Enlargement and tourism development
Tourism Minister Francis Zammit Dimech addresses last weeks
technical seminar on European integration in the era of the EUs
enlargement and the development of tourism
Richard Rosser, chairman of the European Trade Union Committee on Tourism,
once stated that: "Tourism is Europe's biggest industry, yet tourism
is a sector that in Europe has been squeaking like a mouse for far too
long. It now needs to roar like a lion."
EU institutions and many current and future member states do recognise
that travel and tourism is an important sector for their economies.
The tourism industry plays a crucial role in national, European and
global economies and should be considered accordingly. Within the EU,
it accounts for five per cent of GDP and generates eight million jobs.
It is therefore undoubtedly a major industry which will become larger.
In fact tourism is one of the industries which grows as global wealth
increases. The wealthier the people, the more spare time they have and
the more they are apt to travel. This fact gives the tourism sector
scope to increase its potential. The World Tourism Organisation envisages
a boom over the next twenty years which will lead to worldwide tourism
more than doubling.
At the same time, tourism is a vulnerable sector, subject to external
influences such as the global economy and safety. The effects of the
terrorist attack of 11th of September 2001 on the Twin Towers in New
York are still fresh in everybodys memory. The conflict in the
Middle East is another external influence which is having a profound
effect on tourism to countries in the Mediterranean. In tourism, one
can also witness an ever-changing competitive scenario with the constant
development of new destinations for the tourist.
Tourism is one of the mainstays of the Maltese economy. In less than
four decades it has grown from an almost invisible economic activity
to the complex and noticeably large phenomenon it is today.
Malta is not any more merely a sun and beach destination. We are targeting
niche markets that include English language schools, diving and cruise
liner passengers. In 2002 about 60,000 visited Malta to take up English
Language learning whilst the same number of passengers visited Malta
for diving. The number of cruise passengers went up by 82,242 to 341,632
from 259,390 in 2001. Keeping in mind our 7000 years old history we
are marketing Malta as a cultural destination particularly for the off-peak
A study commissioned by Government, measuring the industrys impact
on the national economy and the ensuing results, shows that tourism
in Malta contributes 25 per cent to Gross Domestic Product, 22 per cent
to Government revenue 28 per cent equivalent to 40,000
in employment terms. Gross earnings from tourism during 2002 amounted
to Lm246.3 million, whilst earnings per capita in the twelve month period
January December 2002, earnings from tourism per capita stood
Tourism does not fit easily into any standardised national institutional
framework. Measures taken by different ministries transport,
environment, interior, foreign affairs, public works, culture, consumer
protection, health can profoundly affect tourism outcomes.
Within the European Union, tourism policy and development of favourable
general framework conditions are primarily a matter for each Member
State. Co-operation on an EU-level is relevant in areas where we can
add value by addressing them in a European context. Three areas have
in fact been identified where EU action can add value to Member State
tourism policy. These are:
The improvement of a common statistical database accurate
knowledge of the industry is a precondition for benchmarking, for the
exchange of views and of experience and for addressing strategic problems
of the sector;
initiating operational and focused benchmarking analyses in order
to achieve a detailed understanding of tourism in the Member States
and thereby developing quality definitions and indicators, by formulating
a vision for sustainable tourism; and
Strengthening the integration of tourism policy issues into related
policies. Tourism is a sector of a transversal nature affected by numerous
EU-policies and common efforts must often be focused on horizontal issues.
European growth in the coming years to an increasing extent must derive
from structural reforms and through the improvement of the general framework
conditions for European citizens and businesses.
The latter point is currently at the centre of discussions taking place
on an EU level. The argument is whether tourism should have a horizontal
policy in its own right or whether tourism should be reinstated in the
Treaty as one of the areas for supporting action, with the European
Union playing a complementary role to that of the Member States. Following
the first informal meeting of Ministers and high officials from the
25 EU Member States, held in Crete a fortnight ago, I would venture
a guess to the effect that tourism, in the coming years, will begin
to be regarded as a specific policy area within the enlarged European
Union family. As Member of that family we certainly welcome the news.
Co-operation between the Member States of the European Union, both the
current and the prospective ones, on this issue thus is and remains
key to success. It is important that Member States work according to
an open method of co-operation taking account of the principle of subsidiarity
while encouraging the active participation of enterprises and economic
and social players.
