28 AUGUST 2002

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Toon this week: Life in the fast lane

The thriving economy!

There is a thriving economy, one that appears to benefit from a permanent tax holiday. It is a sort of underground economy driven by fraud, crime, drugs and illicit gains.

It is the economy that has moved ahead as the traditional economy remains entrenched in yesterday.

This is a small country where people know people and where questions remain unanswered.

You can see it happen. Individuals with little or no business investments and history catapult themselves to stardom. Possessions, cars, apartments and outlets are proof of their new wealth. It can hardly be missed.

Yet, often far too often there is no evidence to link this new wealth to crime.

Often there has been little or no attempt to highlight this new dimension in our society. As many people become further stretched and pushed into a corner, the same individuals continue to thrive. It boggles the mind.

There is only one way to prove that there is a link between this activity and crime.

The crime busters who are the security service, the police and the tax compliance unit could join forces to take a good look at these individuals.

The very fact that two judges have fallen foul to bribery from a convicted drug trafficker points amply to the frailty and weaknesses within our systems.

When the US faced one of the biggest depressions and recession in its history in the 1930s, one group of products and services did not change in the traditional supply and demand equation: it dealt exclusively with drugs, alcohol, fraud and prostitution.

Testing time approaching

Maltacom may still be burdened by an over compliment of workers inherited from years of political interference in the running of the state monopoly, but the company is looking as aggressive as ever in the run-up to the full liberalisation of the telecoms sector by January 2003.

The company has invested in new technology and services with mobile telephony and Internet now showing signs of an upturn. According to the financial results published yesterday the subsidiaries providing these two services are now contributing to the Group’s turnover.

Until now the monopoly company has only tested its subsidiaries in the open market. The core operation of the Group, fixed line internal and outgoing telephony, has until today been an exclusive domain.

While the subsidiary companies have been founded with a private sector mentality that takes into consideration competitors and consumer complaints, the mother company still suffers from a legacy reminiscent of government departments.

This will be fully tested after January next year when fixed line telephony would be liberalised. At that stage Maltacom’s core operation would be tested to the limit by possible new entrants in the market and the government mentality that still hounds a good number of employees would have to be shed.

But it is not just the liberalisation process that characterises Maltacom’s performance. The company still owns a substantial shareholding in Vodafone. This situation cannot be left to go unchecked by the competent authorities. Maltacom has repeatedly said that it wants to get a fare price for the disposal of its shares and has also suggested that Vodafone has not co-operated in the process.

We expect a regulatory authority with more grit. Maltacom’s shareholding in Vodafone makes a farce of competition. A deadline must be set and the authority must make sure that full co-operation is forthcoming from both Maltacom and Vodafone to get over and done with this anomalous situation.

Copyright © Network Publications Malta.
Editor: Saviour Balzan
The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07, Malta
Tel: (356) 21382741-3, 21382745-6 | Fax: (356) 21385075 | e-mail: editorial@networkpublications.com.mt