MONEY ISSUE 69

BUSINESS

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LIFEST YLE

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DESIGN

THE FINANCE EDITION ISSUE 69

COVER STORY

A WEALTH OF EXPERIENCE Alistair Muscat

(

)

POLITICAL AND ENVIRONMENTAL IMPERATIVES IN A POST-COVID- 9 REALITY Colin Lawrence & Paul Bonello ( ) SOFT POWER: THE DIPLOMATIC FRONTIER Hon Evarist Bartolo ( ) FINANCING GREEN & GREENING FINANCE JP Fabri ( )

POWERED BY

a springboard for local tech companies !"#$%&'()*++(,-../01(!"#$2%1(*3( .+&4*3'(&(5*1&+(0/+"(*3(1&6*3'(1$"( .0/7+"(1"#$(*38-,104(1/(&3/1$"0( +"5"+9(:-*+8*3'(/3(1$"(,10"3'1$,( 1$&1(*1(&+0"&84("3;/4,(&38($"+.*3'( +/#&+(1"#$(#/%.&3*",(1/(</-0*,$( :4(,-../01*3'(1$"*0(.0/8-#1,(&38( ,"05*#",(*3(=&+1&(&38(:"4/382

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COVER

Alistair Muscat Read the full story on P.16

E D I T O R Anthony P. Bernard

[anthony@moneymag.me] Editor’s letter — As we close one chapter and

positively because they align with long-

D E S I G N BloomCreative

begin another, a great sense of trepidation

term thinking and potential risk reduction.

[bloomcreative.com.mt]

engulfs the islands for many reasons. We are

Furthermore, companies with good ESG

yet, another year into the pandemic, and it’s

management tend to be better equipped for

hard to shake off the black cloud following us

crises due to this emphasis on sustainability.

around as new variants begin to emerge. New

ESG is taking on an even greater significance

and increasingly resilient variants bring about

considering recent events: companies have

a set of unique challenges as we continuously

the responsibility and resources to accomplish

adapt and readjust. But, it’s not all negative.

positive climate action, building a more

We are finding new ways to innovate and do

sustainable, resilient future and “putting

MONEY is hand-delivered to businesses in Malta,

business and collaborate. We are not alone,

money where their mouth is”. However, it

including all managers and directors of the TOP

which brings about a great sense of unity in

remains to be seen if we will see more entities

this shared experience.

implement better ESG measures for the better

including their business centres, executive lounges

of all.

and rooms (where allowed), embassies and Maltese

P R I N T I N G Print It D I S T R I B U T I O N JD Distributors

companies; iGaming, yachting and boating businesses, marinas, all -star hotels and boutique guesthouses

embassies abroad (UK, Rome, Brussels and Moscow);

In this issue, we take a closer look at reactions

all government ministries and entities.

towards Malta’s efforts to get off the grey list,

With that comes a reoccurring undertone,

as all eyes are on the nation, watching our

one of long term thinking being the kingpin

For information regarding promotion and advertising:

every move. For some, we are ticking along

to success. So, let that be our message as we

(+

at too slow a pace, it’s been months since

head into

our proverbial judgement day, and things

just about preparing for future shocks, such

just aren’t happening quick enough. But,

as pandemics. It also means responding to

unfortunately, as we all know, the sour taste

‘slow burn’ issues that are already well known,

left behind resonates beyond our shores and

sustained action to meet complex policy

reverberates across Europe. As a result, Malta

goals, and protecting resources for future

is no longer an attractive place for many to do

generations. A mix of approaches could help

business, particularly for those considering

improve long-term planning. This includes

making a leap to the islands or investing here.

alternative measures to assess policy progress

All rights reserved. Reproduction in whole or in part

and independent institutions to protect future

is strictly prohibited without written permission.

)

· [hello@moneymag.me]

. Long-term planning is not

Another hot topic is our collective efforts

interests. No strategy is a silver bullet – and

towards a more sustainable Malta; as EU

political will is ultimately needed.

Money is published by Be Communications Ltd, No.

