Friday, 31 October 2003

Czech eye-Opener

The Malta Independent 

That Vaclav Klaus, the President of the Czech Republic, was labelled a euro-sceptic I knew. But that he held such strong convictions that the EU enlargement is not serving the interest of the accession countries still came to me as a surprise.

I had the priviledge last week to attend a conference where Klaus was invited to relate his views on the enlargement. In no uncertain terms he stated that the catching up process of his country to the EU average will be slowed down and not accelerated by the terms of the negotiated membership. He also felt dismayed that with each Treaty and after each EU summit a further step is taken to the final objective to render Europe a single political entity.

He argued vehemently that after 40 years of communism, eastern countries deserved to be given a longer period where they could catch up to EU average free form the bureaucracy of membership. This view indeed reflects the findings of a research conducted by the Cato Institute, a Washington-based public policy research foundation, that challenges the belief that joining the EU will improve the competitive position of Central and Eastern European Countries (CEEC) in the world economy. I had written about this 4 weeks back ( Researchers vs the People
– 3rd October 2003).

One could argue that Klaus has no prerogative on the truth and that his views could be challenged on the basis that it takes too much an economic perspective of the matter. He may be criticised as giving too low weighting to the political stability benefits of the enlargement which could lead to a speedier influx of foreign direct investment than would have been the case if membership was dragged out over a longer time horizon.

I had the opportunity to ask Klaus for an explanation of the disconnection between the views of the President of the
Czech republic with those of the population at large considering the overwhelming majority (77%) with which the referendum was carried in Czech republic as in other East European accession states.

The reply he gave me is an eye-opener. After 40 years of communism and after going through the crush of the Prague Spring under Dubcek in August 1968 when
Czechoslovakia was invaded by the Warsaw Pact forces, the fall of communism in 1989 gave the Czechs the dream of going back to Europe. The Accession Treaty which Klaus himself signed in Athens last April is the concrete expression of such dreams and in Klaus own words anyone who would have argued against the concretisation of such dreams would have been cut out of the political mainstream and considered a Milosevic. This explains why he had to keep quite silent during the referendum.

He told me that now that the issue has been sealed by the signing of the
Athens treaty the real debate on the terms of the accession has started and there are critical views on its terms and on the proposals contained in the EU draft constitution. He said that there is a large and growing section in Czech Parliament that wishes to subject the EU constitution to a fresh referendum and he was confident that it is that referendum which will show the true expression of the people not just to be back in Europe but to go forward into the EU.

I think this is an eye-opener both to the government and the opposition. To the government not to close the door on a referendum on the Constitution. Apart from the democratic significance of such a referendum it could strengthen the government’s hand in arguing for fine-tuning of the draft constitution on the points mentioned by the Prime Minister, most of all the need to retain unanimity voting on foreign security and defence issues.

To the opposition it could give it an opportunity to enhance its new found zeal for EU membership and could appease the genuine though misguided efforts of KMB to re-negotiate the Treaty and instead insist on the Constitution safeguarding our right to veto on Foreign and Security policy (or at least on our participation therein) and on our right to having a fully fledged Commissioner and to participate equally as other States in the EU Presidency rotation.

Such a strategy would not only put Labour in line with quite acceptable mainstream thinking in using the Constitution referendum to stem the EU slide towards political Union, but would also give the MLP conference of next week the opportunity to discuss what it really should be discussing i.e. why where EU policies chosen before the election which were considered worth losing an election for, only to change them after the event.

Friday, 24 October 2003

Time to Shape Up

The Malta Independent 
It was a pitiful mind-bending experiencing. Hearing the MLP leader in a live radio debate on PBS with his predecessor under the chairmanship of a former deputy leader discussing the EU policies which the Opposition party should adopt at its upcoming general conference, should have hurt the sentiments and offended the intelligence of all those who have Labour at heart.

Firstly the fact that such an internal conflict about EU policies had to be externalised on third party media exposes the lack of internal space for such a debate upon which the general conference delegates still have to deliberate and decide. Secondly it shows total lack of consistency with other occasions where such externalisation met the wrath and discipline of the Vigilance & Disciplinary Board.

