Cabinet asks for briefing on Chamber proposals for economic sustainability
BusinessToday has learnt that a report by a think tank set up by the Chamber of Commerce to propose scenarios for a sustainable and competitive economic future for Malta will be discussed by the Cabinet of Ministers when they meet on Tuesday
by Paul Cocks
A report by a think tank set up by the Chamber of Commerce to propose scenarios for a sustainable and competitive economic future for Malta will be discussed by the Cabinet of Ministers when they meet on Tuesday, BusinessToday has learned.
Chamber president David Xuereb said that the report, launched on Tuesday, had received wide acceptance across the various industries and sectors. The Opposition too has asked for detailed briefing.
“Carmelo Abela, minister within the Office of the Prime Minister, was present when the report was launched,” he said. “And we have now been asked to present its findings to Cabinet next week.”
The think tank brought together business leaders, academics, and various experts from a number of fields who have called for less government and more governance if the country is to truly reach its ambitions for the future.
Xuereb said that the think tank was set up before the onset of COVID-19, when Malta’s economy was considered to be booming.
“Even then, we realised those levels were not sustainable and set up the think tank and series of round tables to set out a plan for economic sustainability,” he said. “With the onset of coronavirus, this exercise took on even more importance and relevance.”
With the effects of COVID-19 soon apparent, the think tank’s first assignment was to focus on a multi-disciplinary action plan on how Malta’s economy could recover and take advantage of the new norm.
A series of round-tables were established to focus on specific fields of expertise, engaging the country’s leaders and experts in areas of interest of the economy, namely Tourism, Hospitality, Construction, Financial Services, Education & Training, Retail, Importers, Exporters, Digital & Media, Technology, Manufacturing, Transport & Logistics.
A series of sector-specific recommendations were presented but a number of proposals common to all industries highlighted the need to act upn them.
The report underlined the absolute importance of strong governance. A fundamental requirement mentioned by all sectors is Malta’s reputation being an important ticket for foreign investment and continued prosperity.
“The country needs to have proper frameworks in place and stakeholders need to ensure that they had the right structures and processes to guarantee good governance, as was previously recommended in our Good Governance Manifesto,” Xuereb said.
Government assistance also featured highly, as a requirement seen to be a central motor for growth and investment, with incentivisation seen as an important tool for economic development.
Sustainability also remained a key topic which cut across all sectors, as it underscored the importance to start thinking more long term than we are actually doing till today.
Quality too was identified as key for future prosperity. The Chamber agrees, for example, that in the future Malta should focus on quality tourism rather than seeking to attract record numbers of tourists. It believes that, with the country needing to upgrade to cater solely to four- and five-start tourists, the general population of Malta as a whole would benefit.
“With our Think Tank project, The Malta Chamber is once again taking a proactive role to sit in the driving seat and, using the vast expertise of its membership, propose solid policy recommendations to the movers and shakers of the country for a better and more resilient Malta tomorrow,” Xuereb said.
“We want the wellbeing of our people that drives our economy. Economic growth must respect the country’s sustainability goals and the physical and mental wellness of our people.”
Sector-specific proposals
Hospitality
- Maintain & Improve Wage Subsidy until vaccine is administered.
- Implement laws on Rent for Force Majeure.
- VAT Reduction 18% to 7%.
- Promote Malta as a Safe Destination.
- Keep Malta’s Ports Open Safely.
- Media Campaign for locals & tourists to uphold responsibility.
- Ensure Practical & Flexible Employment of TCNs.
Tourism
- Marketing & Promoting Malta as a Safe Destination.
- Keep Malta’s Ports Open Safely.
- Incentivise / Subsidise & Diversify Airline Routes.
- Lower VAT to 7% for all Travel related services.
- Tax Losses carried back.
- A National & Holistic Tourism Strategy.
- Focus on Quality.
- Pausing PA Applications & Raising Standards.
Financial services
- Rebuilding and Safeguarding Malta’s Reputation (Moneyval).
- ESG principles must be woven in our country’s fabric Areas for Growth: FinTech, Core Financial Sevices & ESG related offerings.
- Importance of improving E-Gov.
- Support for Innovation.
- Human Capital: Address Skills Gap, revise Academic Curriculum & include International Outlook & disruption of the sector.
- Incentivise foreign expertise.
- Create platform for funding opportunities for start-ups.
Education and training
- Back to School within the New Norm.
- Support to Parents.
- Faster payment for all Funding Schemes.
- A Rescue Plan for EFL Sector.
- Incentivise skilling & reskilling of Workforce.
- Resource Education Malta to attract international students.
- Visas Extensions of International Students due to Covid-19.
- Support for Training Service Providers.
Construction
- A Strategic National Vision.
- Better Regulation & Harmonisation of Laws.
- A resourced Building & Construction Authority (BCA).
- Incentives for the regeneration of dilapidated areas.
- R&I Investment for an improved Built Environment.
- Holistic review of the Local Plans.
Retail trade
- Implement laws on Rent for Force Majeure.
- Access to Finance & minimise collateral for MDB Loan.
- Keep Malta’s Ports Open Safely.
- Level Playing Field in Taxation and enforce Existing Regulations.
- Ensure Practical & Flexible Employment of TCNs.
- Ensure Accessibility to Retail Destinations.
- National Campaign of reassurance for consumers.
Manufacturing
- New vision for manufacturing in Malta - cluster granular approach
- A formalised stage-lifting approach
- Incentives for digital smart manufacturing
- Support related to hyper retreat from hyper-globalisation
- Education for Industry 4.0 mind-set
- Reduce bureaucracy
- Effective Government incentives on recurrent & utility costs
Transport and logistics
- Invest in mass rapid transit & inter-modal solutions which can reduce journey times
- Take stock of Transport Master Plan 2025 and the Strategic Plan 2050 aims & objectives
- Mobility e-wallet for various transport modes, not private ones
- Consolidate transport operations close to the airport to park vehicles
- Centralise logistics delivery process to reduce costs
- Launch public-private partnerships to create new underground parking spaces
Technology
- Start-Up Ecosystem encouraging angel invest & venture capital supplemented with a funded tech support platform led by a key international leader
- Embassies as business facilitators, support for fairs participation, legal assistance in target jurisdictions & marketing activities
- Make AI Strategy work!
- Tech earlier in Education curriculum, education campaign for parents, blended with online courses
- Incentives for business processes re-engineering
- Remote worker teams, including overseas, to expand the effective talent pool.
Digital and media
- Transparent Government advertising rules, free media from indirect obligations
- Telecoms eager to invest in future tech infrastructure subject to a concrete long-term Government vision
- Political Parties should not occupy TV media space
- Wellbeing of society driving the economy, ready to promote the concept
- National broadcaster to support more effectively the film industry
- Events devastation risk support for qualitative activity commitments
Exporters
- Strategic export clusters: leverage, network, consortia
- A National Export body supporting companies to go global
- Safeguard measures for Maltese resilient indigenous business vs FDI
- Improvement in the Key Employee Initiative
- Clear pathway for 3rd country workers to become Maltese citizens after years of work in Malta
- Banking and insurance industry to prioritise export orientated operations, corresponding banks
- Digital Export marketing investment & training
Importers and wholesalers
- Improved MIP schemes and warehousing solutions
- Better MCCAA and Tax Compliance Unit enforcement
- Reduction in VAT rate to help retail and tourism
- Mamvo fees support for healthcare importers
- Extend credit for payment on excise duties for wines & spirits
- Subsidise salaries to reduce layoffs
- Reduction in utilities prices to reflect market prices
