in affected communities. We cannot achieve social justice if we do not safeguard our future resources, because resource exploitation comes at the expense of the collective. Which in turn ties to governance. We need a stronger framework and better governance structures for the environment.

There were many improvements over the years with the establishment of the Building Construction Authority. However, we need to do more to put people’s minds at rest. We’ve reached a crossroads, and Malta clearly deserves stronger safeguards. I am happy to be on the PL’s ticket. And this is why I am running a different campaign relative to others. Surely, my loyalty remains towards the PL. However, proposing policies to aid the country doesn’t mean abandoning loyalty. I am an economist by profession. True, principles do not change unless there are grave matters that require prioritising the collective interest over individual interests. Right now, the PL is the only party that proposed a well-being index and a costed manifesto. So far, we haven’t seen anything at this level. We saw other proposals that cast doubt without providing a proper cost analysis. The PL is pledging to increase the well-being index by 25% over the baseline in the upcoming five years, which aligns with Malta Vision 2050. The proposals have been studied, and the finance minister knows they are executable on both implementation and financial grounds. The idea of a manifesto with a well-being index is contemporary and one we have been waiting for over the past few years.

The proposal for affordable housing measures and a 25% interest-free mortgage is a brilliant idea. We needed this to help first-time buyers planning to purchase a new dwelling. I already said that this proposal is one I have been campaigning for and is among the best, providing social justice and security to many individuals. Whether we like it or not, we must admit that the PL in government has brought a revolution over the past years, with an increase in median income and better social benefits. We can do more. But the most pressing issues are now being addressed in the current manifesto.

Certainly, if the electors of the second and ninth districts give me their trust, I will never disappoint them. I will be there to continue assisting people as I have over the past years. I am a different politician. I debate ideas and propose solutions. I did not spend my years bickering and whining about everything without giving solutions. Au contraire, I used this weekly column as a vehicle for ideas. I propose ideas, others take note and implement. This is how we must make politics. We use every medium to promote change. And you, who are reading, must also bring change. Change can’t happen by staying at home. If there were politicians who disappointed you, simply vote for others; just don’t change the party. Thank you for the support you have given me so far. You know I respect you and love you. Two more weeks to go.

The post My top priorities are the Environment, Social and Governance first appeared on The Malta Business Weekly.

I understand that it is not easy to re enter politics once you exit. I thought it was going to be a short lived experience, given that I ruled it out back in 2024, right after the MEP elections. However, when the PL presented the manifesto, I realised that it would have been a shame to be left out of what I have been campaigning for – inter alia, affordable housing and aid for those in need. The idea of a 25% interest free loan to cover accommodation is indeed commendable. Certainly, the policies that the PL is currently proposing are designed to address some of the anomalies, as well as those pockets that are not reaping the benefits of economic growth.

When people ask me whether these proposals are sustainable and whether they will add to the country’s debt, the answer must be given in relative terms. This means that if the economy keeps growing, and we address these pockets to improve the quality of life of many, then it is sustainable. We always speak of additional economic growth, but we fall short in asking what it comes at the expense of. Seeing the PL’s manifesto addressing these lacunas and pockets is indeed commendable. True, after the MEP elections, I wasn’t keen on re entering politics. However, my passion to aid people and serve the country, as I did in previous posts before joining the private sector, made me reconsider. Surely, what I campaigned for was simply to stand shoulder to shoulder with families, especially those less advantaged. I am not here promoting laziness. I am promoting what we must do as a state to provide the tools to elevate people. I can express this because I grew up in a deprived environment. Material well being wasn’t the norm. We struggled to make it in life, especially in Bormla and Cottonera. The stigma was certainly untoward and unfair to us. However, when given the right opportunities, we exploited them and moved forward.

My vision is wider, and I want to see the PL’s manifesto executed if the electorate gives Prime Minister Robert Abela another chance. Many observers argue that Dr Abela has demonstrated leadership, keeping Malta afloat through economic storms and geopolitical shocks over the past few years. Surely, having a manifesto that offers a well being index tied to all the policies presented is unprecedented. Commentators note that no other political party has ever achieved such a milestone. This aligns with what I have campaigned for in the private industry, in banking and finance. So, I think it is important to keep pushing these ideas against the backdrop of Malta Vision 2050. One of the proposals I pushed for over the past two years was proper remote working, as well as flexi time. I tied this to improving efficiency in terms of time and reducing emissions. The proposal can help alleviate some of the traffic problems. It is also in line with the EU’s direction on decarbonising the continent.