, Howard Street, Sliema, Malta SLM

! " · [becommunications.com]

Opinions expressed in Money are not necessarily those of the editor or publisher. All reasonable care is taken to ensure truth and accuracy, but the editor

targets loom, every one of us must strive

and publishers cannot be held responsible for errors

for a better Malta. Initiating ESG is another

or omissions in articles, advertising, photographs or illustrations. Unsolicited manuscripts are welcome

subject covered in this issue, whether

but cannot be returned without a stamped, self-ad-

through sustainable investment or otherwise.

dressed envelope. The editor is not responsible for

Ultimately, we can view ESG investments

material submitted for consideration.

ISSUE 69

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CONTENTS

08

20

36

Political and environmental imperatives in a post-Covid- reality

Marketing and finance: A partnership for growth

Financing green & greening finance: An opportunity for Malta

Based on a series of interviews with leading economic and risk experts, Professor Colin Lawrence and Paul Bonello, Lea Hogg distils their hard-hitting advice for the government and businesses in this article for MONEY.

Lyndsey Grima analyses the relationship between finance and marketing and why both departments must work together for success. She catches up with Luca Caruana and Susan Weenink Camilleri, the pair having experience in both departments, to find out more.

12

27

International observers not impressed by Malta’s efforts to get off the greylist

A revolution in finance or a mere craze?

Six months after Malta was greylisted by the Financial Action Taskforce (FATF), I see three main perils to the government’s plan to get Malta off the greylist in 18 months as envisaged. We are fixated on the technicalities of reform without seeing that the more significant effect is falling short of the expectation or perception of international observers.

We are starting to believe our spin on technical compliance and, more seriously, the idea that greylisting has not impacted the ‘real economy’.

Victor Paul Borg investigates.

One of the buzzwords in cyberspace that is increasingly gaining traction is decentralised finance, better known as DeFi. But what, exactly, is DeFi? Moreover, what is it looking to trump? Jake Aquilina asks.

30 Malta’s soft power potentials (part ): The diplomatic frontier

16

38 The pandemic saga and its socio-economic implications

The fourth wave of coronavirus infections is raging across continental Europe, forcing governments, once more, to take drastic actions to mitigate the spread of the virus and stop from hospitals being overwhelmed. Jordan Portelli explains.

42

A wealth of experience COVER STORY

Duncan Barry speaks to Alistair Muscat, CEO of Sliema-based Integra Private Wealth, on the firm’s services, what differentiates between banks and wealth management firms, and the challenges tied to constant changes in investor protection rules.

As countries recover from the Coronavirus pandemic, we must take the historic opportunity to tackle climate change simultaneously – to build back better and greener. We can deliver green recoveries across the globe that create good jobs, trillions in investment and ground-breaking new technology. And we must.

JP Fabri explains.

Ray de Bono met with Minister Evarist Bartolo, Malta’s Minister for Foreign and European Affairs, in his spectacular office at Palazzo Parisio, adjacent to Castille Place, in Valletta. Its prestigious location, right next to the prime minister’s office building, is not a trivial detail here.

ISSUE 69

Investment alternatives: understanding the risk How do you gauge the risks involved for the different options available if you seek to invest your money?

The Malta Financial Services Authority explains.

MONEY

CONTENTS

45 Slow and steady wins the race There are very few things in life that frustrate Richard Muscat Azzopardi more than a panicked approach to marketing that seems to believe that the role of the discipline is to save a business when it’s doing poorly. But, convearsely, these businesses seem to think that, in a classic Schrodinger’s cat logic example, you should cut down on marketing the minute business starts looking bad.

48 Initiating “ESG” through sustainable investment Over the last decade, ESG (Environmental, Social and Governance) has replaced CSR as companies are becoming more and more accountable to their various stakeholders like investors, customers, employees, and non-governmental organisations that want to evaluate a company’s impact. Michael Psaila Debono explains.

Lea produces and hosts a popular current affairs TV show. She provides

training at the gym.

B U S I N E S S P.20

multi media content, analysis, forecasting and assessment reporting for a number of

Over the last two decades, Ray

international corporates.

has directed businesses in the media,

F I N A N C E P.08

marketing and IT fields, focusing mainly on the international market.

62

with more than two million words and

A beautiful year

every corner of the world.

a multi-disciplinary advisory practice.

F I N A N C E P.12

G R E E N F I N A N C E P.36

MONEY spells out your new year resolutions in luxury and style.

