Close fight

Close fight seen in Malta parliamentary election according to a Reuters report published in the Khaleej Times:

Malta holds a parliamentary election on Saturday with the opposition Labour Party optimistic it can return to government after 10 years in the wilderness. The poll will be the first since the Mediterranean island of 400,000 became the European Union’s smallest member in 2004.

Labour is campaigning on a platform of change, saying the Nationalist Party has been in power for most of the last 20 years and is now short of ideas. Labour leader Alfred Sant, 60, had bitterly opposed EU membership. Sant, who was prime minister for 22 months between 1996 and 1998, froze Malta’s bid to join the EU, but the Nationalists reactivated the bid within days of being returned to power. Sant now insists that the EU is not an issue and says Labour can make more of a success of its membership than the current government.

This will be the first election with Prime Minister Lawrence Gonzi, 56, leading the Nationalists. He took over from Eddie Fenech Adami in 2004, days before Malta joined the EU. As finance minister, he restructured the economy and public finances, enabling Malta to join the euro zone on Jan. 1. Gonzi insists Labour is still sceptical about Europe and wants to reopen Malta’s EU accession agreement. Sant has said he wants to renegotiate conditions which ban state aid to loss-making Maltese shipyards from the end of this year, and he also favours better conditions for Malta’s farmers.

Latest official figures show the Maltese economy grew by 4.3 percent last year, well above the EU average, and the government deficit dropped to 1.6 percent of GDP. “A priority of a new Nationalist government is to achieve a budget surplus by 2010. That will be good for the economy, and it will signal confidence for investors,” Gonzi said on Wednesday. He is proposing income tax cuts to further spur growth, pointing out that tax cuts over the past two years had led to greater government revenues as the economy grew.

Both parties have promised to further strengthen Malta as an international financial centre. Financial services now account for at least 12 percent of the island’s GDP and Gonzi said he could see the sector accounting for a quarter in five years’ time. The sector has been buoyed by uncharacteristic consensus between the parties.

Independent opinion polls are in short supply but a Sunday newspaper survey showed the Nationalists edging ahead after having trailed earlier in the five-week campaign. However with a large number of voters still undecided, the battle is expected to go down to the wire. That is the norm in a country where voter turnout averages 95 percent and a difference of three percent between the parties is considered wide. First results are expected on Sunday.

The election is also being contested by two smaller parties, Alternattiva Demokratika, allied to the European Greens, and Azzjoni Nazzjonali, which is calling for a tough line against illegal immigration. Azzjoni Nazzjonali (National Action) leader Josie Muscat says if the EU does not share tackle the issue more forcefully, Malta should put migrants on the first plane to Brussels.