in

Capitalism, corruption and criminality

What do the concessions granted by Joseph Muscat’s government to Henley and Partners, Sadeen and Vitals have in common?

Over the years Malta has gained an undesirable reputation as an offshore haven for hot money within Europe

Joseph Muscat’s government has now been in power for almost five years and despite all the pomp and circumstance, it has failed to create new economic sectors.

From an employment and foreign direct investment perspective, the Labour administration has been very successful in steadying the ship captained by successive PN governments by consolidating the online gambling and financial services sectors.

Concurrently the Labour government has continued feeding the gluttonous construction industry by turning the Planning Authority into an auction house and embarking on a €700 million road upgrade project which will keep contractors happy for many years.

But notwithstanding all his ‘successes’, Muscat heads a tax haven which enables multinationals and criminal organisations alike to rob citizens of billions in unpaid taxes by taking advantage of Malta’s tax system.

Malta is consistently accused of being a centre for international money laundering and Muscat’s government has done very little to actively dispel these claims. Over the past 30 years the Maltese economy has become a magnet for criminal organisations as Malta has gained an undesirable reputation as an offshore haven for all the hot money in Europe.

Muscat and his éminence grise Keith Schembri would like to be remembered as some sort of sons of Plutus who distributed wealth indiscriminately. But, wealth is not being distributed blindly. Instead it is being distributed to the elite members of the inner circle and a few shady foreign companies.

Labour’s flagship investments include the construction of a new gas-powered power plant, the sale of passports to wealthy foreigners and flogging state assets to mysterious companies, including the privitisation of hospitals to Vitals and the concession of ODZ land to Jordanian construction company Sadeen.

All of the above have many things in common. None of them – bar the power plant – were announced in Labour’s electoral programme, they all remain shrouded in secrecy and they all prompted serious questions on why and how the companies were chosen.

In Sadeen’s case, government transferred 90,000 square metres of public land to a construction company with zero experience in running a university without any call for tenders, or any transparency whatsoever. The Jordanian company was simply hand-picked by the government, in a way that clearly flouts all known governance procedures.

It has now emerged, that not only was public land transferred to Sadeen at great environmental and social costs but according to its own projections, the American University of Malta is not in a position to fulfil the contractual obligations.

The privitisation of public hospitals to Vitals was no different. The company had no experience in running hospitals yet a Memorandum of Understanding (MoU) was signed before Vitals actually won the tender to run three state-owned hospitals.

Now, a few days before EU anti-money laundering laws came into force Vitals – whose owners remain unknown –  has supposedly sold its concession after a mere 21 months. The Shift reported that no final deal has been signed according to Vitals, despite Mizzi’s insistence.

The government’s announcement on 21 December welcoming the agreement between Vitals Global Healthcare and Steward Healthcare on the hospitals’ concession was put into question after a VGH spokesperson said the company was still “in negotiations” on the deal.

A few critical voices had warned that the chickens would one day come home to roost and now two of Muscat’s pet projects are in disarray while the sale of passports and the new power plant in Delimara remain, to say the least, shrouded in secrecy.

Rules are in place to safeguard the public and common good and Muscat’s government cannot expect to flout them with impunity, and not pay a price. These deals and the involvement of Schembri and ‘star’ minister Mizzi in the Panama Papers scandal are what Muscat will be remembered for.

Moreover, when Muscat will one day retire from public life, his legacy will be blotched by his ostensible perseverance in reinforcing a system which espouses ‘legal’ capitalism with corruption and criminality.

202 new dwellings instead of Salina Wharf hotel

Konrad Mizzi dismisses MEPs call for his removal with a party in Gozo