Editorial • January 18 2004

It’s all about being competitive

The number of jobless has become a burning issue. The level of unemployment is a major source of concern carrying serious economic and social implications. The issue must be tackled head on.
The announced meeting to take place between the Prime Minister and the social partners is most appropriate. We hope a line of action can be agreed upon and, soon after, implemented, to reach pre-determined targets. Tackling joblessness requires a serious and honest assessment of its causes.
In essence, unemployment is rising because our country is no longer competitive. We are experiencing difficulties in competing on the international market. This is the cause and we are all best advised to find solutions based on this economic reality.
Citing globalisation or the EU as the cause of rising unemployment is far too simplistic. It only reminds us of the Mintoff government blaming the global economic recession as the cause of our economic difficulties in the early eighties. Both globalisation and Europe have an impact on our economy, but the real cause is lack of competitiveness. Consequently, a more profound study analysing what is making our country uncompetitive needs to be carried out.
The causes of our uncompetitiveness are various including the working practices and the over-manning especially in the public sector. The exaggerated number of national holidays, the discrimination between workers in the public and the private sector, the half-days for persons employed in the public sector, the monopolies which render certain services too expensive. The list is endless.
This government which traditionally and with great success has been perceived to be pro-business and sympathetic to the difficulties businesses encounter risks losing its reputation as the better manager of the economy. It must pro-actively address the difficulties businesses are facing. The government is not all to blame. Private enterprise too must change and many private companies are still managed like small fiefdoms with no distinction between company and personal accounts. The Price Club scandal reported in today’s MaltaToday is a case in point.
Overcoming these difficulties requires both the political will and the flexibility in the private sector. The Opposition is right in asking for a recovery plan but wrong in not putting up its own plans for public scrutiny and discussion. The Opposition should come up with some solutions. Private enterprise too must stop being parochial and look to the long term.
One need not be a rocket scientist to individuate some of the steps which need to be taken forthwith: a freeze on all further recruitment within the public sector, downsizing the number of national holidays, removing most of the half-days from public sector employees in the summer. Added to this the introduction of stricter control on Government spending, tax collection and the war on tax evasion and ensuring that all government spending is both scrutinised and reaches the criterion of value for money, and make the government agencies far more accountable.
Most especially one must pro-actively chase foreign investment. The case of ITS [Malta] ltd exposes the delays, shortcomings and deep-seated bureaucracy still prevalent and which is impeding the easy flow of foreign investment.
Direct foreign investment will not come simply because of membership in the European Union. Lining up with Malta, will be all the other acceding countries fighting for this same investment. It will only reach our shores if we are competitive and have the vision.