Thursday

19th Jul 2018

Malta PM battles for survival after Panama leak

  • Opposition leader Busuttil speaks to crowd outside PM's office in Valletta on Sunday (Photo: Alan Carville)

Thousands of people poured into Malta’s capital city, Valletta, on Sunday (10 April) in a show of anger over revelations in the Panama Papers that top government figures had created shady offshore entities.

Chanting “barra, barra”, which means “out, out”, and carrying placards with the same word in Malta’s two official languages, English and Maltese, they called for the resignation of prime minister Joseph Muscat, his chief of staff, businessman Keith Schembri, and his minister for energy and health, Konrad Mizzi.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... our join as a group

  • Muscat, the PM, left for Jordan as the crowd gathered (Photo: Alan Carville)

Mizzi and Schembri had set up secret companies in Panama, held by undisclosed trusts in New Zealand, after they took office in March 2013.

They also tried to open secret bank accounts in Panama and in Dubai at the same time as negotiating a behind-closed-doors energy deal with Azerbaijan, a notoriously corrupt dictatorship.

Muscat’s refusal to hold them to account has prompted the opposition Nationalist Party to table a motion of no confidence in his government.

A parliamentary committee is to decide the date of the no-confidence vote on Monday evening.

Muscat, who is on a trip to Jordan and Lebanon, had proposed Friday for the vote. But the opposition said that would not give MPs enough speaking time, and asked for it to be held early next week.

Speaking to the crowd in Valletta on Sunday, Nationalist Party leader Simon Busuttil said Muscat had “lost the moral authority to lead the country”.

“We are not calling for the resignation of the entire government, or for an early election,” he said.

“The Labour Party can govern legitimately for another two years. But we are demanding that the prime minister should go, taking with him his chief of staff and his minister Konrad Mizzi.”

Government 'confident'

A few hours before the rally, the Australian Financial Review broke news of another offshore company created by Schembri in the British Virgin Islands in 2011, shortly before the Labour Party was elected.

One of the protesters, 50-year-old office worker Angie, told EUobserver she felt “degraded and embarrassed” by the “greed and corruption”.

A common theme at the protest was the feeling that the prime minister had directly broken promises to lead a clean and transparent government.

“We were promised transparency, meritocracy and a new way of doing politics, and we got jack,” said Daniel, a 29-year-old accountant.

Busuttil, the opposition leader and former MEP, told the crowd: “The prime minister finds out that his favourite minister has a secret company in Panama, and instead of kicking him out, he promotes him.

“These are not just any members of the government, but the two who are closest to the prime minister.

“They are the people who negotiated the biggest contracts, which they have refused to publish or put up for discussion in parliament. The prime minister could be involved himself.”

Muscat declined to comment on the street protest before leaving for the Middle East trade trip.

He earlier said he would wait for the result of an independent audit into the finances of Mizzi and Schembri before making a decision.

Muscat's spokesman Kurt Farrugia told this website on Monday that the government was confident it would win an “unequivocal vote of confidence” in parliament.

Predecessor backs PM

Mizzi last week said he created the offshore entities because his wife is Chinese and they own property in London. He said his current job “does not mean that I will be here [in Malta] forever.”

Schembri, a former businessman, said he created the structures because his business advisers told him they were needed to manage his holdings in foreign firms.

The Labour Party has a comfortable majority in parliament ahead of the no confidence vote.

But in signs of cracks inside Muscat’s camp, Edward Scicluna, Muscat’s finance minister, last week urged the PM to take “hard decisions” on Mizzi and Schembri for the sake of Malta’s international reputation.

Alfred Sant, a former Labour Party prime minister who led the party between 1992 and 2008, said on Facebook on Sunday that Muscat had “behaved prudently and with an admirable sense of fair play”, urging members to give him “full support”.

But he added: “In his own interest … as well as the national interest, the honourable thing to do would be for minister Konrad Mizzi to resign as quickly as possible.

“In that way, too, he will be better able to defend his name and his honour.”

Malta ‘suffering’

A Maltese international relations expert, Joseph Pirotta, told EUobserver the affair was “destabilising the country”.

