Bilateral Relations of Greece and Malta from 1939 to today Goldnews.com.cy

The Mediterranean has, since the dawn of humanity been a hub of controversy, history, progress, and passion. Jade Jagger had once stated that: “I love the Mediterranean for the fact that winter is over in a minute, and the almond blossom arrives in January.”However, the Mediterranean holds far more potential than early blossoms, it has been a hub of interconnectedness in which every individual member state is intertwined with each other yet fully independent with its own history. Such is the case with any number of combinations between individual member states of the Mediterranean, whether that is Portugal and Malta, or Greece with Spain, each holds an individual piece of history that ties it with each other member in creating factually everything modern civilisation stands on. The aim of this essay is to analyze aforementioned relations, and look into bilateral relations and agreements between two of the aforementioned states, namely those of Greece and Malta from the beginning of the Second World War till the joint European membership of today.

In Primis, the Hellenic Republic and Malta have been intertwined for myriad years in antiquity.  Malta was used by the Greeks as commerce, maritime pursuits, and competition against the Phoenicians. There is no clear historical depiction of how the Greeks managed to come to the island, with a plethora of opinions ranging from the notorious story of Odysseus and how the five years spent under the company of the Goddess Calypsos and her cave was actually in Gozo, Malta, which was according to Dr.Economakis, the first contact between the two populations, which also explained the Greek name which Malta was baptized under, the name of Melite, deriving from the word honey in Greek, later transformed to what it is  today, Malta. (Malta.com)

This is based on the traditional theory of liberalism, of which the relations of Greece and Malta are prime examples. Liberalism argues that economically intertwined and democratized nations will work together socially and economically without going to war. This idea originates from Adam Smith in response to mercantilism and argues that the market should be free of government regulation, and the pursuit of material self-interest, would maximise the wealth of a society. As will be discussed later, both nations have greatly profited from economic liberalism.

Greece was particularly vocal about the Maltese islands becoming a part of the European Union. In a state visit and during a press conference with Maltese Prime Minister Fenes Adami, Costantine Simitis stated that: "Greece's belief is that the European Union's enlargement would be decided during the first half of 2003, when it would hold the Presidency of the Union. Of course we will face some difficulties, but we will do our best to overcome them, since we want the southern part of the European Union to be stronger than it already is. And that is the reason why we [would like] Malta and Cyprus [to] join [the] EU." Greece, and Simitis was very vocal of the Maltese and Cypriot entry into the European Union convinced that Greek relations with the aforementioned countries would pressure Turkey into changing their attitude towards Cyprus, and potentially due to their joint history in the future be able to block Turkish claims to more islands, or even accession in the European Union. By having ensured public support by a number of countries Simitis went on to do an extremely dangerous diplomatic maneauvre by stating that with the accession of Cyprus and Malta: “Our aim is to establish good neighbour relations with Turkey, based on the implementation of international law. That is why we supported Turkey's attempts for becoming a member of the Union. As a result, this has not only advantages, but obligations for Turkey in the field of human rights, on its relations with its neighbours and on Cypriot affairs. It is our government's priority, as it is for all Greek governments, to find a fair and enduring solution for Cyprus. It is also our priority to ensure the continuance of the negotiations regarding Cyprus' entry to the Union." (CE review,2015)

Since 2004, Greece placed an Embassy in Tax Biex and accredited its first Ambassador to Malta, while prior to that the Greek embassy in Rome was accredited to act both for Italy and Malta. Similarly, Malta in return has also placed an embassy in Athens and two honorary consulates in Piraeus and Thessaloniki. The two countries also share membership of the European Union and of Parliamentary Assembly of the Mediterranean. Historically, they are being tied by far more as both the Hellenic and Maltese front against the Axis powers of 1939, held a common target, Mussolini’s Italy. Both countries fought gallantly, honoured by after war statements, such as Churchill referring to Malta as: “The greatest mistake of the Axis in the whole war in this theatre,” and to the Greek resistance with: “Greeks don’t fight like heroes, heroes fight like Greeks.” Despite the fact that both countries did not fight side to side against the Italian invasion, they both fought braver than ever against Fascist Italy’s aim to carve new Holy Roman Empire, both through a trilateral cooperative measure offered by the British. When the Allied forces commenced an invasion of Southern Europe, which resulted in the Italians deposing Mussolini a prolonged battle for Italy took place between Allied and German forces, and as the strategic situation changed in south-east Europe, British troops returned to their bases in Greece and Malta. (Historynet, 2015)

