Chinese company to be a minority shareholder in Enemalta
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This morning in China a Memorandum of Understanding for strategic investment in the field of energy was signed between Malta and China
The agreement was reached under which China showed its intention to invest in Malta’s energy sector, through direct investment in Enemalta, with the possibility of setting up a company which assembles Chinese solar panels in Malta for Europe and which will see Malta being utilised as a centre from which China services power stations across the Mediterranean.
The Government said in a statement that as a result of this agreement, Malta will have a major company from China, which is the second largest economy in the world, as its strategic partner. The Memorandum of Understanding was signed by the Minister for Energy Konrad Mizzi and Mr Lu Qizhou, Chief Executive Officer of China Power Investment Corporation, after a meeting the Maltese Prime Minister Joseph Muscat had with the Chinese Prime Minister, Li Kenqiang, in Dalian China.
The Memorandum of Understanding is the result of months of negotiations, the Government said, “by means of which, the Chinese Government is showing its interest in investing in Enemalta Corporation.”
The value of the investment, which is expected to be substantial, will be determined after negotiations which will take place in the next six months.
Through this Memorandum of Understanding, they China Power Investment Corporation has agreed that it will be investing in Enemalta Corporation through its subsidiary Shanghai Power Electric. The Chinese will be minority shareholders in the Corporation, with the control of the company remaining in the hands of the Maltese Government, The Malta Government said.
“This should lead to a cash injection in Enemalta, which would mean a substantial reduction in the Corporation’s debt. Thus removing a large part of the burden that the taxpayers have been carrying for 25 years, with the workers secured, who had previously been put in danger by this debt.”
The Memorandum of Understanding will also lead to the creation of new employment in both the conventional and alternative energy sector, as well as new investment in infrastructure for Enemalta, the Government statement said.
“The agreement has no connection with the plan to reduce the cost of water and electric bills which is still on track,” the Government said.
Through this agreement, Malta and China have a six month time frame to set up a company with the participation of Enemalta, aimed at servicing other power stations that China has in the Mediterranean.
The possibility of photovoltaic solar panels being assembled in Malta is also being explored together with the creation of a joint venture for the installation of the PV solar panels both in Malta and abroad. “This will also help Malta to reach the 2020 targets for the reduction in emissions,” the Government said.
“China Power Investment Corporation is among the largest companies in the world which was looking for strategic partners in Europe and the Mediterranean at the same time that Malta was going through important changes, important to the county, in order to strengthen the Enemalta Corporation so that it would not longer be a financial burden on the taxpayers, safeguard employees’ jobs, while also creating new ones,” the Government said.
The Government intends, for the sake of transparency and good governance, to have the agreement ratified by Parliament once the negotiations are concluded, the statement said.