If Malta will not have a robust economy recovery, it’s likely that we will move from a health crisis to an economic one according to Melvyn Mangion. Without an economic boom and a spending boom, we are going to be in serious trouble. This economy recovery should not just be robust, it should also be a prolonged one.
After Lockdown, we need spending
Released from lockdowns and other restrictions, many will want to spend. Many would argue that this is a natural bounce back in consumption. For those who had the luxury to retain their full wages during the past months, one assumes that their level of savings increased. Not being able to attend restaurants, bars, other social events, and not travelling abroad must have led to guaranteed wage earners a rise in their savings. Consumer spending sprees will prime the recovery pump.
Households who have not taken a holiday for two years are likely to take one, possibly an extended one, beginning Summer 2021. This is the hope of local tourist business operators. Bars and restaurants are also likely to see exceptional demand. If this happens, there could be a consumer boom in the second part of 2021. More than a quarter of that expenditure will end up in the government’s coffers thanks to taxes and a reduction in unemployment payments.
Wasted Money vs spending wisely
It is in such times that one understands the importance of the millions wasted on corruption scandals. Those funds would definitely come handy to any Government to boost its economy after the bruising caused by the pandemic.
Melvyn Mangion says that the Government has a very pivotal role to play in ensuring an economic boom. If the Government does not do all it can to encourage a recovery, we will face serious consequences. We must have an economic boom, without growth all of that debt piled up could come back to haunt all of us. Government spending is key in ensuring such growth. Vigilance on such spending is even more key.
Green investment is what every developed country should aim for. Many used to worry that decarbonising our economies could come at a cost of growth and jobs. Melvyn Mangion believes that this is no longer the case. Investing in the green economy will, under the worst-case scenario, be neutral in terms of employment and could even boost growth.