Budget to include more measures to aid businesses weather COVID-19

Domestic tourism, previously snubbed as a fallback option by the industry, is now seen as a viable source of income for many ailing businesses

Economy minister Silvio Schembri
Economy minister Silvio Schembri

The upcoming budget for 2021 will include measures to continue to assist businesses - and families - to weather the economic fallout forced upon them by the COVID-19 pandemic, the economy minister told BusinessToday.

Silvio Schembri said that as it had done during the first wave of the coronavirus, the government would continue to assist Maltee businesses as they struggle under a prolonged period of uncertainty due to COVID-19.

“Malta was amongst the first countries in the EU that immediately started to disimburse financial aid to protect businesses and most importantly safeguard jobs.” he said.

Compared to other countries, Malta offered a holistic phased economic plan aimed at mitigating as much as possible economic impact brought about by the pandemic followed then by a robust regeneration economic plan.

“At all times as a Government we made sure to stand shoulder to shoulder with our businesses. Our stance and approach was even lauded by the recent S&P report which black on white said that if we hadn’t taken such approach the results would have been catastrophic on our economy,” Schembri said. “Having said that discussions pursued with all stakeholders and the upcoming budget will continue to assist families and businesses.”

One possible measure that is being repeatedly put up for disucssion in various fora sees the government issuing another round of vouchers that were distributed to Maltese households at the height of the first wave of the pandemic, aimed at helping to revitalise somewhat the Maltese tourism industry and the retail sector.

Other countries too, including the UK and Germany, are actively considering measures that boost internal tourism to complement sound economic measures aimed at helping to keep businesses afloat during the coming months, which many analysists believe will be worse than the first wave.

Tony Zahra, president of the Malta Hotels and Restaurants Association, agreed that for too long, domestic tourism had been treated only as a fallback option locally.

“In larger countries like Germany, where inbound tourism amounts to around 4% of GDP, the domestic market is enourmous and the size of the countries offers attractive alternative destinations,” he said.

In Malta, he explained, inbound tourism amounted tourism amounted to around 25% of GDP. But the small size of the islands were a barrier to prolific domestic tourism, with the exception of Gozo, which enjoyed a strong domestic market share.

“Should we promote domestic tourism more? Of course we should,” Zahra said.

“Necessity is the mother of investion and, whereas domestic tourism had previously been seen as a fallback option, today it could prove to be a very good source of income for many ailing businesses.”

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