Author: Developers Think

The delegation, which includes representatives from enterprises in the Training and Education sector, is visiting the Expo 2020 during the Knowledge and Learning Week.

During this week, the delegation will visit the Malta Pavilion at EXPO 2020 which is situated in the Opportunity District. A number of seminars will be held on the Malta Pavilion to promote the training and education sector in Malta whilst a number of visits to other international pavilions have already been set in an effort to enhance networking opportunities and explore openings for cooperation.

TradeMalta has also set up meetings in Dubai and Abu Dhabi for the visiting delegation such that delegates have two days of meetings on the Expo grounds followed by two days in Dubai and Abu Dhabi.

Twelve private colleges and six government entities will be joining this mission following an expression of interest issued by TradeMalta.

Expo 2020 Dubai is the first World Expo ever to be hosted in the Middle East, Africa and South Asia (MEASA) region. Through the theme of Connecting Minds, Creating the Future, Dubai aims for EXPO 2020 to showcase the best examples of collaboration, innovation and cooperation from around the world.

Organisers are targeting 25 million visitors and it is expected that over 200 participants including nations, multilateral organisations, businesses and educational institutions will be taking part. Participants chose to be in one of the three districts, Sustainability, Mobility and Opportunity – with Malta being situated in the latter.

A total of ten ‘theme weeks’ will be taking place throughout the six months of Expo 2020 Dubai. The selected themes seek to address the critical challenges and opportunities faced collectively by countries and citizens worldwide, from a cultural, social, environmental and economic perspective.

“The Malta Chamber of Commerce, Enterprise and Industry’s Tourism Operators Business Section is pleased to note that the Government’s strategy launched last Thursday is very strongly aligned to The Chamber’s tourism vision which was also launched three weeks ago and captures very broadly the challenges and opportunities facing the local tourism industry today,” said Mr Alan Arrigo, Chairperson of the Tourism Operators Business Section.

The Malta Chamber’s document titled “Rediscover – A New Vision For The Tourism Industry In Malta ”, compiled in collaboration with Seed, insists on a quality-based approach and calls for focus on eight (8) key themes:

1. Branding & Marketing
2. Digital & Innovation
3. Accommodation
4. Sectoral Infrastructure
5. Culture & Identity
6. Governance & Institutions
7. Human Capital
8. Connectivity

Certain recommendations proposed in the Government’s strategy document are in line with The Malta Chamber’s vision. These positive recommendations include:

• the point that The Malta Chamber has made repeatedly on the basis that the current supply of bed stock, both operational and in the pipeline, is outstripping the number of tourists that can be expected during the nine years of this Strategy,

• noting The Malta Chamber’s point on the importance of digitalisation as one of the prime drivers in tourism which is partially reflected in Government’s strategy document on promoting the use of data and market intelligence as critical tools to rethink the tourist value chain, and

• acknowledging The Malta Chamber’s preposition on focusing on the importance of the island’s niche markets and how these can be used to access the full potential of what the market has to offer.

The Malta Chamber lists several concrete action points aimed at supporting established and new segments – MICE, sports, medical, arts and gastronomy niches to name a few. However, while the Government’s strategy document takes note of their importance, it falls short of proposing concrete actions.

On the other hand, The Malta Chamber insists that the MTA should reposition itself as an industry enabler and as a regulator which enforces licensing standards and promotes best practices, as opposed to its current status as a competitor with the private sector.

CEO of The Malta Chamber, Dr Marthese Portelli stated, “Whilst acknowledging that overall, the strategy is a positive one, The Malta Chamber reminds Government that the devil is in the detail and it ultimately all depends on the implementation. The Malta Chamber remains committed in its pursuit to help the relevant authorities to see this vision moving from words into tangible actions.”

HSBC Bank Malta and The Malta Chamber recently organised a webinar titled ‘The Post-Covid Outlook’, which investigated global economic and financial trends in light of the pandemic. The event was the latest in a series of joint events designed to help Chamber members navigate the current economic scenario.

The webinar examined how the pandemic has impacted every aspect of business and the different strategies adopted around the world to mitigate its impact. The event also looked at the fact that, while uncertainties still exist, the progress of the global economy and the increasing vaccination rates offer a silver lining.

