The Economic Update January 2014

Special Feature

Women Leaders January 2014

Leading the Data Revolution An interview with Amanda Nelson, CEO, Vodafone Malta p.04

Inside ›› Corporate Interview: Repositioning Malta as the Top Jurisdiction

We sit down with Joseph Cuschieri, Executive Chairman of the Lotteries and Gaming Authority p.20

›› Special Feature: Women Leaders – Integrity & Determination

We present Part II of our exceptional feature dedicated to women leaders, featuring Equiom’s Sheila Dean and Christine Lagarde, IMF p.02S

›› Business Management: Performance Leadership

David J Dingli tells us why performance leadership emerges as a critical benchmark for corporate performance p.24

›› Diplomatic Relations: Promoting Peace & Integration

Interview with H.E . Nguyen Hoang Long, Ambassador of the Socialist Republic of Vietnam to Malta p.40

MONTHLY INVESTMENT plaNS

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BOV Branches/Investment Centres & Licensed Financial Intermediaries The value of the investment may fall as well as rise and any initial charges may lower the amount invested and the amount received upon redemptions. Investments should be based on the full details of the Prospectus and the Key Investor Information Document (available for sub-funds of the Vilhena Funds SICAV plc) which may be obtained from Valletta Fund Management (“VFM”), Bank of Valletta plc Branches/Investment Centres and other Licensed Financial Intermediaries. VFM is licensed by the MFSA. All Funds managed by VFM are licensed by the MFSA. The Vilhena Funds SICAV plc qualifies as a UCITS. Issued by VFM, TG Complex, Suite 2, Level 3, Triq il-Birrerija, L-Imrieħel, Birkirkara BKR 3000 Malta.

Tel: (356) 21227311, Fax: (356) 22755661, Email: infovfm@bov.com, Website: www.vfm.com.mt. Source: VFM.

Special Feature

WOMEN LEADERS January 2014

LEADING THE DATA REVOLUTION An interview with Amanda Nelson, CEO, Vodafone Malta p.04

CONTENTS FEATURE STORIES 04 Cover Story: Leading the Data Revolution

INSIDE ›› Corporate Interview: Repositioning Malta as the Top Jurisdiction

We sit down with Joseph Cuschieri, Executive Chairman of the Lotteries and Gaming Authority p.20

›› Special Feature: Women Leaders – Integrity & Determination

We present Part II of our exceptional feature dedicated to women leaders, featuring Equiom’s Sheila Dean and Christine Lagarde, IMF p.02S

›› Business Management: Performance Leadership

David J Dingli tells us why performance leadership emerges as a critical benchmark for corporate performance p.24

›› Diplomatic Relations: Promoting Peace & Integration

Interview with H.E . Nguyen Hoang Long, Ambassador of the Socialist Republic of Vietnam to Malta p.40

Publisher John Formosa Editor Martin Vella Journalist Lorna Diep Sales & Publication Manager Margaret Brincat Graphic Designer Berthrand Pisani Cover photography Daniel Borg Printing PRINT IT Quote of the month: “It always seems impossible until it’s done.”

- Nelson Mandela

For magazine and website advertising enquiries please contact: margaret@networkpublications.com.mt or call on (+356) 9940 6743

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We interview Amanda Nelson, CEO, Vodafone Malta who talks about how she will be improving operational efficiencies and service delivery with Vodafone Group plc 08 New Product Launch: Credit Card Innovations… The Future of Money is Plastic

Frederick Ellul, CEO of Insignia Cards Ltd, explains how the company has established itself as a financial institution providing Card products as he introduces the new product portfolio 12 Exclusive Interview: 3a GlobalLaunch of Malta’s First Accountancy & Audit Network

An Interview with Neville Cutajar-Director of 3a Global about the company’s growth and global expansion strategy 16 European Investment Fund: Lending to SMEs in an Easy Way

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The Economic Update interviews Sig Alessandro Tappi, Head of Guarantees, Securitisation & Microfinance, EIF, on how this business loan is aimed at ensuring higher accessibility to bank lending for SMEs and micro-enterprise 20 Corporate Interview: Repositioning Malta as the Top Jurisdiction We sit down with Joseph Cuschieri, Executive Chairman of the Lotteries and Gaming Authority, who discusses the Authority’s progress with gaming in Malta and beyond

For editorial enquiries please contact: martin.vella@networkpublications.com.mt

02S Special Feature: Women Leaders

The Economic Update is published by:

We present Part II of our exceptional dedicated to women in business and women leaders featuring Sheila Dean and Christine Lagarde.

Network Publications Ltd., Angelica Court, Giuseppi Cali Str., Ta’ Xbiex, XBX1425, Malta Tel: +356 2131 6326/7/8 Fax: +356 2132 3432 Contributors: George Carol; David J Dingli; Lorna Diep; Alexia Farrugia; Mark Galea; Keith Laferla; Bruno Lecuyer; George Mangion; Sharon May Scicluna; Ingrid Zerafa Special Thanks: BOV; BPC Ltd; Global College Malta; Fimbank; Finance Malta; HSBC; Insignia Cards Ltd; Ogilvy PR; PKF.

Please feel free to email us with your viewpoint, whether you agree or disagree with the standpoint of the personalities we interview or the topics we focus on.

Your opinion, contribution, concern and feedback on our articles and interviews are welcome. Please include full name, contact details

Special Feature

WOMEN LEADERS January 2014

16 WOMEN LEADERS

08 Women Leaders: Lagarde Cautions on Global Recovery Christine Lagarde’s latest on why governments need to create a more vibrant global economy 24 BUSINESS MANAGEMENT: PERFOMANCE LEADERSHIP David J Dingli tells us why Performance Leadership emerges as a critical benchmark for corporate performance

www.maltaeconomicupdate.com All rights reserved. Reproduction in whole or in part is strictly prohibited without written permission. Opinions expressed in The Economic Update are not necessarily those of the editor or publishers. All reasonable care is taken to ensure truth and accuracy, but the editor and publishers cannot be held responsible for errors or omissions in articles, advertising, photographs or illustrations. The Economic Update is printed by Print IT and distributed free with The Business Weekly.

02S

Editor’s Note I am very much looking forward to speeding off into 2014 without even glancing in the rear-view at 2013.

And it is the time for those dreaded New Year’s resolutions – I will exercise more, eat less, and write more thank-you notes. Most of these resolutions don’t even last as long as the glitter found from those sparkly New Year’s tinsel lying in your carpet after taking down Christmas decorations.

08S

This year, I would like to suggest a different New Year’s resolution to my fellow business, finance and industry professionals. Let’s focus 2014 on security awareness. To be clear, I am not talking about the typical crap powerpoint presentation some would-be event organiser feebly calls “security awareness or management training”, where invitees are forced to sit through at some dull, boring, repetitive and amateurishly organised B2B event. Anything that is mandatory attendance is going to get the exact amount of attention paid to it which it deserves. Any event professionals know what I am talking about here. You may be enticed to such events with the pretext of being awarding CPE credits for your various certifications. How many have you actually taken away valuable knowledge, insight, or awareness from? Be honest.

Force-feeding awareness is not helpful. The only thing that I have found to be helpful throughout my career is one simple thing -communication. We need to learn how to communicate better with those we are serving.

Whether it is our employers, our customers, our friends, or our family, we need to communicate with people on their level.

Awareness is when individuals are aware of the decisions they are making, and the consequences of those decisions. Awareness creates two significant side benefits: First, through awareness of the consequences of their decisions, they will often cease to be (as big of) a threat to the security of their information and the information of their organisation. Second, they become an ally in spreading awareness.

34

A few weeks ago I discussed this subject with guests attending a B2B networking event. The benefits were not just that the individuals at the event created better security, but those colleagues have gone in their office and home and passed those same lessons on to their friends and family. Awareness is gained through communication. And awareness is communicable.

So take my advice – resolve to improve security awareness through an improvement in communication during 2014. The benefits to improving communication will last for many years to come.

While we encourage writers to put pen to paper and join the regular influence of our award-winning interviews, stories, and features, we hope you enjoy our first edition of 2014, with the best quality content which makes up Malta’s leading progressive business media brand, with a unique editorial vision towards leadership stories across different business and industry sectors.

Martin Vella

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34 Fund Management: A Dynamic Approach to Asset Exposure An interview with Steve Waddington, Portfolio Manager, to discuss diversified growth funds, such as Insight’s Broad Opportunities Fund

38 Oil & Gas: Making an Oil & Gas Services Hub George Mangion, a Senior Partner of PKF talks about the international oil and gas conference to be held on 7th of May in London

39 Technology: Mobilising Your Enterprise: Safely and Securely An article on mobile security device management by Ivan Zammit, Head of Enterprise Business, Vodafone Malta

40 Diplomatic Relations: Promoting Peace & Integration Interview with H.E Nguyen Hoang Long Ambassador of the Socialist Republic of Vietnam to Malta

Cover Story Interview

Leading the Data Revolution

By Martin Vella

TEU: What are the key challenges you face in your new appointment and how are you leveraging your experience to counter them?

AN: Firstly, let me say that by joining Vodafone Malta I have come to an extremely impressive operation with a history of firsts. First operator on the Island, first to launch SMS, first to launch Data services on 3G, first (and only) operator with licenced Apple products and now first to launch super high speed mobile data on 4G. So it is a great privilege to be here and a great time to arrive. My challenge is now to communicate better the power that high speed mobile data has and how it can make everything they want to do on a phone, tablet or laptop so much quicker and simpler. I have come from a market (the Netherlands) which has led Europe in terms of data and smartphone adoption, so there’s plenty of experience there to build on. Communicating is so much more than calling and texting these days – but it’s great to see that the Maltese still like to stay in touch in very personal ways too TEU: In the tightly-regulated telecom industry, how are you leveraging IT to keep up with the changing norms?

AN: We are and have been investing significantly in IT at a global level and locally in Malta. In particular, we want to improve the experience we give our customers when they are looking for help or support. Contacting Vodafone doesn’t just have to be via a telephone call or shop visit. We are developing our online, chat and mobile app experience.

Security of data and personal information is also of upmost importance in this highly connected environment. That’s something Vodafone takes very seriously – and we’re proud that our network offers the most secure and reliable way for people to communicate above open wifi for example.

TEU: How will you be preparing Vodafone for the near future and position the brand in the local marketplace?

AN: Vodafone is and will remain a communications leader. We want to make sure our customers are always confidently connected, whether that be through calling, texting or use of data services at home or on the move. Based on my Dutch experience, I would say that using mobile devices (phones or tablets) for data services such as streaming video and music will become more and more important. That’s why we have invested 10 million Euro in rolling out high speed service, which will go nationwide later this year.

Vodafone is also passionate about offering great service to our customers. We constantly ask for feedback on people’s experience of dealing with us, and the results make us proud.

Amanda Nelson, CEO, Vodafone Malta in an interaction with Martin Vella speaks about how she will be leveraging her previous experience with Vodafone Group plc to improve operational efficiencies and service delivery, as she discusses Business IT alignment and the impact of technology and leadership on business.

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TEU: How does Vodafone differentiate itself from the rest of its competition?

AN: We are the only truly mobile company – it’s not an add on service, but the heart of what we do. I think that shows in the way we are always the first to bring things to Malta.

Cover Story Interview We have invested heavily since we started in order to make our network the fastest and best on the Islands. The satisfaction is when our own customers strongly recommend us for their experience using our network and the service we provide.

We have a history of firsts here, and there’s no reason why I want that to change. Continuing to deliver innovation in communications to Malta is at the top of my agenda

Being part of a global organisation also makes us different – and special. We can learn from other markets (internally we call it “steal with pride”) and also leverage Vodafone Group resources for making things happen faster and cheaper.

TEU: How important is innovation to Amanda Nelson’s success?

AN: One thing I have learned from fifteen years at Vodafone is that things never stand still. We constantly want to improve our network, services, skills, processes and take them to the next level.

We have a history of firsts here, and there’s no reason why I want that to change. Continuing to deliver innovation in communications to Malta is at the top of my agenda. However, the great thing about being part of Vodafone family, is we don’t have to always invent things locally.

As mentioned before – there’s a great wealth of experience and services developed elsewhere in the Vodafone Group that we can and will bring to the Island.

That said, even within the Vodafone Group the Malta team are renowned for being innovators.

We have developed roaming business and opportunities ahead of other countries – I put that down the extreme entrepreneurial spirit here and the Maltese love of travel and challenge. Being small has its advantages, one of which being an inherent drive to punch above one’s size. This is how Vodafone Malta is regarded at Group level.

TEU: Does your corporate responsibility need to align with your business and how do you engage your employees in these efforts?

AN: There’s a very simple answer to this – social responsibility is key to what we do! We are a responsible business that is not only reflected in what we achieve but how we achieve it. For example our employees and all companies that deal with Vodafone have to adhere to a set of ethical standards that ensure the company’s name is always held at the highest level. Our employees learn from the start that to work with Vodafone means working according to high standards that are not compromised.

We are a company that works toward leaving a positive mark on society and through our CSR projects engage with society to make a difference.

This year our CSR team are busy with new and

innovative projects that will embody Vodafone’s philosophy to the full. Watch this space .

We also have a very active Vodafone Foundation which is managed as a separate entity from the commercial operation. We are really proud that every member of staff has participated in one day for charity during the last year and will continue this tradition. It’s one of the reasons I have stayed with Vodafone for so many years.

You can see the change that mobile phones have brought (for good) in people’s lives, and the fact that the company operates in a way that takes their environment and social responsibility so seriously, still really impresses me.

Another angle on this is the way we set up our workplace for our staff. We fully believe in the power of mobile working for both making happy staff and generating more productivity. To give you a personal example - both here in Malta and in the Netherlands I have often worked from home, or worked hours very different from the normal 9-6, so I can balance my responsibilities with four small children. I feel so much happier being able to attend their school event, for example, and having a fully mobile laptop/tablet/phone means I can catch up with work or do a video conference at a different time. So it’s a win – win. Vodafone gets a very motivated and happy employee and I get to manage my private things in a way that suits me. It’s great for enabling more working parents in the workplace. I hear the same story of how the mobile working environment we operate motivates people a lot.

Our offices at Sky Parks have been purposely designed to support our philosophy on work/life balance which has made a great difference to staff morale and work practices.

TEU: How do you define leadership and what other qualities are important in your role with Vodafone?

AN: Leadership is about inspiring the people in your team to be the best they can be.

Setting the direction and letting them fly. I really believe that the main long term strategic advantage any business has is the quality and motivation of its people. I am really impressed with the Maltese team I have inherited.

They truly stand out in passion, energy and enthusiasm for our customers.

Another aspect that I have learned is that it is really important to achieve a right balance between managing the team, engaging with customers, managing upwards to Group and managing important external stakeholders. Every leader has a strength and a preference in one of those areas.

I want my diary to really reflect a good balance between all these activities.

I am also passionate about creating an environment that enables people to balance family and work commitments properly.

Especially making it possible for Mums (or Dads) to come back from maternity leave into challenging or interesting roles instead of taking a step back or stepping out completely. Mobile and flexible working can really help in this respect and we proactively encourage both at Vodafone. And finally, as a very wise mentor once told me – always take your holidays and find times in the year to rest and re-energise.

Work can be so absorbing and people here in Malta work extremely hard. Sometimes we think we are irreplaceable, but four maternity leaves has taught me that we are not and there are opportunities for others to develop if you step out of the limelight for a short while.

TEU: What are your key priorities for Vodafone as you look to the future?

AN: To keep leading the data revolution in Malta; •

To really leverage the benefits of Vodafone Group. To develop products and services in areas that really make a difference in people’s lives (unlocking mobile working tools and practices for other companies for example);

•

To never get complacent about the level of service we give our customers and to push for continuous improvement – with a focus on enabling customers to do more and more very easily on their phones or online;

•

To continue to develop the people in my team to a global standard of excellence;

•

To give as much back to the community as we can, via our core services, our time and our Foundation;

•

To have a lot of fun with the team while we do this and to remain one of the best places in the Vodafone Group to be.

TEU

All rights reserved | Copyrighted

Editor’s Note Amanda Nelson is a qualified Chartered Accountant with fifteen years telecoms experience.

She joined Vodafone Group plc in 1998 working in the central finance team during the period when Vodafone was expanding globally. Since then she has held various senior finance positions in New Zealand, Japan, UK and the Netherlands and gained experience in managing multi-cultural teams. In 2009 she became Chief Financial Officer of Vodafone Netherlands and was a key player in the management team that made the company the most successful mobile operator in that market. During this time Amanda was Chairperson of the Vodafone Foundation (Netherlands). In 2012, she became a Commercial Director in the same company responsible for a market segment of two million consumers and €1bn revenue. Amanda was appointed Director and CEO of Vodafone Malta with effect from 1st November, 2013. Amanda is British, is married and has four children. She enjoys doing outdoor activities with her children, including running, cycling, skiing and hiking. She is hoping to run the Vodafone Malta Marathon next February.

