China’s loans and projects transformed Malta’s economy

This year sees the 50th anniversary of the establishment of diplomatic relations between China and Malta. China is a large country in East Asia with a population of some 1.4 billion people. Malta is a small European country in the Mediterranean with a population of less than half a million. Yet the two countries share a deep and profound friendship.

With the Golden Jubilee of diplomatic relations approaching, on January 10, President Xi Jinping had a telephone conversation with his Maltese counterpart George Vella. According to the official read out from the Chinese Foreign Ministry:

“Xi Jinping pointed out, China and Malta are old and good friends that have withstood the test of time. Half a century ago, the elder generation of Chinese and Maltese leaders, with great vision and foresight, jointly forged friendly relations between China and Malta. Over the past 50 years, no matter how the international situation changes, China-Malta relations have been developing in a sound and steady manner, with deepening friendship and fruitful cooperation in various fields. In the face of challenges such as the international financial crisis and the COVID-19 pandemic, the two sides have always helped and supported each other.”

For his part, President Vella responded: “Bilateral relations have become more mature and made remarkable achievements, setting a good example of state-to-state relations. Malta is firmly committed to further developing its friendly relations with China and is ready to strengthen high-level exchanges and deepen practical cooperation with China in various fields. Malta cherishes the precious opportunities brought by Belt and Road cooperation and is ready to continue to advance relevant cooperation with China. I hope that Malta-China relations will develop even better in the next 50 years and bring more benefits to the two peoples. Malta firmly adheres to the one-China principle and firmly supports multilateralism. Malta is ready to play a positive role in promoting the development of EU-China relations. Malta highly appreciates China’s vaccine aid for the international community’s fight against the COVID-19 pandemic and its positive contribution to the global response to climate change, and looks forward to closer cooperation with China.”

Although Malta won its independence from a century and a half of British colonial rule in 1964, it remained a neo-colony under the military and economic domination of British imperialism. All that was set to change with the election of a Labour government under the Prime Ministership of Dom Mintoff in 1971. Under his visionary leadership, Malta was transformed from a British neo-colony into a bastion of anti-imperialism and a mainstay of the Non-Aligned Movement. He also expanded the state and public sector of the economy, with extensive nationalisation, established a comprehensive welfare state, and enacted key social reforms, including equal pay for men and women and the decriminalisation of homosexuality. All this required the forging of international alliances and Mintoff assiduously developed close friendships with such outstanding revolutionary leaders of the developing world as Mao Zedong, Kim Il Sung, Muammar Gadaffi and Nicolae Ceausescu, among others. Above all, it was Mintoff’s deep and genuine friendship with Socialist China that enabled Malta to expel the British military bases and to stand up in the world. This writer vividly remembers the consternation of the British TV newsreader reporting Mintoff’s crossing back into the then British colony of Hong Kong, sporting a large badge of Chairman Mao on his suit jacket lapel following a meeting in Beijing with the Chinese leader.

Naturally all this earned Mintoff the undying hatred of the British ruling class. Particular and sustained vitriol was poured by the Daily Mail, a right wing British daily which had supported the British Union of Fascists in the 1930s, who dubbed him “desperate Dom”. Their hatred became positively apoplectic when his daughter Yana, then a student in London, and a key activist in the Troops Out Movement (TOM), campaigning for Irish independence and reunification, hurled horse dung on MPs from the public gallery of the House of Commons in solidarity with the ‘dirty protest’ waged by Irish Republican prisoners in the north of Ireland. (The ‘dirty protest’ was to culminate in the 1981 hunger strike in which 10 young Volunteers from the Irish Republican Army and the Irish National Liberation Army were to heroically lay down their lives.)

Without the British military bases, Malta would have faced economic ruin. That is why, in 1975, China built Dock Number Six in the harbour of the Maltese capital Valetta. Far better known as the Red China Dock, this engineering feat remains the largest dry dock in the Mediterranean. At that time, China was still a poor country and its economy was reeling from the turmoil of the Cultural Revolution. On a per capita basis, Malta was clearly a more prosperous country. But Chairman Mao and Premier Zhou Enlai saw it as their solemn internationalist duty to help Malta take the road of independence and the building of a new society.

Visiting the Red China Dock on 7th September 2021, China’s Ambassador to Malta Yu Dunhai noted that it is, “a significant symbol of China-Malta friendship and remains as a monument in the heart of the people devoting themselves to China-Malta friendship. More than 40 years ago, China overcame its economic and technological limits, provided 100 million RMB interest-free loan and sent about 800 technicians to Malta to construct the dry dock, which showcases the sincere friendship between our two countries. Two Chinese engineers, Mr. Xu Huizhong and Mr. Gu Zhaoyan, lost their lives during the construction. Their great effort and sacrifice laid solid foundation for China-Malta ongoing friendship.”

We are therefore very pleased to reproduce from Shine News, the online platform of the prestigious Shanghai Daily, the following interview with Dr Alex Sceberras Trigona, Foreign Minister of Malta from 1981-87. In this period, Dr Trigona worked closely with Deng Xiaoping to carry forward and develop the friendship established with the preceding generation of Chinese leaders.

(Introduction by Friends of Socialist China co-editor Keith Bennett).

Dr Alex Sceberras Trigona recalls the big moment when he had to arrange a meeting between Malta Prime Minister Dom Mintoff and Chinese leader Deng Xiaoping in 1982 when he served as Malta’s minister for foreign affairs.