Marisa Xuereb, President at The Malta Chamber, said: “These are some of the most interesting and challenging times in recent history. During the pandemic we witnessed one of the deepest recessions, followed by one of the quickest recoveries. As businesses try to navigate this environment and plan for the future, The Malta Chamber, supported by HSBC Malta, will continue to offer support and practical insights”

James Pomeroy, Global Economist at HSBC in London, said: “These are interesting times for the global economy. As vaccination rates are growing, we can try and live with the virus. We need to keep an eye on restrictions. Any further business closures may result in a significant setback to economic activity.

Households have accumulated money, and they are spending it, which supports economic growth. Growing retail sales are, however, creating supply chain bottlenecks. The tighter labour markets we are experiencing are giving bargaining power to job seekers, which will drive wages higher. All in all, while it is still relatively early for a certain global outlook, we expect growth to be solid enough over the next couple of years.”

Daragh Maher, Head of Research Americas at HSBC, said: “From a currency perspective, the US Dollar is likely to gradually strengthen, driven by the deceleration in global growth and the FED’s policy relative to many other major central banks. The contrast in the outlook for US policy is particularly evident when compared to the ECB, and points to further downward pressure on the Euro Dollar rate through 2022. From an interest rate and external balance point of view, the British Pound Sterling currently is a vulnerable currency.”

Earlier this week the Malta Chamber of Commerce, Enterprise and Industry organised an event as part of SME Week 2021 titled ‘Digitalisation: The Way Forward’, promoting the importance of building digital, smart and resilient businesses.

The event was organised in collaboration with our esteemed Bronze Partners, BMIT and Western Union Business Solutions, under the auspices of the Ministry of the Economy and Industry.

In her opening remarks, Malta Chamber President Marisa Xuereb said, “The biggest risk that the world can face at this point in time is an attack on digital.” She also pointed out the increase in the use of and dependence on technology, particularly since the pandemic struck.

Dr Marthese Portelli, The Malta Chamber CEO, delivered a client-centric and insightful presentation explaining how industry can optimise on funding for industry to go digital. She delved into terms and conditions applicable for micro, small, medium, and large businesses, explaining techniques on how to tap into growth, R&D and internationalisation support with an optimal returns-on-investment.

In his keynote speech, Mr Mark Anthony Camilleri, Country Manager and Executive Director of Western Union Business Solutions in Malta, stated “The integration of digital technology into all areas of a business, including payments, is fundamentally changing how we operate and delivering value to customers. The global pandemic rendered digitisation a crucial priority, reflecting an acceleration cultural change that requires organisations of all sizes to undergo without further delay.”

Mr Camilleri outlined the importance for businesses to venture globally and become flexible by highlighting several misconceptions about international payments.

A panel discussion, moderated by Julia Aquilina, Policy Development Executive at The Chamber, followed. Topics focused on digital readiness, innovation, policy-making requirements and the promotion of digital-ready practices.

Mr Nick Tonna, CCO at BMIT and Mr Kyle Anastasi, Client Technology Lead at Microsoft explained the importance of investing in digital and innovative solutions, highlighting how digital advanced firms have been better placed to adjust and emerge stronger from the current recovery phase.

Released in July 2021, the Fit For 55 package is the first set of legislative proposals seeking to move the EU towards the goal of climate neutrality by 2050, as outlined in the EU Green Deal. The package covers issues ranging from increasing energy efficiency and renewable energy, to reducing the emissions generated by the building and transport sectors, including maritime and aviation.

Amongst the several proposals put forward, the European Commission aims to increase energy efficiency obligations on member states as well as the share of renewable energy in their final energy consumption, remove tax exemptions of maritime and aviation fuel, promote the use of sustainable fuels, and increase the supply of adequate charging infrastructure for electric vehicles.

Opening the webinar, Head of the European Commission Representation in Malta, Dr. Elena Grech asserted the importance of immediate action, “If we do not take climate action now, we are going to miss our chance. The ambition is to achieve carbon neutrality by 2050. The European Commission is proposing to achieve this through impactful legislation and practical assistance to Member States through its Recovery and Resilience Funds.”

MBB CEO Joe Tanti welcomed the increased climate ambition, considering it necessary to safeguard long term prosperity, growth, and job creation. Nonetheless, he argued that “policy measures should always be designed keeping in mind the economic context they are operating in. Businesses are just starting to recover from the worst economic downturn since the 2008 financial crisis. It is critical that new or revised policy measures do not hamper business competitiveness or introduce disproportionate financial costs that will invariably be felt by companies and impact consumers.”