January 2014 | THE ECONOMIC UPDATE

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oil and gas

Making Malta an oil and gas services hub

By Mr George Mangion

PKF plans to organise an international oil and gas conference on 7th of May at the Brewery (52 Chiswell St, EC1Y 4SD) in London hosted jointly with Oilbarrel who is a specialist in the field. It is planned to attract more than 250 investors and international service operators who may be encouraged to invest resources into Malta’s nascent hydrocarbon sector and in particular the expansion of its maritime facilities.

In a wider context, the conference is gearing up to sow the seeds which will see Malta grow into an offshore hub servicing the needs of operators requiring maintenance and upgrading of rigs and in particular building of advanced subsea modern structures. It is common knowledge that the massive decommissioning work which is currently being contemplated in the North Sea oil platforms will lead to potential sharing of structural work. While the UK oil and gas industry has reason to be optimistic of further growth, however the North Sea remains one of the world’s mature petroleum provinces and, despite new discoveries ,many assets are reaching the end of their field lives and will require decommissioning. This will develop into a major business activity, and it is critical that we in Malta are ready and able to share some of this work. Really and truly, the island is strategically well placed to exploit our facilities as a maritime service centre which is planned to be developed in Marsa, - a project for which international tenders are currently undergoing adjudication by government.

Moving to another topic which will be discussed one notes that our vast acreage map of the continental shelf is surrounded by neighbouring countries who themselves are active and competing in offshore oil drilling. Some of these countries have in the past disputed the way we have delineated our boundaries but recent attempts are ongoing to try to persuade such countries to accept joint drilling on contested areas.

PKF is gearing up to promote the island among major service providers prepared to participate in this growing sector particularly in the transformation of the Malta as a maritime sector .thus showing its potential as 06 |

www.maltaeconomicupdate.com

a mini- Aberdeen. The island is well-placed in the centre of the Mediterranean, to service other offshore operators using its natural harbours and attract new capital formation to improve its maritime facilities. Add to this the renewed interest by government not to leave any stone unturned to kickstart oil and gas exploration- one can augur that the future is bright when comparing how Cyprus and Israel have both succeeded in drilling for offshore gas in the Levant and closer to us we know that the central Mediterranean is an intra basin where countries such as Greece, Italy, Libya and Tunisia have been successful in offshore drilling. Technical speakers at the conference will address a number of topics which are of particular interest to the oil servicing sector. This is a unique opportunity for mainstream oil and gas investors to get the latest facts about Malta as a potential future producer in the Mediterranean.

Interested firms that wish to sponsor and / or exhibit can contact Kinga Warda on kwarda@pkfmalta.com TEU

George Mangion is a partner in PKF an audit and business advisory firm gmm@pkfmalta.com

All rights reserved | Copyrighted

Editor’s Note George Mangion is a senior partner of PKF Malta, an audit and consultancy firm, and has over thirty years experience in accounting, taxation, financial and consultancy services. His efforts have seen that PKF Malta has been instrumental in establishing many companies in Malta and placed PKF Malta in the forefront as professional financial service providers on the Island. George is a regular contributor to both local and foreign publications on business, financial services, taxation, captives, company structure and insurance. He has also lectured and delivered presentations at numerous seminars and conferences worldwide, namely in Europe, South Africa, North and South America, Canada, Australia, China and the Caribbean.

New Product Launch

CREDIT CARD INNOVATIONS...

THE FUTURE OF MONEY IS PLASTIC

By Martin Vella

Insignia Cards Ltd is a principal member of VISA and operates various card programs in Malta, issuing the Yes Money Card, the YES Money VISA Card, the YES e-Card and the Valletta FC Card. Insignia Cards Ltd also operates the YES Net Merchant programme. We sit down with Frederick Ellul, CEO, who explains how the company has established itself as a financial institution providing Card products.

TEU: Can you briefly outline Insignia Cards Ltd operations?

FE: Insignia is a Financial Institution licensed and regulated by the MFSA to undertake payment services under the first, second and third schedule of the Financial Institution Act. We can issue electronic money, we can operate as an e-wallet, we can acquire payment instruments and we can give credit to individuals. But we are not a bank, and I am stressing this fact because I think it is to our customers’ advantage that we are not a bank.

We launched our products on the 1st of December 2013. We are a start-up here in Malta, but we are part of an International Group of Companies that has been operating for the past twelve years in the industry. We have decided to enter the Maltese market by offering mass market products.

TEU: What experience and product value do you bring to your customers?

FE: Even though we are a start-up, the company is extremely experienced. We saw a business opportunity and decided to enter the Maltese market with credit card products. We are also offering a co-branded card with the Valletta F.C. Insignia is the official sponsor of Valletta F.C. and therefore being a company that issues VISA Cards, it was a natural progression to issue the Valletta FC Card. That is one product.

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Insignia Cards has also teamed up with a local business to manage the YES Card program, issuing and operating the YES Money VISA Card and the YES e-Card. We launched the YES Money VISA Card and the YES e-Card as two mass market products since Insignia Cards Ltd looks forward to building mutually beneficial relationships with its customers by offering them advantageous products.

Both of these products come with an array of benefits, rewards and protection which we’ll highlight later. In the coming years, the institution has plans to expand its operations in the Maltese Islands and overseas, also offering premium cards and services. the credit card industry locally is virtually non- existent, it is virgin territory because credit cards were only ever issued by banks. Our ultimate aim is to launch similar products overseas

TEU: What criteria to screening are you applying?

FE: You don’t need to open a new bank account or deposit any money with us, you simply apply online and receive a reply within 30 seconds if you have a credit line approved or not. At application stage, the company conducts a series of due diligence checks, including the regulatory compliance and anti-money laundering checks. If you are approved, we will send our delivery person to deliver your card and collect any documents required.

When collecting data, we scrutinise this data with our own databases, and we safeguard that this information cannot be hacked or defrauded in any way. As mentioned previously, a series of checks are carried out and when there are no serious problems, a card will be issued and delivered. We offer an alternative and innovative payment solution to the market as we have incorporated a consumer loan in the YES Cards that is not available in any other VISA product locally.

This means that with every purchase carried out with the card, the customer will receive an SMS giving them the option to defer their payment over three, six, nine or twelve months. Very soon, we will be launching another YES branded card which will offer even further flexible payment plans with longer term benefits.

TEU: What are the main benefits of your new products?

FE: The majority of credit cards currently available in Malta, operate with the standard credit card revolving payment plan therefore you make purchases and your re-payment is always on a revolving plan standard credit card solution. The YES Cards still offer these standard payment terms like every other

TEU: On-line what type of questions are you asking? How safe is the system you are using?

FE: Our systems work like a bank, there is no question regarding security.

A massive investment has gone into the safety and security of the IT infrastructure of the institution.

YES eCard

New Product Launch

credit card, however the client now has the choice to ‘transfer’ any transaction from this standard revolving payment method and send that transaction to the Deferred Payment Plan (DPP) where the monthly repayment can be paid in fixed instalments over a determined amount of time. It is the customer’s choice if he wants to split the repayment over 3 months or twelve months depending on his desired monthly repayment amount, the longer the term the lower the monthly repayment.

We are giving the customer a single credit card, but they have the option to defer their payments, we are combining a credit card with a consumer loan. It is already a benefit in the YES Money VISA Card and you will see this in our future products, which will be more advantageous and innovative for the client. At the end of the day, we are pumping new money into the economy. Clients retain their current bankers and card and we are offering them extra credit with our cards.

TEU: Who are you targeting in the local market?

FE: We have decided to enter into the Maltese market through the mass market. In 2014 we have many new innovative projects, auspicious ideas, and new products that will target different market segments.

The main ideas for 2014 are to increase the product range of the YES brand, and issue premium card products. Malta is the perfect testing ground for a card because the credit card industry locally is virtually non- existent, it is virgin territory because credit cards were only ever issued by banks. Our ultimate aim is to launch similar products overseas.

TEU: How are you going to market the products?

FE: The YES Money VISA Card and YES e-Card are marketed to everyone and campaigns have included the use of billboards, banners on websites, television, radio, newspapers and magazines. We also have a FB page with a growing community.

The Valletta FC Card is targeted to people who share the passion and pride of the Valletta FC team so most marketing initiatives revolve around newspapers, magazines and television within sports programmes and sections.

TEU: If you had to address the mass

market out there what will your message be for them to convince them to use the YES Money VISA Cardand easy credit?

Our message is very clear, we are giving people easy credit in their pockets, innovative payment plans, a new deferred payment mechanism and value added benefits such as the YES Rewards Programme where you gain one YES Coin for every one Euro spent on the card, YES Coins can then be redeemed for a number of gifts such as electronics, household items and much more. All this is complimented by a 24/7 customer support centre and Online Services so that clients can control their account from anywhere.

The cards also offer Purchase Protection and Travel Accident benefits.

About the Cards The Valletta FC Card The Valletta FC Card is a credit card, which enables you to get closer to your team and enjoy every Valletta FC moment. Enjoy special benefits when using the card: • Earn incredible opportunities, like the chance to win tickets for the Champions League Final, invitations to meet players and managers at special events, the chance to win VIP tickets to Valletta FC games, the chance of being selected for the Dream Team to play a match against your heroes and the opportunity to be a coach for a day • Special benefit packages* including travel accident, purchase protection and medical expenses assistance.

• Earn 1 point for every euro spent on the Card and accumulate points redeemable for a variety of exclusive Valletta FC merchandise * Subject to benefits limits and policy terms and conditions on eligible items.

TEU: Any other special products you’d like to mention?

FE: It’s also important to note that we offer the YES e-Card, this is a supplementary card available to all clients who apply for a YES Money VISA Card. It is a virtual card to be used for online purchases only, and comes with all the standard YES Money VISA Card benefits plus additional special benefits geared toward online shopping. These include Best Price Protection, Safe Surf and Extended Warranty.

TEU

All rights reserved | Copyrighted

The YES Money VISA Card The YES Money VISA Card allows you to have YES Experiences around the world and includes the following benefits: • The convenience of having 2 payment plans in one card – the usual credit card plan and the Deferred Payment Plan* that allows you to pay in fixed monthly instalments of up to 12 months.

• Special benefit packages* including travel accident, purchase protection and medical expenses assistance.

• Genuine gifts through the YES Rewards. Earn 1 YES Coin for every 1 euro spent and collect YES Coins that can be redeemed for fantastic gifts from selected retailers. * Subject to benefits limits and policy terms and conditions on eligible items.

Editor’s Note

Dr Frederick Ellul completed Doctorate of Laws and obtained Law Degree (LLD) from the University of Malta in 2004. Dr Ellul started his career by setting his own private practice, where his focus was primarily financial services, corporate and commercial law. Frederick later joined CredoraxMalta Ltd., a licensed financial institution, as Head of Legal and Compliance, where he was eventually promoted to General Manager. In July 2013, Dr Ellul joined Insignia Cards Limited as Chief Executive Officer.

The YES e-Card Shopping online comes with worries about security and protection. With the virtual, non-plastic YES e-Card you can put those worries aside and really relish your YES Online Shopping Experience. Designed especially for use on the web, this card provides additional security, convenience and protection for your online purchases.

Special Benefits*: • With Safe Surf your online purchased goods are insured from delivery issues or mistakes, defects and/ or damages • Ensures you get the best deals with the Best Price Protection on eligible items • Additional Extended Warranty on eligible items providing peace of mind • Travel Accident Benefits for your travel plans Plus, because it’s handily combined with the YES Money VISA Card, you get all the benefits of the YES Money VISA Card with payment convenience and gift rewards.

All of your YES e-Card expenses and purchases will be grouped in one detailed statement of both your online and real-world transactions. * Subject to benefits limits and policy terms and conditions on eligible items.

January 2014 | THE ECONOMIC UPDATE

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retirement scheme

Malta Consolidates its Position as Leading Pension Jurisdiction

By Stewart Davies

avail of strong regulation, provided by the Malta Financial Services Authority (MFSA).

The MFSA carefully vets any pension scheme administrator, who must pass their qualification requirements and meet strict capital and liquidity requirements. Whilst the growth in the number of scheme administrators has been marked over the last two years, this needs to take into account the servicing of over five million British expatriate, who do not intend to return to the United Kingdom on retirement, and the over 250,000 who emigrate annually – therefore the potential client base continues to grow.

Accordingly the market is still in its infancy.

The retirement scheme administrators are normally part of wider groups, with operations in other jurisdictions such as the Isle of Man, Gibraltar and New Zealand.

These are widely accepted as the main jurisdictions and account for nearly all the QROPS business currently placed. Malta maintains its market leading position, due to: • It’s position as a highly regarded, stable and well governed jurisdiction which is recognised internationally, • Benefiting from strong regulation from the MFSA,

Malta’s burgeoning financial services industry, has over the last three years added a further significant strand to its diversified base of financial and services industries such as its Fund sector, and more recently, Gaming. This is following the growth in the number of international pension scheme administrators, now based on the Island.

First and foremost, any decision to locate their pension in Malta is an opportunity to avail of strong regulation, provided by the Malta Financial Services Authority (MFSA)

In total, twelve retirement scheme administrators are now based in Malta, primarily to service the UK expatriate community, whom have decided to emigrate from the United Kingdom, permanently.

Malta offers significant advantages to these underlying clients, because of its robust pension legislation and favourable treatment of pension funds based in Malta.

First and foremost, any decision to locate their pension in Malta is an opportunity to 10 |

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• A significant number of double taxation agreements, which assist in the housing of the, pension scheme and the payment of income from the pension fund, • Full member of the European Union • Excellent legal system based around both civil and common law, in particular its corporate legislation.

So why move your UK pension overseas at all?

Stewart Davies, the newly appointed Chief Executive Officer of Momentum Pensions Group with a subsidiary in Malta with offices in the Isle of Man and shortly in Gibraltar, answers this question.

“Our underlying members have no intention of retiring in the United Kingdom, and in nearly all cases have already left the United Kingdom. Accordingly, they do not wish to fall within the UK tax regime, having left the country.

Maltese pension legislation allows: Flexible generation planning with any residual pension fund on death being passed to their loved ones, free of UK Inheritance tax and more importantly UK Income tax. If you

have a UK pension on death with benefits in payment, any remaining fund would be subject to a 55% income tax charge.

• Allows them to receive income, without any withholding taxes, providing they reside in the jurisdiction with which Malta has a working double taxation agreement (DTA). There are over 60 countries where Malta has a DTA and they reflect most, if not all, of the favoured retirement destinations e.g. Spain, Portugal etc.

• It can also offer them a wider investment choice with the ability to construct their portfolios denominated in currencies better reflecting where they intend to retire, accounting for currency fluctuations and inflationary risks. Nearly all UK pension schemes are denominated in Sterling and have a UK biased to investing, negating the ability to plan effectively for these risks. This expands on some of the UK restrictions on pension scheme investments, but not all.

• The convenience of being able to receive financial advice locally, in their chosen jurisdiction Whilst Malta has come under more competition of late, following the re-entry of Gibraltar into the market, its position at the heart of Europe, alongside its regulation and number of double taxation agreements provides a compelling reason to house your international pension scheme in Malta.

From the twelve retirement scheme administrators there are no less than 18 schemes currently on the HMRC QROPS list reflecting its position in the international community.

This is set to continue for the foreseeable future.”

TEU

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Editor’s Note Stewart Davies is the recently appointed CEO of Momentum Pensions Malta Limited, having relocated to Malta in December 2013 from the Isle of Man. A qualified Banker, he has been in the Fiduciary Services industry for the last 15 years, and led the acquisition of Ernst & Young Trust Company, IOM by an Irish Bank in 2002 before leading the Group’s operations in the Isle of Man, peaking at over 150 staff, ahead of the sale of the Trust business for a significant premium in 2006. After leading the Bank’s activities in the Midlands, Wales and West Country for 3 years, he returned to the IOM in 2009 to lead the merger of two prominent Isle of Man Trust Companies.

Accountancy

3a Global-Launch of Malta’s First Accountancy & Audit Network

By George Carol

We sit down to interview Neville Cutajar, Director of 3a Global - a network of accountants, auditors and business advisers and Managing Director of 3a Malta, a dynamic young team of professionals, who blended with the experience and vintage of some well known experts are firmly primed to assist entrepreneurs succeed in today’s complex global business world.

TEU: What has been the history of 3a Accountants prior to launching 3a Global?

NC: 3a is a second generation professional services firm set-up in 2007 as a management buy-out of a mid-tier audit firm in Malta. Having launched their 3a brand in February 2008, the firm expanded on a growth strategy, focusing on international business, through the setup of a dedicated international tax unit.

This enabled the 3a’s client portfolio to change from being completely focused on local enterprises to a balanced portfolio of local and international clients.