64 A stocking full of stars Start the new year in style with MONEY’s gift list.

MONEY

Victor is an investigative journalist

[raydebono.com] S O F T P O W E R P.30

hundreds of pictures to his name, in books, magazines, and newspapers in

Duncan has over two decades of

JP is a founding partner at Seed,

Jordan is an economist and CIO /

experience in feature writing and

portfolio manager for a local financial

journalism. He is also a freelance writer. In

services company.

, he was the national winner of the EU

E C O N O M Y P.38

Health Prize for Journalists.

C O V E R S T O R Y P.16

Richard is the CEO of Switch — Digital & Brand, a marketing agency that forms

Lyndsey is a freelance writer and social

part of ICOM, the world’s largest network

media marketeer. When she’s not typing

of independent agencies.

away, you will find her focusing on her

M A R K E T I N G P.45

THE FINANCE EDITION

FINANCE

Political and environmental imperatives in a post-Covid-19 reality Based on a series of interviews with leading economic and risk experts, Professor Colin Lawrence and Paul Bonello, Lea Hogg distils their hard-hitting advice for the government and businesses in this article for MONEY.

Malta’s GDP plummeted to – . % in warnings for

as tourism and services, representing over

are encouraging, with the Island getting back to pre-COVID-

levels. In a remarkable turnaround, GDP is forecast to rebound to + % in

% of the economy, were impacted catastrophically. But the

levels of unemployment ( %) and inflation contained at sub . %

. The World Bank estimates that Malta’s GDP in

may reach . %, a

performance significantly higher than the . % predicted for the average of Eurozone countries.

However, Paul Bonello, a leading finance

it anymore”. Bonello quips that “insofar as

guard against inexorable and intensive growth

consultant and government advisor, cautions

quality of life is concerned, COVID-

as much as against stagnation. The name of

that there is a “danger in GNP growing too

one big advantage, we no longer had to suffer

the game will be cooking Goldilocks’ porridge

fast”. He believes that the “accompanying over

hours of interminable traffic jams”. “Let us

to the right temperature; not too hot, not too

development will reduce the countryside to

beware of politicians: fast growth is exciting,

cold. We need not grow big while encouraging

back and front gardens”. Land is ultra-scarce

it releases adrenaline, it brings a good feel

diversity and inclusion. We need not pursue

in Malta. He forecasts that “another boom

factor, it is popular, it makes politicians popular

a sizeable population of guest workers and

will increase the population by hundreds

and win elections. But when the elated state

immigrants, making Malta’s highest density

of thousands and will cause social and

is over, it often leaves you in a miserable state

per square kilometre in Europe even more

environmental upheaval. Property prices

afterwards,” says Bonello.

accentuated. We need not aim for millions of

had

and rentals will skyrocket”, echoing Mark Twain’s quote, “buy land, they don’t make

tourists. A much smaller number of quality Bonello’s economic thesis is that “we must

ISSUE 69

tourists will be much better, producing a

MONEY

FINANCE

much better spend per capital and much less stress on our environment and infrastructure.

Instead, let us pursue high yield niches in the economy, such as the financial services in Malta, which, sadly, as Prof Lawrence commented, have been so severely hurt by the FATF greylisting.”

So, is Malta’s economic outlook sustainable with the spectre of Omicron, Malta’s greylisting and environmental concerns casting long shadows? Opinions vary about what might happen next. Professor Dr Colin Lawrence, a recognised leading expert in financial and regulatory risk and former senior regulator at the Bank England, shared his views with Money magazine.

Lawrence argues that while the UK and US economies rebounded from the recession, growing . % and . %, respectively (in real terms), much of this recovery can be attributed to fiscal stimulus packages. In the UK, policies adopted include £ bn additional spending on infrastructure, £ bn on a job retention scheme, £ . bn on a stamp duty holiday and £ . bn on a temporary VAT cut for hospitality and leisure. The UK’s Office for Budget Responsibility estimates the additional cost to the economy to be £

bn ( . % of UK

GDP). However, the Professor says, “the Uk has been hit very hard by both COVID-

and

Brexit, plummeting last year by %. As a result, despite growing out .

% this year, it is far

in the hole with growing unemployment and significant supply chain disruption”.

Greylisting is doing untold harm to the financial services that have almost ground to a halt.