In her statement, Hon. Dr. Miriam Dalli, Minister responsible for Energy, Enterprise and Sustainable Development, argued that the energy sector across Europe is currently feeling post-pandemic effects. Minister Dalli added that while some questioned the EU Green Deal’s validity during the pandemic, she believes it will in fact underpin Europe’s post-recovery effort.

Moderated by Media Consultant Rachel Attard, the webinar featured a high-level panel discussion between Diederik Samsom (Head of Cabinet of European Commission Executive Vice President Frans Timmermans), Ing. Patrick Spiteri Staines (Chairperson of The Malta Chamber’s Energy Committee) and Prof. Simone Borg (Head of the Environmental & Resources Law Department at the University of Malta). The discussion centered around the potential implications of the Fit For 55 Package on Maltese businesses.

Recognizing Malta’s geographic limitations, the panelists argued that more research and investment should be dedicated towards applying innovative technologies which generate greener energy and reduce atmospheric carbon emissions. This would help push Malta beyond its minimum targets, especially on renewable energies.

The drive towards a greener European economy will also represent several opportunities for businesses to delve into new areas and focus on the sustainability and efficiency of their operations, cutting down waste in the process.

Finally, the panel stressed the importance of providing suitable financial support to those businesses and communities which will be hardest hit by stricter environmental legislation.

Other interventions were made by Kevin Borg, CEO of the Malta Maritime Forum, Dr. Nadia Giordimaina, General Manager International Affairs of Air Malta, and Perit David Xuereb, former President of the Malta Chamber.

These Commission proposals are just the first step towards enacting the new and revised set of EU legislation. Agreement on common texts must now be sought between the Council of Ministers and the European Parliament.

At a recent conference, the Malta Business Bureau (MBB) officially launched an online SME Hub to help strengthen the financial and digital skills of microentrepreneurs and enable them to
widen their networks and internationalise. The event was organised as part of DIFME – an Erasmus+ Knowledge Alliances Project led by MBB with the participation of the University of Malta’s Edward de
Bono Institute and other European partners.

In her opening address, MBB President Alison Mizzi said, “We have seen the digital transformation of the workplace outpacing educational institutions as well as the labour market itself, leading to skills
shortages in several sectors. For this reason, the EU must continue facilitating cooperation among Member States’ authorities and educational institutions and the private sector to address key challenges by microenterprises.”

The SME Hub serves as an open repository of solutions for entrepreneurs. Through collaborations between the DIFME project partners, practical information was collated and made accessible to
entrepreneurs operating across different industries, including information on doing business in Malta, Bulgaria, Germany, Greece, Ireland, Italy, and the Netherlands, relating to government agencies,
banking sphere and assistance programmes, among others.

Commenting on this, MBB Project Manager Marika Huber stated, “Whether you are kicking off your enterprise or scaling up, the SME Hub will provide you with the tools and resources you need to make
informed decisions regarding your financial and internationalisation well-being now and in the future.”

The hybrid conference was also addressed by Roberta Metsola, First Vice-President of the European Parliament and Josianne Cutajar, Member of the European Parliament. Dr Metsola explained the
European Parliament’s work on boosting entrepreneurship and facilitating investment and trade by pushing the development of better SME financing tools and generating greater business
opportunities. On her part, Dr Cutajar put emphasis on the challenges faced by microenterprises in island states like Malta, whilst also highlighting the critical role of funding and access to finance in
helping microentrepreneurs get equipped with the skills they need to cope with the twin transition and the structural challenges they face.

At the end of the conference, the DIFME project partners signed a Memorandum of Cooperation, thus confirming their intention to develop further activities and maximise on the outputs achieved
throughout the last three years of project implementation.

Despite the number of challenges faced by business, The Malta Chamber of Commerce, Enterprise and Industry notes that this year’s Black Friday, like in the previous years, in general left a positive impact on business particularly since the majority anticipated the challenging environment and sought to work around it. In fact, many businesses spread their offers over a week and even longer periods. Ensuring extra precaution to avoid COVID spread, logistics and transhipment issues in respect of stock and the very bad weather conditions were just some of the few challenges experienced.