In 2010, 3a took on board Franco Azzopardi, a leading specialist in corporate strategy and finance and MISCO, Malta’s leading knowledge organisation on the island, as equity holders. Franco Azzopardi was appointed as chairman, whilst MISCO directors, Joe FX Zahra and Lawrence Zammit, were appointed as non-executive directors.

Besides the benefits brought about by the synergy of the new partners’ areas of expertise, which enabled 3a to extend its services offered in the advisory arena, this gave 3a the impetus to embark on its internationalisation strategy. This eventually culminated in the launching of 3a Global on 8th November 2013.

TEU: Why the name 3a?

NC: 3a was the name chosen for our brand, as it stands for our core competencies being Accountancy, Assurance and Advisory. It also captures the A’s in our carefully chosen corporate tagline, ‘Your Aspirations, Your Achievements - Our Aims’. This tagline stems from our focus on two objectives 12 |

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namely, that of assisting our customers in realising their business potential through our advisory directorate, and that of accounting and auditing their achieved results so as to ensure seamless compliance with regulatory frameworks.

3a have reversed the trend and are now engaging affiliates who will be representing the 3a brand in their respective countries

TEU: What is the significance behind this launch?

NC: 3a is the first locally founded accountancy firm in Malta to branch out overseas. Instead of becoming representatives of a foreign principal, which is the norm in Malta, 3a have reversed the trend and are now engaging affiliates who will be representing the 3a brand in their respective countries.

TEU: What are the benefits that member firms find in joining this network?

NC: 3a Global was launched after thorough logistical planning and the investment in state-of-the-art information systems set to facilitate the smooth running of a business and professional exchanges between teams operating across multiple regions. The Global operation was instituted as a fully-fledged association, legally set up and registered in Malta, to act as the coordinator of 3a’s international professional services network.

3a Global members will benefit from cross-border facilities such as customised IT infrastructure inclusive of a dedicated knowledge sharing database, the

granting of privileged access to network resources (and potentially clients) geared to help members meet increasing service demands within the international business context. In parallel, clients of 3a Global will benefit from a multinational, best-of-breed HR team and a range of services including assurance, accounting, advisory, trust/fiduciary, international taxation, and corporate services.

In the words of Mr George Georgiou, one of the partners of 3a Cyprus, the first foreign affiliate joining 3a Global: “Being a member of the 3a Global network has provided our office in Cyprus with access

Accountancy

From left -Marinos Karayiannis, George Georgiou, Franco Azzopardi, Neville Cutajar, Christian Vella, Clive Farrugia and Lawrence Zammit

to markets and clients worldwide that recognise the value of quality services.

In collaboration with an international network of professional accountants, we can demonstrate the strategic and taxoptimising opportunities available to our clients. Utilising the 3a Global network tools and shared resources such as the online Knowledge Base and the Quality Management System, we can offer fresh and unique solutions that add value to our local and international clients.”

The Global operation was instituted as a fully-fledged association, legally set up and registered in Malta, to act as the coordinator of 3a’s international professional services network

TEU: What do you reckon are the competitive advantages of the firms forming part of 3a Global?

NC: Firms within 3a Global have a mission to provide a service to their clients which is “different, innovative and personal”. We try to talk less and listen more. For most professionals, this may seem difficult since they are deemed to be the experts and hence the persons that should do the talking. However, at the end of the day it’s not about us, our company,

our products or our services. It’s about meeting customer needs and adding value. The reality is that until we actually take the time to get to know our client and the client understands that we care more about meeting their needs than anything else, then the relationship cannot evolve into a personal, trustful and meaningful one. And this is our daily challenge.

Our credo of being innovative and different has been put in action and actually implemented in our culture as well as in the way in which we operate. Our management approach is open and we work as one team.

The structure facilitates teamwork and excellence, and is oriented towards serving the customers in the best possible way.

Projects are led on the basis of functional expertise, not hierarchy; the attempt is to get the best people to deliver the best we can provide. Our competitive advantages are definitely our approach in dealing with our clients, what we call the 3a experience, which involves agility of service, quality, customer centricity and the building of an effective personal relationship.

You can read more about 3a Global on www.3aglobalnet.com

Editor’s Note

The Economic Update was speaking to Mr Neville Cutajar a director on the Board of 3a Global. Neville is also 3a Malta’s managing partner. He has extensive business experience and has attained specialisation in corporate services, liquidations & turnarounds as well as being the technical partner in relation to International Financial Reporting Standards. He is the firm’s audit partner and is in charge with compliance and quality control issues at 3a. He has ample experience in management consultancy, internal auditing as well as information systems audits. He serves as a member on a number of Committees at the Malta Institute of Accountants as well as Chamber of Commerce.

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January 2014 | THE ECONOMIC UPDATE

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EU Competitiveness Innovation Framework Programme

BOV Start Plus Bank of Valletta, through the European Union’s ‘Competitiveness Innovation Framework Programme’ (CIP, 2007-2013), is offering the BOV Start Plus. This business loan is aimed at start-ups and micro enterprises* who need funding for investment purposes and initial related working capital requirements. The objectives of this facility is to ensure higher accessibility to bank lending for start-ups and micro enterprises BOV Start Plus Benefits • Higher accessibility to bank lending for start-ups and micro enterprises.

• A value-added package that offers the advantageous interest rate of 2.5% margin over the Business Lending Bank Base Rate**.

• No Advances Related Fees, i.e. no arrangement fees, annual processing fees and early repayment fees.

• No collateral requirements.

• The financing of capital investment requirements through a loan payable over a period of time.

BOV Start Plus Features • Purpose of financing: investments in tangible and intangible assets and investment in working capital.

• Maximum amount of EUR 25,000 per project

The BOV Start Plus offers advantageous interest rates and enhanced collateral requirements earmarked for start-ups and micro-enterprises as part of the EU’s 2020 Strategy. Through this financing package, Bank of Valletta is offering financing up to a maximum of EUR 25,000 per project.

Potential Target Projects Projects that may be financed through the BOV Start Plus include: • Graduate or post-graduate students who would like to embark on a new business operation, following completion of their studies.

• Self-employed professionals who would like to start a new business activity.

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• Individuals who would like to re-enter the market workplace with a new business venture.

• Full-time employees who would like to commence a part-time operation.

BOV Start Plus Eligibility Criteria 1. SME Size: The facility is intended for start-ups and micro-enterprises which employ less than 10 persons (in full time equivalents) and whose annual turnover and/or annual balance sheet total does not exceed EUR 2 million.

2.

Credit History: Start-ups and enterprises which do not have a term loan history on business facilities with BOV are eligible to apply.

• The loan term ranges between a minimum of 1 year and a maximum of 5 years. The term of the facility depends on the type of asset being financed and cannot exceed the useful life of the asset.

For more information on BOV Start Plus, please contact one of Bank of Valletta’s branches.

One can also contact Business Generation and EU Affairs on 2275 1160 or email eubiz@bov.com. Competitiveness

The BOV Start Plus benefits from a guarantee issued under the European Community’s Competitiveness and Innovation Framework Programme.

TEU

*A micro enterprise is defined as an enterprise which employs less than 10 persons (in full time equivalents) and whose annual turnover and/or annual balance sheet total does not exceed EUR 2 million. ** The Bank’s Base Rate (BBR) means the basis, established by the Bank from time to time, on which the rate of interest payable generally on all Bank lending is determined. The applicable Bank’s Base Rate varies in accordance with the type of lending involved, whe ther Business Loans, Consumer Loans or Home Loans, as quoted on the Bank’s official website. The base rate applicable to the BOV Start Plus is the Business Lending Bank Base Rate which is currently 2.30%.

For further information contact: Peter James Sant, BOV plc, T: 2275 3303

BOV START PLUS

access to finance has become easier If you want to start a new business activity, talk to us to find out about our BOV Start Plus ∙ our lowest rate ever ∙ our best terms ever ∙ added value support for your business Your success is our goal.

BOV BUSINESS BANKING 2131 2020 I bov.com

BOV Start Plus benefits from a guarantee issued under the European Community’s Competitiveness and Innovation Framework Programme.

All loans are subject to normal bank lending criteria and final approval from your BOV branch. Terms and conditions apply.

Issued by Bank of Valletta p.l.c. 58, Zachary Street, Valletta VLT 1130 - Malta

SMEs

Lending to SMEs in an easy way

By Martin Vella Bank of Valletta, through the European Union’s ‘Competitiveness Innovation Framework Programme’ (CIP, 20072013), is offering the BOV Start Plus loan programme, sponsored by the European Commission. In an exclusive The Economic Update interviews Alessandro Tappi, Head of Guarantees, Securitisation & Microfinance, EUROPEAN INVESTMENT FUND to learn more how this business loan is aimed at ensure higher accessibility to bank lending for start-ups and micro enterprises who need funding for investment purposes and initial related working capital requirements.

TEU: What role is the European Investment Fund doing to promote access to finance for SMEs and Micro Enterprises?

AT: The goal of the EIF is supporting SME’s through guarantees and private equity investments. The EIF offers different guarantee products providing financial institutions with credit risk protection and capital relief, as well as re-financing facilities. The aim of the products is to facilitate new sustainable lending to SME’s at more favourable conditions, which could mean lower collateral requirement, better pricing, larger volumes and longer terms.

TEU: What are the results that EIF has attained in Malta through BOV, being the local financial intermediary with the JEREMIE programme?

AT: The JEREMIE instrument implemented in Malta has been a very successful pilot case. JEREMIE stands for Joint European Resources for Micro to Medium Enterprises. It makes use of European structural funds made available by the government through financial instruments. JEREMIE was implemented in Malta through guarantees to BOV, and BOV has been able to build up a new loan portfolio at a very fast pace. The Bank granted more than EUR 50 million loans to borrowers, all these being SMEs. So building on the success of JEREMIE, we are now implementing the CIP guarantee 16 |

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programme with the aim to support SMEs and in particular start-ups.

TEU: What is the competitive advantage with the newly launched BOV loan programme under CIP? BOV has been able to build up a new loan portfolio at a very fast pace. The Bank granted more than EUR 50 million loans to borrowers

AT: With the CIP guarantee facility the bank will be able to offer loans to companies that are in the start-up phase.

Start-ups are the most difficult companies to be financed, as they don’t have a track record, they don’t have collateral, they don’t have profits to show and sometimes they don’t have experience in the field. So banks are not at ease in financing these enterprises. But at the same time start-ups are the most active generators of new jobs.

Thanks to this new facility, BOV will be in a position to finance viable companies that lack the above commercial lending requisites. The maximum loan amount for businesses under the CIP guarantee facility signed with BOV is 25, 000 EUR. TEU: What role will the EIF be playing in the 2014- 2015 financial perspective in providing further support to finance SMEs? AT: We are at a very crucial point because in 2013 all the existing EU mandates EIF could offer in support of SMEs have

come to an end and in 2014 we will launch new programmes. The first one to be implemented will be the COSME programme- which is the successor programme of the competitiveness and innovation programme - CIP. This programme will again provide EU budgeted resources for guarantees for SME loans and for venture capital investments.

TEU: Do you have secure mechanisms that will ensure that these funds will go to the right borrowers?

AT: Yes. Let’s start with the way funds are allocated to financial institutions.

EIF selects banks under its mandates via an open call for an expression of interest. Each financial institution can apply and submit an application and if the application complies with the criteria in terms of quality, credibility, etc., then the EIF will proceed with the due diligence, which includes an analysis of the credit sanctioning process of the bank, as well as

SMEs

the proposed conditions that will ensure the appropriate transfer of financial benefits to the borrowers. Once satisfied with the processes applied by the bank, EIF gives full delegation to the bank to provide loans, service the client, etc.

TEU: Why is the European investment bank pushing forward for increasing the share holding capital of EIF? AT: There are many new initiatives that will be implemented shortly by EIF. at the same time start-ups are the most active generators of new jobs

These include the new EU guarantee programmes COSME and Horizon-2020, a new mandate for guarantees from the EIB, as well as the SME Initiative. The latter, endorsed by the EU council in October 2013, combines structural funds with EU budgets and EIF own resources.

In practice EIF will be providing guarantees using structural funds and EU money. as well as its own resources.

The EIF capital increase is therefore part of the recipe that will allow us to step up our presence in the market in support of SMEs and to have an even bigger impact in the real economy.

TEU

The BOV Start Plus benefits from a guarantee issued under the European Community’s Competiteveness and Innovation Framework Programme.

All rights reserved | Copyrighted

Editor’s Note Alessandro Tappi is Head of Guarantees, Securitisation & Microfinance at the European Investment Fund (EIF), focusing on structured finance solutions for SME portfolios and with a long track record on SME securitisation. EIF’s guarantee activity now spans across all the EU Member States, as well as the candidate countries and South-East Europe.

Mr Alessandro Tappi with BOV Chairman Mr John Cassar White

Between 2006 and 2008 Alessandro has been Member of the Board of Directors of EFSE, the largest microfinance investment fund worldwide.

Prior to joining EIF, Alessandro worked for several years in project financing at San Paolo Bank, Italy. Alessandro holds an MBA in Business Administration and a Diploma in Economics from the University of Turin. He has been lecturer and held training courses on Structured Finance products and Financial Modelling.

January 2014 | THE ECONOMIC UPDATE

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Mobile Communications

Mobilising your Enterprise safely and securely

By Ivan Zammit Head of Enterprise Business, Vodafone Malta

There is no doubt that advances in mobile communications have given companies, small and large, the possibility to adapt and change their processes making them more efficient and much faster. This has also provided companies with the opportunity to change their working practices in an attempt to retain their trained staff and allow for a more flexible working environment, thus achieving better and bigger results.

Striking a balance between access to information and security has always been a central concern for businesses. More so today, when speed and information accessibility through smartphones has turned businesses around and ensured their competitiveness in an ever changing market place.

In truth, enterprises should always be in control of their information. Information Systems are devised upon this concept.

The heart of the issue is trust. To what extent do we associate use of smartphones with Information Security? In general, especially in traditional set ups, the two have never co-existed.

Vodafone has brought to the market a product aimed at striking this all important balance. It unleashes employee productivity through the use of smartphones for work purposes and the need to integrate such

devices within the IT security policy of your company. Vodafone Malta boasts one of the most advanced working environments on the island with a highly integrated and flexible mobile workforce that can seamlessly work and access company Information Systems from anywhere using mobile devices.

This could only be achieved through the implementation of a comprehensive mobile Information Security strategy. Naturally, as a communications company, data protection and security of information is of paramount importance. Going mobile and ensuring the level of security required of Vodafone was only possible through the use of the Vodafone Secure Device Management (“VSDM”) platform which is now being made available to Vodafone’s Enterprise customers..

The VSDM service provides a simple way to get Vodafone staff to work with their smart devices without compromising the company’s security. With VSDM we have not only ensured that all Vodafone employees can use smartphones and tablets for work purposes but that all mobile devices that having access to company information resources are enrolled in Vodafone’s I.T. security policy including strict password enforcement and data encryption. The devices can be remotely and centrally locked

or wiped of all company data if lost or stolen, while the service also enables administrators to define lists of approved apps that are allowed or apps which must be installed on the devices. This allows for secure access to company data from anywhere at all times improving staff productivity and flexibility while reducing operating costs.

We have recognised that times are fast changing. With each development within the telecoms sector, new challenges and new opportunities arise. VSDM is one such opportunity that allows for the expansion of business in a secure and safe way.

TEU

Should you wish to schedule a meeting kindly contact us on : business.solutions.mt@vodafone.com

Editor’s Note Ing. Ivan Zammit has twenty years’ work experience in ICT and holds a Master’s in Business Administration from Henley Business School. He has served in various senior technical, marketing and commercial positions at Vodafone and currently heads the Enterprise Business unit. Ivan has a passion for technology as an enabler for business growth and innovation.

January 2014 | THE ECONOMIC UPDATE

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Gaming

Repositioning Malta as the Top Jurisdiction

By Martin Vella

This month, The Economic Update features an interview with Joseph Cuschieri, Executive Chairman of the Lotteries and Gaming Authority, on the Authority’s progress with gaming in Malta and beyond. Cuschieri in past worked with Vodafone on key regulatory projects both in Egypt and Turkey . He explains that a culture based on creativity and always asking “what if” is one vehicle to innovation, stating that, “too much conventional wisdom makes an organisation stale and inward looking”. He believes that to change that requires a behavioural mindset which becomes ingrained in the way things are done at the LGA and says why he is committed to make that happen with the involvement of all the team at the LGA.

TEU: How has 2013 been for the Lotteries and Gaming Authority?

JC: 2013 has been the year of change at the LGA. There was a change in Government, change in Chairman and Board of Directors, resignation of the CEO and then a change with my appointment as Executive Chairman on 1st November 2013. Overall it was a relatively good year but there’s a lot of change and reform which needs to happen both from an organisational and regulatory standpoint. My agenda is a reformist one which will layout the foundations for the next decade.

TEU: What’s the competitive landscape like for you? What do you see as some of your competitive advantages in the space?