The PL presented several proposals that aim to help families. When you consider these policies in light of what is happening abroad, one might question their feasibility. However, when seen in isolation and relative to economic growth and public finance management, one realises that it is indeed possible to implement the policies presented so far. What we need to ensure is that the PL clearly explains the policies to the public, as they are doing. My role is to aid the PL in promoting such policies. As you all know, I have never had any problem criticising government policies when needed, and I have been quite blunt and explicit. We need to ensure that whatever is promised to the electorate is executable and well thought out.

What is being proposed on the other side is a different story. I have not been convinced by the energy proposal, which many analysts consider crucial for stability. The solar panel proposal seems half-baked. The refuelling hub proposal is to consider LNG, which is seen as a source of clean energy in transition by 2035. Thereafter, we would need to rethink how to do business. An investment that will take years to realise and become outdated before it is even realised in terms of EU policy direction. Some experts would have considered other energy sources in line with EU policy.

To conclude, what I said this week on TV is that if Dom Mintoff were still alive, he would be shoulder to shoulder with us, campaigning for this manifesto. It is a manifesto that promotes socialist leaning policies. And for this, I must thank the Prime Minister and the PL for listening to us, and to the public, when designing it. Thank you. I am happy to be part of the PL’s formidable team. Let’s do this.

The post Re-entering politics first appeared on The Malta Business Weekly.

The PL presented its first set of proposals the following day, including a 25% government loan of the property’s value to first-time buyers, interest-free and repayable over several years at a fixed rate. This measure is intended to support families with initial payments during their early years. Proposals for affordable housing to counter market speculation, such as those from the Foundation for Affordable Housing, may also be introduced. Another closely watched proposal concerns parental and maternal leave, offering additional weeks of leave to parents, a €5,000 birth bonus per child, and other measures targeted at families. Personally, I do not benefit from these proposals as I do not have children, nor do I benefit from the tax benefits announced during last year’s budget. Nonetheless, I appreciate that these measures were presented, as they seem necessary for the country at this time, even though my taxes subsidise such schemes. Furthermore, I welcome the proposal to increase pensions by €50 per week by the end of the next legislature, resulting in an increase of €200 per month over five years.

In addition, prior to this election announcement, the Minister for Transport launched Malta in Motion, a mass transport scheme connecting a rapid transit system along Malta’s Eastern coast, a bus shuttle service, a water transportation system, and cycling and walking lanes. This proposal aims to improve connectivity, ease congestion, and provide more sustainable travel options. I understand that many people were not amused by the proposal. Compared to the metro system proposal, it admittedly could be more ambitious, yet it remains the most feasible option presented so far. For the past four years, I have argued for connecting all transportation modes on our island, which measures 27km by 15km. The Minister for Finance has been clear. Approval depends on solid financial estimates of the costs, which is a prudent stance since we cannot afford mistakes. My position on social media has been that, by including the private sector and leveraging the budget through private capital, we could avoid funding the entire €2.8 billion from public finances. The remaining amount could be distributed over 15 years. This approach would ease pressure on public resources, and with moderate infrastructure adjustments – since further flyovers seem unlikely – the investment could be manageable if the economy grows as forecast by the European Commission and International Monetary Fund. Encouragingly, there is finally a national consensus that the economy is strong.

Another point, which was music to my ears when I listened to the prime minister, is that the PL’s electoral manifesto appears to be costed and provides a well-being index for the proposals presented. Indeed, the well-being index is highly commendable. Which measurements were chosen, as they are subjective and there are many forms, including the OECD, we still need to see. However, we are moving in the right direction, as this aligns with the Malta Vision 2050. The push, from now on, is to explain the well-being index to the public in layman’s terms, as it is quite subjective and intangible. Certainly, there are enough competent candidates, cabinet ministers, and MPs on the list who can articulate this easily to the public. Not to leave out the authors of the manifesto or those involved. Although it would have been interesting to see the reduction in emissions for this plan aligned with Europe’s decarbonisation strategy. Having a well-being index is already a great step in the right direction. Building on this is something we all aspire to, especially economists working in sustainability. The PL’s proposals so far are focused on family well-being. As time passes, we will see additional proposals announced.

