[WATCH] Diversification through EU funds
An inconspicuous building on a corner in Zachary Street in our capital city used to be home to a number of offices. But through the help of an EU scheme, the site was turned into a picturesque boutique hotel
by Paul Cocks
An inconspicuous building on a corner in Zachary Street in our capital city used to be home to a number of offices. But through the help of an EU scheme, the site was turned into a picturesque boutique hotel.
The CEO of Sterling Jewellers Alfred Fenech, whose family-owned business Sterling Group has operated in the silverware and jewellery business for over 100 years, said that this concept was very successful – and made possible through the funding injection.
In fact, he explained that the costly art on the walls, which gave the hotel its unique Valletta theme, would probably not have been feasible if not for the EU-funded scheme.
The enterprise successfully implemented a project under the Business Enhance ERDF Grant Schemes co-financed through the European Regional Development Fund under Operational Programme I – ‘Fostering a competitive and sustainable economy to meet our challenges’.
It had ventured into different retail areas such as fashionwear, catering and restaurant management and others and has now diversified even further its activities by introducing in its portfolio the provision of tourism products and services related to the promotion of natural and cultural heritage.
Specifically, the business benefited from the SME Diversification and Innovation Grant Scheme, which aims to incentivise SMEs to adapt and become more resilient and address market challenges whilst offering timely support to nurture the right environment for businesses to grow.
On a visit to the hotel, EU funds parliamentary secretary Aaron Farrugia said that the business has successfully diversified its portfolio, now having opened up accomodation of a high standard in Valletta – a UNESCO site. “This is a clear example of a business which is making excellent use of European funding instruments in order to provide a service to the country and the economy. In this case, EU funds were utilised to also improve our country’s touristic product.”
He explained that the business made good use of funding opportunities by submitting a sound project proposal under the SME Diversification and Innovation Grant Scheme with the aim to develop high-end tourism accommodation in the heart of the capital city.
The ideal location of the hotel has also done the project many favours. It offers its client base a superior experience in the heart of the capital city in close proximity to most of the capital’s amenities and attractions. This diversification strategy – apart from adding much needed quality room and bed capacity in the capital – has provided a new alternative revenue stream for the enterprise.
Another successful result of this project focused on the nature and location of the building, which provides an excellent accommodation business and in so doing the beneficiary has diversified its business interests. This diversification activity is assisting the beneficiary to maximise its asset base and tap new business opportunities.
This enterprise is only one of the success stories of SME Diversification and Innovation Grant Schemes. The target groups for these schemes are micro, small, and medium-sized enterprises, with the aim of ensuring that SMEs sustain a high level of resilience through their ability to adapt to rapidly changing market demands. These businesses need to innovate and keep up a steady investment momentum which is crucial to Malta’s macro-economic and competitive performance.
Businesses, particularly small ones, face a number of challenges, and this is where the need to innovate and diversify becomes crucial. This is the key to sustainable and competitive economic activity.
Through this scheme, businesses can opt for the diversification of the output of an existing establishment, implement a fundamental change in the overall production process, or even start a new economic activity related to the diversification of the activity of the establishment, the adoption of solutions that are new or significantly advanced.
Funds from the scheme have been used by a number of enterprises for leasing or renting of premises, construction, purchasing equipment, patents and licenses, as well as wage costs related to the wage of change manager employed specifically through the project to drive the necessary change through the initiative.
The scheme is demand-driven and managed through an open rolling call.