China and Malta established diplomatic ties in 1972, and Sceberras Trigona was instrumental in strengthening the relationship between the two countries during his tenure as foreign minister from 1981 to 1987. He has lost track of the number of times he has visited China but thinks “it could be 30 to 40 times” at least.

He has experienced the “hospitality and big heart” of China and was involved in the documentation and negotiations of projects that China helped build in Malta. He had negotiated and concluded Malta’s Neutrality Agreements in the worst years of the Cold War and has met generations of the Chinese people, from leaders to young students. He opened Malta’s embassy in Beijing.

“Our friendship with China is long-standing and proven. It’s not a rhetorical relationship, but also corroborated in material economic terms,” the diplomat told Shanghai Daily via video interview.

“China’s loans and projects helped Malta in transforming our economy from military-based to one based on peace, commerce and industry, initially starting with manufacturing. Malta gave China an opportunity to showcase its engineering capabilities to the rest of Europe and the world. It was a win-win for both sides.”

As China and Malta mark the 50th anniversary of diplomatic ties, Shanghai Daily spoke to Sceberras Trigona about what the future holds for the two countries.

SD: What was your impression when you heard that the two countries had established diplomatic relations back in 1972? Was it a big surprise?

AST: It was a fantastic opportunity for our prime minister at that time, Dom Mintoff, to meet Mao Zedong and Zhou Enlai. They gave him the most fantastic welcome, as big as (former US president Richard) Nixon’s, if not bigger.

I want to put his visit to China into perspective. He was elected in June 1971, but his government had only a one-seat majority in parliament. As a result, policy-making was difficult.

When diplomatic relations were established in January 1972, Malta cut off all relations with Taiwan. This was a major historical change for a European country.

Malta was constitutionally independent, but we still had NATO and British military bases all over the country. This was not acceptable to Mintoff. The Chinese, who had suffered from “unequal treaties” in the past, also did not like seeing countries being humiliated like that.

But the bases couldn’t be closed overnight, because they employed about 25 to 30 percent of the Maltese labor force. Mintoff’s plan was to close down the bases one by one over seven years, and find alternative sources of employment for them.

At the end of March 1972, he concluded the withdrawal agreement in London, announced it in parliament in Malta and immediately flew to Beijing to meet Mao and Zhou with the plan for economic transformation. They immediately appreciated what he was doing and considered it feasible.

China offered a long-term interest-free loan of 100 million yuan (US$15 million), and they would also launch projects and factories here, which created a lot of employment. The biggest project was to build a 300,000-ton dry dock for new supertankers, the Red China Dock.

I want to stress again, it was not only a long-term loan, but it was interest-free. That was very generous from a country that was rather poor at the time. Zhou even gave Mintoff a letter canceling the debt to be used just in case our economy did not take off. We paid all the debt in the 80s. This is something we cherish and appreciate.

SD: The Western media were skeptical, saying the poor and inexperienced Chinese would fail to deliver the projects.

AST: The Western press was appalled by Mintoff’s visit to China. In the 1972-1979 Anglo Maltese Agreement they had only prohibited Malta from granting military facilities to Warsaw Pact members. The Western press was critical because they failed to see it coming. Not only did they talk about China’s inexperience, but also suspected it was a Chinese military base.

But everybody could see the Chinese cutting the rock and constructing the dock.

I remember going to some media offices in New York and Washington, because they were saying there were 10,000 Chinese military personnel hidden in Malta.

I asked the chief editor, “Malta is so small, how can you hide 10,000 people? We can’t even hide 100 people.”

The press wanted to create opposition and suspicion. They also tried to scare Maltese people by saying that if we are going to be close to China, we will only be eating rice and wearing gray uniforms. No more color… The stupidity of such criticism!

SD: Did it ever occur to you that China might fail the project?

AST: No. Before I became foreign minister, I was a law student and an Oxford University scholar. In the Labour Party I was the international secretary from 1976. So I was assisting with a lot of background documentation for the Red China Dock. When the dock opened in 1981, it was greatly welcomed here.

Shortly after I took office, I organized the meeting between Mintoff and Deng in 1982, during which I managed to conclude the agreement for another major project – the Marsaxlokk Freeport in the south of Malta.

The big port didn’t have a breakwater, without which ships could not dock in rough seas. We wanted to develop a second port in Malta, but we didn’t have the technology to build a breakwater.

China Harbor Engineering Company brought its best engineers and operated underwater for the first time.

Today, we have a huge Freeport Container Terminal operating, handling nearly 2 million TEU (Twenty-foot Equivalent Unit) a year. It created employment in a totally new area. It was also a very good global advertisement for CHEC, which was new at the time. Now they are carrying out marine engineering projects all over the world.

SD: What are your thoughts on the growth of bilateral relationships in the post-pandemic period and tensions between China and the EU?

AST: We will strive to minimize the tensions as much as we can. We are a very small country with limited diplomatic staffing, but our hearts are big. We always try and push for peace, reduce the tensions and increase the confidence required for the peaceful resolution of disputes. This is very important for people. We need people-oriented diplomacy.

We can still develop not only better cultural relations, but also improve our infrastructure relations. We are speaking of material joint action, instead of a communique, saying how friendly we are to each other. We have electric plants at Enemalta with minority shareholding from Shanghai Electric Power. Such efforts benefit both sides.

SD: When was the last time you visited China? And what is your impression of the younger generation of Chinese?

AST: Before COVID … about two years ago. Over the years, I have been invited to give lectures on international trade, international economics and international politics by various Chinese institutions, such as China Foreign Affairs University and Chinese People’s Institute for Foreign Affairs. It was great fun to meet the younger generation of Chinese, who are very bright and go-getters.

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