By the time I wrote this article, I had not seen any PN proposals. I will write about them in upcoming opinion pieces. I only followed a press conference outlining what the PL failed to deliver during its term. Well, the Malta Flimkien manifesto was written for five years, not four years and two months. I will give a fair economic assessment of what is good and what is best for Malta from both sides. I was a candidate on the PL’s ticket in the last MEP elections. My allegiance is towards the PL, as I grew up within the party structures. Still, if there are good proposals from the other side or other parties, I will discuss them and state my views. I will also analyse PL’s proposals that I do not agree with.

During a general election campaign, our country must show maturity. I’ve already noticed divisive comments from both supporters, but we are all Maltese with mixed political family ties. Don’t let election fever harm family relationships over petty arguments. Support your party and discuss civilly within your family. Avoid political quarrels, especially among relatives. For now, everyone should remain calm as debates intensify. The PL currently leads in proposals. Perhaps next week, we can analyse the PN’s. Meanwhile, enjoy the election slogans, and I wish all candidates success as they meet voters and serve the people. I have been in that position before. Be honest and follow up on cases, as people are paying attention. If you need my help, I am here. Good luck!

The post A snap election has just been called in Malta! first appeared on The Malta Business Weekly.

I have written extensively on the traffic problem over the past years. I proposed building underground car parks in the outskirts of towns and villages. Parking spaces have become scarce due to infrastructure upgrades and population growth. We should use dilapidated, unregulated sites for underground parking. This would provide more parking while keeping the surface green, as seen abroad. Many government offices in Valletta could also be used more efficiently. We could explore using Marsa, in line with Chapman Taylor’s vision, to revitalise rundown areas. Such offices could support Marsa’s regeneration and provide walking access to Valletta, reducing traffic and emissions. Valletta’s palaces must be restored to help avoid rental office cost pressures. We must also preserve our UNESCO World Heritage status from over-exploitation. Teleworking and flexible hours are key to lowering emissions and reducing traffic from private vehicles.

Also, we need a serious discussion about how people should commute through new means of transportation. A water transportation system, connected to a tram system might be ideal on the island’s eastern coast. We do not need to dig up Malta to have this executed, because, firstly, we do not have space to dispose of our construction waste – unless we go for land reclamation – and doing so would be quite costly over a long period of time. We should first explore some low hanging fruit initiatives. Whatever is proposed is obviously welcomed. Besides, we might consider short-term measures and ask whether third country nationals need a driving licence to work and live in Malta, given that public transport is free, and perhaps delve further into data on tourists driving in Malta while on holiday. Eventually, I prefer to cap the number of rental cars for tourists per season to reduce emissions and traffic rather than impose it on locals, as some fringe parties have proposed. Traffic has indeed expanded to every hour of the day and every season.

Besides, the electorate expressed their concerns about over-construction. Indeed, I have also written extensively about the right policies to plan and pause some of the construction for refurbishments. The government did listen, as I saw a bit of a push in this area with grants that aid families to refurbish and green their properties. The Labour Congress last week was a good opportunity to listen to delegates and the public. After the MEP elections, I offered to help the PL draft the manifesto. As you know, I grew up within the Labour Party, so it is only reasonable to offer my services. Well, I would have loved to help, and I am still available should they need my services.

One of the reasons I kept this weekly column was to propose economic policies. And I know that many take note of what I write, and at times they use the ideas. Certainly, a policy which I would be happy to see in the upcoming manifesto is the preservation of residential gardens within our towns and villages. We need to revise our planning policies. Surely, the PL in government must stop contradicting itself on this matter. The government, rightly so, is spending millions to green Malta by restoring nature and refurbishing our existing open spaces for our families by planting hundreds of trees. However, in tandem, residential buildings that host mature trees and serve as green buffers between dwellings are being knocked down to make way for rows of flats.

