11 July 2001

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By Edwin Vassallo

Building a successful entrepreneurship policy

Parliamentary Secretary in the Economic Services Ministry, Edwin Vassallo, spoke on Monday about the formulation of an entrepreneurship policy for Malta and the inherent need for a co-ordinated and multi-disciplined approach for Malta’s socio-economic environment. Following are extracts from his speech

The formulation of an entrepreneurship policy for Malta has brought about an interesting debate on the need for a co-ordinated multi-disciplined approach for our socio-economic environment. A successful entrepreneurship policy together with the process of restructuring and the revision of established work practices should result in concrete benefits for all those involved.

The development of an entrepreneurship policy white paper for our country has the aim of inducing all the players to participate in effective actions that radically change the priority of and the manner in which decisions are taken, in particular those that affect:

1) the interaction of the different economic sectors between themselves,
2) the interaction of the Civil Service and State agencies with the private sector,
3) the interaction between the residential and the business communities in the different localities.

The emphasis and the focus of the Entrepreneurship Policy are on the individual behind the enterprise rather than on the business concern itself. It seeks to chart a plan of action for Government to create the best environment possible for enterprise and entrepreneurship, especially small enterprise initiatives that create value added and are a main source of job creation.

It is only with such an approach that Government can bring about a change in the perception and practices that guarantee the sustainability and development of commerce. Economic success on a personal and national level will never be attained if the criteria for investment are not based within the parameters that ensure sustainability. In every business decision process, the evaluation of risk will always feature as one of its considerations. But one has to go a step beyond the element of risk: one has made careful planning based on disciplined and innovative work practices. It is all a question of quality over quantity. In this manner, we ascertain the sustainability of business by avoiding a situation of over-trading across various economic sectors.

Government has taken a series of practical steps to set up new support structures that should help bring about a much needed change in the attitude of the business community that has, until recently, enjoyed the protection of various trade barriers. We are now faced with an emerging situation whereby the protection offered by the market is not so much related to the limiting or the control of competition but one based on a system of open but fair competition. It is a system in use throughout the EU today, which is based on the recognition of common standards, harmonised commercial regulations and a single market that derives strength from its unity.

The restructuring of the Commerce Division that brought together a number of services which previously were available from a number of different government departments together with the setting up of the Small Business Efficiency Unit have as their objective the provision of a new centralised support service for the commercial community. The Malta Crafts Council has been set up by legislation last year with the objective of breathing new life to an ailing artisan community thus making it a commercially viable venture to investors and craftsmen.

The Institute for the Promotion of Small Enterprises (IPSE) has introduced in all its programs the concept of business planning for all business proposals brought forward for its consideration. The new Trading Licences Act shall radically change the way in which a commercial licence is issued, from the archaic and complicated procedure that we have at present to a transparent process based on the one-stop-shop system.

All these support agencies aim to create synergy in the web of services available and aim to change the mentality of the entrepreneur. The Ministry for Economic Services has the responsibility for a wide array of agencies and departments that provide a service to commerce and industry. The reorganisation and operations of these entities is focused on obtaining economic success in Malta. The smooth functioning of these entities within the Ministry goes much of the way to determine economic success. However I shall go to great pains to stress that an Entrepreneurship Policy in Malta should not be the monopoly of the Ministry for Economic Services. A successful Entrepreneurship Policy is the responsibility of all Ministries that in one way or another influence the environment in which the entrepreneur operates. Today's meeting mirrors the priorities and the direction of this policy. It is a result of the co-ordinated synergies that are brought together with one common aim: that of constantly improving the operating business environment.

The simplification of legislation and of administrative procedures are the main aims of the different Ministries, Government Departments and Authorities. It is not and should not be the sole responsibility of the SBU. The SBU co-ordinates and is the focus of the multi-disciplined tasks that are involved throughout this process. However, every department, agency and authority has its respective responsibility to ensure that the procedures and legislations that they administer should be and are as business friendly as possible. I believe that this objective is high on their agenda.

I would like to take this opportunity to refer to the report entitled "Major Regulatory Constraints on SME’s" compiled by the SBU. This document that has been made public has the aim of publishing every issue or group of similar issues that were reported to the SBU and is proof of the Administration's decisiveness to tackle inefficiencies within Government entities in this regard. Therefore I cannot but again stress that this should be the aim shared across the entire Civil Service. The BEST exercise is a valid example of the efforts that are involved to simplify work practices. All these efforts and aims form an intrinsic part of our Entrepreneurship Policy. There is no place for those who do not offer an efficient service to the business community. We will have a public administration that is efficient, effective and responsible. We are here to offer a service, a good service, the best service.

The reports that are being discussed today are the contribution and result from a number of diverse departments and institutions, ranging from Education and Training, Access to Finance, Access to Research and Innovation, Visibility of Support Services, Public Administration and Employment and Working Conditions. A number of interesting meetings have taken place as a result of this exercise. Separate discussions have taken place between ETC, IPSE, Malta College for Science and Technology and the Ministry for Education in the area of Education and Training. In the area of Access to Finance, a national Round Table Conference with the major financial institutions and representatives of the business sector has been organised while a questionnaire is being circulated to a broad sample of around 800 business enterprises operating in diverse economic sectors. The results obtained from this conference were complied in a report that will help us formulate the necessary actions to facilitate access to funds. In the area of Research and Innovation there is a specific Task Force that is promoting participation in the Fifth Framework Program that has specific actions in favour of SME’s.

It is not enough to have support services in place. They have to be accessible and visible to the business community wishing to use such services. In this respect the Ministry has worked in close collaboration with the SBU, IPSE, METCO and the EIC to ensure that all their services and programs are accessible to the smallest of enterprises and I have also met all Permanent Secretaries. All these meetings had the same theme: the provision of a transparent, accessible and simplified service to the business community.

What we shall be discussing today is the result of an understanding that we have to improve our situation, to change where change is needed. It is due to our awareness that we have to continuously oversee the circumstances and improve on them. And this awareness is not because we have to be compatible with any directive of the EU but because we have to be compatible with the prevalent social and economic conditions that are constantly changing.

We also have to keep in mind the local perspective. A successful Entrepreneurship Policy has to be further focused and developed to integrate the local communities.

As soon as taking up office I brought into action a programme called ‘Commercial Policy in the Community’ which aims to highlight the requirements of the local business community and address them. I believe that in this way, the residents and the entrepreneurs can exist in a harmonious manner to achieve mutual benefits.

The organisation and restructuring of the business sector and the environment in which it operates is the aim of our Entrepreneurship Policy. We are working towards a culture that is pro-entrepreneurship and in favour of small business. The success of our Entrepreneurship Policy should be gauged in our commercial communities and centres, in the industrial estates, in the various open markets across Malta and in the general improvement of the business environment. By providing the relevant infrastructure and training it should be sensitive to the needs of start-ups and students who have the intention of entering the business arena. Accessibility to finance should not present a barrier to entry for commercially viable and innovative investments. It is all about improving working conditions: both for the entrepreneurs themselves and their employees. Above all, a thriving entrepreneurship policy would be reflected in an improved public administration that in turn guarantees the success of our economic well being. We can achieve all this through continuous consultations with the widest spectrum of our community. We would strive to develop further synergies that have to be brought together for our common improvement.

We have started a process that I know will not and cannot stop here. We have seen and understood that no one can exist and survive in isolation. We have to come together to achieve shared aims. I have one last thought for this meeting: let us make sure that we rise to our responsibility of being of service to those that need us. This is our duty.

The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07
Tel: (356) 382741-3, 382745-6 | Fax: (356) 385075 | e-mail: editorial@networkpublications.com.mt