— Paul Bonello

However, the UK’s spending spree is dwarfed

costs and incentivise domestic consumption,

sudden bursts in economic activity possible,

by Biden’s stimulus package of $ trillion,

and measures to support investment. The

satisfying pent-up demand for good living,

including $ . trillion for infrastructure and

improvement in GDP may, to an extent, have

entertainment and shopping. He identifies

around $ trillion for social spending. This is a

resulted from the government’s stimulus. Still,

a nexus in COVID-

massive boost to the economy. Compare this

Professor Lawrence points out that “much of

tourist figures but notes that the situation

to growth lower than . % over the past two

the upturn was triggered by the opening up of

reverts each time there is a resurgence of

decades. Meanwhile, the stock market is up

other key economies”.

COVID- .

relenting and improved

% for the year. Given how gigantic the US GDP is ($

Paul Bonello’s view broadly supports this

At the same time, he notes, “the uptick in

global economy. Still, there is a supply-side

trillion), this is very bullish for the

analysis, saying that “a combination of record

tourism in

COVID-

government borrowing and EU funds have

pent up demand and in Malta only partly due to

chain shortages and thus inflation, but it

meant that the government has managed

the subsidy given to tourists who stay at least

should be short-lived once we recover from

to keep the economic wheels turning

two nights”.

the pandemic, and longer-term, we should see

during lockdown avoiding the onset of mass

growth in projects for infrastructure.

unemployment”. He concurs that government

Professor Lawrence draws attention to some

stimulus measures have supported the

of the risks to Malta maintaining sustained

In comparison, Malta’s government responded

manufacturing and tourism sectors and

growth. “Malta must continue to work with

to the pandemic with a raft of packages

suggests many businesses would have closed

the FATF to have its ‘Greylisting’ rescinded. He

estimated to cost €

without this support. Furthermore, Bonello

argues that Malta must “restructure financial

indicates that government stimuli made

services monitoring and further improve »

shock as well, and we see supply

m ( . % of GDP)

targeted to reduce businesses’ operational

MONEY

THE FINANCE EDITION

was caused in the main by

FINANCE

its governance with independent bodies

But while Malta is holding its own in the

is no scope for adventurism, for short-term

overseeing tougher regulations and oversight”.

Freedom Index, it plummeted to

nd in

solutions that bring us into unnecessary

Lawrence believes that “failure to do this will

the Corruption Index. A drop of

places

put Malta’s reputation under continual scrutiny

since

and discourage financial transactions hurting

Caruana Galizia’s assassination, an episode

to pseudo residents or the promotion of

GDP growth”, adding that “Central banks

likely to haunt the government for some time

ill-conceived Blockchain Island when no real

and regulators worldwide have tightened

to come.

thought and planning had gone into it”.

surveillance. As a result, lending to entities in

Professor Lawrence cites analysts quoted in

“Our Financial Intelligence Unit and other law

Malta will be considered a much higher risk and

the Freedom Index agreeing that the Maltese

enforcement agencies must spend what is now

discourage traditional lending”.

government must address a “sprawling

a super budget in the pursuance of hardcore

socialist bureaucracy that oversees heavy

criminal and economic activity and not in

Anti-corruption journalist Daphne Caruana

entitlement spending” to sustain the progress

stifling financial services practitioners with

Galizia’s allegation that there existed “an

made to date. But, adding that, it will need to

accusations of minor breaches of formalities.

entire superstructure of fraud, bribery, tax

“fight corruption more aggressively, further

The government needs to target the big fish

evasion, fiduciary neglect and cheating

reform the labour code and the judicial system,

and tax evaders seriously. Until all vestiges

reached the highest echelons of government”

and prioritise spending cuts and pension and

of impunity have been removed for those

drew worldwide attention. The outcome

health care reform, as entitlements continue

who can avoid punishment because of their

to pressure public finances”.

political influence or wealth, our greylisting will

reflecting Malta’s Greylisting’ and

friction with our neighbouring countries and the EU, such as promoting the sale passports

AML and anti-terrorist lending controls and

remain”.

Paul Bonello is equally forthright, believing that “the culmination of so much corruption

Professor Lawrence contends that sustainable

and sleaze over the last few years resulted in

GDP growth in Malta is contingent on several

Malta being the only European country ever

factors. “It depends on the new steady-

Malta’s attractive tax regime appears to have hampered (at least for the time being) a move off-Island for many companies involved in the digital economy.

