malta sliema

As Malta digested the news that former Prime Minister Joseph Muscat and those close to him would face their day in court after the Attorney General filed criminal charges against them relating to the “fraudulent” privatisation of three state hospitals, the business community was similarly analysing the price of further instability in a country that has so often recently made international headlines for all the wrong reasons.

Robert Abela / DOI Omar Camilleri
(L-R) Prime Minister Robert Abela and Justice Minister Jonathan Attard

Prime Minister Robert Abela’s response, criticised as “an attack” on the judiciary, not to mention the characterisation of critical journalists as part of “the establishment”, may have galvanised supporters but did nothing to calm the tense situation, attracting further condemnation as non-governmental organisations of all kinds urged the country’s leadership to keep a level head.

Chris Fearne
Chris Fearne

As more stakeholders adopted public positions, the first fallout from the scandal started to be felt, most notably with the resignation of Deputy Prime Minister and Minister for European Funds, Social Dialogue and Consumer Protection Chris Fearne from these roles. The former Health Minister however stayed on as deputy leader of the Labour Party, and insists on his innocence.

The situation is expected to continue making headlines over the next couple of weeks, with the date of arraignment of Dr Muscat and his close collaborators Konrad Mizzi and Keith Schembri set for 28th May.

Joseph Muscat

The Opposition Nationalist Party has submitted two requests to discuss issues arising from the inquiry in Parliament, both of which were shot down. During a demonstration held on Monday (yesterday), PN Leader Bernard Grech told protesters that the Prime Minister is attacking three elements of democracy at once – the judiciary, the media and the parliamentary process.

While business lobbies are unlikely to call people down to the streets, the various statements issued show they have no appetite for long drawn out instability.

Employers: ‘Attacks on judiciary strike at the heart of Malta’s democratic credentials’

In a rare joint statement, The Malta Chamber, the Malta Chamber of SMEs and the Malta Employers Association (MEA) on Wednesday 8th May called for an urgent meeting of the Malta Council for Economic and Social Development to deal with the “serious risk to economic stability and Malta’s international reputation.”

“The attacks on the judiciary strike at the heart of Malta’s democratic credentials and challenge basic principles of governance. Malta, having already suffered through being greylisted, cannot afford further reputational damage. Branding individuals, organizations, and institutions as ‘the establishment’ or enemies of the state does not contribute to the cause of justice,” they said.

“The perilous nature of the situation is underscored by the potential for destructive alienation and tension within society, posing significant threats to social and economic well-being, and weakening the rule of law. It is imperative that the findings of the inquiry are not subject to speculative conjectures that undermine trust in judicial institutions. Any criminal proceedings warranted, should happen without any political interference or threats to the judiciary. The judicial process must be allowed to take its course. Any attempts to undermine the integrity of the inquiry only serve to erode public trust in the institutions and compromise Government’s future standing.”

The Malta Chamber: ‘Deputy Prime Minister’s resignation shows ethical behaviour that should be followed by entire political class’

Malta Chamber
The Malta Chamber’s headquarters

In a statement issued after Deputy Prime Minister Chris Fearne tendered his resignation from Cabinet, The Malta Chamber described the move as “ethical behaviour that should be followed by the entire political class.”

It noted that Mr Fearne’s letter of resignation emphasised loyalty to the nation and its people above personal or party interests, asserting that the duty of a politician is to uphold the best interests of the country, its institutions and its people.

The Malta Chamber said: “Politicians must lead by example, demonstrating a commitment to ethical standards and accountability. We have become accustomed to seeing private persons resign from office following inquiries that implicate public authorities, while politicians carry on business-as-usual. Fearne’s resignation sets a high standard for political conduct.”

It further stressed that “justice delayed is justice denied – it punishes the innocent and favours the guilty, and also creates unnecessary uneasiness in people’s well-being and peace of mind as well as unnecessary instability in the economic climate.”

Abigail Agius Mamo: ‘Don’t bring elections into it’

Abigail Mamo portrait
Abigail Agius Mamo

Speaking to BusinessNow.mt, SME Chamber CEO Abigail Agius Mamo added that the filing of criminal charges against a former Prime Minister and top Government officials “continues to feed into the bad reputation which has been with us for a while.”

