Karl Azzopardi, who previously headed the state industrial parks agency INDIS and the Building and Construction Authority, has been appointed CEO of Malta Government Investments.

Azzopardi was appointed in January following a selection process led by the MGI board, an economy ministry spokesperson said.

He brings over 30 years of managerial experience in both public and private sectors, and holds a Master’s in Business Administration (MBA) from Wales University, the ministry said.

Malta Government Investments is tasked with managing various financial investments on the government’s behalf. According to its annual report for 2021, MGI employed 50 people and held assets totalling €27 million. The company has yet to file accounts for subsequent years.

On Friday, the MGI website still listed Jesmond Gatt as its CEO.

INDIS was among the state entities that feature heavily in the public inquiry report following the construction collapse death of 20-year-old Jean Paul Sofia.

The report concluded that Malta Enterprise and INDIS should never have allowed land in Corradino to be allocated to the developers in the first place.

The developers’ proposal was “objectively lacking in every respect”, the board of inquiry concluded, adding that officials at both Malta Enterprise and INDIS should “consider their positions” in light of the findings.

Azzopardi had already left the INDIS CEO role well before the December 2022 tragedy and the final report. But at the time when the Corradino project was assessed and approved, INDIS, the government entity responsible for industrial land administration, was under Azzopardi’s control.

Azzopardi went on to lead the Building and Construction Authority as its first CEO but quit just one year later, following clashes with minister Stefan Zrinzo Azzopardi.

He subsequently filed a case for unfair dismissal. A tribunal ruled against him but concluded that Azzopardi had been given to understand that he would be given an alternative post or financial compensation.

On Thursday, Times of Malta asked the Economy Ministry – which is responsible for both INDIS and the MGI – if the Sofia public inquiry’s findings were considered when Azzopardi was made CEO.

“INDIS Malta and MGI are entirely separate entities. Mr Azzopardi stepped down as CEO of INDIS in early 2021.

“The land allocation referenced in the Jean Paul Sofia inquiry was made according to the policies in place at the time. Since then, the government has acted on the inquiry’s recommendations, with reforms already implemented and further changes coming through legislation.”

“Where the inquiry identified serious shortcomings, it named individuals directly. Mr Azzopardi was not one of them,” the ministry spokesperson said.

Azzopardi has always maintained that INDIS followed all established policies and practices in the Sofia case. It was Malta Enterprise that approved the project that ultimately led to the construction site collapse, he noted.

“I was only involved in the process until the signing of the contract, so what happened throughout the implementation process is after my time, but the contract definitely did safeguard INDIS’ interests and, by extension, that of the government,” he said in March 2024.

Bigger role in policymaking

Azzopardi’s appointment at the helm of Malta Government Investments (MGI) comes at a key moment for the state-owned firm, as it is poised to adopt a bigger role in policymaking and take over the work of Mimcol, another state entity.

Mimcol, which was set up in 1988 to manage and streamline government investments, is itself now facing the chop as part of a ministry exercise to “enhance efficiency and effectiveness across its entities” and is in the process of merging into MGI.

It remains unclear whether Jesmond Gatt – Azzopardi’s predecessor as CEO of the MGI and who also leads Mimcol – is being assigned a different government post. Gatt also chairs the board of governors of the financial regulator, the Malta Financial Services Authority.

MGI is likely to be rebranded under a different name in the coming months.

Some of Mimcol’s workers will be absorbed into the MGI-led entity, while a “handful” of others have been transferred to the government-owned Resource Support and Services Limited.

“We do not need two separate entities, with two management structures and boards of directors. This will streamline operations,” government sources said.

Apart from efficiency and cost savings, the new entity will serve as an economic research unit for the Economy Ministry, assessing economic proposals and submitting reports and advice to the Silvio Schembri-led ministry.

The entity will also provide an outsourcing service for non-core functions that smaller state-owned entities may require.

“Such entities may require the occasional services of a human resources manager or payroll administrator, for instance,” sources said. “Instead of hiring someone to do that job, they will be able to obtain that service from this new entity we are creating.”