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Last Updated:  Friday, 7 March, 2003, 11:28 GMT
Malta set for tough EU vote

By Oana Lungescu
BBC, Valletta

Prime Minister Fenech Adami addresses supporters
Adami wants a voice for Malta in Europe
On Saturday, the small Mediterranean island of Malta goes to the polls in a referendum on joining the European Union.

It is the first referendum to be held by any of the 10 countries set to join the EU next year and some fear that a No vote would boost Eurosceptics across the continent.

The Maltese are bitterly divided over EU membership, with the opposition Labour party claiming it would lead to loss of jobs and domination by larger states.

But Prime Minister Eddie Fenech Adami is greeted by a sea of enthusiastically waved flags - both Malta's and the EU's - when he addresses rallies calling on voters to "say Yes to Europe".

'Increased exposure'

Among those singing the anthem of EU supporters loudest are hotel and restaurant owners.

Tourism is the biggest money-earner on this tiny island and Winston Zahra, president of the hotels and restaurants association, says the pros of EU membership clearly outweigh the cons.

"First of all there's the increased exposure that Malta will get being part of the EU," he says.

"There's the advantages of the introduction of the euro, which reduces the cost of a holiday to Malta by about 3%, and there are advantages on the VAT harmonisation issue that is currently being discussed in Europe."

Malta's size - if it joins the EU it will be by far the smallest member - is seen by different camps as an argument for or against EU membership.

Mediterranean Switzerland

Mr Fenech Adami says joining up will give the former British colony of 400,000 people "a voice in one of the most important blocs of countries".

Opposition leader Alfred Sant addresses supporters
Labour could put EU membership on ice
But the leader of the opposition Labour Party, Alfred Sant, says that the big countries in Europe will always believe that the smaller ones should ride on their coat-tails.

Seven years ago, Labour beat Mr Fenech Adami's Nationalist party in a general election and promptly put the island's EU membership bid on ice. Mr Sant says he would do it again if he wins the next general election later this year.

He wants Malta to become a sort of Switzerland of the Mediterranean, keeping a visa-free policy towards north Africa and a free trade partnership with the EU - but without accepting all the rules of the club.

REFERENDUMS
8 March - Malta
23 March - Slovenia
30 March - Cyprus (only if deal reached between Greek and Turkish Cypriots)
12 April - Hungary
16-17 May - Slovakia
10-11 May - Lithuania
8 June - Poland
15-16 June - Czech Republic
14 September - Estonia
20 September - Latvia
"We don't say those rules are bad rules," he says.

"We say they have been drafted over 40-50 years by big continental countries and our point is this - applying all those rules and policies 100% to Malta just does not suit us, does not fit with our circumstances."

But Malta is no Switzerland - its wealth is only half of the EU average. If it decides to stay out of the EU, it will also wave good-bye to hundreds of millions of euros worth of European aid.

On the other hand, it is richer than many central and eastern European countries. Although the government can deny work permits to outsiders for seven years after Malta joins the EU, the Labour Party and the unions fear the island will be flooded with cheap labour from the east.

Crucial vote

Whether the Eurosceptics win the referendum on Saturday may depend on just a handful of undecided voters.

POSSIBLE TIMETABLE
April 2003: Accession treaty to be signed in Athens
May 2004: New members join
December 2004: Turkey invited to start membership talks
2007: Bulgaria and Romania join EU

In real terms, it will not make much difference to the EU if Malta joins or not, but psychologically a No vote in Malta could be devastating, triggering a domino effect throughout the applicant countries.

This spring voters in Slovenia, Hungary, Slovakia and Lithuania are expected to back their country's entry into the EU.

The weakest links may be the Baltic republics of Latvia and Estonia, in September, where euroscepticism is strongest.

But surprises are not excluded in the Czech Republic - where Vaclav Klaus, who describes himself as a "euro-realist" was recently elected president - or in Poland, where the June referendum could turn into a no confidence vote for the government, as it grapples with a serious economic downturn.


SEE ALSO:
Hurdles on road to EU expansion
14 Dec 02 |  Europe
EU hopefuls to woo voters
18 Feb 03 |  Europe
EU enters new era
14 Dec 02 |  Europe
Country profile: Malta
15 Dec 02 |  Country profiles


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