Both aspects merit further consideration and analysis. KMB line of argument is hardly surprising. Even if KMB did not put forward the case for rejecting the Accession Treaty as signed by government last April in
Athens, it would still be a fact that the mood among a large section of Labour’s rank and file mirrors much of KMB’s arguments. This is unavoidable. Having militated over a long number of years against EU membership in ‘God forbid’ terms it is to be expected that many will have difficulty to adjust to new realities.

But political parties do change policies from time to time. Once policies get rejected by the electorate they would normally have to change to reflect the new realities as part of the quest to gain majority support at the next time of asking. But it is policies that change not the principles. So when a political party raises a policy such as the one about EU non-membership to the level of principle, it will unavoidably sail into confusion as it tries to convince its followers that the principle was no principle but was simply a policy.

Normally such shift of policies become more acceptable by a change of leadership. Things get debated. Policies get contrasted. Personalities argue and put forward their case and ultimately a vote is taken. The majority rules prevail allowing full space for the minority to argue and make their point. Normally after time the majority grows bigger behind the new leader and the minority, whilst holding on to their view, get less vociferous and allow due space for the new leader to execute his/her policies.

When however new policies get promulgated by the previous leadership who had mistakenly elevated the previous policies to principle status, they lack credibility. They harden the minority, if minority it is, in the view that principles should remain principles and cannot be reduced to policies by the same leadership that had emphatically developed them in hard black and white terms.

Can somebody suggest any reason why the internal debate on the new EU policies is being externalised over third party media and then allowed no space on the party’ inner mechanisms and party’s own media, whereas the independent Analysis report has been treated with utmost secrecy and rapidly buried into the Party’s darkest vault? If anything the contrary should apply. The new EU policy could easily be debated internally among the one thousand or so conference delegates with full space being allowed to contrasting viewpoints. The general public is interested mostly on what the policy is when it is decided upon, and has much milder interest on how the Party works to formulate and decides upon its policies

The analysis report is however of interest not only to the Party administration and executive. It is of interest to the general public, certainly those 134000 who voted Labour believing that its policies can gain majority support. These are fully entitled to know why this has not happened. They demand accountability as to who will carry the guilt for missing the objective which had been described as quite easily within reach.

It is time for Labour to shape up into a proper Opposition not least re-ordering its internal affairs and put logic into what should be externalised, as a duty not as a privilege, and what should be debated internally in the policy formation stage. Could it be that the strange willingness to externalise a pure internal debate is meant as a deviation from the need to give proper account to the conference delegates and the public at large of the election analysis report. Whoever elevated the EU non-membership policy into a principle worth losing an election for only to change it after the event has something to answer for.


Sunday, 19 October 2003

Interim Solutions - Permanent Damage

The Malta Independent on Sunday 

“Are you preparing a very harsh budget?” the interviewer asked Dr Fenech Adami recently.

His reply is awesome. “The country can no longer ignore issues that exist and have to be tackled seriously. Sometimes, interim solutions are sought. The time for that is past. This is clear in the case of the drydocks. We have been seeking interim solutions, which have not given us long-term results. This also applies to other issues, almost across the board. Look at social security and the health system... we have to seek long term solutions.”
I cannot agree more. I have been hammering at it for years that the country was expensively seeking interim short-sighted patch-ups which would in time make real lasting solutions far more painful and difficult. What marvels me is the coldness with which the Prime Minister now admits it. He makes it sound as if he is a new-comer trying to put right what predecessors had fouled. He seems to forget that he has been running the show for 16 years almost uninterruptedly. What marvels me is the gentle strokes with which interviewers accept these sort of replies rather than demand why we had to come to this stage.

One must not forget that barely six months back in pre-election mode the same Prime Minister was proclaiming solemnly that all was fine and dandy. That State finances were on solid foundations. That everything was sustainable and that EU accession would, on its own produce an influx of new investment which will spur economic growth without having to take hard cost cutting measures.

I should repeat an analysis I had written on May 9, 2003, in this paper’s sister daily where I had analysed Dr Fenech Adami’s performance on the 16th anniversary of his first election win on 9 May, 1987. I had stated that:

“Sixteen years of his administration has given the country a false sense of prosperity and well-being built on very shaky foundations that future generations will struggle to maintain as they will have to make good for past excesses. These can best be signified in the three major structural problems which will come to face us with daunting if not horrifying stark reality.

