SME Chamber

GRTU Leaders address Commissioner Michel Barnier

 On the initiative of the Head of Commission Representation in Malta Martin Bugelli, GRTU and other leading constituted bodies had the opportunity to meet Michel Barnier, Commissioner for the Internal Market and services during his visit in Malta. GRTU raised the issues related to obstacles to trade and investment in the internal market especially as these effect services, problems related to the implementation in Malta of the Transparency Directive and issues relating to thresholds on public procurement in the internal market.

GRTU Director General Vincent Farrugia stated that he is very much involved as Malta's employers representative at EESC on issues effecting the internal market. Mr Farrugia was the rapporteur who wrote the EESC adopted report on the taxation obstacles for citizens crossing from one country to the other. He stated that much greater effort needs to be done to eliminate the obstacles that are effectively prohibiting more trans-border investments by small businesses. In spite of the efforts of the commission too many hurdles still exist and the statistics show clearly that the vast majority of enterprises – 99% of enterprises are small and medium – hardly ever cross borders. This really means that under current austerity programmes, as imposed by various Governments under budget deficit procedures and as total demand continues to fall due to falling rates of economic growth, that an unbalanced situation in Europe continues to persist whereby areas in Europe suffer from shortage of labour while others have high rates of unemployment. This is one important factor why youth employment in Europe in many countries is so high. There are simply not enough incentives for EU citizens to become more mobile in spite the fact that we have just celebrated 20 years of internal market. Michel Barnier was also urged, given his vast experience in trade and administration, to push harder to remove existing obstacles and provide great incentives for owners of SMEs especially in the services area to be able to seek new opportunities for orders and direct investment across the EU.

Paul Abela GRTU President raised the question of public procurement. Also on behalf of GRTU and the employers Vince Farrugia was rapporteur on the Communication Green Paper on expanding the use of e-Procurement in the EU. The President stressed that the threshold level under which tenders for orders by Governments of member states are not obliged to be public should be removed. Traders, consultants and service providers from Malta cannot be expected to contest for the above threshold contract, most of there offers are just too large. It is easier for small enterprises from all over Europe to be able to bid for tenders for orders across border if smaller size orders where also open for cross border competition. The situation is getting even worse in the market of most member states such as Malta where obstacles for small enterprises to compete for public tenders are increasing rather then diminishing. The GRTU president appealed for strong immediate action on this issue.

"Small businesses have survived during the recession and will grow despite the treat of a second recession if they are given greater opportunities to work beyond borders. Malta is not afraid of this competition. On the other hand we make efforts as the national chamber of SMEs to encourage our members to look for opportunities within the internal market", stated Paul Abela.

Another speaker at this encounter with Barnier was Mario Debono. Mario is GRTU's special envoy to Libya and he is also President of the pharmaceutical section at the GRTU. Mr Debono explained that the way that the Transparency Directive is being implemented in Malta is erroneous, and in the views of the Pharmaceutical Committee he represents the Maltese Government is going beyond the power bestowed by this Directive. The Directive is aimed at ensuring transparency in the pricing of medicines that are refundable under medical health systems as operational within most EU countries. In brief this really means that the vast majority of EU citizens who are eligible for free medicines under the national health schemes of most EU countries should not be over charged by pharmaceutical suppliers as this would entail unnecessary and additional burdens on the national free medicines services. This situation is not applicable to Malta.

Medicines in Malta except for those listed as receivables of medicines in Malta from the state are sold by registered pharmaceuticals and paid for directly by Maltese citizens. It is a free market where the role of Government is only to ensure that market mechanisms work but definitely does not provide for a Government Imposed Price Control Mechanism of medicines. Yet in Malta under the aegis of the Transparency Directive, Parliamentary Secretary Chris Said, responsible for consumer affairs on behalf of the Government, introduced a regime which is nothing short then Medicine Products Price Control which is unacceptable in a free market and according to GRTU a sheer abuse of the Transparency Directive.

Mario Debono on behalf of GRTU strongly urged Michel Barnier to take up this issue. GRTU has already written to the Commission as GRTU believes that the Malta Government is in infringement. "GRTU is against any abuse by any trader in the pricing of medicines. Government is right in ensuring that suppliers of medicines under public procurement should adhere to the strictest control so that the pricing of medicines to Government services not only appear to lack any hidden profitability but also to lead in a free market with just pricing. Supply of medicines in a free market in a small country like Malta that finds it extremely hard to ensure regular supply from leading manufacturers because of the small size of orders and demands from various brands cannot be accepted to compete under rigid and illicit price control interventions by Government. Traders are suffering but those that are suffering the worst are the patients as a wide range of medicines are becoming uneconomic to trade for local commerce. This is a serious situation as it is turning the clock back to the years of state dirigiste economic policies. This is why GRTU strongly urged Commissioner Barnier to act.

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