JC: The competitive landscape is changing fast and the yardstick we have been using to measure success has also developed. Today there are many more jurisdictions which host remote gaming operators than say five years ago. Malta’s ability to retain such a high segment of remote gaming players, some of which are big names, is already proven. Our legislative framework, anti-money laundering mechanisms, player support systems and the general package of incentives are still attractive. Having said 20 |

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that, what got us here won’t get us there and we need to act quickly to refresh our regulatory framework so that this remains at the cutting edge of this sector.

We cannot afford to be complacent and my aim is to reposition Malta at the top of the list globally. what got us here won’t get us there and we need to act quickly to refresh our regulatory framework so that this remains at the cutting edge of this sector

TEU: How do you intend to reform the authority to make it more efficient and agile, strengthening the relationships with all stakeholders, strategically grow the on-line gaming sector and promote Malta as a globally recognised gaming jurisdiction?

JC: In any organisation, it’s all about people and attitude. My plan is to invest in people and high end information management systems so that the LGA is better equipped with the tools to execute its role more efficiently and effectively.

First and foremost, I want to invest in training and development of our people, bringing in fresh blood and drive behavioural change. More consultation needs to take place across the board so that we make sure to listen more and improve the quality of our decision

making. We are refreshing our regulatory framework so that Malta can host other forms of gaming such as digital games of skill and social gaming. We are recalibrating our strategy to target other geographical jurisdictions so that we maintain a growth trajectory. We are also modernising our legal framework so that we have a more technology neutral framework. There’s more change in the pipeline but like that I believe that the LGA will become a formidable organisation which will give Malta the edge over other jurisdictions.

TEU: Can you tell us a bit about the culture of working for LGA. What’s it like being an LGA employee?

JC: Being an LGA employee carries great responsibility because day-in, day-out we are dealing with a sensitive industry which

Gaming

contributes more than one tenth of the Maltese economy. We cannot afford to make mistakes. Malta is a highly respected remote gaming jurisdiction and we have the responsibility to protect that. Integrity and transparency are ingrained in our DNA as an organisation and we need to make sure that we are seen that way.

TEU: How do you market LGA in such a way that the media will respond positively?

JC: We need to be innovative in the way we communicate with all stakeholders.

Effective stakeholder engagement is key to ensure that what the LGA is doing is transparent, sound, principled and can stand up to scrutiny. Every time, we interact with licensees, operators, new applicants, service providers and the rest

of our broader stakeholder groups, we need to make a positive impression with our professional outlook and efficiency.

Once our actions and the quality of our decisions are accepted and understood, the media and the rest of the stakeholders will react positively.

shift in that respect. Today people spend more time interacting with their Smartphone than looking at their TV set and sometimes their PC. Direct communications e.g. via SMS or MMS or applications will continue changing the way the gaming industry interacts with its customers.

Effective stakeholder engagement is key to ensure that what the LGA is doing is transparent, sound, principled and can stand up to scrutiny

TEU: How do you see the Maltese gaming market changing in the next five years?

TEU: How should online lotteries promote themselves to players in today’s market? What techniques are most likely to grab the attention of potential customers?

JC: I think the shift from the PC to the Smartphone or tablet is a paradigm

JC: This industry has the potential to grow substantially in the coming years and what we are doing right now is laying the foundations for that to happen. Once we make all the changes to the regulatory framework, start licensing for other forms of gaming, tap into other geographical markets and reform the LGA, then I really think that we will get there.

TEU

All rights reserved | Copyrighted

Editor’s Note Joseph Cuschieri, is a certified public accountant and a fellow member of the Malta Institute of Accountants of Malta. He is specialised in management accounting and finance and holds a Masters Degree in Business Administration from Henley Management College, UK. Throughout his professional career, he held various senior executive positions within the private sector mainly in the construction, services and hospitality sectors amongst others. Prior to joining the LGA, Mr Cuschieri was Chief Commercial Officer at Vodafone, and a senior consultant with Ernst & Young. During Furthermore, Joseph spent a period of eighteen months enrolled on the Vodafone Group’s global leadership development programme.

He has vast experience in economic regulation particularly in the electronic communications sector where he spent five years as Chief Operating Officer at the Malta Communications Authority.

In his new role at the LGA as Executive Chairman, Mr Cuschieri will be focusing amongst other things on reforming the Authority to make it more efficient and agile, strengthening the relationships with all stakeholders, strategically grow the online gaming sector and promote Malta as a globally respected gaming jurisdiction.

January 2014 | THE ECONOMIC UPDATE

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Finance News

FinanceMalta end busy year with Malta’s international financial centre at an unprecendented all-time high.

By Bruno Lecuyer During a busy month for the custodian of Malta’s financial services brand, the magnificent Magazino Hall at Valletta Waterfront was the striking venue for FinanceMalta’s 5th Annual Winter Networking Reception which welcomed over 100 corporate and affiliate members to a celebratory gathering and fundraiser for Din l-Art Helwa (National Trust of Malta).

FinanceMalta is the public-private partnership set up to promote Malta’s international financial centre.

auditing/reporting standards, Quality of the Education System and Quality of Math and Science Education.

Mr. Farrugia also highlighted that the International Monetary Fund (IMF) noted in its annual report on the Maltese economy that the sensitivity of the Maltese banking sector to sovereign risk events in Europe is low given very low direct exposures to vulnerable countries, as well as domestic banks’ reliance on a traditional retail deposit-based banking model containing over €40 billion in local deposits. “Compared to euro area peers, Maltese banks continue to outperform in terms of profits and capital adequacy,” the IMF said.

In his address, the Hon Dr Joseph Muscat stated that “Government was fully supportive of the growth of this industry and the presence of a stable economic and political environment was equally conducive to the growth of this industry”. Hon Muscat went to on say that ”education is equally pivotal in the process and it is firmly in the Government’s plans to further strengthen Malta’s educational system to ensure that the industry is supported through the availability of skilled personnel”.

FinanceMalta recently held its annual Christmas networking event at Valletta Waterfront while raising funds for Din l-Art Helwa and a few days before Chairman Kenneth Farrugia presented FinanceMalta’s vision to the media at Hotel Phoenicia.

Immediately prior to this eagerly anticipated annual networking event, one of the social highlights for the financial services sector, FinanceMalta also hosted a press dinner at Hotel Phoenicia to outline the progress made in the sector and to bring the local media into direct contact with new members of the Board of Governors.

FinanceMalta Chairman Kenneth Farrugia articulated the recent selection of Malta as Europe’s favourite location for Hedge Funds, explained the extensive media activity and social media implemented

by FinanceMalta, as well as delineating how significant the growth of the financial services cluster has been to Malta’s economy with just under €10 billion in net asset value, 620 funds, 133 fiduciary licences, 28 credit institutions, 66 insurance operators, 26 fund administrators, 6 custodians, together with 18 captives and cells.

In his address, Mr. Farrugia explained how part of this success had come about due to 4 key “attractiveness criteria” which included Malta’s comprehensive legal and regulatory framework, the presence of an accessible yet meticulous regulatory body, cost competitiveness and equally important the industry’s responsiveness and can do mindset. Mr. Farrugia said that in addition Malta ranked within the top 20 in all the primary indicators in the World Economic Forum ‘s Global Competitiveness Index 2012 – 2013, Financial Market Development, Soundness of the Banks, Regulation of Securities Exchanges, Strength of the 22 |

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According to the Malta Financial Services Authority (MFSA), Malta’s banking sector is now truly international in nature, with 73% of borrowings and deposits originating from overseas.

In 2013, the finance sector supported close to 10,000 jobs in Malta, and the gross value added contribution the sector made to the economy both directly and indirectly is estimated to be moving towards 15% of GDP. The Maltese government has set a target of 2015 for the jurisdiction to become one of the most important financial centres in the region Mr Farrugia went on to say that “Malta is increased demand from a number of hedge fund managers who are choosing to shift their fund operations to Malta in response to both the rising costs of business in their domicile which is amongst others driven by the growing regulatory burden. As a result, Malta is emerging alongside London, Geneva and Luxembourg, as another European location for fund managers keen to maintain flexible operating arrangements. Positive coverage by key media such as CNBC, Bloomberg and The Financial Times together with professional publications such as Hedge Fund Review reinforces this interest.

Mr. Farrugia concluded that, “Malta is becoming a destination of choice for individuals, assets and business and provides one of the highest quality lifestyles in the region. FinanceMalta’s role going forward is to strengthen our international financial centre brand further and to constantly sustain our brand franchise. Key to this is our ability to drive our brand online and across industry events which fit our profile to build a reputation as a front-line candidate and EU domicile of choice, given Malta’s excellent value proposition, as well as the acquired reputation of having robust, flexible regulation exercised by an approachable, yet robust regulator.”

TEU

For further information visit www.financemalta.org

Special Feature

Women Leaders January 2014

WOMEN LEADERS

Women Leaders

Cover story interview

Integrity and

Determination

By Martin Vella

Equiom’s Managing Director Sheila Dean explains that the Trust and Corporate Services industry is increasingly competitive. The success of Equiom has been driven by the delivery of the best possible service and by ensuring that the organisation provides the support and specialist services that are needed by sophisticated clients.

TEU: What made you so effective as a MD, and how do you define what it means to be an effective leader today?

SD: I have had great mentors that have helped me channel my passion for business development. I gained hands on experience of good business practices and learnt, from very young, that integrity, hard work and determination are fundamental to a successful career in business. I must add that none of what I have achieved in life and in business would have been possible without the exceptional team I have to support me, both at work and home.

To be an effective leader in today’s very competitive world, you not only need to innovate and lead by example, but you also need to guarantee that your staff are delivering the best possible service otherwise you cannot grow a business or continue to deliver value to your clients.

TEU: Equiom’s growth in recent years reflects its high quality service offering to customers. Why have you chosen Malta as a jurisdiction to do business alongside considerable investment in Equiom’s operational platform and sales drive?

Our decision to expand our trust and corporate services business into Malta was based on a number of factors including political and economic stability, access to a highly educated workforce as well as competitive effective tax rates for Maltese tax resident entities.

We recognise that every client has a unique set of requirements and therefore 02 |

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requires a flexible range of solutions tailored to their individual needs and so, our decision to expand our jurisdictional capability was a key objective in our corporate strategy. The expansion into Malta further demonstrates the Group’s commitment to developing its strategy for growth into other jurisdictions and enhances our range of wealth management solutions.

The expansion into Malta further demonstrates the Group’s commitment to developing its strategy for growth into other jurisdictions and is another enhancement to our range of wealth management

TEU: With Equiom (Malta) Limited having recently been granted its Trustee Licence by the Malta Financial Services Authority, you can now provide trustee services from its offices in Swatar. How does the Equiom Malta office operate within the niche business lines in addition to Equiom’s traditional corporate and fiduciary services?

SD: Equiom provides specialist services with the view to enhancing the offering for our clients and with the intention of being the premier manager of specific classes. For instance, in addition to our core trust and corporate services, we manage a large fleet of Superyachts

and Business Jets assisting owners in registering, managing and enjoying their assets. We have also successfully managed numerous licence applications for e-Gaming operators across a broad range of gaming platforms.

Our Maltese operation has continued to go from strength to strength over the past six months and from the outset it has always been our intention to offer the widest possible range of services to our clients. With our Trustee Licence in place we are in a strong position to offer a wide range of services to our clients, including acting as trustees and nominee shareholders in addition to administering private foundations, to support and develop both existing and new relationships.

Our Group head office in the Isle of Man will provide support drawing on Equiom’s heritage, experience, and technical expertise.

TEU: What does Equiom’s recent and successful acquisition of fiduciary services provider West Corporation Limited (West) in October 2013 mean in terms of your growth strategy, client portfolio, advisory/fiduciary and specialist services including yachting and aviation?

SD: We have set clear objectives to grow the business both organically and through acquisitions. Building on previous acquisitions West was a coup that I am sure most of our competitors will be envious of. It is one of the most prestigious service providers in the Isle of Man with, like Equiom, a long reputation

Women Leaders

Cover story interview

for quality and integrity. As well as a fantastic client base, the acquisition also brought with it management and technical expertise that will enhance Equiom’s offering and help the Group’s growth. For instance, as a result we have now set up a new business in Equiom Solutions Limited providing tax and estate planning services to Isle of Man residents. We were also able to add West’s yachting and aircraft businesses to our own further building our leadership in this area.

Equiom had previously acquired City Trust Isle of Man in April 2013, Andium Trust Company in Jersey in October 2012 and Intertrust Isle of Man Yachting and Aviation business in January 2011. Each acquisition has brought a varied portfolio of clients and experience which adds to the total offering of the Group.

Our teams work incredibly hard because they are prepared to go the extra mile and build enduring relationships. We are proud to say that Equiom offers a market leading proposition and has been successful in enjoying a period of steady growth. Our global approach to business and multi-jurisdictional capability, coupled with our specialist Yachting, Aviation, e-Gaming and Property propositions, ensures that our clients receive a flexible and dynamic market leading service.

TEU: Can you elaborate on Equiom’s successful management of numerous licence applications for e-Gaming operators across a broad range of gaming platforms?

SD: Equiom has a 100% success rate in the first time management of a number of complex licence applications for operators and software providers and has been involved in the e-gaming sector since 2005.

We have successfully managed applications for a variety of clients including bingo, poker, casino and sportsbook operators.

Due to the complexity of the application process our expertise is called on in the early stages to facilitate meetings with key support business such as banking, hosting and telecoms companies.

We have highly experienced staff with extensive technical expertise and knowledge, covering all aspects of an e-gaming operation, namely: prompt management of licence applications, tax-efficient and compliant corporate structures, critical insight into regulatory and legal requirements, specialist input into business planning, access to specialist tax and VAT advisers, essential management and financial reporting.

Sheila Dean’s Awards •

Women in Business – North West & Isle of Man International Business Woman of the Year 2011: Sheila Dean

•

Citywealth Leaders List 2012 – Leading Trustee: Sheila Dean

•

Private Client Practitioner: Top 50 Most Influential: Sheila Dean 2013

•

Citywealth Leaders List 2013 – Leading Trustee: Sheila Dean

• Citywealth Magic Circle awards 2013 – Runner up: Sheila Dean – Woman of the Year

January 2014 | THE ECONOMIC UPDATE

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Women Leaders

Cover story interview

Our team are well placed to tailor our services to meet with specific client requirements and we approach each piece of business in a flexible manner, putting the needs of our clients first.

TEU: At the size of the firm, how do you maintain a family culture and feel?

SD: Following the recent acquisitions the business has grown to over 180 staff.

When we enter into negotiations with firms that we would like to acquire I endeavour to identify cultural synergies between the two companies as early as possible in the process – without doubt it makes the short and long term integration of the businesses much simpler. Communication and accessibility are the key drivers in maintaining a family culture. I frequently remind my staff that my door is always open and my Blackberry is always on!!

Without this interaction I would find it impossible to keep my finger on the pulse. Tradition also plays a big part in maintaining Equiom’s family culture and feel, together with celebrating business goals and staff achievements.

I am lucky to have enormous support from my senior team allowing me the opportunity to travel extensively and meet with our teams and their clients and intermediaries – maintaining regular personal contact and interaction.

TEU: After an acquisition, how difficult is it to change the culture with the same people in place?

SD: With any acquisition there is always that initial uneasiness about different cultures and how these may impact on the staff on both sides. Culture can often emerge as one of the dominant barriers to effective integration, but we deal with this before acquisition. Equiom seek out businesses which have shared values, beliefs, heritage and ethos - working closely with staff on all levels to ensure an effective and efficient integration. I believe in a collaborative approach throughout the business and the success of our acquisitions has been down to the hard work, determination and a joined up approach across all businesses. I am delighted to say that our recent acquisitions have been a great success in terms of commercial and cultural integration.

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TEU: How do you differentiate among different market segments and to what do you attribute Equiom’s success?

SD: Equiom was established over 30 years ago and we have an established reputation for providing market leading specialist services by employing highly skilled staff to manage entities across the business. We have the right people with the best industry knowledge to exceed the diversified and sophisticated needs of our clients and intermediaries. Each client can expect to receive a bespoke and tailored service with their needs and requirements carefully fulfilled.

Communication and accessibility are the key drivers in maintaining a family culture

responsible for assets in access of £8 billion including £3.2 billion of Real Estate.

We currently also provide ownership and administration services to 64 superyachts and 42 aircraft. These services are provided to clients all over the world. Together with our new equity partner Lloyds Development Capital, Equiom will continue to invest in organic growth and strategic acquisitions.

TEU: Do you pause to appreciate your success or are you always looking at what’s next?

Admittedly I am always looking at ‘what is next’. I am extremely passionate about the business and my drive for something special is constantly reinforced by the continued success of Equiom. Every now and again I do take a step back and look at what the business has achieved. The Equiom team works incredibly hard and it makes me extremely proud to be part of all the great successes to date.