She said that instead of managing to get rid of this bad reputation, “we continue to regularly revisit the situation through new developments, generating more uncertainty.”

Ms Agius Mamo said that the Government “seems to be missing the whole point,” which is “the priority to close this once and for all, completely independently from any political interest, to restore Malta’s name and reputation.”

She also warned against the political rhetoric being used to conflate the result of 8th June Local Council and European Parliament elections with a vote of confidence in the inquiry is “completely out of context” and risks “such an important issue becoming lost in political rhetoric.”

Tony Zahra: ‘A serious risk to economic stability’

Tony Zahra, president of the Malta Hotels and Restaurants Association, struck a similar tone while remaining unmistakably more ambivalent in his comments to BusinessNow.mt, saying that the situation “poses a serious risk to economic stability as well as Malta’s international reputation.”

Tony Zahra / Image by Inigo Taylor

He said that “in light of these challenges, there is an urgent need to promote caution and attention to all public statements and all other actions taken by all Malta’s institutions, politicians and political parties.

“MHRA relies on the justice system to apply all legal remedies to ensure that the innocent are acquitted whereas those found guilty are held accountable.”

Mr Zahra also stressed that “everyone is presumed innocent until he or she is proven guilty,” and called for “transparency and accountability in upholding the integrity of our institutions and the rule of law.

“It is imperative that the findings of the inquiry are not subject to speculative conjectures. Any criminal proceedings warranted, should happen without any political or other interference. The judicial process must be allowed to take its course.”

The MHRA is therefore calling for “prompt and responsible action to safeguard the rule of law and stability in Malta and to ensure that the national interest will not be undermined by partisan agendas.”

Financial services bodies: ‘Attacks on rule of law unacceptable in a democratic society’

In another joint statement, the Institute of Financial Services Practitioners (IFSP), the Malta Institute of Accountants (MIA), the Malta Institute of Taxation (MIT) and the Society of Trusts & Estate Practioners (STEP – Malta) said they are “deeply concerned” about the current situation in the country.

The four professional associations said on Friday 10th May that attacks on members of the judiciary and against the workings of the judiciary are “unacceptable and condemned,” since such actions “undermine the independence and proper functioning of our democratic institutions and undermine the public’s confidence in the judiciary.”

They added that these attacks also potentially cause “irreparable damage to Malta’s reputation in the eyes of current and future investors, economic operators, practitioners in the financial services industry and assessors.”

They continued: “Attacks on the rule of law, members of the judiciary, or the judicial process itself are unacceptable in a democratic society. This may have untold repercussions and could have a severe, detrimental and lasting effect on the social well-being and stability of Malta.

“The judiciary is deserving of the highest respect and should be allowed to function with the complete serenity it requires in order to fulfil the fundamental and difficult role it has.

“Any doubts should be addressed through the proper institutional channels that exist in a democratic country like Malta, such as the Commission for the Administration of Justice and certainly not via the media or political platforms.”

The four financial services professional associations also sought to to highlight that the financial services sector has been “painstakingly” built over the past 35 years and is both a major contributor to Malta’s economy and a major employer.

“Any damage to our reputation as a stable, robust and serious financial centre will negatively affect the country as a whole.”

The said bodies therefore called on all to act responsibly and with integrity, whilst upholding the principles of the rule of law, good governance and full respect for the country’s judiciary and the Maltese Constitution.

As for FinanceMalta, a public-private partnership set up to promote Malta as a hub for financial services, it expressed its confidence to BusinessNow.mt that “the ongoing judicial processes will portray Malta as a jurisdiction with a resolve to strengthen its democratic processes.”

Asked whether current events may hamper future prospects of attracting investment to Malta, it said that while “there is no doubt that political events of such magnitude will have their repercussions, investment attractiveness rests on many factors – and Malta’s unique selling points remain strong.”

Gozo Business Chamber: ‘Judiciary should be left to do its work serenely’

In a statement released on Tuesday 14th May, the Gozo Business Chamber called for “maturity in all that is said, especially in the political sphere,” reminding those holding positions of influence that their words have “a significant impact on the whole of society.”

It pointed out that Malta’s legislative framework provides various remedies, and consequently the judiciary “should be left to do its work in a serene way” to enable justice to be done with all the parties concerned.

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