There was public outrage when the finance minister, Edward Scicluna, described the government of Malta as the victim of the Montenegro wind farm scam that this website has exposed. Yet, he is right. In a way. Just not in the way he meant it.
To understand why, remember this. If this deal is as corrupt as it looks, Malta is a victim twice over. Malta was robbed – and was made an accomplice of the robbers, making it subject to blackmail.
The evidence strongly indicates that Enemalta paid far more than it needed to for its share of the Mozura wind farm project. Enemalta admitted it paid €10.3 million for the Mozura acquisition only two weeks after another company had purchased the shares for €3.5 million.
At the end of a series of complicated transactions, Yorgen Fenech’s secret company 17 Black pocketed an extra €4.6 million (or possibly €4.8 million). At around the same time, the financial advisers of Konrad Mizzi and Keith Schembri wrote emails stating that the latter’s Panama companies expected to receive up to €2 million from 17 Black.
The basic outline of events follows a pattern similar to that of the Electrogas deal:
(1) The people of Montenegro end up paying three times the market price for the energy generated by this project.
(2) As with the Electrogas deal, you have an international consortium whose members are hidden in an array of disguises. Aspects of the deal remain shrouded in mystery.
(3) The protagonists of the deal include Fenech, Mizzi and Turab Musayev, very close to Azerbaijan’s corrupt ruling family and an executive of a subsidiary of SOCAR, Azerbaijan’s State oil company. Joseph Muscat is also highly visible, though he denies deep involvement.
(4) A business partner and close friend of the President of Montenegro ends up with a generous cut.
(5) The consortium now owning the wind farm, and pocketing the above-market rate profits, is led by the Chinese State.
As a result of the suspicious transactions, Enemalta paid three times more for its shares than they were worth two weeks earlier. It’s this part of the deal that the prime minister, Robert Abela, has described as disgusting. It’s this part that led Scicluna to describe the government as victim.
People were right, however, to be outraged by Scicluna’s remark. The mysterious transactions strongly suggest the government could only have been robbed thanks to an accomplice on the inside. An insider would have to be a high official. We still have to determine just how high.
However, even if the government’s top representatives in this deal – Muscat and Mizzi – were sleepwalking, that’s such gross negligence that it still qualifies as complicity of sorts.
It takes a nerve to describe the government as victim. Its then leaders bear responsibility for the scam – either by leaving the door to Malta’s coffers insecure or by actually letting the robbers in.
The deal, however, has a second aspect. Enemalta may have been cheated in the share price; but those are shares in what looks like a corrupt deal. In Montenegro, questions are even being raised as to whether Enemalta may have participated in tax fraud – by under declaring its costs.
It’s not just Enemalta that participated. The Maltese State participated in the ceremonies in which the deal was officially celebrated. It was represented by our then prime minister (Muscat) and two Cabinet ministers, Mizzi and Carmelo Abela, in his role as foreign minister (there is not the slightest whiff that Abela’s involvement was anything other than ceremonial).
The Maltese State participated in a deal featuring three other States, all with a well-deserved reputation for systemic corruption right at the top: Montenegro, Azerbaijan and China.
If this deal was as corrupt as it seems, then Malta was used as a Trojan horse (or getaway driver, if you like) in the heist. The State may have been roped in by individuals; but it’s still compromised.
Even if Muscat and Mizzi are innocent of criminal intent, they would still be politically responsible for compromising Malta and its reputation. It is in this sense that Scicluna is right to say the State (he said ‘government’) is the victim here.
To allow this situation is in itself disgraceful. But the truth could be even worse. If a member of our government was involved with criminal intent, then they were also subject to blackmail – by three States with plenty of reasons to need an EU Member State to act on their behalf within the Union.
What about our government now, under a different prime minister? In principle, it shouldn’t be subject to blackmail. If there was wrongdoing by former members of government, they can simply be prosecuted.
Except it’s not so simple. What if a prosecution led to an earthquake within Labour, such that it shook the government itself? Such a prosecution could end up sawing off the branch on which the government sits.
That is the true full force of the Montenegro scandal. It’s not just about our government looking like it was robbed. It’s about our government, even now, being potentially subject to a conflict of loyalties and blackmail by rogue States.