“Firstly we have the fiscal deficit problem. We still await publication of the December 2002 figures. November 2002 figures showed that in spite of Lm21 million cosmetic exercise related to MIA privatisation we were Lm30 million off the mark as at end November. Stories about attempts being made to shift expenditure from year to year to hide the extent of the deficit have been made and never convincingly refuted.

“Be what it may such problems cannot be solved by cosmetics or creative accounting but by sustainable economic growth and serious expenditure controls.

“The environmental faults we have developed are seriously threatening sustainability of economic growth and our quality of life. Waste mismanagement, air and sea pollution, uncontrolled urban sprawl and horrific road and transport problems are a distasteful legacy of an unbalanced administration where short term party political priorities were given precedence over the real national interest.

“Lastly the unfunded pension liabilities which have been allowed to accumulate whilst taking political advantage from short-term over-consumption which fuelled and extended the pension problem, is becoming a reality that can no longer be postponed.

“I have a theory that Dr Fenech Adami’s recent electoral success is totally due to Labour’s unwise decision for the EU issue to be decided through an election not through a referendum. This has placed Dr Fenech Adami in the strange situation where the more he was criticised on the domestic front, the more his re-election prospects improved through the support of the many who thought that the country could no longer do without the externally imposed discipline of EU membership.

“This is fine for Fenech Adami as a party leader. But not so fine for a statesman who should have delivered the country in a good state to decide on EU membership on its merits and not through default because of the imbalances his laissez-fair style allowed to materialise.”

I am pleased that Dr Fenech Adami is evidently sharing my own assessment of his performance and that he seems determined that in the last phase of his political career, free from the pressures of seeking re-election, he seems inclined to put the country back on a sustainable track to make up for past excesses. I think he owes this much to the well-meaning citizens of this micro-State who have chosen EU membership not as a panacea for our ills, but as a external source of discipline to force our political leaders to take decisions and initiative meant to serve the long-term sustainability of the catch-up process of our standard of living to EU averages rather than to serve the short term interest of politicians to acquire or remain in power.

Hard decisions await us. And hard decisions will find great resistance for acceptance especially by those who were consistently led to believe that the free lunch could last forever. To facilitate acceptance, solutions have to be and be perceived as being fair.

I strongly feel that by tackling the issue sectorially the fairness dimension will be missing and resistance will be fortified possibly to the point of aborting the process of change. The obvious question is Why the drydocks? Why Malta Shipbuilding? Why Medigrain? Why PBS? By implication this question means why not the whole central government administration? Why not Water Services Corporation? Why not Freeport? Why not the multitude of authorities who pay themselves private sector salaries for doing a public sector job? I am sure we have among us many Grassos (Richard Grasso was the former chairman of the NYSE) if everything is put in relative proportions.

So let’s indeed stop interim solutions. Let’s look at the problem in a holistic manner and propose real solutions that though painful are perceived as fair and equitable. Maybe a good starting point would be if the Prime Minister were to brush up his reading of a report which “seven wise men” had prepared for the Labour government in 1997/98 and which the Prime Minister had abused so much by instigating the resistance to change that he is now trying to convince us is necessary.

Friday, 17 October 2003

Re-Ordering our Priorities

The Malta Independent 

Certain private sector operators keep resisting change and endeavour to earn their way by perpetuating market rigidities depriving clients of a fair choice. Many can’t get used to the idea that they can earn a living, indeed prosper, by delivering value to their clients in the context of a competitive market.

This is nowhere more evident than in relations to public transport services. An up-grading of public transport is overdue. It is probably the single most important source for acquiring a step change improvement in our quality of life. Not only we would be able to travel from point A to point B more comfortably and reliably, but it could bring about a marked improvement in environmental standards in terms of air quality and open spaces currently occupied by congested traffic and parking. It could also make the tourist industry more competitive possibly putting it back on a strong growth path as it has not experienced since 1997/98.

Following massive investment by the State in subsidising new public buses the operators of public transport seem to be pressing for their solitary fare increase. Rather than take the signal that the State, to whom the consumers pay taxes, has already done its part by subsiding their new configuration permitting them to offer a better service, they seek to cash in their favour the improvement through State funded buses by charging more the consumer who through taxation has subsidised their trading position.

Public transport operators should devise systems to boost volume and gain more revenue flows from increased usage and not through increased fares. They must realise that new configuration alone will not do the trick. The network reach, loyalty schemes to stimulate long term usage, attitude of bus drivers and punctuality of the service are ingredients as essential as the shine on the new buses.