Well, I understand that the PL is trying, through Project Green, to provide green open spaces within 10 minutes of every locality. However, when you arrive from work, after a busy day, and after spending time in traffic back and forth, the last thing you want is to open the window and see a row of blocks of flats and over-construction. If there is a green patch that can be saved within our highly urbanised areas, hosting gardens and mature trees, please preserve them. This can be tied to mental health problems too as part of an integrated approach, and what I have proposed as the right to adequate green space in highly urbanised areas two years ago. People cannot tolerate over-construction any longer, with roads closed for diversions to upgrade our infrastructure and, in tandem, the construction of rows of flats.

When I look at the electorate’s concerns, Malta’s problems seem largely planning-related, which is an irony given the economic success. However, no party in government was ever changed over traffic or construction issues. While the EU faces rising energy prices and economic challenges such as inflation, unemployment, and stagnating growth, I realise how fortunate we are in Malta to have the right government at the right time, with the right economic policies. Still, the government needs to accelerate road infrastructure upgrades. Currently, there are road closures and upgrades in several localities. Residents are not opposed to these upgrades, but their frustration stems from lengthy completion times caused by a lack of coordination among the various entities involved, including Enemalta (for cable upgrades), Water Services (for drainage and water pipes), and other agencies. It is indeed our malaise. Considering that the Marsa Junction was completed in just two years, it is hard to see why resurfacing and servicing a road should take about a year.

Indeed, the PL’s long-standing record and credibility are undeniable. Now, people expect higher-quality services. We must complete infrastructure projects on time, upgrade mass transportation where necessary, and preserve the environment. Over the past 13 years, the PL tripled the economy. We can address these issues today because our economy has grown faster than expected. Without economic growth, we cannot guarantee these services. We have already experienced this process in the 1970s and 1980s. Back then, the PL improved many lives in a very short time, and the electorate demanded higher-quality products. Now, 50 years later, the electorate seeks upgrades not in products, but in services, infrastructure, and the environment. Why? Because the basics are now met, the country is richer, and hence we must address higher-level of needs.

The post Taking note of the electorate’s concerns first appeared on The Malta Business Weekly.

Now that we know Peter Magyar won by a landslide, the answer is clear. You can attempt to manipulate democracy, but the electorate draws the line at alliances that run counter to their values. Let’s not forget Hungary’s history. After World War 2, Hungary became a Soviet‑aligned communist state, which unsettled many. The Hungarian Revolution of 1956 was a nationwide uprising against Soviet control and the communist government. It remains one of the most significant anti-Soviet movements of the Cold War, still shaping Hungarian identity. Back then, Western Europe looked away, becoming complicit in the aftermath when the secret police opened fire and triggered wider revolt. Hungarians demanded Soviet withdrawal, free speech, and a new government. Now, Hungarians demanded better governance in a democratic set-up.

Certainly, with Ukraine invaded by Russia and Orban aligning with Vladimir Putin’s foreign policy, this was a significant factor. Hungarians chose freedom in 2004 and reaffirmed that choice. The path to joining the EU is not easy, as it involves rigorous tests and scrutiny. I was there and witnessed this firsthand. Although the EU Commission may be somewhat lenient, the principles of democracy – especially independence of the judiciary and other institutions – cannot be altered. The sentiment that Hungarians did not want to slide back to regime alignment was clear. History teaches us all a lesson.

Besides, the US interference in Hungary did not go well either. In a period where there is a chaotic situation going on in the Middle East, and the surge of gas prices and oil prices because of a war that has the support of the US, this is reminiscent of the economic hardship that Hungary had to endure during the invasion of Ukraine and might once again need to bear due to the interference in Iran. Now we can argue that there are many economic factors stemming from the Ukrainian war, inflation that eroded people’s pockets, and the wrong economic policies of Orban’s government. However, interference from the EU or the US is still interference. And having Vice President JD Vance endorse Orbán in such a chaotic time certainly did not go down well with the electorate, given that many within the Trump administration don’t look favourably on the EU’s modus operandi. Besides, Magyar managed to convince and onboard Orban’s stronghold base in villages to vote for him.