Furthermore, the two countries engaged in a series of bilateral relations, historically all of which have been based mostly on the strengthening of the commercial trade, scientific and technical cooperation, cultural, economic, industrial, police and taxation agreements.  This long history of economic reliability can also be reflected from the recent visit of the Greek President, Mr.Papoulias and the press release that followed, notably referring to a number of bilateral enhancements based on the historical past by stating that: “our economic cooperation can and should be a major part of our bilateral relations. We wish to strengthen the cooperation between Greek and Maltese investors. Our economic cooperation can rise to higher level in spite of the difficult times. We hope that our bilateral trade will increase....We look forward to welcoming a high number of Maltese citizens who will wish to spend their holidays in Greece. Our cultural cooperation is equally important. Greek language and civilization are taught at the Maltese higher education establishments and I wish to assure you that we will continue to support every initiative at aiming at the promotion of our cultural cooperation.” (Press Release, Gov.mt)

Notably, the first bilateral agreement between Greece and Malta was signed prior to both of the countries entry in the European Union, namely the Commercial Agreement of 1976 which ratified and regulated trade between both countries. A realistic agreement, made in the midst of a turbulent time for Malta and international relations, only two years after Malta became a Republic being integrated by an international arena swallowed by division between two systems of governance. In the same year both the Bilateral Agreements on Scientific and Technical Cooperation and Cultural Agreements were signed.  As was aforementioned by the press release by Mr.Papoulias, these bilateral agreements aimed where spices used to only formally ratify the agreements between investments, financial regulation and cultural sharing, within the framework of respect for each other homogenous existence. This was further enhanced when in 1992 the Greek government financed for a park to be build in Malta in honour of Ioannis Papafis. (Ministry of foreign Affairs.gr)

Moreover, following the Detente in Europe, and for the first time in the midst of the Cold War where countries such as Turkey, Malta, and Greece, for the first time formed joint chambers, a plethora of further bilateral agreements followed. With the progressive institutionalization of economic relations the two countries recognized that their economic relations, in general, could be upgraded and intertwined further in a manner that is consistent with the common interests, views and aspirations of the two countries. The Agreement on Economic, Industrial, and Technical Cooperation has also been ratified by Egypt, making it an excellent trilateral agreement with the framework of Euro-Mediterranean Partnerships. Mostly, these agreements facilitate the movement of goods, the ability to enhance economic trade relations, air transportations, and food products such as fresh, frozen and processed juices and mineral waters. (Historynet,2015)

Notably, Malta and Greece have both emphasized the importance in 2004 of signing an agreement within the European boundaries of avoiding double taxation.  It was sought as important to encourage the aforementioned growth of international trade within tangible goods as well as that of financial services. This agreement, to this day remains in force and is expected under no circumstances to be removed. The Maltese government has highlighted that not only with their Greek partners, but with every partner who has signed and ratified this agreement Malta will continue to encourage growth. Double taxation relief is a form of a tax treaty, which of course, means that business from all the ratified countries would be ratified and taxed in the least taxed country.  These deals are extremely prosperous for Malta, considering the levels of low taxation the government has managed to hold in comparison with the current Greek taxation of 23 per cent. This pivots the economic strength in terms of investments towards Malta’s side, allowing, factually Greek investors to declare their incomes in Malta rather than Greece in order to pay the least possible tax.(FinanceMalta, 2015)

Finally, both countries have agreed on specific police agreements. Most of these agreements have been signed and ratified in the latter years, i.e. 2001-2004 signed in Valletta and involves the general cooperation with regards to civil protection, cooperation in attempts to prevent and respond to the effects caused by disasters and major accidents, calling for a cooperation in crisis management like the current refugee question, drug issues, and a joint civil protection cooperating unit that functions, not necessarily between the offices of Europol and Interpol within the member states per se, but as an independent unit that enables further cooperation, particularly in matters of tax evasion, and money laundering. (MFA.GR,2015)

In conclusion, the fundamental point is that both countries have had a historical interconnected problems, ties, and solutions, however, when it comes to recent history both have used each other as a pivot of support for some form of gain. Greece used the Maltese succession as a pivot of power over any potential Turkish threats, and Malta thus used the momentum to gain financial empowerment over Greek investors. Both agreements however proved to be extremely unstable, as the issue with Turkey has seen no resolution, and tomorrow’s Greek government could decide to turn the Hellenic Republic to a tax safe heaven with 0.05 per cent taxation.