White taxi service also pretend that they can force visiting cruise-liner tourists to use their exclusive service to take them from the Grand Harbour Quay to
Valletta. How can we grow tourism if we treat visitors which such disdain? Tourists must be given a choice and of course the choice should include the taxi service. If their price is right and service is good, visitors will choose them in preference to more common transport means. But it would be the tourists’ choice not our forcing them to use a service they might not wish.

If white taxi operators do not have sufficient business to earn their living they should try to reduce their prices and offering their service to Maltese. Getting to
Valletta or Sliema with private transport means, parking fees and all, has become expensive and taxis could offer a reasonable alternative. Again revenue enhancement could come from volume growth not price increases.

And the shops of lower
Valletta can’t expect the Authorities to force tourists to walk back from Valletta to their cruise liner purely to give them the opportunity of access to their shops. In modern age it is shops that have to chase clients and not clients forced to find shops.

And if government means to set an example to private operators to stop their narrow minded thinking and see the wider picture of how better we would all be by devoting resources to grow the market rather than to defend our small patch, it has to act responsibly especially when it comes to macro economic polices concerning growth sectors like tourism in general and cruise-liner business in particular. What sense does it make to give priority quay access to guest military vessel visitors and relegate regular cruise liner to uncomfortable backward quay locations?

This country has long decided to stop making a living from its defence related values and to earn our way through commercial activities where we have a competitive position, especially from tourism. We could have made a living from our defence values but collectively decided not to. It was a free choice which has been widely subscribed and is enshrined in the Constitution.

When we come to prioritise we cannot have second thoughts and put defence values above the interest of our economic growth sources. If the Government chooses the wrong priorities it sends bad signals encouraging private sector operators to persist in their defensive narrow minded way of doing things, rather than in pursuing forward looking open growth strategies to delivering more value than clients expect for the price they pay.


Friday, 10 October 2003

De-stabilisng the Stability Pact

The Malta Independent 

France and Germany are offending the Stability and Growth Pact (SGP) underpinning the Euro monetary union for 12 EU states. In effect France and Germany are running budget deficits beyond what is expected of them under the SGP and rather than make internal adjustments to honour their common currency commitments they are seeking to de-stabilise it. In polite diplomatic jargon they are demanding for flexible interpretation of the SGP.

It is easy to criticise France and Germany and insist that they adhere to the rules which have been enforced with full vigour on smaller EU members. Portugal is undergoing severe fiscal restraint to bring itself within the pact and smaller EU countries have exercised such restraint to ensure that they stay within the set rules. Why should the rules which apply rigorously for the smaller country members but be applied leniently with the big members? The Commission supports a uniform approach and has this week publicly reprimanded France and forwarded its report to the Council of Ministers as contemplated in article 104 of the Maastricht Treaty.

Fairness apart, it would however be unrealistic to expect the Euro area to achieve comparable economic growth with that of the US if its two largest economies, France and Germany, are forced by the SGP to apply the economic brakes on their economies when these are registering anaemic growth if at all. The smaller countries, like Ireland, Austria, Belgium, Netherlands, Finland and Greece cannot on their own deliver the necessary regional growth if France, Germany and Italy fail to notch up their growth` under the adjustment conditions imposed by the SGP.

The European Central Bank exiting president, Dutchman Duisenberg, is right in arguing that France and Germany did not save for the rainy day when the going was good. Germany is still paying the cost of the integration of its former eastern part whereas France lavished in solving problems by working a shorter week, a measure which has seriously prejudiced its international competitiveness. But the clock cannot be put back and I don`t think that the Euro area urgent growth problems can be solved by the rigid application of the SGP on its two or three largest economies.

Reality is that when the SGP was devised way back in 1992 its conditions were set to suit a very different scenario from the one we have today. The threat to Growth was then perceived to be excessive inflation which was sourced from excessive budget deficits. So the way the SGP was drafted, principally by the Germans, was to ensure that the risk of inflation is controlled by putting strict conditions on the size of the budget deficit assuming that once inflation is controlled sustainable growth would automatically follow.

The situation today is very different. In spite of excessive budget deficits there is no risk of inflation which is hitting record lows well within the ECB`s target range. But low inflation is not delivering growth and in old-fashion Keynesian style the US is pump-priming the economy by running huge budget deficit at a time of record low interest rates.