The Malta Chamber notes that there has been a major shift in customer behaviour particularly the move from shopping-in-store to shopping online, hence the importance for business to keep abreast with and invest in digital innovation.

Black Friday outcomes that occur once a year are not enough for business particularly given the current circumstances when business is going through a tough recovery period. The Malta Chamber believes that there should be more incentives which help businesses to innovate and strengthen their online presence as well as further investment in well thought out infrastructure suitable for bad weather conditions.

A resilient environment will help businesses anticipate and set trends whilst ensuring good sales all year round.

A Malta Chamber delegation led by President Marisa Xuereb attended the BusinessEurope Council of Presidents (COPRES) meeting in Paris. Business Europe is the leading confederation of European businesses representing enterprises of all sizes in the European Union and other non-EU countries. The Malta Chamber is one of forty industry and employers’ organisations making up BusinessEurope.

The discussions amongst the top business representing bodies on the European continent are evolving on the economic recovery and the challenges being faced at present, including disruptions and increased costs related to supply chains.

Outlook for the European Economy

The EU economy is undergoing a strong recovery, but rapid price increases and bottlenecks in global supply chains are threatening to blunt the upturn.

The EU27 economy is expected to grow by 4.8% this year, followed by 4.3% next year. The recovery is propelled by a consumer-led rise in domestic spending. Retail sales are now 6% above the 2019 average and the household saving rate is at 21%, vs around 12% before the crisis.

In contrast, production in the EU is suffering from supply chain bottlenecks. The share of European companies that report materials/equipment as a factor limiting their production has shot up from 9% in 2019 Q3 to 39% in 2021 Q3.

EU Energy prices are now 7% above the January 2020 level. There is a clear risk that price pressures could translate into longer-term inflationary pressures if wage increase fully reflect such rises. So, wage moderation will be important.

The toolbox to tackle rising energy prices

The rise in energy prices overshadowed all discussions during the meeting of the European Council on 25 October 2021.

A toolbox with short-term measures that member states can take was proposed. These included direct payments to vulnerable households, deferred payments, tax cuts, state aid for companies that are compatible with the EU state aid rules.

Mid-term to long-term measures, were also suggested, including a number of already planned EU initiatives such as the announced revision of the gas/hydrogen market regulatory framework, future guidance on how to accelerate permitting process for renewable energies, as well as new ideas such as joint procurement and/or joint reserves of gas stocks.

The disruptions in supply chains

BusinessEurope created a Supply Chains Taskforce to assess the overall cumulative effect of actions and legal initiatives taken by different countries on supply chains.

The temporary and short-term challenges listed by members, included the current shortages in raw materials, the subsequent increased prices of materials and the peaks in transportation costs and obstacles to mobility of personnel.

To mitigate these impacts, companies themselves are taking measures. For instance, by adopting diversification strategies, increasing strategic safety stocks and improving lead times. However, certain areas require public action. Among the priorities that require public policy action, we have for instance the elimination of all export restrictions, promoting regulatory cooperation and the adoption of international standards, as well as carefully designing initiatives in the area of sustainability.

Regarding the short-term challenges, the taskforce suggests underlining that these are mostly related to disruptions caused by the COVID-19 pandemic. Several measures can be useful to alleviate pressure. For instance:

• simplifying customs procedures,
• ensuring better coordination on health and safety measures as well as travel restrictions,
• monitoring and addressing the uptake of trade-restrictive measures by governments.

Regarding the medium and long-term challenges, the taskforce suggests underlining that even if they can be related and exacerbated by the COVID-19 pandemic, they often have deeper root causes. Building resilience is important and requires good coordination between different policies. For instance:

• addressing trade restrictions will help ensure access to critical inputs that are necessary for European industrial sectors,
• at the same time, boosting investments and production capacity in Europe might be necessary but we also need to cooperate with allies and like-minded partners.

The crisis is also leading governments to increase national content requirements and promote “buy national” policies in many cases attached to the financial stimulus plans. Access to third countries’ procurement market is a long-standing problem for European companies. The taskforce therefore suggests underlining that this crisis is making the case for having the International Procurement Instrument in place even more compelling.

The Malta Chamber reaffirms its commitment to bring to the fore the issues and challenges faced by local businesses within these highly influential European fora.