However, there have been a number of historical ties in terms of bilateral and trilateral agreements, prevalent from the Second World War. Despite the fact that the Hellenes and the Maltese did not fight side to side, they both fought side to side with the British, and the British needed both nations to win the Mediterranean.

There also appears to be a significant cultural recognition of each other’s state.  As Mr.Papoulias mentioned in the Press statement, it is considered the ultimate form of honour for the Hellenic Republic the fact that the Maltese schools are teaching Greek culture, and philosophy. Ultimately it is seen as the highest form of human interaction and teaching it to another nation is considered, philosophically the highest recognition of ethics. Philosophically there is no higher compliment.

As such most agreements are based on a financial and entrepreneurial corroboration. With the exception of a few technical agreements such as the Agreement on Air Transportation, both nations basically interact with each other through Soft power, ie, building a Greek Park in Malta, welcoming Maltese tourists in the Hellenic islands, and the financial sector, as per examples, tax standards,  financial co operations, joined investments, and so forth. Notably, at this point relations have not been affected despite current Prime Ministers Dr.Muscat’s demands that Greece should pay back the Maltese or that it could not be saved under any circumstance.[1] There is a threefold reason to why the Hellenic Republic has taken the aforementioned statements very lightly. Firstly, the Alternativa Demokrattika, shut down these statements by referring to the Greek problem as a European problem that should focus on helping the people not spend bailouts on forced equipment by Germans and the French.[2] Greece also has a very limited number of allies within the EU, and could not afford losing Malta, turning a blind eye.

However, and to conclude, under normal economic circumstance both countries hold excellent relations with each other as investment hubs, and culturally collaborative centers, and that is dominant from the bilateral agreements shared between them, all in good faith, the Mediterranean way. 

References:

The Race to Malta. 2015. The Race to Malta. [ONLINE] Available at: http://www.historynet.com/the-race-to-malta.htm. [Accessed 06 November 2015].

ADDRESS BY H.E. THE PRESIDENT OF THE HELLENIC REPUBLIC MR KAROLOS  PAPOULIAS  TO  H.E.  THE  PRESIDENT  OF  THE  REPUBLIC  OF MALTA DR GEORGE ABELA Available at: https://gov.mt/en/Government/Press%20Releases/Documents/pr140244c.pdf. [Accessed 06 November 2015].

Πολιτικές Σχέσεις - Η Ελλάδα και η Μάλτα. 2015. Πολιτικές Σχέσεις - Η Ελλάδα και η Μάλτα. [ONLINE] Available at: http://www.mfa.gr/missionsabroad/malta/bilateral-relations/political-relations.html. [Accessed 06 November 2015].

Maltese historical civilisations: greeks, phoenicians, romans, arabs. [ONLINE] Available at: http://www.malta.com/en/about-malta/history/maltese-historical-civilizations. [Accessed 06 November 2015]

Malta Double Taxation Treaties . 2015. Malta Double Taxation Treaties . [ONLINE] Available at: http://www.financemalta.org/double-taxation-agreements. [Accessed 07 November 2015].

CER | Greece: Prime Minister supports Malta's EU accession . 2015. CER | Greece: Prime Minister supports Malta's EU accession . [ONLINE] Available at: http://www.ce-review.org/01/19/greecenews19.html. [Accessed 07 November 2015].

 



[1] Greece must repay debt, extending repayment period negotiable – PM - MaltaToday.com.mt. 2015. [WATCH] Greece must repay debt, extending repayment period negotiable – PM - MaltaToday.com.mt. [ONLINE] Available at: http://www.maltatoday.com.mt/news/national/48894/greece_must_repay_debt_extending_repayment_period_negotiable__pm_#.Vj3JBmu6LK8. [Accessed 07 November 2015].
Muscat on Greece: We need a solution, but not at any price - timesofmalta.com. 2015. Muscat on Greece: We need a solution, but not at any price - timesofmalta.com. [ONLINE] Available at: http://www.timesofmalta.com/articles/view/20150712/local/muscat-on-greece-we-need-a-solution-but-not-at-any-price.576316. [Accessed 07 November 2015].

[2] Stop playing the machos with Greece, AD tells Joseph Muscat, Simon Busuttil - timesofmalta.com. 2015. Stop playing the machos with Greece, AD tells Joseph Muscat, Simon Busuttil - timesofmalta.com. [ONLINE] Available at: http://www.timesofmalta.com/articles/view/20150709/local/stop-playing-the-machos-with-greece-ad-tells-joseph-muscat-simon.575917. [Accessed 07 November 2015].