Editorial | A plan for recovery

Recovering from the economic downturn caused by the COVID-19 pandemic is not going to be easy and will require a national effort.

The recovery will depend on how nimble the country is to continuously adapt to changing scenarios caused by the virus’s evolution and its impact on both the domestic and foreign markets.

Malta needs a three-year recovery plan that includes short-term firefighting measures and long-term goals to tap new sectors and help others adapt to a different reality.

The plan will necessitate the government to run a deficit for next year with the target of reaching break-even in the subsequent budgetary period.

It will have to be a plan that includes tax incentives for businesses, assistance schemes to enable renovations and wage support in those sectors where the hope of recovery remains dim.

Other measures must be targeted at encouraging domestic consumption – these can be through direct money injections and indirect measures such as a reduction in fuel taxes that leave more money in people’s pockets.

But apart from the immediate focus, government must also chart a course for the future by hitting the ground with crucial investments in the country’s digital, manufacturing and transport infrastructure.

The €400 million investment in industrial parks pledged when government announced its stimulus package last June must kick-off to ensure the country creates the right spaces for expansion of existing factories and new foreign direct investment.

Part of those funds should also be used to enable home-grown manufacturing companies to develop further locally and expand overseas.

From the digital aspect, government must move ahead with rolling out 5G licences and laying down a second fibre optic link between Malta and Gozo.

Within this context, the forward-looking document unveiled by the Chamber of Commerce on Tuesday is a welcome development.

The Chamber set up various sectoral think-tanks to come up with policy measures that will help the Maltese economy transform in a post-COVID scenario.

“We have to make the necessary changes to develop the future we want,” the Chamber said in its foreword to the presentation.

The Chamber correctly pointed out that COVID-19 has presented us with “a substantial challenge of survival” but it has also presented us with “opportunities to change where change is needed”.

The findings cover a range of sectors, their needs, and future prospects.

The exercise provides a very solid basis for discussion and consideration by government, the social partners and other stakeholders.

The crisis at hand is massive and despite the green shoots, Malta is not out of the woods. As long as COVID-19 is around and no vaccine is available, the uncertainty will remain.

Charting a new way forward is necessary and the Chamber’s contribution in this regard is commendable.