Indeed, many of my readers may disagree with my position, but I have never and will never support Orbán’s government. Orban, during his tenure, demeaned minorities and implemented non‑Western policies that compromised freedom and liberties, especially in foreign policy. The EU stands apart from the US, and the prevailing US narrative about the EU does not resonate with many educated Europeans. While we have always been US allies, recent years have revealed growing cracks in the relationship – originating not in the EU but across the Atlantic. The EU and US operate differently, and US policies and rhetoric – especially recent discourse against minorities – do not resonate with European voters. Despite the EU’s flaws, the bureaucracy and incompetence at the highest echelons of the EU Commission, I would rather live here than anywhere else. Though I often find the President of the European Commission’s approach lacking due to her incompetence, I still prefer the EU’s way of life. Nevertheless, today, the EU must reassess itself, as the rules‑based order is faltering. I am not suggesting that we abandon rules, but clinging to unchanged policies will not serve a democratic Europe.

Now that Magyar has become Hungary’s Prime Minister, we can fairly say that his government will pursue a pro‑EU approach, or at least I hope he doesn’t descend into Orban’s path. To give my readers some background, Magyar is the leader of the Tisza Party, a centre‑right, pro‑European political movement. He was a Fidesz (Orban’s party) insider who later became a strong critic of Orban’s government. Peter campaigned on anti‑corruption reforms, restoring democratic institutions, and strengthening ties with the European Union. Indeed, his campaign achieved a historic victory in Sunday’s parliamentary elections, reaching a two‑thirds supermajority in Parliament. The turnout was also historical, with 77% of the electorate voting.

The EU’s approach to Hungary remains to be seen, particularly regarding EU funds, the new prime minister’s stance on the war in Ukraine, EU assistance on Cohesion funds to keep him in power for the long term, migration, and foreign policy. The next four years will be challenging, especially in restoring Hungary’s reputation abroad, navigating relationships with other governments, and stabilising the economy in a messy world. In truth, Magyar is no outsider, and that’s probably what augmented the victory and allowed him to beat Orban. He was shaped by the Fidesz party within the same political culture and networks that engineered his predecessor. And the way it looks is that he is still deeply embedded in that neo-patrimonial system. His politics aren’t that different either. However, it won’t be wise to pursue Orban’s policies, the same polices that the electorate just dumped in the trash bin of history.

The post You cannot fiddle with democracy! first appeared on The Malta Business Weekly.

I have seen some numbers and plots that, in truth, are a little worrying from a global economic perspective. Everything was revised downwards, due to this conflict, not least global economic growth. This week, President Trump lost his patience with the Iranians, to the point of asking them to open the ahem, Strait. However, the Iranians seem to be defiant, and they are totally ignoring the USA. To make matters worse, Iranians are telling EU countries that the passage is open to them, but not to the USA. Those allies aiding the USA will be targeted by Iran, and many merchant vessels passing through will be targeted. Under UNCLOS and the Law of the Sea, the passage cannot be blocked. However, no insurance company will cover the trade and the stock carried on those vessels. And this is making the situation even worse. So, besides the oil price spikes, the problem is also one of supply. By the time this article was written, the US and Iran had agreed to a ceasefire brokered by Pakistan. This, though, does not include Lebanon, and Israel seems to be forging ahead with their military interventions.

The EU has already signalled a move to ration fuel by encouraging carpooling and public transport, reducing air travel, and lowering the speed limit on highways to reduce fuel consumption, especially diesel. All this shows that the economic strain is now inseparable from the political and military escalation. Now that a two-week ceasefire has been agreed, there is a possibility that oil, LNG and other related energy commodities will pass through the Strait as it will be open. However, as I reiterated, it does not guarantee insurance of commodities, and the risk premia may be quite high. This week, the US, or better the President of the United States, resorted to Truth Social, going further in saying that if Iran is not ready to make a deal by the time of the deadline, an entire civilisation will die and will not come back. That threat is an ugly one. As the understanding is one that would go to lengths we haven’t seen since the Second World War. God forbid that something so ugly occurs.

