 25 April - 1 May 2001 |
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The credit pinch The revelation on a creditors’ meeting regarding huge debts owed by the Price Club led other creditors to phone the offices of The Business Times. They complained that they had not been invited to this creditors’ meeting, but that they, too, were owed monies. The extent of the debt, we are informed, runs into more than simply hundreds of thousands. But the malaise is not one restricted to the Price Club; it is widespread. What has happened in this country is that the ‘thinking big’ syndrome has overwhelmed many individuals. When the going is good, people discard their brakes and indulge in fast driving. A large number of them had visions of grandeur – but most worrying is the way banking facilities have been used and abused. And we are not exaggerating here. There were countless businesses that took loans but used these loans for other projects. Some of them to kill pending loans, others for ill-thought-out projects and others to satisfy extravagant or unworthy lifestyles. Worse still, the business plans presented for borrowing purposes were fictitious story plans aimed at extracting easy money from the banks. Many businesses have overgrown, over stretched and over traded. They have also been run like family fiefdoms with no control over expenditure, salaries and perks. The banks have woken up to this grey scenario. It is not a happy one, There are many situations which could have been avoided if caution had been administered by some banking facilitators. But the Banks are not taking this nonsense any longer. People will have to change their lifestyles. Instead of a new Mercedes, a second hand one will have to do and instead of a 27 footer a 15 footer. And just as importantly, instead of overextending themselves, businessmen must seek restraint. This will be good news for the financial well being of the markets. Undoubtedly, there is a severe liquidity crisis, but this has not come about because of economic slowdown, rather due to overspending, unabated growth, competition and over trading. Evarist Bartolo is quite right The speech on Monday evening by Evarist Bartolo was one that was truly worthy of an Opposition shadow minister of culture. And we don’t mind saying this. Mr Bartolo has many feathers in his cap. They include the fact that he was a good and effective minister, he has discipline, he has vision and he is energetic. He is also cultured, well read and perhaps has aspirations to power, but not to greed. On the down side, he is a spin doctor with a streak for subterfuge. One may not agree with him on certain stylistic traits but compared to Louis Galea he is a star (a red star perhaps). And yes, many of the arguments he espoused were not only factual but well presented. It is true that the Labour government before 1987 did little for the heritage of this country, but the same can be said for the Nationalist administration after that. And how far back should we look to unearth mistakes? Perhaps the errors of the late Carmelo Caruana (recently eulogised) with his love for passing roads right through our village centres should be exhumed? Perhaps this editorial could chronicle the rape list of Malta’s heritage. Yes, we agree wholeheartedly with our colleagues at The Malta Independent who led with the title: ‘More of the same’. This country needs to trade words for action. And yes, politics apart, Evarist Bartolo would be a breath of fresh air compared to the lethargy and disorientation in some corridors of power. |
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