TEU

But we are not complacent about our success.

Innovation and constant attention to what the market wants are key to our future.

The success of the business is built on the core belief of “partnerships built on trust”. What the business has achieved would have been impossible without the hard work and determination of our teams across the business and the partnerships we have with our clients and intermediaries.

TEU: Is there an effective understanding of the scale and penetration that Equiom has in the market?

SD: The business has grown to employ over 180 staff within our Malta, Isle of Man and Jersey offices. Since 2006 we have invested heavily to develop and promote the Equiom brand to ensure that it could support our vision for the business. Equiom’s strong brand recognition and reputation, together with our robust operational platform and unparalleled people culture makes us a market leader.

Our numbers are impressive.

We look after over 2100 trusts, companies and other arrangements, which are

Equiom (Malta) Limited is authorised to act as a trustee and fiduciary services provider by the Malta Financial Services Authority

All rights reserved | Copyrighted

Editor’s Note Sheila’s passion for business developed at an early age whilst working in the family owned retail businesses on the Isle of Man - gaining hands on experience of good business practices and learning that hard work and determination are fundamental to a successful career in business.

Sheila’s successful career with Equiom has been founded on her belief in building partnerships with clients and intermediaries – some of whom she has worked with for over 20 years, and many of whom repeatedly recommend Equiom’s services. Sheila’s ability to network extensively both socially and professionally is key to maintaining and developing Equiom’s profile. Sheila’s extensive knowledge of trust and company structures and the implications of cross border issues ensure that Equioms clients’ complex financial matters are structured appropriately in order to preserve and enhance their assets and ensure tax- efficient planning. Sheila’s personal values of hard work, endless enthusiasm and absolute integrity have been imbedded into Equiom’s culture through Sheila’s determination to lead by example and by expecting nothing but the best from her team. Sheila’s drive and enthusiasm ensures that Equiom, through its strategy for both organic and acquisitive growth, has the vision and flexibility to continually flourish.

Your dream yesterday, is your reality today

It’s understanding the importance of protecting the dream that sets us apart from the rest.

In addition to excellent service and first class credentials the highly experienced team at Equiom can provide efficient and professional fiduciary services.

Our services include: Trusts & Companies: Yachting & Aviation: Crewing: e-Gaming: Property:

the establishment, formation and administration of trusts, foundations and companies multi-jurisdictional registration, VAT planning and effective ownership structures MLC compliant employment solutions and automated payroll management of licence applications, tax-efficient compliant corporate structures and the provision of key personnel tailored property solutions and the highest standards of corporate governance

“…The proactive approach taken by Equiom ensures that their innovative ‘added value’ client proposition distinguishes them from their peers, and we thoroughly enjoy working with their professional and dedicated team...”

Treasury Advisor

Malta: Tel: +356 2546 6614 | Email: enquiries@equiom.com.mt | www.equiom.im Equiom (Malta) Limited is authorised to act as a trustee and fiduciary services provider by the Malta Financial Services Authority.

Women Leaders

Moving Forward

By George Carol We interview Global College Malta intern Claudia Goncalves, who together with her colleague Lilly Azbaha, talks about their initiative to solicit support for the new Gender Equality Scholarship through networks and social media to maximise scholarship uptake.

TEU: Why is Malta the right place to test a very new and innovative scholarship programme that focuses on a ‘Women in Business’ Gender Equality Scholarship?

CG: Globalisation is a something that is happening to the bigger part of the world, businesses are expanding and borders are disappearing. Businesses will not grow without going global and Malta has great potential to play a big role in globalisation for different kinds of companies since the island is situated in the centre of Europe, Africa and Asia. By going global, businesses are going forward. Yet, internally companies have to grow as well, and some are not going forward by not giving women the same opportunities as men are getting professionally.

Everyone, men and women, should be able to speak their minds without the barrier of gender inequality

TEU: Why, in your opinion, can young capable and talented female students speak with a mind of their own and how can they show it?

CG: Young capable talented students can speak with a mind of their own, because this is actually how it should be. Everyone, men and women, should be able to speak their minds without the barrier of gender inequality. It should not even be a debate on how this should be. They can show it by 06 |

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Global College Malta interns helping with new Gender Equality Scholarship.

being confident and standing behind what they say. This is something a lot of women need help with, because sometimes it is still the case that they are being ‘’silenced’’ when in fact they can make a different all over the globe.

TEU: Who is your ideal role model who has encouraged gender equality in management positions and leadership roles?

CG: Maria das Graças Silva Foster; the CEO of Petrobras-Petroleo Brasil. She is the CEO of a company of what some may call a men industry, therefore I have a lot of respect for this woman and I believe that many girls and women are looking up to her. She is setting an example for us and showing that a lot can be done as long as you get an equal chance as others to do it and even if you are not getting a chance to grow, you should be able to motivate yourself to create opportunities to grow on your own.

TEU: What is significant in a role model encouraging gender equality in management positions and leadership roles, and can you spread this message viral, and take it through their networking media?

CG: The great significance would be that women are more promoted in connection to business and management. I find that media is an important role in this, because if the media would show more women,

who are on top in the business world, and which we have plenty of, more people would be aware of the fact that it is not something strange or rare. It happens that great companies have female CEO’s, and the media should provide young women about this information and make them aware of it, so they will not stop chasing their dreams just because they think others will think it is strange that these young females, want to be a manager someday.

A way to promote this would be using the social media because social media has so much power these days that a simple app would already attract millions of people.

With for example an app for young women to ask questions/guidance and get help/ motivation from a panel that is organised by the strong women who are already on top. Nothing will motivate you more than speaking to someone who walked down the same path and succeeded.

TEU

Editor’s Note Claudia Gonçalves graduated from Rotterdam University of Applied Sciences in the Netherlands with a Bachelor in Administration (International Business and Language Studies).

She is Interested in seeing the world, which led me to the course I am following. I can speak Dutch, English, Portuguese, Spanish and French now.

Women Leaders

Lagarde Cautions on Global Recovery

By Lorna Deip

In a recent interview Christine Lagarde talks about what women bring to the table in times of crisis, and why the world’s governments need to create a more vibrant global economy.

The battle was just beginning against a financial crisis that would bring the world economy to its knees, When Christine Lagarde arrived in Davos in 2008 as French finance minister. Six years later, as head of the International Monetary Fund, she warns the World Economic Forum at the Swiss mountain resort that the fight is not over.

She urges policy makers to remain alert for asset bubbles and prevent a looming threat to prosperity: deflation.

“In case there was a shock, which is something we have to consider and imagine -- not that it is in the cards yet -- then we have the risk of deflation,” Lagarde said during the January forum in Davos. “What the crisis has taught us is that we need to be extremely vigilant and expect bubbles from places that we don’t anticipate.” Lagarde’s concerns emenate from her experiences in dealing with the U.S. mortgage meltdown to banks including France’s BNP Paribas SA and an understanding of how easy money crosses borders. As officials from the European Union and the US exuded optimism in Davos last week, Lagarde cautioned that progress is unbalanced, with still worldwide “massive unemployment”.

After barely two months into the job, Lagarde called on European officials to urgently recapitalise their banks or face a liquidity crisis. “When you’re the head of the IMF, your role is to be the one who cries wolf,” Jacob Funk Kirkegaard, a senior fellow at the Peterson Institute for International Economics in Washington, said in an interview. As French finance minister, “in 08 |

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a forum like Davos in that role, she’s by and large a saleswoman,” he said. According to Kirkegaard, Lagarde is effective because she has a “rock-star media appeal” that helps amplify the IMF’s warnings on the global economy.

Her celebrity status was on display in Davos. The line to see her started forming forty five minutes before her session.

An executive vice president at Danish drugmaker Novo Nordisk A/S describes her as role model, saying, “she is pretty rare in the sense she has an operational, economic framework, but she puts her perspective in a historic, cultural context.”

Ms Lagarde maintains that while the crisis still lingers, optimism is in the air, maintaining that, “the big priority for policy makers in 2014 is to fortify the feeble global recovery and make it sustainable.” Among the new risks to advanced economies, the IMF’s forecast report cited “very low inflation,” particularly in the euro area, as becoming more significant and raising the prospect that longer-term inflation expectations could head lower.

In a recent Bloomberg Global Poll, the Euroarea inflation was at 0.8 percent in December and has been below the European Central Bank’s 2 percent ceiling for eleven months,

while international investors were the most upbeat about the global economy in almost five years, buoyed by the U.S.-led revival of industrial nations.

Olli Rehn, the European Union’s economic and monetary affairs commissioner, said last week that “green shoots are clearly visible” in Europe. In Davos, Lagarde was less upbeat and commenting on the low inflation, she said, could have “a consequence in terms of the cost of debt and the burden of debt” for both countries and companies.

According to a former IMF board official Domenico Lombardi, who is now the director of the global economy program at the Waterloo, Ontario-based Centre for International Governance Innovation, Lagarde is trying to “shape the IMF as an intellectual, caring organisation” and steer its narrative away from the specifics of the euro-area crisis. Inequality is one of the broad themes Lagarde is also emphasising.

The income gap between rich and poor “has widened in all corners,” she said. “The more unequal the society is and the more variance there is between the haves and the have-nots, the less sustainable growth will be.”

TEU

Sources: Bloomberg; Time Magazine; The Economist; ABC News; HBR

All rights reserved | Copyrighted

Editor’s Note Christine Lagarde has held top jobs in government, in the private sector, and now at a big global institution, the International Monetary Fund, where she became managing director in 2011. It was a doubly challenging time to take the helm: Lagarde’s predecessor, Dominique Strauss-Kahn, was embroiled in scandal, and the global economy remained in dire straits. The former labour lawyer and first woman to lead the institution has been contending with a fiscal crisis across Europe and helped oversee emergency loans to Greece, Portugal, Ireland and Cyprus.

Responsible, Responsive, Reputable.

Lotteries and Gaming Authority www.lga.org.mt Suite 1, Level 3, TG Complex, Brewery Street, Mriehel, Birkirkara BKR 3000, Malta Tel: (+356) 2131 6590 • Fax: (+356) 2144 6950 E-mail: info@lga.org.mt

Women Leaders

European Securitisation Market

By Alexia Farrugia

Securitisation is one of the financial innovations that has recently been receiving much attention in international financial markets. This financial instrument pools together different assets such as residential or commercial mortgages, credit card loans, auto loans or consumer loans in a separate structure, usually a Special Purpose Vehicle, which then sells different tranches of bonds to investors, who use these bonds for long term investment, trading or as collateral. The tranches generally have varying credit ratings and risk/return profiles.

Europe’s economy is highly dependent on banks. Following the financial crisis, most European banks are facing capital constraints and difficulties in raising funding. Securitisation is an important source of bank funding and a direct means of tapping capital markets. It provides money from sources or investors that are an alternative to those traditionally used by banks, and allows banks to increase their lending. An increase in bank lending is widely believed to have a positive impact on GDP. Securitisation is an important source of bank funding and a direct means of tapping capital markets

For investors in these bonds, securitisation can be an asset which gives higher returns, and despite its negative perception in the past, some types of securitised bonds are reasonably secure assets. This is evidenced by the solid performance of European securitised bonds throughout the financial crisis. For example, only 0.07% of Residential Mortgage Backed Securities (RMBS) defaulted between 2007 and 2012. This also shows that the underlying loans in European securitisations were being issued more prudently than those in the US. 10 |

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My research into the future of the European securitisation market found that despite the regulatory and economic changes that this market is currently facing, securitisation may yet come to play an important role in any future European economy, as Europe’s bank dependant financial markets, gradually give way to financial markets with larger capital market involvement.

The study, concluded in August 2013, found securitisation to be supply driven and the market will likely be revived especially should the credit spreads and regulatory uncertainty prevailing at the time change favourably. Field surveys confirmed plans to securitise assets in the future, and interviewees that have recently securitised assets and placed them in the market, did so successfully even in rather difficult market conditions. One of these issuers was a Malta based bank.

From a demand perspective, major incentives for investment in securitisation were portfolio diversification and credit strength. This was being hampered by the perceived risk and uncertainty that was possibly being caused by the expected changes in regulation.

Although issuance levels are still below their highs in 2008, renewed interest

Women Leaders

in this asset can be seen from several segments of the financial markets.

Issuance of paper-backed non-residential mortgages is reported by The Economist, to have gone up from $4 billion in 2009 to more than $100 billion in 2013.

The European Commission and the European Central Bank support wellfunctioning securitisation markets because they have the ability to transform illiquid assets into liquid ones and because it can shift risk outside the banking system, thus completing the financing cycle of the economy. Securitisation may be important in increasing lending to small and medium enterprises (SMEs), since by securitising SME loans, banks can obtain the necessary funding to generate more loans. The EC is arguing that this could pull Europe out of recession. This argument assums particular importance when considering that over 90% of Europe’s businesses are SMEs. In fact, the EU offers various incentives to banks that securitise SME loans through the Competitiveness and Innovation Programme.

Securitisation may be important in increasing lending to small and medium enterprises (SMEs), since by securitising SME loans, banks can obtain the necessary funding to generate more loans

There are other emerging trends in this market that may contribute to the growth of securitisation. Investors are eagerly looking for opportunities with good returns. Since banks are constrained by capital and regulation, a number of fund managers have found a rewarding opportunity in filling the void in financing. These funds have been replacing banks in originating loans and giving their investors access to the credit market, which currently has a more attractive risk/return profile than other asset classes. Loan origination investment funds assume the responsibilities of credit assessment, loan selection, loan pricing and documentation, monitoring and servicing.

In some countries however, lending is not allowed by entities other than credit institutions. It seems that recently, a number of fund promoters have approached regulators in various

European countries to relax these rules.

In Malta, the traditional banks’ situation is somewhat different to that of the banks in the rest of Europe. For a number of reasons, most Maltese banks have not been facing the same funding difficulties as their European counterparts and they have not felt the need to securitise their assets. The uncertainty in future regulation being brought about by Basel III in the banking sector will certainly reduce banks’ appetite to invest in such assets. However investment in high quality RMBS may be a good way for banks to diversify their loan portfolios, particularly since this is renowned to be heavily dependent on local property.

Malta’s securitisation law has also reportedly been used in other non bank centred deals. The beauty of this instrument is that any asset that has a stream of cash flows can be securitised, and companies of a certain size can access the financial markets for funding in an innovative way.

Securitisation as an instrument is likely to function better in the future than it has in the past, in part thanks to having been severely tested during the financial crisis.

This is certainly the time for both issuers and investors to take a good second look at this instrument, and see how it can be used to their advantage.

TEU

All rights reserved | Copyrighted

Editor’s Note After having worked in different areas of the financial services sector, Alexia Farrugia has recently completed an MSc in Finance at Trinity College, Dublin, where she specialised in risk management and researched the future of the European securitisation market. This research was partially funded by the Strategic Educational Pathways Scholarship (Malta) which is partfinanced by the European Union – European Social Fund (ESF) under Operational Programme II – Cohesion Policy 2007-2013.

January 2014 | THE ECONOMIC UPDATE

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WE carE Help and Care Services when you need them the most

Middlesea Health insurance Policy We understand that your health and that of your family is priceless to you. Therefore, we are offering you more value with the introduction of 3 new benefits to our HEaltH insurancE. Get in touch with us today to find out how you can get MOrE from Health Insurance.

if it matters to you, it matters to us. contact us on 21246262, visit www.middlesea.com or contact any of our authorised intermediaries.

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Middlesea Insurance p.l.c. (C-5553) is authorised by the Malta Financial Services Authority to carry on both Long Term and General Business under the Insurance Business Act, 1998.

We care

Higher Education

Are you the next Nelson Mandela?

By Mark Galea

Bill Clinton, Winston Churchill, Eva Perón, Lady Di, Nelson Mandela, Dr. Martin Luther King. Six ordinary people with a great gift -- when they spoke, millions listened in awe... when they walked, millions followed devoutly. Six people, one great gift - Charisma.

Many will insist that a great leader must possess charisma.

The truth is that without Charisma, there exists no such thing as a great leader, and no such thing as leadership. As a leader, charisma is the one quality which you cannot afford to be missing, and which you can never have enough of.

All great leaders have invested time and energy into cultivating this quality. But one person has taken that knowledge and crystallized it into a unique way of teaching.

Her name is Nikki J Owen. As a speaker, Nikki’s controversial and inspirational style earned her the award for Rising Star 2012 from The Academy for Chief Executives. She is the winner of London’s Professional Speaking Association’s Speaker Factor 2012.

Nikki J Owen will be delivering a session on Charisma on Friday 31 January 2014. She will be sharing with you her unique blueprint for acquiring and enhancing your charisma. Using tried and tested tools and techniques at the frontiers of leadership development, Nikki will reach into your very core and implant inside you all the tools and knowledge you will ever need to become the next great charismatic leader.