Is it wise for Euro countries continue to invoke strict application of the terms and conditions of the SGP written under very different conditions and aimed to address very different circumstances than those prevailing today, whilst the US goes for growth free from the restrictions of strict monetary unions rules regarding debt and deficit  ?

  The argument is made that any flexible interpretation or outright revision of the SGP would loosen international investors` faith in the Euro. This is not something that in normal circumstances should be taken lightly. But these are not normal circumstances. The Euro is hardening too rapidly on the foreign exchange market and the ECB will have to do something about it to retain international competitiveness. It could of course reduce Euro interest rates further and bring them down to US levels and below the actual inflation rates. But it could also, and may be more effectively, re-write the SGP rules to re-balance the obligation of Growth with the obligation of Stability as it is clear that stability in fiscal positions is no longer delivering the desired levels of growth. If this could force down the Euro a little bit from its current strength then so be it.

With a Frenchman about to take over the ECB may be France stands a better chance of making the Council of Ministers and the Commission see the light. It will definitely find backing from Germany and Italy, second line offenders, and could overcome the objections of the smaller countries who rightly argue that they are made to honour the rules whilst the rules are made to honour the big countries. That`s life!

Sunday, 5 October 2003

Benchmarking with Peers

The Malta Independent on Sunday 

There is no doubt about it. We have some problems which need to be addressed without further delay.

The Prime Minister admitted as much during his independence speech though he shied away from stating the obvious that his government carries primary responsibility for the creation of these problems.

We should be happy for the small mercy of having achieved convergence of opinion at least on the fact that problems do exist. Gone are the pre-election days of liberal assurances that everything was fine and under control and that government finances were on a sound footing, that the very accession to the EU will generate an impulse of investment to re-generate the economy and deliver sustainable growth at a rate that would permit a fast catch-up with the EU average.

Acknowledging of problems is a necessary first step. On its own, however, it does nothing to provide any solution although it helps to raise awareness of the need to come up with solutions. The next thing we should do is ask ourselves, just about how big is the problem? And there can be no absolute answers to this, only relative ones in comparison with the situation prevailing at our competitors which in this case are the other nine countries acceding to EU membership next year and who will be playing with the same rules and regulations to try to push their fortunes closer to the EU average.

Fiscal Def
Fiscal Dbt
Bank Assets
Stock Market Capitalisation
/gdp %
,/gdp %
/GDP %
CPI 2002

Source : own research

I have prepared a table of comparison for the 10 acceding countries of five key macro-economic performance indicators. They are all in percentage terms of GDP (except inflation which is a percentage of increase of consumer prices within the economy) in order to make them more easily comparable overriding the size difference from Poland, the largest, to Malta, the smallest.

Take our fiscal deficit which last year came in at 5.2% of GDP. Bad as this may be there were four other countries performing worse than us with the extreme being Hungary with nearly 10% of GDP deficit. At the opposite virtuous extreme there is Estonia with a budget surplus of 1.2%. Rather than be concerned about the absolute level of the 2002 deficit we should be more worried by the fact the 2003 deficit is shooting up to 7% as one-offs that cushioned the 2002 outturn will not be repeated. Even more worrying is the prospect that in the absence of structural adjustment this deficit will continue to increase as we are made to finance our share of the contribution for carrying out the obligations of EU membership.

The annual deficit will take a more meaningful significance if viewed against the situation of accumulated fiscal debt. So for example Czech Republic’s 7.3% 2002 deficit is much less worrying if considered against a 20% accumulated debt position than if considered on its own. Basically the Czechs have a great capacity to incur deficit so their current high level of deficit is much more tolerable than it would be if the accumulated debt level was anywhere near the Maastricht indicator of 60%.

So the seriousness of Malta’s deficit gains added significance in the context of our chalking up the highest rate of Debt/GDP of all candidate countries. At 62.5% we are already above the EMU limit and our capacity to incur debt is getting uncomfortably narrow just as the size of the annual deficit has started growing again.

