Need for solidarity trumps self-interest on EU recovery plan, according to Sant

The need for the EU to cooperate to avoid a total collapse in the face of the unprecedented crisis caused by the Covid-19 pandemic trumps any concerns that Malta – and others – may have about the bloc’s proposed economic package, according to former Prime Minister Alfred Sant.

Sant and fellow Labour MEP Josianne Cutajar held a videoconference with the press on Wednesday afternoon, ahead of a plenary session of the European Parliament which will discuss the EU’s economic recovery plans.

The Maltese government reaction to the plan proposed by the Commission has been lukewarm at best. In a video conference with his EU counterparts last week, Finance Minister Edward Scicluna noted, among other things, that Malta may end up becoming a net contributor to EU funds, and that the criteria through which loans and grants have bene allocated put Malta at a disadvantage.

Sant made his own reservations about the proposals clear, but stressed that “we face an enormous crisis, whose extent is not yet fully appreciated.”

“We should not be talking about how we will be carrying the burden ahead, but on how to cooperate so that the EU does not collapse,” the MEP said. “We can do our calculations later.”

But Sant also said that Malta was left with no alternatives because it had chosen to join the euro in 2008, stating that as a result, it had to bear part of a burden of enormous debt.

EU ‘stuck’ on negotiations

The Commission had unveiled the plan late last month, and the EP’s plenary session takes place ahead of EU leaders’ own online meeting discussing the plan on Friday. Sant pointed out that MEPs had limited powers in the process, only truly capable of making its opinion heard.

Before the Covid-19 pandemic struck, EU members had already been at loggerheads over the EU’s proposed budget for 2021-27, a process complicated by the fact that Brexit resulted in the loss of the second-largest net contributor of EU funds.

That issue is yet to be resolved, though as Sant pointed out, Commission President Ursula van der Leyen is seeking to do so by sticking to a frugal long-term budget whilst also shelling out on a recovery plan generally agreed to be necessary.

But the recovery plan is itself a source of conflict, with countries worst-affected wanting a generous package and others seeking to tighten the purse strings as much as possible.

“The EU has been stuck for months. It has managed to launch some measures to address the pandemic with respect to health, but when it comes to coordinating efforts on the economic crisis as well as on economic recovery things are jammed,” Sant said.

Both MEPs observed that countries were trying to look after their own interest, and that Malta was no excpetion. Cutajar highlighted Malta’s objection to the harmonisation of taxes, which could put an end to its low-tax regime. She also pointed out that as the EU expected solidarity in the face of the pandemic, similar solidarity should be offered to Malta on the issue of migration.

Malta’s lobbying limitations

One of the questions fielded by the press concerns the Mobility Package adopted by the European Council last April, which local freight companies have warned would negatively impact Maltese businesses by increasing trade costs and disproportionately affecting Malta as a country on the periphery of Europe.

Cutajar, who is presently a substitute member on the EP’s Committee on Transport and Tourism, noted that MEPs from other member states on the periphery of Europe raised similar objections, strengthening Malta’s own argument that the rules did not make sense. However, most countries still favoured the proposed package, with MEPs largely voting on national lines, rather than party ones.

“We knew it was an uphill struggle, though this did not mean that we did not play our part,” she said.

Both MEPs pointed out that discussions on the legislation started before Cutajar joined the committee upon her election to the EP last year, with Sant highlighting that Malta’s six MEPs were physically unable to cover all committees.

“But one thing that bothers me is that, if an issue truly has an impact on Malta, it does not only affect the government and MEPs,” he said, insisting that the private sector should be more proactive.

He noted that the Malta Business Bureau was set up to represent Maltese businesses’ interests in Europe, to “put these problems on our desk,” but was not aware of any such efforts on issue.