Certainly, if Iran’s nuclear infrastructure has been decimated by the US, the regime is arguing that sanctions imposed on it might as well be lifted. There is no threat anymore. Meanwhile, Israel kept bombing Lebanon, pursuing Hezbollah members. And the entire region is in chaos. And naturally, this chaos is feeding directly into the global economic outlook. The global economic figures are not looking good. The IMF revised the economic growth downward. And if we carry on like this, next month will be crucial for feeling the pressure of the price spike. Inflation will pick up, wreaking havoc on many EU and Western economies. As many want this conflict to end as soon as possible, it doesn’t seem to be the case, even though a ceasefire has been agreed upon.

Even if the war stops, stability will take longer to restore. What I am intrigued to see is the EU at the negotiations and mediation table. The EU is looking conspicuous. By the EU, I do not mean the European Parliament. The latter lacks competence in foreign affairs and defence. They can only issue political statements that, in truth, only fuel further problems, misunderstandings and chaos. Some of the EU parliamentarians do not even know the history of Iran. When they speak, they look idiotic by the verses they write for themselves and the citations they cite from uninformed history books. And while the EU struggles diplomatically, it is also struggling economically.

What will surely hit us here is the increase in oil prices, although after the temporary ceasefire, prices eased. We must make sure to cushion this impact. The EU economy cannot handle such a shock. And the EU must intervene with its budget to look after its citizens. We cannot have a situation where money is spent on defence while people do not have food on their table. It’s becoming even more difficult for the EU to understand the economies. They are just trying to stay within the rules, which were designed years before any conflict or shock and do not make sense in today’s context. When meeting with economic operators in the industry, they tell you that costs are exorbitant, including compliance, green, and sustainability costs. The EU was not ready to issue legislation on reporting requirements amid a pandemic, a war in Europe, and ongoing conflicts. And the latest revisions were neither proportional to the original text nor a travesty of green initiatives. And this brings us to the reality we must face: many companies have incurred costs and uncertainties.

What we must deal with in the coming month, economically and security-wise, is the result of years of postponement of the EU’s problems. Luckily, in Malta, the GDP grew three times as much as it was in 2013. And we can cushion part of the impact and sustain it for a short to medium-term period. If it were not the case, we wouldn’t be able to sustain all the benefits provided by the PL in government since 2013, not least free childcare, increased pensions, and the public sector wage bill. People must realise that we do not live in a bubble. We are part of the world, and any impacts, regional or global, will affect our economy. The choices we make today will shape our future stability and prosperity. It is crucial that we remain vigilant, adaptive, and ready to take responsible decisions, both as individuals and as a country. The cushioning of these impacts depends on the ideologies of those governing the country. You either choose a government that believes in intervention or a party that believes in the free market. The choice is ultimately yours.

The post We do not live in a bubble here in Malta! first appeared on The Malta Business Weekly.

The President of the United States has threatened to withdraw security guarantees to NATO allies if they do not participate in the conflict in Iran and contribute to safeguarding the stability of the Strait of Hormuz. Europe’s security – encompassing both energy and defence – remains heavily dependent on the transatlantic relationship. The President stated that allies must either help maintain the stability of the Strait of Hormuz or purchase energy from the United States, which he claims is abundant in supply. Donald Trump has branded EU allies as “freeloaders”, reiterating his position that the United States should not increase defence spending to protect them unless they support his efforts regarding the Strait of Hormuz. This pressure adds another layer of complexity to Europe’s already fragile energy landscape.

Given the EU’s ongoing conflict with Russia over the war in Ukraine, the sanctions imposed in recent years, and its commitments to Ukraine, the alternative suppliers identified by the European Commission to replace Russian energy have proven problematic due to one route. The crisis in the Persian Gulf further complicates the situation, as even an immediate end to the conflict would leave the region highly unstable. Resolving the war through displays of strength would likely only extend the energy crisis. Commissioner Jorgensen’s recent statements echoed those of Commissioner Kadri Simson in 2022, but also incorporated rhetoric reminiscent of the pandemic era, when citizens were encouraged to work from home, reduce air travel, limit private vehicle use, and adopt renewable energy practices. The European Commission is currently adhering to the International Energy Agency’s (IEA) recommendations, which prioritise remote work to reduce oil demand, particularly diesel. The IEA also identifies jet fuel as a significant concern and thus advocates for reduced air travel to lower demand, ease energy price pressures, and curb emissions.