— Prof. Colin Lawrence of the independent investigation into her

to be placed in the FATF greylist. The focus on

state (continuing) and the restructuring of

murder finding that “the state had to bear

Malta by the EU, the OECD, the FATF, and the

labour habits”. He foresees “the ability to

responsibility after creating a “culture of

ensuing greylisting may have dealt the death

communicate globally by digitalisation” being

impunity” severely damaged the government’s

knell to the current international tax regime

an imperative for success”. He asserts that

credibility. Unquestionably, Lawrence argues,

that has served us so well in the last twenty

Malta must act now to reduce dependence on

trust in the government has been sorely tested

years. Greylisting is doing untold harm to the

tourism, predicting that while tourism might

domestically and internationally.

financial services that have almost ground to

rise in the short term, it remains vulnerable to

a halt”.

further restrictions and uncertainty. The UK is

He applauds Malta

th place in the

predicting m Omicron cases by the end of the

Freedom Index, ahead of Belgium but behind

“The effects of greylisting on the domestic

year, and currently,

Cyprus, which placed

economy will start being felt more concretely

inbound travel to reduce their infection

judicial effectiveness as the primary reason

in a few months,” states Bonello. “It has been

rates. Professor Lawrence also cautions that

Malta maintained its mid-level position.

a humiliating blow to our counties pride”. “The

“continued globalisation looks limited”. CEOs

Recognising the changes achieved, the Island

only way confidence in Malta can be restored

and senior executives will continue to “zoom

ranked

is the government living up to its original

in rather than fly in.” International travel for

has an overall score above regional and world

election campaign mantra: accountability,

business and conferences will reduce globally

averages.

transparency and good governance”. “There

as the world “transitions to a zero-carbon

st among

rd. He cites improved

countries in Europe and

ISSUE 69

countries have banned

MONEY

FINANCE

footprint”. In Europe, Omicron has already

appears to be a double-edged sword for

unexpected changes will occur. Leaders must

affected the hospitality and entertainment

property investors. While turnover in real

plot a route to prosperity like pilots of long

sectors, seeking financial assistance from

estate reached € bn in

haul aircraft. They must anticipate turbulence

governments to offset the loss of business

evidence that high rents are driving migration

and navigate new courses in the face of

caused by the reintroduction of social

to lower-cost parts of the Island and Gozo

the headwinds they will undoubtedly face.

distancing.

and ROI on a property is expected to decline

Professor Lawrence’s final counsel is that the

to -

government must restore Malta’s reputation.

, there is

%. Remote working has facilitated

The UK considers making WFH (working from

office downsizing and moving out of high

Companies must be agile in anticipating and

home) a legal requirement for employers.

rent and congestion locations. Fortuitously,

fearless in implementing the changes required

Transportation, restaurants, supermarkets,

Malta’s attractive tax regime appears to have

to prevail and prosper in the new reality.

property owners, high street retailers and

hampered (at least for the time being) a move

entertainment venues. Already beleaguered

off-Island for many companies involved in the

by previous restrictions are reeling from the

digital economy.

prospect of yet further footfall reductions.

Professor Lawrence highlights the “growing

Despite the headwinds, Professor Lawrence

trend in the post-COVID-

can foresee a return to relative prosperity.

steady-state

that many workers have decided to WFH not

Malta has a well-trained, English-speaking

only under COVID-

workforce and low labour costs. Its EU

but post-COVID- . In

the USA, . million workers have exited the

membership and tax regime attract foreign

labour force leading to massive shortages

investment, its strategic location provides

About

in physical centres (supermarkets, storage

a competitive advantage, and it remains an

Professor Dr Colin Lawrence

and production). The stay at home workers

attractive tourist destination. However, he

Colin is a former senior regulator at the Bank

is usually high quality and as many men as

raises concerns over Malta’s skilled labour

of England. A world-leading risk and regulatory

women. This must do with demographics and

shortage, which is forecast to worsen despite

expert, he advises global financial institutions,

parenting choices, and travel; it is convenient

the government’s initiatives and financial

central bankers and regulators on critical and

and favourable from a carbon perspective.

incentives. In Europe, amongst the top

strategic risks. He serves as a board member

This leads to a mixed economy with services

skills in short supply are ICT professionals. As

of OSTC and chairs the Risk and Compliance

roughly

a result, EU companies are designing more

Committee. His career includes roles as a

by high-quality labour, some operating from

attractive packages and hybrid work models

professor at Columbia Business School in

home. This will no doubt lead to further

to fill vacancies. As a result, there is concern

money and financial markets, partner Ernst

inequality as routine lower-skilled labour have

that IT savvy Maltese and guest workers will

& Young, Regional Leader Risk Management

to take over jobs in factory-like conditions at

be enticed off-Island, compounding the skills

IBM, and managing director in markets UBS

minimum wages.”

deficit that is limiting the growth of iGaming,

and Barclays. Colin is currently working on

one of Malta’s most important sectors.