By the end of the session you will have the power to: •

Dramatically augment your own charisma for maximum impact and influence

•

Energize your employees for optimized performance and productivity

•

Destroy barriers to high performance, engagement and growth

•

Reframe deep seated negative barriers or beliefs

•

Better appreciate the link between engagement and financial success

•

Understand the true cost of disengagement

•

Simply put, Nikki J Owen will empower you to be the best you can ever be.

Endorsement “Nikki is a powerhouse of energy who engages her audience and allows people to step well out of their comfort zones with ease. She opens even the most cynical minds to new and exciting possibilities.”

TEU

- Stewart Stone, Managing Director, Enhancing Potential If you’d like to know more about Nikki J Owen’s session on Friday 31 January, please

Editor’s Note Nikki the UK’s Leading Expert in Charisma, the Founder of The Charisma Model Programme and the creator of The Big Apple Experiment. In 2012, Nikki launched The Charisma Model Programme for businesses wanting to improve engagement, productivity, energy and confidence with employees by developing the charismatic potential of leadership teams, talent and high potentials. Her autobiography was published in 16 Countries between 1992 1997. Using her unique STAR process that guarantees personal transformation, Nikki works internationally coaching and mentoring hundreds of CEOs, Leaders and Board Directors from FTSE 100 organisations and SMEs. As the demand for her services grew, Nikki began training and accrediting a small team of individuals to use her methods - Charisma Coaches. Nikki is an official political commentator for Aljazeera and The Sunday Tribune and is Positivity Advisor to The Expotel Group. In 2012 Nikki became an Executive Faculty at Henley Business School where she teaches her Charisma Model to International Business Leaders. As a speaker, Nikki’s controversial and inspirational style earned her the award for Rising Star 2012 from The Academy for Chief Executives. She is the winner of London’s Professional Speaking Association’s Speaker Factor 2012.

contact Mark on 9999 0312.

January 2014 | THE ECONOMIC UPDATE

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Performance Leadership

Performance

Leadership

By Ing. David J. Dingli M.Phil.(Maastricht); MBA(Brunel); B.Elec.Eng.(Hons.)

Introduction

Reflection for Leaders

When Microsoft announced that Steve Ballmer would no longer remain CEO of this iconic company, the media lashed out with its criticism of his management and leadership style and capability. They informed us that the company “lacks the leadership needed to steer it into the mobile era”, that the company “lacked the vision to capitalise on consumer enthusiasm for lightweight touchscreen devices”, that “Microsoft chief will leave a mixed record of success” and that “shareholders have objected to Mr. Ballmer’s performance for years”.

Considering the difference in size and global scale of an average Maltese owned company, one would therefore expect that it should be a simple task running a local firm and that leaders should be excelling at their job. However, the real question is “Is your leadership style achieving the desired performance objectives?” In order to be achieving the desired results employees need to be fully engaged by their work and leaders should be capable of enhancing employee productivity in order to optimize organizational performance. Organizations with effective leadership have more than twice the number of engaged employees than those without effective leadership. Organizations with leaders who help ensure, for example, that employee opinions count or that employees understand what is expected of them have a higher number of engaged employees than organizations without such leaders.It is interesting to note that although most leaders feel they are doing a good job, research shows that most employees rate their senior leaders as rather ineffective.

All this harsh criticism towards a man running a company whose net worth is approximately $69.96 billion and ever since its first acquisition in 1987, it has purchased an average of six companies a year. The company purchased more than ten companies a year between 2005 and 2008, and it acquired 18 firms in 2006. It also made six acquisitions worth over one billion dollars: Skype (2011), aQuantive (2007), Fast Search & Transfer (2008), Navision (2002), Visio Corporation (2000), and Yammer (2012).

What is Performance Leadership The notion of Performance Leadership emerges as a critical benchmark for corporate performance. This is a systematic, results oriented approach to management and leadership for high performing organisations, teams and individuals. The approach consolidates the fundamentals of management and leadership within the organisation, and then builds on clients’ existing abilities by increasing the rigour, range and effectiveness of their capabilities. This is achieved through the introduction of best-practice processes, tools and techniques together with the development of skills and competencies, brought together within an integrated system.

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In order to qualify as an effective leader, one must have the ability to consistently move him/herself and others to action and the starting point would be to articulate a clear and compelling vision in order to provide meaning, focus and clarity of purpose for employees.

What makes an effective leader It is interesting to observe leadership from the bottom up and ask: “What is it that employees look for in their leaders?” The expectations are very realistic as employees want their leaders to be honest, forward looking, competent in what they do, inspiring, not out to seek fame and glory, people who accept criticism and to really act and behave as though they are part of the team.

Performance Leadership

Some of the key attributes of effective leaders are demonstrated through their capability to: (1) Create an idealized influence over their employees.This is demonstrated by the ability of leaders to display conviction, emphasize trust, take stands on controversial issues, present their most important values, and emphasize the importance of purpose, commitment, and ethical consequences of decisions.

The application of idealized influence essentially amounts to being a role model and exhibiting behaviours that subordinates admire and appreciate.

(2) Inspire motivation for action. When properly executed, visionary leadership can be a powerful tool for focusing and energizing staff. Another important aspect of this element is setting high expectations for the department. Enthusiasm and encouragement are then used by the leader to pull the team toward the vision and achievement of expected results.

(3) Stimulate individuals intellectually by creating innovative challenges. The leader should develop the ability to “question old assumptions, traditions, and beliefs; to stimulate new perspectives and ways of doing things in others; and to encourage expression of new ideas and reasoning.

(4) And always giving personal attention to each member of staff.

The leader must become a coach and mentor of workers, treating them as individuals and having ongoing personalized interactions with them. It involves finding ways for followers to identify growth goals and providing opportunities for them to achieve them.

Effective leaders place emphasis on four pillars of their business set-up.

(1) The organization – the structure that enables value to be created. The company should be structured in a way that it is capable of developing core business intelligence in order to underpin the quality of all decision-making in order to achieve high performance.

(2) The processes that link all the activities using available resources to create value. The focus should be on the development of appropriate processes and associated tools and techniques that will be fundamental to achieve high performance.

(3) The people that work for the organization as they are the only source of innovation which can be directed to create value. The development of core competences, attitudes and behaviours that will be fundamental to leading, managing and performing in order to achieve high performance.

(4) The stakeholders – ultimately all that is being done within the organization should aim towards creating value for them.

Exemplary Leadership Some exemplary leaders from whom we could all learn a thing or two are people like: Former Southwest CEO James Parker; Following the September 11, 2001, terrorist attacks he made an announcement only three days later announcing that they would be keeping all of their employees and starting a $179.8 million profit sharing payment to employees.

January 2014 | THE ECONOMIC UPDATE

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Performance Leadership

When US Toyota announced that they would have to recall 2.3 million vehicles for faulty brakes outrage ran rampant across the media and public. Complaints were filed and lawsuits were made. Instead of letting a PR team handle the issue with only press statements and interviews, Toyota turned quickly and offered a live conversation on one of the most popular communities on the web: Digg. CEO Jim Lentz answered as many questions as possible in the given time. It was a totally transparent interview.

Costco’s former CEO Jim Sinegal better known as a man of the people at Costco. His name tag plainly says “Jim,” he answers his own phone.

His employee turnover rate was the lowest in the retail industry, over five times less than rival Wal-Mart.

In 1997 when three Starbucks employees were killed in a robbery of one of their Washington D.C. stores instead of issuing a press release or calling legal counsel, CEO Howard Schultz flew straight to D.C. and spent the entire week with the employees and their families in the area. Schultz’s compassion and incredible leadership helped heal those closest to the tragedy.

Leadership for results Performance Leadership relates to the way leaders and business owners manage and lead their organisations for success. The key is to focus every effort in everything being done on what customers value most. This is the challenge for every engaged employee; to get things done better, faster and more cost effectively, thus creating value for all stakeholders. Leaders must clarify strategic priorities, build a shared sense of vision and purpose throughout the organization, develop commitment, motivation and establish effective collaboration between all players in the value chain.

The stated strategic priorities must then be translated into ongoing operational objectives and tasks, through the building of operational programmes and capabilities that drive performance management to know that accountabilities are being effectively delivered.

The systematic exploitation of cost drivers, time and quality improvements that are all necessary to build new capabilities and continually improve what is being done must follow a continuous improvement cycle, constantly setting the bar higher with each iteration of the cycle.

Leaders must develop their people using high performance techniques to help them achieve their full potential. Leaders must build on existing skills, attitudes and behaviours, through investments in training and skill development. Leaders must constantly reinforce the vision to ensure that employees are focused efforts on the most important priorities to deliver valuable results and outcomes.

Leaders cannot ignore the evolving cultural traits that take root within their organisation. They must lead the cultural development by setting clearly stated values and develop the appropriate ritual, norms and beliefs that drive performance towards the desired goals.

Leadership Performance assessment Performance must also be assessed. Leaders should want to know where they are, what results have been achieved, where the problems lie and they must do this in a pro-active way by using a set of both lagging and leading indicators, such as the Balanced Scorecard tool.

Benchmarking against best practices and the competition, to establish 26 |

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industry performance gap, and to challenge norms and set new targets are all trademarks of high performance leaders. Undoubtedly, the organization must be structured in a way that data is collected in a timely manner, processed and interpreted at the right time for executive actions to take the necessary effect.

Leaders that drive innovation throughout the organization are ensuring long-term sustainability of the company. Innovation requires a strategy and must be led by the top, so it serves as an excellent bridge to narrow the performance gap in the long-term and raises the bar to achieve performance leadership.

The benefits that Performance Leadership brings are both deep and wide, whether implemented at organisational, team or individual level.

Leaders who are more capable of creating the conditions for success by aligning the organisation to a compelling picture of the future, clarifying the priorities, providing resources and motivation and leading by example will be the ones who the media will praise and follow.

Conclusion In summary then, everyone throughout the organisation and beyond it (stakeholders) benefits from increased business performance.

Being a leader and /or an owner of an organisation is no easy task.

If leading a public organisation, the Board of Directors together with the media and analysts will determine how long your tenure will be, however, when you own your own private business, where you are the sole (effective) shareholder and director, who is there to judge your performance? How are you going to determine if you have the right qualities to not only own but also lead your own organisation? How will you know if it’s time to employ professional management?

These are tremendous challenges for all business owners who are often too proud to take a step back and have their management style and business results professionally audited in order to determine if minor adjustments need to be made or if after all you are the biggest problem to your own organisation.

TEU

All rights reserved | Copyrighted

Editor’s Note David is the Managing Consultant of Resource Productivity Consulting Services, (R.P.C.S.), Formed in the year 2000, his consulting practice specialises in strategic development and operations management, while the corporate training arm focuses on management development programs on a broad range of topics. He has consulted & provided training in private manufacturing & service organizations as well as Government bodies. He is also an Assistant Professor with Maastricht School of Management (MsM).The Netherlands and lectures at MBA level in: Operations Management, Global Supply Chain Management, Strategic Management, Entrepreneurship, & Innovation. His international experience over the last 13 years reaches out to 27 countries, in Europe, Africa, Asia and South America. Throughout his career he has delivered lectures and corporate training to over 5000 managers from more than 50 nationalities.

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Motoring News

New Showroom for Citroën Malta Following the appointment as official importers of Citroën in Malta, on Thursday 28th November Michael Attard Imports Ltd inaugurated their new showroom, displaying a full range of Citroën cars.

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The occasion started off with a speech by Mr. Michael Attard, managing director of the Company, followed by the blessing of the premises.

The showroom was then officially opened by His Excellency Dr. George Abela, President of Malta.

One of the highlights of the event was a 1939 Citroën Traction Avant Cabriolet displayed at the entrance of the showroom, together with a complete line up of C-line vehicles, including the newly arrived C4 Picasso.

A dedicated platform was also set up to host the prestigious DS range.

The New Citroën showroom is situated at Mdina Road, Attard.

TEU

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1 – Citroën Traction Avant Cabriolet 1939 2 - A dedicated platform set up to host the prestigious DS range.

3 –Mr. Pedro Regalado Munoz Calero (L) from PSA being introduced by Mr. Michael Attard to His Excellency Dr. George Abela 4 - President Dr. George Abela admiring the leather in the Citroën DS4 5 - Official opening by His Excellency Dr. George Abela, President of Malta (Left), Mr. John Attard (Second Left), Mrs. Lucienne Attard (Second Right), Mr. Michael Attard (Far Right)

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focused on your sensations

Combined consumption (l/100 km): from 3.6 to 5.8. CO2 emissions (g/km): from 93 to 134.

The new Peugeot 308 is a compact hatchback with a pure and a charismatic design.

It offers a new driving experience, intuitive and intense, with its Peugeot i-Cockpit: a compact steering wheel, head-up instruments, a large touchscreen and the high centre console.

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16/01/2014 17:39

Libya Conference

FIMBank Chairman

to chair international Libya conference FIMBank Group Chairman Dr John C. Grech has been invited to chair the Libya Trade & Infrastructure Finance Conference that will take place in Istanbul, Turkey on the 6th February 2014. The conference is organized by the UK based event and publishing house Exporta and will present a cutting edge assessment of the rewards and risks posed by this newly liberalised economy.

It will also highlight the overhaul of Libya’s public institutions and private sector and discuss the extensive opportunities offered by this key North African market’s potential as a hub for regional trade.

Commenting on the significance of this prestigious event, Dr Grech stated that “Libya’s successful transition and sustainable development hinges on the evolving security situation and the new government’s economic strategy.

This conference will focus on these key developments, and the progress being achieved. It will also provide a unique insight by policy makers as well as senior Libyan public and private sector business leaders”.

With regard to FIMBank’s activity in this country, Dr Grech confirmed that “FIMBank has an excellent reputation as well as an established record in supporting business in Libya. By means of the important exposure we will be getting at this international conference, we intend to send the message that we plan to continue fulfilling our role as a facilitator between emerging and developed markets. FIMBank remains committed to increasing access to trade finance products in order to support development in the region.”

Dr John C. Grech, FIMBank Group Chairman 30 |

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For further information about the Libya Trade & Infrastructure Finance Conference please visit www.exportagroup.com. For further information about the FIMBank Group please visit www.fimbank.com TEU

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TAx

Regional State Aid: Reduction of maximum aid intensities for regional state aid

By Sharon May Scicluna

Tax incentives are available to companies engaged in any of the following activities: Manufacturing, Information Technology, Research and Development, Hospitality, Freeport activities, Operation of Call Centres, Biotechnology, Filming, Provision of Tertiary Education or Healthcare, logistics operations, activities in relation to eco-innovation, waste treatment and environmental solutions or providers of knowledge intensive business services.

Companies in these industries may already be benefitting from investment aid in terms of the Malta Enterprise Act. Investment tax credits are available to such companies and are computed as a percentage of qualifying capital expenditure or wage costs in respect of job creation. The tax credits are deductible against the tax payable by the enterprise on income that is directly derived from the said activities. Any unutilised tax credit in a given year will be increased by a specified reference rate and carried forward to be deducted from the tax payable of future years.

Reduction of maximum aid intensities If your enterprise is already benefitting from investment aid, it is very important to note that the Guidelines on regional aid for 2014-2020 were recently adopted by the European Commission.

These Guidelines define the parameters within which Member States can grant aid in order to promote the economic development of certain disadvantaged regions in Europe. In particular, they indicate how much aid is permissible (the aid intensity) and the geographical areas where aid is permitted, known as the designated Assisted Areas.

The Guidelines have brought about significant changes to the conditions regulating regional aid in Malta, particularly regarding the aid intensities available both to large and small and mediumsized enterprises (SMEs).

Expected key changes for 2014-2020 Up until 31 December 2013, on the basis of its per capita GDP, Malta was entitled to the maximum aid intensities as sanctioned by the EU. These aid intensities (and hence the percentage of investment tax credits to which an entity may be eligible in terms of Maltese legislation) vary according to the size of the 32 |

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enterprise. Up until 31 December 2013 in terms of the EU Commission Guidelines on regional state aid for 2007-2013, the aid intensities were as follows: small enterprise – 50%; mediumsized enterprise – 40%; large enterprise – 30%.

In terms of the Guidelines for 2014-2020, it is expected that the aid intensities available from 1 January 2014 will decrease with effect from 1 July 2014 as follows:

Pre-approval of Investment projects If your enterprise is engaged in qualifying activities and plans to carry out an investment project, commencing before 31 December 2014 and which should be completed by 31 December 2015, that either has a budgeted tangible asset cost in excess of EUR1 million or that results in the creation of at least 20 new jobs, then you should apply for a pre-approval of such investment project with Malta Enterprise. The pre-approval application together with any supporting documentation must be submitted to Malta Enterprise by 31 January 2014. In this way, eligible enterprises may be entitled to receive investment aid at the current rates rather than the new less beneficial rates that will apply as from 1 July 2014.