The IEA has recommended that remote work for at least three days per week can substantially reduce commuting‑related fuel consumption, particularly diesel. Last week, I highlighted on my social media that the energy crises of the 1970s led to a decade of stagflation, drawing on my experience as an economist analysing markets, international trade and geopolitics from my former PSC seat in Brussels. This perspective has provided me with insights into market behaviour, interconnectedness, and the influence of geopolitics. A single event can trigger widespread global economic disruption, as evidenced by the 1970s oil crisis, which caused significant economic hardship despite lower energy intensity in products and services at that time. In contrast, today’s environment is characterised by increased energy demand driven by advances in artificial intelligence, technology adoption, and rising consumerism. This makes the current crisis far more challenging to navigate.

The outlook for Europe is concerning. Historically, Europe has relied on external energy sources. The core issue is that the EU delayed investment in renewable energy for three decades. Now, the geopolitical context has shifted, and the EU has severed ties with Russia, a major supplier of liquefied natural gas and other energy products. In my view, it is imperative for the EU to invest in renewable energy or nuclear energy and pursue energy independence. Without substantial investment in renewables or nuclear energy, this issue will persist.

However, the challenge extends beyond energy security to encompass defence. The EU is currently economically ill‑equipped to address multiple crises simultaneously due to high public debt levels. Additionally, the new Multiannual Financial Framework (MFF) has adopted a different approach to defence investment. Prioritising energy security is essential before increasing defence spending. While concurrent investment in both areas is necessary, NATO and the United States remain irreplaceable in terms of defence capabilities. The United States is the primary provider of defence resources, and without its support, the EU would face significant difficulties. The bill is costly to replace the USA. This reality underscores the strategic imbalance Europe must confront.

Certainly, it is important to recognise that the President of the United States is fully aware that the EU cannot manage these challenges independently. Consequently, the EU requires stronger ties with the United States to maintain and advance its defence and security. Realistically, the EU cannot simultaneously invest heavily in defence and accelerate its transition to renewable energy. The economic situation in the EU is precarious, particularly debt to GDP ratio in major economies such as France and Italy. Surely, any significant economic instability in these countries could trigger a crisis for the euro, the currency used to purchase energy against the US dollar. A weakened euro would increase the cost of energy imports, compounding the effects of the current energy shock with a potential currency shock. This combination would be highly problematic.

Since Israel and the United States initiated attacks on Iran less than a month ago, oil and gas prices have surged by over 70%, as around one‑fifth of the world’s crude oil and liquefied natural gas supply is now obstructed in the Persian Gulf. Russia cannot serve as an alternative supplier, due to the EU’s intentional efforts to lessen reliance on Russian gas  – a milestone the EU has publicly celebrated. Reversing this policy is not feasible, particularly given the ongoing need to support Ukraine. Recent informal EU energy discussions have reportedly examined the necessity for state aid and greater investment in renewables or nuclear energy. It now appears that nuclear energy is being considered as the next step in the EU Commission’s strategy to strengthen energy security.

Malta’s political parties should consider the recommendations of the IEA and the EU Commission. Indeed, the Maltese government, along with the public sector should implement a teleworking schedule. Specifically, they should enable remote work and reinstate teleworking at pandemic levels, as I have previously advocated, to reduce CO2 emissions and ease traffic congestion. Nevertheless, policy in Malta is slow to implement, and by the time these measures are enacted, the Persian Gulf crisis may have subsided. Yet the global structural vulnerabilities will remain, and Malta cannot afford to ignore them.

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To understand this, consider how, during periods of rapid economic growth, benefits are felt across all groups. Yet those at the upper end of the income percentiles typically do best compared to lower- and middle-income earners. I explained this in my preceding articles tackling the K‑Shaped economy. Top earners have more opportunities to benefit from economic expansion, often possessing dormant capital and better liquidity to invest. To illustrate, let’s look at what happened over the past decade in Malta.

For instance, those who owned land that could be developed, much of it included in the 2006 rationalisation under a Nationalist government, saw an opportunity in 2013 to develop and earn money. The push was for development because the country needed investment to boost the economy. This helped landowners increase their income and generate more wealth by developing, building, and selling or renting their properties. This situation has a cascading effect, or what economists call a multiplier effect. Additional foreign direct investment increased GDP and helped sustain such developments. Over the past decade, the increase in foreign workers has further boosted rental income for many, who are using it as an additional pension for those now retired.

