10 September 2003

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Toon this week: Working the docks has never been so lucrative

Restructuring is long overdue

The recent announcement that some manufacturing lines of ST Malta are to be transferred to Morocco is not a good sign. Malta’s competitiveness is being eroded by cheaper costs in other countries, and promises for improvement have remained just that.
At a recent press conference Finance Minister John Dalli spoke in no uncertain terms about restructuring and improving competitiveness.
Talk about restructuring is cheap, but over the past years action has been very limited. Malta undoubtedly has a manufacturing base that has a future. Maltese workers can produce high quality products and come with acceptable qualifications, educational backgrounds and expertise. But while some industries have good prospects others are on the wane. Malta was aware of the prospects many years ago and should have geared itself for further expertise and more available employees to service the high tech manufacturing, banking, IT and other service industries.
In several former communist states and China the past decade has witnessed giant steps ahead in restructuring, with large sectors of the population geared up for new challenges. In Malta, restructuring seem to be more a fashionable word we talk about.
The recent dismissal of 250 workers in the denim industry was all but unpredictable.
For our businesses to be sustainable we need to remove wastage and excessive costs. The exorbitant port charges were one of John Dalli’s targets at the press conference, but changes are long overdue.
A businessmen visiting these offices this morning grumbled about how bringing his products from Valletta to Qormi is more expensive than bringing the same products from the north of Italy to the grand harbour.
According to one study, port charges in Grand Harbour and the Malta Freeport are 20 per cent more expensive than Marseilles, 49 per cent more expensive than La Spezia and 66 per cent more expensive than Southampton. Considering that our wages are substantially lower than those in other countries, the Maltese rates are hard to defend.
Everybody wants to make a living, but the port and carriage charges in Malta are going to put us all out of business.
Minister Dalli must take the proverbial bull by the horns and establish a timeframe for ‘restructuring’ what does on at the port. According to the same study, a full third of all port charges cannot be accounted for.
The Maltese port workers are eroding Malta’s competitiveness and causing prices to increase. The high port and transport costs have been brought to the ministers attention several times over the years and it is hoped further reminding will not be necessary.
For some weeks now government has been coming under fire for its apparent lack of diligence. It is understandable at this stage that, with EU membership looming Malta’s ministers and parliamentary secretaries have much planning and preparing to do. EU membership was never going to be plain sailing for Malta and proper preparation is necessary. Where the government is failing however is in communicating its planning and progress.
At the beginning of any new administration one would expect that each minister and parliamentary secretary would prepare and announce their business plan with targets and timeframes. If much is being achieved by government then the public is not being kept informed. If the problem is a marketing one, the situation is not so desperate, but the government needs to send clear signals that it is planning and achieving, otherwise the public will rightly continue to criticise.

Copyright © Newsworks Ltd. Malta.
Editor: Saviour Balzan
The Malta Financial & Business Times, Newsworks Ltd, Vjal ir-Rihan, San Gwann
Tel: (356) 21382741-3, 21382745-6 | Fax: (356) 21385075 | E-mail