TEU

Editor’s Note Sharon May Scicluna is a Senior Manager at KPMG Malta. She has been involved in advising and providing assistance to clients on various taxation matters including financing structures, group restructuring and incentives available to the manufacturing industry. Sharon is also engaged in providing advice and assistance on tax matters to personal tax clients

Fund Management

Corporate interview of the month

A Dynamic Approach

to Asset Exposure

By Martin Vella

Valletta Fund Management Limited is one of Malta’s most experienced asset managers, whose specialist capabilities include portfolios managed by Insight Investment. Our Editor sits down with Steve Waddington, Portfolio Manager, to discuss diversified growth funds, such as Insight’s Broad Opportunities Fund. Steve believes that an increasing number of investors are moving away from pure equity allocations and seeking more diversified exposure to growth assets. Indeed, Steve believes that this trend is starting to represent a structural shift in investor behaviour. Having gained strong traction in the UK, Steve believes that diversified growth funds are likely to prove increasingly popular with investors across Europe.

TEU: There is a vast range of international investments - collective investment schemes have become more popular within investor portfolios because of the element of diversification they offer. What are the other attributes of multi-asset funds and what benefits can they offer?

generate positive returns (these strategies are known as non-directional). In my view, it is these two factors in combination that our investors find particularly attractive.

SW: The starting point for any formal multiasset strategy is to try to deliver access to a wide range of investment opportunities within a single fund solution. Multi-asset funds by their nature are designed to invest across diverse regions of the world, across diverse asset classes and to deploy diverse underlying strategies. Some multi-asset strategies, like our Broad Opportunities Fund for example, benefit in particular from their dynamic approach towards asset allocation.

This can ensure that the underlying portfolio is constructed to reflect what is happening around the world and how differing economic scenarios are impacting on differing asset classes. This kind of approach can ensure that the resulting portfolio can provide clients with a one-stop solution for their investment goals.

TEU: Investors may be interested to learn more about total return funds. Can you explain the concept of this type of fund please?

TEU: What is your competitive advantage in terms of your ability to offer a one- stop solution?

SW: The feedback we get from clients suggests that our competitive strengths stem from our focus on the dynamic management of our asset exposure. Our highly active approach ensures that we can genuinely reflect the way we see the world when constructing our portfolio. This translates into both a dynamic approach towards our allocation to traditional asset classes and also scope to widen our investment universe by taking on exposure to strategies that depend less on the absolute direction of markets to 34 |

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Our highly active approach ensures that we can genuinely reflect the way we see the world when constructing our portfolio

SW: This really goes back to the heart of investing. What are the investor’s needs?

Total return funds seek to provide solutions to clients’ specific return requirements, rather than being focused on abstract benchmark indices. Total return funds are focused much more on client goals and are designed to offer solutions capable of meeting these goals.

TEU: How does a fund using total return strategies differ from a traditional fund?

And what strategies do absolute return funds deploy to monitor and control downside risk?

SW: Traditional diversified funds may have a relatively static asset split, with, for example, a 60% allocation to equities and a 40% allocation to bonds. This is based on the premise that such an allocation will deliver relatively smooth returns over time.

However, if the broad investment backdrop is such that the underlying investments are unlikely to deliver attractive returns, then this kind of static approach may disappoint.

Our approach turns static asset allocation on its head. We look at what is happening in underlying economies around the world and we try to understand the likely implications

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Fund Management

Corporate interview of the month

of each of these economic scenarios on different types of assets. We then reflect these views in our portfolio. We start with a blank sheet of paper and we can hold zero weightings in asset classes that we think are unlikely to deliver positive returns. In essence, our approach is to identify all the risks and all the opportunities that we see right across global financial markets and to ensure that we construct a portfolio that fully reflects these views.

TEU: Okay, we will talk about risks and opportunities later on. Why should investors consider funds that deploy diverse return strategies within their investment portfolios?

SW: Our investors entrust us to manage money on their behalf and what they tell us is that they are seeking access to a whole range of diverse investment opportunities within a single portfolio. This is why our fund is called the Broad Opportunities Fund. In particular, our investors are looking for exposure to growth assets, but without experiencing the kind of rollercoaster ride that can be inherent in equity-only strategies.

Our approach enables us to make directional investments, i.e. investments that provide exposure to market movements, and also to widen our investment universe by gaining exposure to relative return opportunities.

These can represent attractive return engines in environments in which markets are trending sideways and/or moving lower.

And, as I mentioned earlier, if we do not see positive opportunities within specific asset classes, then we do not need to hold these asset classes within our portfolio. For example, we have been able to take our equity exposure to zero during periods when equity returns have been highly negative.

TEU: For the past two years, one popular total return strategy used by many hedge funds has been dividend futures. Can you explain this strategy to our readers and explain why dividend futures have been widely used by hedge fund managers and how can they can enhance overall returns?

SW: Dividend futures look at likely returns from companies and/or equity markets in the form of forthcoming dividend payments.

It can be argued that dividend payments can represent the most stable source of returns from equity investments. Taking a position in dividend futures can, therefore, enable us as 36 |

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equity investors to express our equity market views without focusing solely on more volatile price/earnings multiples. The overall dividend futures strategy that we deploy is highly liquid.

We start with a blank sheet of paper and we can hold zero weightings in asset classes that we think are unlikely to deliver positive returns

TEU: Can you elaborate on the case for diversified growth funds and the benefits to investors of a total return fund please?

SW: Diversified growth funds seek to deliver a genuinely smoother return profile. Our strategy aims at a target return of cash plus 4% over a three- to five-year horizon. We are seeking to deliver returns on a par with what investors might expect from a long-term investment in equities. Looking back over 100 years or so, that level of return has typically been cash plus 4% per annum. However, investors typically are unwilling to embark on the kind of rollercoaster ride associated with equity investing. A diversified growth strategy can deliver comparable return generation, with only 40% of the volatility associated with an equity market investment.

So diversified growth strategies provide investors with opportunities to generate the attractive return levels and the exposure to growth assets they seek, but with a much smoother return profile.

TEU: What is the investment process and the risk management approach deployed within the Broad Opportunities Fund?

SW: Our starting point is a global macroeconomic approach. First, we look at the key drivers behind our investment views and consider how we would like to be positioned. We don’t stop there as we also need to look at relative valuations. We need to consider which assets are looking attractively valued versus those that seem relatively expensive since the former are more likely to deliver compelling returns. And we need to understand the triggers that may unlock the true value of any asset. We look at how other investors are positioned around the world as we need to be aware which assets are widely owned, where there is scope for sell-offs to occur and for price trends to reverse. This enables us to integrate our top-down asset allocation views with prevailing valuation trends so that we can identify the most attractive return generation opportunities for our portfolio.

Then we move on to how to construct our portfolio most effectively. We take an architectural approach. We may conclude that the most efficient way to implement our views might be, for example, to hold a direct security or via derivatives or using a pooled vehicle. In our view, this approach ensures that our views can be implemented at the portfolio level in the most cost-effective, liquid and transparent manner. At Insight Investment, we have more than £270 billion in assets under management and we enjoy clear strengths in risk management. Our commitment to risk management means that we look at risk from an overall portfolio perspective and also in terms of our asset class exposure and, indeed, our individual investment exposure.

TEU: Insight has been named UK Pensions’ Investment Manager of the Year 2013. To what do you attribute this success?

SW: We are clearly focused on our clients’ goals. What outcomes are they seeking?

And what solutions can we provide to help them meet those goals? We believe that our business will continue to grow if we retain this focus on meeting our clients’ objectives.

TEU

All rights reserved | Copyrighted

Editor’s Note Steve Waddington is a Portfolio Manager at Insight Investment M a n a g e m e n t (Global) Limited. Mr. Waddington serves as a Portfolio Manager of Valletta Fund Management Limited and also as a Fund Manager at Insight Investment Management Limited.

Mr. Waddington also assists in the identification and performance assessment of potential investment managers and funds for Insight’s multi-manager offering. He is a highly experienced Investment Professional specialising in traditional and alternative multi-asset strategies for institutional and private investors. He joined Insight’s Multi Asset Group in January 2008 as Director of Investment Selection. Before joining Insight, he spent five years at BT Financial Group, Australia (formerly, Rothschild Australia Asset Management), where he served as Head of External Investments since 2004, responsible for investment and manager research, due diligence, selection and portfolio construction.

Stephen started his career at Savills Commercial Ltd, where he was responsible for advising institutional and private company clients on investment and development. He is a Professional Member of the Royal Institution of Chartered Surveyors and holds an M.B.A. from the Australian Graduate School of Management, University of New South Wales and a B.Sc. (Hons) in Valuation and Estate Management from the University of the West of England, Bristol.

HOT NEWS

ERC at the 2014 Davos meeting: Belgian Prime Minister Di Rupo praises the European Research Council The European Research Council (ERC) is attending the World Economic Forum (WEF) in Davos, Switzerland, which started on 22 January, 2104, to bring science into the debate with political and business leaders from around the world. At this year’s meeting, the ERC - Europe’s first funding body for excellent frontier research - is represented by Sir Tim Hunt, Nobel Laureate and ERC Scientific Council member, and Prof. Helga Nowotny, ERC President until the end of 2013, as well as two leading scientists. Also attending, Belgian Prime Minister Elio Di Rupo today applauded the ERC for its landmark role in science and innovation in Europe. Under this year’s Davos theme, “The Reshaping of the World: Consequences for Society, Politics and Business”, the ERC takes part in six sessions.

In a joint press conference today at the world-renowned Alpine meeting, Prime Minister Elio Di Rupo declared that “Some European Member States have reduced their research funding, under the pretext of austerity. Clearly, that is a mistake. Belgium continues to invest in fundamental research and research excellence.” He also stressed the importance of the ERC, which “plays a major role in guaranteeing that Europe’s research will be competitive and of great quality.”

Sir Tim Hunt also shared his views: “Davos is a unique platform that offers a rare opportunity for the ERC to emphasise the importance

of curiosity-driven research to an unusually important audience.

The one message I’d like to pass on here is the crucial importance of letting scientific creativity and curiosity loose; giving researchers the freedom to explore new avenues and follow their noses beyond conventional wisdom. That’s how real discoveries are made that enrich our understanding of the world, helping both society and the economy. That’s why I see the European Research Council as central for European growth and development.”

The ERC delegation in Davos also includes two outstanding scientists - ERC Advanced Grant winner Prof. Wolfgang Lutz, Founding Director of the Wittgenstein Centre for Demography and Global Human Capital, and Nobel Laureate for Physiology or Medicine (2009) Prof. Dr Elizabeth Blackburn, Morris Herzstein Professor in Biology & Physiology, at the University of California in San Francisco.

Sir Tim Hunt and Prof. Helga Nowotny represent the ERC’s newly appointed President, Prof. Jean-Pierre Bourguignon, who is unable to travel this week due to a fractured arm.

ERC programme at Davos 2014 The ERC takes part in seven sessions and one press conference in this annual meeting.

TEU

OUT EVERY QUATER 2014 CALENDAR DATES: FEBUARY/ MAY/ JULY/ OCTOBER For magazine advertising and booking enquiries please contact: margaret@networkpublications.com.mt or call on (+356) 9940 6743

January 2014 | THE ECONOMIC UPDATE

| 37

HSBC Market Growth Index end 2013

HSBC Market Growth Index end 2013 Emerging market growth checked at year end

Key Points · ·

HSBC Emerging Markets Index: 51.6 (prior 52.1) Manufacturing continues to outpace services

The HSBC Emerging Markets Index (EMI), a monthly indicator derived from the PMI™ surveys, signalled overall growth of output across global emerging markets in December. But the EMI fell to 51.6, from 52.1 in November, signalling a weaker rate of expansion.

Manufacturing output continued to rise at a faster pace than services activity, and the rate of growth was only fractionally weaker than November’s eight-month high. Meanwhile, service sector output rose at the slowest rate in three months.

Goods output growth was broad-based across the economies covered at the end of 2013, with the strongest expansions indicated in Taiwan, the Czech Republic and Turkey. Chinese manufacturing output growth eased from November’s eight-month high.

New business inflows in global emerging markets rose for the fifth month running, albeit at the weakest rate since September.

Backlogs continued to expand marginally, in line with the broad trend shown throughout the fourth quarter.

Inflationary pressures in emerging markets remained muted in the final month of 2013, with average input prices rising at the slowest pace since July. This led to the weakest increase in output prices in the current five-month sequence of inflation.

Business Expectations The HSBC Emerging Markets Future Output Index is a new series tracking firms’ expectations for activity in 12 months’ time.

The index fell to a six-month low in December, reflecting weaker sentiment in both manufacturing and services. That said, the index’s average in Q4 was higher than those in the previous two quarters.

Among the largest emerging markets, Brazil continued to post the strongest sentiment regarding anticipated output growth in 2014, but the extent of optimism continued to ease sharply from October’s peak. Russian firms remained less optimistic, on average, than their counterparts in China and India.

Manufacturing Chinese manufacturers signalled a further expansion of output in December, though the rate of growth eased. New orders also rose at a fractionally slower pace, with foreign sales posting a slight decline for the first time in four months.

month, as both output and new orders increased. Consequently, firms raised their workforce numbers further.

Taiwanese manufacturers reported the sharpest expansion of output in 32 months in December. Total new orders and new export orders also increased at sharper rates. Meanwhile, South Korean production expanded for the third successive month, and the pace of output growth accelerated to a seven-month high.

December data indicated improving manufacturing operating conditions in Indonesia, underpinned by renewed growth of output and a further expansion of new orders. Export demand stabilised, after contracting in each of the previous six months.

Similarly, conditions in Vietnamese manufacturing improved as output and employment increased at sharper rates, while purchasing activity rose at the fastest pace in the series history.

The Indian manufacturing sector ended 2013 on an encouraging footing. Operating conditions improved for the second successive

Brazil’s manufacturing economy expanded in December, with stronger production growth and renewed gains in new work.

The HSBC Emerging Markets Index (EMI) is a weighted composite indicator derived from Purchasing Managers’ Index™ (PMI™) surveys Stephen King, Chief Global Economist, HSBC; Chris Williamson, Chief Economist, HSBC

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Diplomatic Relations

Promoting Peace and Integration INTERVIEW WITH H.E NGUYEN HOANG LONG AMBASSADOR OF THE SOCIALIST REPUBLIC OF VIETNAM TO MALTA

By Martin Vella

In his interview with The Economic Update, Mr Long said he will do everything possible for the successful integration between the Maltese Consular representation to Vietnam and actively contribute to strengthening bilateral ties, especially in the fields of trade, economics, culture, education and training, and science and technology.

TEU: How does The Embassy of Vietnam act as a bridge linking the Maltese and Vietnamese people and contribute to the consolidation of bilateral relations between the two countries in all aspects?

NH: Firstly, I would like to underline a very important fact. Today the 14th January 2014, marks the day that we celebrate the 40th Anniversary of Diplomatic relation between Malta and Vietnam.

Malta was among the very first EU countries to recognise Vietnam in 1974 and that’s why it is politically significant. I have had meeting with foreign affairs representative, and I will be meeting with the Prime Minter and the Minister of Foreign Affairs, so I will talk about this important celebration. My Prime Minister and Foreign Minister sent letters of congratulations to their Maltese counterparts. we want to provide is a new Vietnam, a Vietnam of 90 million inhabitants, out of which 60 million are under the age of 35. A country that has been experiencing more than 25 years of economic growth at 7 to 8% per year, a country that reduces poverty from 76% in 1991 to 10% now in 2014

Secondly, the Embassy of Vietnam in Rome is now in charge of Malta and in the last two years since I took over, we have engineered some important developments. First of all we have nominated our Honorary Consul in Malta as the first important step, because we do not have our own representation here. Honorary Consul Peter Formosa is our spokesperson and he is also an excellent respectable businessman here in Malta. He is also helping Vietnam to increase contacts, business relations, providing information and to promoting the Vietnam’s image overseas. All this is very important. Second step was the economic development of Vietnam; it is now a very top market is South- East Asia, there is a growing interest of EU countries, especially Malta looking toward Vietnam. Based on the economy of Vietnam, we now have more diplomatic strength, more enterprises that look to increase their presence in Viet Nam, and increasing development of investment and trade between Viet Nam and the EU, and among them there is Malta. What I had in mind is that we select economy, maritime and tourism as the top three sectors of our cooperation. We know that Malta is in the top three countries of the maritime sector for many aspects, including the ship registration.

Malta’s maritime training is among the top in the world and Malta has a very an exceptional tourism sector. So now more and more Vietnamese go to Europe to visit and I hope Malta will be one of their destinations for the future.

TEU: In what sectors can Vietnam, together with the Maltese Honorary Consul help the Maltese people to better understand the land and people of Vietnam as well as the developments there?