At the same time, digitalisation changed the way we live, especially in flight and hotel bookings. Many took advantage of increased tourism and invested in properties to rent, using platforms like Airbnb and Booking.com. They are earning a good income, even though it comes with additional infrastructural costs. Still, it remains a good business for many, and over the past decade, people have managed to invest and earn money. I mention property because it is topical, and when things get bad, especially during global inflation shocks, the property market is highly affected as prices rise again. When the economy struggles, and inflation hits hard, the lower- and middle-income percentiles are hit the hardest. The higher income percentiles hedge for future risks and have additional income from rents or interest on other investments. The impact is cushioned more smoothly, and those at the upper income percentiles can weather the storm better than the rest of the population.

Given these realities, my point is that, considering what is happening now, neither the government nor the Opposition can promise much to the electorate, since the priority is to cushion the impact of energy prices and maintain current tax cuts. However, the PL government – particularly under Dr Abela – has greater credibility, having managed three unprecedented events with minimal negative impact on our economy, without increasing taxes or adding a fuel surcharge, unlike in 2009.

Malta’s economy has tripled in growth since 2013, and the PL has enough fiscal space to navigate what lies ahead. However, promising the impossible is not credible, and even Prime Minister Robert Abela knows this from experience. For instance, when we talk about lowering VAT to 7%, we need to examine the industry’s structural problems first. This is not about keeping 11% of the difference between 18% and 7% as liquidity to invest in training and retraining. I understand the industry needs some breathing space because liquidity may have been hit, just as consumers’ liquidity was hit by inflation. We were all affected. However, we need to be careful and first examine structural costs unrelated to the VAT rate, including BCRS, waste management, and rental costs.

When considering these proposals, it’s important to understand that the industry is characterised by monopolistic competition. This market structure drives improvements in products and services. Competition breeds healthier products, and whatever the impact of the VAT reduction, it is competition that has improved our restaurants’ products under a VAT rate of 18%, which was introduced by a Nationalist administration. Restaurateurs and caterers are hardworking, and this is evident in the products they offer to consumers. My understanding is that the VAT decrease will not lower prices, so in the end, consumers will not benefit. As I reiterated in my previous article, the difference is intended to be invested in other areas. However, these areas must not be overlooked, as training and other costs have increased over time, indicating that the root of the problem lies in other unrelated costs, not the VAT rate.

With the general election approaching, we will see many hawkish proposals. We must pay attention to detail and not overlook what is being promised. If it is possible to lower VAT to 7% – if the European Commission allows it – and consumers ultimately benefit, then so be it. But the money lost from the VAT reduction is an opportunity cost of funds that could be invested elsewhere, including energy subsidies to maintain economic stability. Normally, if there are too many restaurants, the market adjusts itself. The invisible hand of Adam Smith takes over, profits balance out, and the least cost-effective go out of business. The struggle in the catering sector to work harder for better earnings is not only about reducing VAT rates but also about keeping costs low, as I outlined in my article last November. Sadly, the political class in this country lacks economists at the helm.

When you look at our Parliament, aside from a few parliamentarians, I am not sure whether the problem is chronic or acute. However, we need experienced economists and financiers in Parliament to have proper discussions. When Clyde Caruana and Silvio Schembri speak about finances and the economy, you can tell they are competent. There are others from the Opposition benches, but their performance is sometimes poor because, even if the arguments are good, their technicalities lack the depth of intellect seen in government. I appreciate these discussions, but they must be informed and supported by proper economics. What we need are not just a few numbers thrown at the electorate’s face to win an argument but economically backed arguments that most of us can process, digest, and decide on when the time comes.

This article was inspired by loyalty. Loyalty to colleagues and the electorate is essential in a democracy. People are tired of populist promises. Voters want truth, bold decisions for Malta, and consistent integrity. Sadly, many see politics as a celebrity show. I believe competence will guide voter choices in the next election. And this is why I chose the title. Because, in truth, when global economic shocks affect our economies, they do not align with the local political narrative!

The post When global economic shocks do not meet local political narratives! first appeared on The Malta Business Weekly.