“The economy and all that goes with it is suffering,” he said.

Josef Vella, of the Voice of the Workers trade union, which participated in the demonstration yesterday, said he felt “insulted” by the actions of the government.

“We are moving from one soap opera of scandal to another,” he said.

However, Malta’s Chamber of Commerce appears to be exercising patience.

“We are waiting for the prime minister’s decision,” Anton Borg, the chamber's president, told EUobserver by telephone after the protest.

“He said that he will decide and let us know what he has decided, and we are waiting for that decision.”

German daily Sueddeutche Zeitung has led the exposure of the offshore dealings of politicians and business people from around the world after it obtained a leak of 11.5 million files from Mossack Fonseca, a Panamanian law firm.

The revelations, published by several media in partnership with the International Consortium of Investigative Journalists in Washington, also implicated top politicians in Iceland, Russia, the UK, and Ukraine.

Iceland’s PM has stepped down and British PM David Cameron, who was forced to admit he made a profit from offshore entities created by his father, has promised to pass a law to punish companies that facilitate tax evasion.

Panama Papers: Iceland PM half-resigns

Iceland PM to step aside, but only for "an unspecified amount of time”, as ruling coalition fights for survival following Panama Papers leak on offshore funds.

EU and Japan wave light in Trump's 'darkness'

EU leaders and Japanese prime minister signed a series of agreements, including the EU's biggest trade deal ever, designed as an answer to the disruption of the world order by the US president.

News in Brief

  1. Johnson slams 'dithering' May in resignation speech
  2. EU border guards to be sent to Macedonia
  3. Juncker investment plan exceeds target
  4. EU will reply 'tit for tat' to US trade measures
  5. EU Commission registers Brexit citizenship petition
  6. EU launches pre-accession probe for Albania and Macedonia
  7. Google faces multibillion euro EU fine for Android
  8. EU wants more guarantees from VW on Dieselgate fix

Stakeholders' Highlights

  1. IPHRCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  2. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  3. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow
  4. UNICEFWhat Kind of Europe Do Children Want? Unicef & Eurochild Launch Survey on the Europe Kids Want
  5. Nordic Council of MinistersNordic Countries Take a Stand for Climate-Smart Energy Solutions
  6. Mission of China to the EUChina: Work Together for a Better Globalisation
  7. Nordic Council of MinistersNordics Could Be First Carbon-Negative Region in World
  8. European Federation of Allergy and AirwaysLife Is Possible for Patients with Severe Asthma
  9. PKEE - Polish Energy AssociationCommon-Sense Approach Needed for EU Energy Reform
  10. Nordic Council of MinistersNordic Region to Lead in Developing and Rolling Out 5G Network
  11. Mission of China to the EUChina-EU Economic and Trade Relations Enjoy a Bright Future
  12. ACCAEmpowering Businesses to Engage with Sustainable Finance and the SDGs

Stakeholders' Highlights

  1. Nordic Council of MinistersCooperation in Nordic Electricity Market Considered World Class Model
  2. FIFAGreen Stadiums at the 2018 Fifa World Cup
  3. Mission of China to the EUChina and EU Work Together to Promote Sustainable Development
  4. Counter BalanceEuropean Ombudsman Requests More Lending Transparency from European Investment Bank
  5. FIFARecycling at the FIFA World Cup in Russia
  6. Nordic Council of MinistersOECD Report: Gender Equality Boosts GDP Growth in Nordic Region
  7. Centre Maurits Coppieters“Peace and Reconciliation Is a Process That Takes Decades” Dr. Anthony Soares on #Brexit and Northern Ireland
  8. Mission of China to the EUMEPs Positive on China’s New Measures of Opening Up
  9. Macedonian Human Rights MovementOld White Men are Destroying Macedonia by Romanticizing Greece
  10. Counter BalanceControversial EIB-Backed Project Under Fire at European Parliament
  11. Nordic Council of MinistersIncome Inequality Increasing in Nordic Countries
  12. European Jewish CongressEU Leaders to Cease Contact with Mahmoud Abbas Until He Apologizes for Antisemitic Comments

Join EUobserver

Support quality EU news

Join us