MBB backs EU Clean Industrial Deal but calls for stronger support for islands

The Malta Business Bureau (MBB) today expressed its support for the European Commission’s Clean Industrial Deal (CID), recognising its potential to balance decarbonisation goals and economic competitiveness.

While acknowledging the Deal’s ambition, the MBB emphasised the need for strategic implementation that addresses the realities of peripheral regions and islands states such as Malta.

MBB CEO Mario Xuereb stated, “the Clean Industrial Deal provides an important framework for strengthening European industry while advancing our climate goals. Its success now hinges on spurring investment and innovation and enabling businesses of all sizes to participate in the green transition.”
Xuereb also highlighted that the Commission acknowledges the persistent funding gap in driving research and innovation in clean technology.

“The CID’s commitment to strengthening EU financing mechanisms, such as the Innovation Fund and InvestEU, and simplifying state aid rules for decarbonisation projects are welcome steps.”

However, the MBB notes that the Clean Industrial Deal unfortunately falls short in recognising the specific challenges faced by islands and other territories, such as higher transportation costs that impact competitiveness.

MBB calls for a stronger commitment to ensuring that future EU environmental legislation does not place a disproportionate burden on peripheral and insular regions, particularly considering the Emission Trading System’s extension to Maritime and Aviation and the revision of the Energy Tax Directive.

The Deal is structured along several priorities, including access to affordable energy, boosting demand for green technologies, supporting private and public investment, and strengthening the circular economy.
This will be achieved through actions such as reforming the EU’s electricity market, simplifying state aid, ensuring the circularity of raw materials, public procurement reform, and further leveraging public and private financing.

For Malta, lower energy costs and increased renewable energy generation promise to enhance long-term energy resilience and reduce dependence on public subsidies to maintain electricity prices, which are expected to remain in place until at least 2027.

Despite the opportunities presented by the CID, Malta may struggle to fully benefit from some energy proposals due to its small consumer market and the presence of a single energy distributor.

For businesses, several opportunities are emerging to contribute towards decarbonisation, including the development of innovative energy and waste management solutions and creating sustainable production processes.

Adequate EU and Government incentives will be crucial to encourage large-scale adoption of green practices by businesses.

The Clean Industrial Deal comes in the backdrop of increasing pressure from EU businesses to address Europe’s degrading global competitiveness due to rising production costs and high regulatory burdens.