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NH: One of the very important aspects that is similar to both our countries is that we both have struggled for our independence, and we both withhold a fondness for independence and peace. Because we have fought very strongly for our independence and this is a very important aspect that I understood with my exchange with the leaders of Malta, I now can understand how deep the aspiration is for the Maltese people, for their freedom and their relatives - common also for Vietnam. What we want to promote in Vietnam is not the past, even though we have gone through a very devastating and brutal war. Vietnam is now developing very fast and what we want to provide is a new Vietnam, a Vietnam of 90 million inhabitants, out of which 60 million are under the age of 35. A country that has been experiencing more than 25 years of economic growth at 7 to 8% per year, a country that reduces poverty from 76% in 1991 to 10% now in 2014. A country with a huge economic development and cultural development - we are now one of the top countries that today have a world cultural site recognised by UNESCO. We want to promote a new Vietnam, a Vietnam of development, of peace, of youth, of full integration to the world.

TEU: How are the citizens of Malta in Vietnam assisted and supported with visa application, and what kind of support, or back-up services do the Honorary Consulate /Vietnam Embassy provide to Maltese business entrepreneurs?

NH: There are two ways of that approach, because we have two ways of doing VISA as follows:

Vietnamese Ambassador Nguyen Hoang Long at the press conference

Diplomatic Relations

1) Either directly issued by the Embassy in Rome, wherein people may apply for a visa from Malta. It is the same as people applying from Torino or Rome, because it is send by post.

2) Or via Visa Online. People normally not only go to Vietnam, but also to Hong Kong, Singapore, or Bangkok can pick it up online, or upon arrival.

Another aspect is how they can be assisted by the Vietnamese Embassy, or through the Honorary Consulate in Malta. We have a trade office in Rome and part of their work encompasses business letters, newsletters and business information. They respond and give answers to the Maltese economic or entrepreneurial community regarding a specific request about a specific product and so on. Our Honorary Consulate in Malta relays info to us here when they receive a request for, providing the necessary information.

Now we do not have a specific trade regulation agreement between Vietnam and Malta. Malta, as a member state of the EU has no restrictions. One very important thing is that EU is now negotiating a free trade agreement with Vietnam, with the EFTA will be completed very soon in 2014. This means that all the trade areas will be available for the Maltese and for all the EU countries. And for their sectors of strength, the elementary sector and service sector will be very good for any EU companies, not only Maltese. The FTA will be extremely advantageous and trade exchanges between Malta and Vietnam based on this turnaround will be doubled in the next five years.

There will be a high delegation from Vietnam visiting Malta and we will have qualified people to speak about different sectors inter alia maritime, tourism, economy, and education

TEU: Are there any joint agreements signed between the two countries covering political, economic, cultural and tourism spheres?

NH: What I am going to do this year is to propose to the Maltese agencies some specific initiatives with the help of Mr Formosa. There will be a high delegation from Vietnam visiting Malta and we will have qualified people to speak about different sectors inter alia maritime, tourism, economy, and education. Secondly, I would propose a business forum to be held in Malta, together with the Honorary Consul Mr. Formosa hopefully some Vietnamese companies will be coming here to meet with the Chamber of Commerce, Enterprise and Industry. The economic community here in Malta will be able to promote Vietnam and evaluate bilateral economic relations. Thirdly, the aim is to export here some cultural events, to promote cultural events from Vietnam such as music and dance.

TEU: The Vietnam agriculture still faces many difficulties such as low competitiveness for its products, the production system is not effective and seriously affected by climate change. Your Government recently launched a program on restructuring the agriculture sector, aiming towards sustainable development and green growth. How do you view cooperation in this sector between Vietnam and Malta?

NH: According to some researches, Vietnam is one of the top countries that have a high chance of being hit by climate change, for example if the sea level rises, or a catastrophic typhoon. We are working a lot in terms of coping with climate change challenges, but of course we need help from the international community, mainly help from the UN, USA and others, for their expertise. Secondly, we are implementing a new direction for economic development and favouring new technologies, including green economy, alternative

energy renewable resources and of course every country that is strong in this sector is welcomed in Vietnam.

We have Italian , German, Scandinavian, French companies in the green growth sector. The European Chamber of Commerce in Vietnam (EUROCHAM) organises every year an exhibition called the ‘Green Biz’, where all the companies from the EU countries can exhibit their technology for the green business. If there are any Maltese companies that are interested in taking part in the ‘Green Biz’ exhibition they can be part of these companies organised by the EUROCHAM and they may contact Mr. Peter Formosa.

Vietnamese Ambassador to Italy Nguyen Hoang Long (left) and Model Khanh My (right) at the “Vietnamese Days” in Milan (Photo: VNA)

TEU: What is the status of Maltese investment in Vietnam and is any new Maltese investment being initiated? Do you think there is a need to increase cooperation between Vietnam and the Malta, and promote the process of developing strategic partnership between the two countries, and identify future development prospects?

NH: What we are doing is to at least try to identify some specific sector that we want to really push ahead in the future. Vietnam is a country of 90 million people and we need a lot of things, so we need to find out what we need from Malta. For example, I talk to the Maltese leaders about training Vietnamese experts in the maritime sector, and it will be very strategic, because Vietnam is a maritime country. We have a coast of 3,500km; we have a huge area of exclusive economic zones in our sea, and we are developing our maritime sector, so we need to train our people. That is why Vietnam supports Maltese candidature to the international Maritime Law Court, such as we did in the case of Profs Attard in Hamburg. If we have people trained in Malta, they come back to Vietnam, they will be a bridge between Malta and Viet Nam in other sectors. We also think about some agricultural products - now we are importing olive from Greece and Italy, or some other specific Mediterranean cultural products, because once we have the FTA, these products from Italy, Greece or France can enter Vietnam very easily and that will be a also an opportunity for Maltese products to enter the Vietnamese market segments. Therefore, we welcome Maltese entrepreneurs and we see other important issues such as Malta acting as intra-port for Vietnam products, for example we are now exporting a lot to the EU, this year we reached like 26 billion US dollars of the two way trade. Thus, if we develop a partnership with Malta such as transit hub for containers, from here to North- Africa, to Europe, or to the Balkan countries, Malta not only have value as a very strategic location, but also reach a critical level of strategic partnership for the transhipment of products we can cooperate and so invest in Malta as a port area.

TEU

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January 2014 | THE ECONOMIC UPDATE

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INSURANCE

Do your Homework – Read your Insurance Policy and know what you are buying

By Keith Laferla

An insurance policy can be hard to read, but it is important for one to know and understand what is in their policy. Unfortunately, insurance companies occasionally receive complaints at claim stage, arising out of the claim being either not fully covered, or not being covered whatsoever. This results in clients wrongly assuming that their insurance provider is trying to avoid honouring their claim, for no good reason. an insurance policy typically contains multiple sections, including a Preamble - a promise by the insurance company to indemnify the insured person for any claims

The policy document (sometimes referred to as the policy wording, or the terms of the policy) together with the policy schedule (which is specific to the risk) provide a clear and precise definition of what circumstances are or are not covered by that policy.

Without delving into too much boring detail, an insurance policy typically contains multiple sections, including a Preamble - a promise by the insurance company to indemnify the insured person for any claims, subject to the policy terms, conditions, provisions and exclusions; which is followed by the Definitions – defining key terms used throughout the policy document. A typical policy would also include a section explaining how the payment of premiums should be made, followed by a section to explain what is covered by the policy. Following this section, one would find a list of Exclusions – which, simply put, are circumstances for which the insurance provider would not be in a position to honour a claim; and also a section to set out any other special conditions of that particular policy. One may also 42 |

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find sections to include instructions on cancelling the policy, Excesses to be applied to the policy, and also the company’s complaints procedure.

After reading and understanding the policy, it is imperative that one also reads through their Schedule – which is an explanation of the person/s and/or property to be insured under that particular policy. For instance, a Home insurance policy schedule would typically include the risk address and the sum insured under each section of the policy; whilst a Health or Travel insurance policy schedule would include the persons to be covered and also the level of cover chosen, which will correspond to a particular table of benefits (the maximum benefits payable under the policy).

A schedule may also include an ‘Endorsement’, which states particular conditions relevant to the contract, which may not necessarily be included in the policy document.

If there is any doubt or grey area, one should always contact their insurance provider for a full explanation of their insurance policy, to avoid disappointment at claim stage.

TEU

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Editor’s Note Keith Laferla is Assistant General Manager at Laferla Insurance Agency Ltd. He is an Associate of the Chartered Insurance Institute (London) and recognised as a Chartered Insurer by the same Institute.

NEWSMAKERS

Air Malta Treats Press to Lunch Air Malta organised a press lunch last week to thank journalists and editors for their support and work throughout the year.

Editors and representatives from almost every local media organisation attended the lunch which was held at The Palace in Sliema.

demonstrated professionalism and sensitivity - and that makes a world of difference when you are trying to achieve something of this proportion,” Mr Davies said.

Before lunch, Air Malta aired a video outlining the airline’s news highlights from 2013, followed by the first viewing of its latest Air Malta promotional film: Awaken the Spirit of Christmas.

CEO Peter Davies said he thoroughly enjoyed working with members of the Maltese press throughout the past three years.

The Editorial Staff from The Economic Update and Sunday Circle together with Colin Fitz and media journalist during the Air Malta Press Lunch

“The press has been very diligent in its scrutiny of Air Malta, ensuring that the restructuring plan is followed properly and the national airline moves towards profitability. We were not always given an easy time, but journalists and editors consistently

Mr Davies thanked all the news editors and journalists for their efforts throughout this year and added that he was confident that Air Malta would continue meeting and achieving further successes with its Restructuring Plan in the coming years.

TEU

One year on at Air Malta’s new offices at SkyParks TEU

6PM nominated as an authorized non-exclusive partner of HP 6PM has been officially nominated as an authorized, non-exclusive partner, for the purchase, resale orDaphne sublicense Tabone of HP Products and Contact: Support, thus joining around 145,000 distributors, resellers and 6PM Ltd alliance partners of HP around the world.

Air Malta CEO Peter Davies celebrating with staff members the first anniversary at SkyParks. (Photo: Jason Muscat)

Air Malta Head Office employees this month celebrated their first year at SkyParks Business Centre within Malta International Airport.

Commemorating the event by cutting an Air Malta-branded cake, CEO Peter Davies thanked the employees for their work throughout the year. “In some ways it feels like we only moved in yesterday. In other ways, it feels like it’s been a very long time,” he said, recalling the changes that took place since staff from five separate buildings were brought together in one open-plan office.

The open-plan environment was intended to support the airline’s restructuring and cultural transformation, and is already reaping benefits and results. The event was organised by Team Air Malta, the airline’s new sports and social committee.

TEU

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Press Rel

6PM uses HP products as part of its infrastructure services such as data centre management and client based managed servers TEU

11th December 2013 | 43

January 2014 | THE ECONOMIC UPDATE

NEWSMAKERS

Business leaders share views in HSBC Malta networking event Business leaders from prominent Maltese businesses recently got together for an inter-company leadership development programme, called ‘Crossover’, organised by HSBC Bank Malta together with Island Hotels, Farsons Group, Air Malta and Ernst & Young.

The inter-company seminar’s panel, formed by Mark Watkinson, the Bank’s CEO, Winston J. Zahra, CEO of Island Hotels Group Holdings PLC, Phillips Saunders, COO at Air Malta Company and Charles Xuereb, CFO at Simonds Farsons Cisk, met with the participants at the Radisson Blu Resort, Golden Sands, to discuss and shed light on the large-scale challenges facing businesses in Malta today, as well as to share best practice tips and techniques for addressing change to build on success stories. The aim of (From left to right) HSBC Bank Malta CEO Mark Watkinson, Island Hotels Group Holdings PLC the development programme was to bring together a number CEO Winston J. Zahra, Air Malta COO Phillips Saunders, and Simonds Farsons Cisk CFO Charles Xuereb leading an inter-company panel discussion. of talented leaders from the different successful companies and market sectors within the local scenario to help participants gain a better understanding of changes taking place in different organisations and their role within the context of a challenging ever-changing work environment.

The programme was also aimed at increasing participant’s commercial awareness of how other businesses in Malta operate and what makes them so successful in addressing change-related issues. During the programme, participants were provided with the opportunity to network with external professionals, who could help them to better understand the importance of their role within an organisation’s rising need to address on-going changes in an increasingly dynamic marketplace.

TEU

Global College Malta completes successful first inaugural-term with well-attended networking reception.

HSBC Malta wins FT’s The Banker Awards three years running

Global College Rector, Professor Brian Smart, welcomed a number of stakeholders, students, VIP’s, dignitaries, collaborators and assistants to a networking event held within the recently completed campus. Professor Smart hosted a relaxed evening of fabulous food and drinks, as well as many discussions about the latest changes at Global College Malta, Malta’s newest tertiary education centre. Everyone in attendance had a great time, with invitees that included MP’s, SmartCity colleagues, the higher education sector in Malta, and the companies that support Global College Malta’s operations. Amongst the attendees was the committee of Xaghjra Football Club, whose tireless volunteers have built the footballing community in the region, with Global College Malta being one of the sponsors.

The lucky guests were treated to a spectacular fountain display put on by SmartCity Malta, who employed lasers, coloured lights and the latest watertechnology to animate the laguna in front of Global College Malta campus, an unexpected treat for all the guests attending this milestone event. Located at SmartCity, Global College Malta offers a sophisticated state-of the art learning environment and gives students the opportunity to study alongside and share cross-cultural insights with people from diverse countries. In this environment students will be trained to become leaders and managers in a variety of business and IT sectors, including the specialist Oil & Gas arena. Global College Malta is the first European College offering university degrees according to British standards at SmartCity.

Professor Smart, FREng, FRSE, FIMMM, CEng is the Rector of Global College Malta (GCM). Formerly Head of the Institute of Petroleum Engineering at Heriot-Watt University, and Vice Principal with responsibility for the HeriotWatt University Dubai Campus, he and his GCM colleagues share a vision for the future of Malta in the oil and gas industry. The vision is that Malta will become recognised as a “centre of excellence” in the Mediterranean for the educational and technical services required by the industry.

Global College Malta is collaborating with and representing highly respected international universities to act as an important education hub. Rector of Global College, Professor Brian Smart said that the first term in Malta had been very encouraging.

Britannia Services was this month named as Air Malta’s Top Travel Agent in Malta for 2012/2013, during a reception held for the members of the travel trade.

Compared to all local travel agencies, Britannia Services Ltd generated the highest Air Malta ticket sales for outgoing individual, group and charter bookings. Air Malta’s Chief Commercial Officer Philip Saunders presented the award to Noel Farrugia, director of Britannia Services Ltd. The event, organised by Air Malta’s Malta Sales Team, was organised in recognition of the support shown to the airline by Maltese travel agents throughout this year.

The get-together was held at the Carissa restaurant at the Intercontinental Hotel.

TEU

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TEU

“Entrepreneurs have the power to build a more economically just and politically stable world.”

Such inspiration came from Kofi Annan, former Secretary-General of the United Nations and Nobel Peace Prize recipient, when he talked with Ernst & Young Global Chairman and CEO Mark Weinberger.

The Entrepreneur of the Year Awards 2014 will be held at the Westin Dragonara Resort, on Friday 16th May 2014 and will bring together some of Malta’s top business people all competing for The Economic Update’s most prestigious nominee awards. The event, which will be sponsored by MSV Life and organised by Circle Events and The Economic Update, will start off with a lavish black tie Gala Event, culminating with the much awaited Best Awards ceremony. The awards categories this year have been increased substantially and will be attributed as follows: • • • • • • • •

International Trade Award Property Entrepreneur of the Year Retail and Leisure Entrepreneur of the Year Technology Entrepreneur of the Year Digital/IT Entrepreneur of the Year Family Business of the Year Most Entrepreneurial Company of the Year Start-Up Company of the Year

• • • • • • •

Best entrepreneur ideas Corporate Financier of the Year Emerging Entrepreneur Young Entrepreneur of Top Female Entrepreneur Top Male Entrepreneur Lifetime Achievement Award or Award for Excellence

The final votes for the award will be the result of a judging panel formed by a professional qaulified VIPs, who will be interviewing the nominees during the gala dinner. Last Year’s winners were: James Abela and Matthew Sammut (NIU) were awarded the honour of ‘Best Innovation Award’. The title for ‘Entrepreneurial Spirit’ was won by Mark J Galea (Quad Consultancy). The title for ‘Top Female Entrepreneur’ was won by Sandra Zammit (TotallyFresh Ltd) while Ivan Bartolo (6PM Holdings) won the ‘Top Male Entrepreneur’ The highest accolade of Top Entrepreneur Award for 2013 was won by Ivan Bartolo.

The event is being organised by Circle Events, together with The Economic Update and MSV Life.

For nominations, sponsor package and bookings please contact: Margaret Brincat on 9940 6743 - margaretbrincat@gmail.com; Martin Vella on 9995 2660; Nicholas Formosa on 9943 8839; Victoria Kyurcheva on 21316326

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For further information kindly send an email to helpdesk@kpmg.eblearn.net www.kpmg.eblearn.net

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