To take a wider view of things I have included a view of the ratio of Bank Assets to GDP. This is meant to assess the level of facility with which the broad economy can finance the deficit incurred. The bigger the ratio of Bank Assets to GDP the bigger is the capacity to finance the deficit within the economy without crowding out private investment finance demands and without hiking up domestic interest rates. This ratio indicates the accumulated savings of the whole population within the economy. And here we can sigh some relief. The savings culture inherited from our ancestors and the size of accumulated past savings are strong enough to give the government undeserved freedom to finance deficit on comfortably structured terms at low interest rates. Compare Lithuania who although boasting very low debt/GDP ratio has very limited capacity to finance deficits internally as they have the lowest Bank Assets/GDP ratio. It could be the result of insufficient past savings or inherent culture to keep savings outside the economy.

So whilst our fiscal problems are not to be under-estimated we should take heart that these problems are generally domestic rather than external and that we still have a large capacity to finance debt, provided we do nothing foolish to force people to use the freedom of capital to take their savings elsewhere.

The final statistics calculates the Stock Market capitalisation as a percentage of the GDP which is a good indicator of the sophistication of the financial markets and finally the level of domestic inflation. In both cases we are among the best of the breed among EU candidate countries.

The conclusion I can best draw from this analysis is that provided we do what we have to do without further delay the position should be recoverable in the medium term. If we do what needs to be done without further false compromises with reality this country could not only solve its deficit problem but restore its competitiveness with the rest of the world and embark on a growth path which will help us catch up with the EU average sooner than many presently consider possible. For this we have the thrift culture inherited from our forefathers to thank.

If we continue to delay and fool ourselves by treating the symptoms and not the root of the problem then we continue just wasting resources making an unavoidable future meeting with reality more painful and much more complicated. 

Friday, 3 October 2003

Researchers vs the People

The Malta Independent

Ten candidate countries that will accede to EU membership next year have all had such decision approved by a popular referendum vote except for Cyprus where the agreement was so broad that a referendum was considered a waste of time. There is no doubt, the people want it. Compare that to the Euro referendum in Denmark and in Sweden where the people said no thank you or at least not just yet.

Respectable economic researchers seem to think that the people got it wrong. A new study from the Cato Institute, a Washington-based public policy research foundation, challenges the belief that joining the EU will improve the competitive position of Central and Eastern European Countries (CEEC) in the world economy. It is hardly surprising that the study omits Malta and Cyprus and it is becoming quite a habit for the two island states to be taken so for granted that it is not worth anybody’s while to include in discussion or research studies.

The study, entitled EU Enlargement: Costs, Benefits, and Strategies for Central and Eastern European Countries, states that the eight CEECs will benefit from reduced barriers to trade and investment and, by 2010, free movement of labour. EU membership, however, brings with it some serious disadvantages and the Cato Institute believes that it will make the accession countries less competitive.

The study argues that the EU forces poor member countries to adopt rules and regulations inappropriate to their level of economic development. Those burdens will result in suboptimal economic growth and complying with the EU’s regulations on labour, agriculture and the environment will raise production costs, while future harmonisation of taxes looms as an additional threat to the new members’ comparative advantages.

The Cato research team recommends a two-part strategy for the new entrants:
· First, they should oppose further limits on tax competition that would make them less attractive to investors;

· Second, they should work to repeal regulations that are excessively stringent for their present level of development.
The study argues that if the new member states follow these strategies and protect their economic liberty, they can demonstrate to the rest of the EU that market-friendly reforms are good for growth. “It is to be hoped that the CEECs will be able to supply such policy competition before they themselves begin to suffer the consequences of an overbearing bureaucracy in Brussels,” concludes the study.

This is not so different from Labour’s pre-election main argument for resisting membership and supporting a loser arrangement with the EU. How is it that the people who have a direct stake in the project can be so much more positive about EU membership for candidate countries than independent academic researchers? How is it that Labour found itself more on the side of US academic researchers rather than on the side of the people?

Only time will tell whether candidate countries will make a success or otherwise of their acceding to membership. Undoubtedly membership on its own is no guarantee of success and there will be different fortunes for those who make the most of it than those who just have to live with it.

But if researchers think that CEEC’s will have difficulty to succeed when they are clearly the major beneficiaries of FDI resulting from EU membership, it will certainly be much more difficult for Malta when we have dimmer prospects of benefiting from such FDI inflows given our higher cost base and distance from the core EU market.

For us the true success of EU membership will be the discipline to force our political leaders to stop studying and analysing the weaknesses in our economic set-up and start really doing something to address them. Only then will we regain global competitiveness which will put us back on the economic map of FDI suppliers.