Malta already enjoys various EU benefits. As from 1 November 2002 the
UK reduced its Passenger Departure Tax by 75 per cent placing Malta
on a par with member states to compete on a level playing field with
Spain, Greece, Italy and Portugal. Moreover we have gained a competitive
edge over non-European destinations like Tunisia and Morocco. The Leonardo
Programme funds 75 per cent of training courses, an advantage we already
enjoy. Malta qualifies for EU assistance, equivalent to 75 per cent
of the cost of road building, heritage and other projects that address
infrastructural and environment deficiencies.
My predecessor, Michael Refalo, identified another area for common European
action, that is the provision of protection against "the often
commercially fatal effects of tour operator collapse" on the smaller
firms that make up most of the tourism sector. Although existing national
schemes do provide some protection to consumers, the hotel sector and
its suppliers remain dangerously exposed - and merit a Europe-wide mechanism
to respond to the "special conditions, such as differences in time
and distance... and diverse business practices". I subscribe to
his opinion and would like to submit this point for debate during this
The overall EU legal framework has a bearing on the tourism sector and
influences the actions of both current and future members. The next
enlargement will widen the scope of EU legislation to cover a larger
geographic area. Such legislation as competition, including state assistance
to industry, consumer protection, safety, transport and the environment
will cover the tourism industry in 25 states 28 if one were to
include the members of the European Economic Area. The adoption of the
environmental acquis communautaire will mean more environmentally-friendly
and "green" destinations. Tourists in all 25 plus three countries
will have the guarantee of the minimum protection which the European
Union offers the consumer. The eventual adoption of the EURO will also
render the comparison of costs between destinations much more easy,
and will remove the costs and risks of different rates of exchange.
Membership in the European Union carries great benefits. The provisions
on the free movement of persons and of the Schengen Agreement have resulted
in easier cross-border traffic for EU citizens. These benefits have
been supplemented by the introduction of the EURO. Countries outside
the European Union, including Malta, are thus at a clear competitive
disadvantage. Malta looks forward to benefiting in full from these rewards
of EU Membership.
EU transport policies are also a major factor in the increasing interdependence
between EU Member States in the context of tourism. Transport and tourism
are strongly interlinked and efficient transport links are essential
for any tourist destination. There is an increasing need for security
and an integrated transport network with convenient transfers between
different modes of transport in order to satisfy the tourist's expectations.
This is where EU transport policy plays an important role. The measures
liberalising the air travel sector and the implementation of the third
package leads to more links, to destinations which were not hitherto
very accessible and less expense. This can only be of benefit to tourism.
The use of structural funds also offers new opportunities for the sector
the "product" can be improved both through direct funding
and through funding which goes to other areas but has a bearing on the
sector. Better roads also imply an upgrading of the tourism product.
In addition, the tourism sector already has and will continue to have
the opportunity to participate in the training and retraining programmes
offered by the Union. Accession in the European Union means that participation
in such programmes will be free of charge. Other benefits include the
removal of restrictions concerning the purchase of chartered flights;
more competition will mean better prices and products for all persons
purchasing flights. Accession in the EU will also be, in itself, an
attraction for Foreign Direct Investment.
Today we speak of sustainable tourism, tourism that is economically
and socially viable without detracting from the environment and local
culture. Sustainability means business and economic success; environmental
containment, preservation and development; and social responsibility.
According to the European Commission, the right pathway to the sustainability
of European tourism is through the reinforcement of the existing framework
for action and making the best use of it.
As island states, Malta and Cyprus face a different tourism scenario
from the rest of the accession countries. To quote Agenda 21 (Chapter
"islands constitute a special case, both for the environment and
for development, and they present very specific problems in the planning
of sustainable development. They tend to be ecologically fragile and
vulnerable". On the other hand, their small individual size, their
limited resources, geographical dispersion and their isolation from
markets place them at an economic disadvantage and prevent them from
achieving economies of scale. "Geographic isolation means they
have a relatively large number of singular species of flora and fauna,
so they possess a very high proportion of the worlds biodiversity.
They also have rich and diverse cultures that are specially adapted
to the island environment".
According to the international arrivals data supplied by the World Tourism
Organisation, islands, as a whole, can be considered the worlds
second leading tourist destination, behind the block formed by historic
To get an idea of the importance of island tourism, if we compare usual
island tourist densities within the European Union we find densities
reaching 150 beds per square kilometre, higher in many cases than the
density in many populated areas of the continent. In these conditions,
competition for space emerges as a key factor in tourism planning.
EU action in the tourism sector must take into consideration the specificity
of island destinations.