Probability of Default and Loss models given

% of the US economy produced

The Professor highlights other imminent

Default under climate scenarios. He also

changes, including the impact on the

The Omicron variant could, of course, throw

assesses risk appetite and regulatory capital

property market. While the property market

a spanner in the works and disrupt the global

requirements for climate-related physical

has recovered to pre-Brexit levels in many

economy and Malta’s growth. So far, while

shocks.

countries, he believes real estate will be

times more infectious, Omicron appears

affected by many continuing to work from

less severe, with most sufferers experiencing

Paul Bonello

home. Indicative of the change in consumer

symptoms not unlike the common cold. But

Paul is managing director of Finco Treasury

behaviour, a UK top

if only % of cases result in hospitalisation,

Management and director of March

for less than half price this week. The new

this could severely affect transportation,

Management Malta, part of one of the

owners’ intention to address the demise of

productivity and place health services under

world’s largest professional services firms

traditional retail is to introduce experienced-

stress. Still, more alarmingly, Professor

headquartered in New York. In a career

based opportunities and additional

Lawrence warns that new variants could

spanning four decades, he has held positions

entertainment choices. The WFH movement

“lead to stock market collapses worldwide if

as director of Air Malta, chairing its Audit

has seen office rents decline and house prices

lockdowns in the EU, UK and USA return.”

Committee and director for Mid-Med Bank

in leafy suburbs rising considerably as WFH

Faced with so much uncertainty, it is clear

and then HSBC, where he chaired the Risk

has created many questions about what

is that the typical annual planning cycles

Management and Audit Committees. Paul also

they want from life. In Malta, where traffic

of government and businesses need to be

served as part of a three-person committee,

congestion and high-density housing is a

replaced by “a linear notion of progress”. Plans

advising the Government of Malta on the

characteristic of Valletta and Sliema, there

for

transition from the offshore to the onshore

will likely be an exodus of businesses and

more agile and robust route to profitability and

financial services regime. Paul is a certified

residents.

sustainability. The changes to business and

public accountant, a fellow of the Association

society since

of UK Certified Accountants and an associate

shopping mall was sold

Malta’s prominence as a leader in connectivity

MONEY

and beyond must provide a leaner,

have been unprecedented,

and in the new reality, one thing is sure, more

THE FINANCE EDITION

of the London Institute of Bankers.

FINANCE

INTERNATIONAL OBSERVERS NOT IMPRESSED

BY MALTA’S EFFORTS TO GET OFF THE GREYLIST Six months after Malta was greylisted by the Financial Action Taskforce (FATF), I see three main perils to the government’s plan to get Malta off the greylist in 18 months as envisaged.

We are fixated on the technicalities of reform without seeing that the more significant effect is falling short of the expectation or perception of international observers. We are starting to believe our spin on technical compliance and, more seriously, the idea that greylisting has not impacted the ‘real economy’. This is a logical extension or evolution of the first two – we are becoming complacent. Victor Paul Borg investigates.

ISSUE 69

MONEY

FINANCE

As an investigative journalist, I make these points based on chatter I am privy to, and insight gleaned from my investigations.

Any analysis must start with the greylisting itself, which would show why our actions are falling short of expectations. Officially, Malta was put on a list of less than two dozen countries in the world subject to increased monitoring – popularly known as the greylist – by the international Financial Action Task Force (FATF). It was also put on a separate UK list of countries at high risk of money laundering and terrorist financing. The FATF’s enhanced monitoring is due to these country’s weaknesses in preventing money laundering and financing of terrorism. In Malta’s case, the FATF pinpointed opacity with beneficial ownership of companies, weaknesses in “pursuing criminal tax and related money laundering cases”, and the money laundering risks related to tax evasion.

The immediate effect of increasing monitoring is that it becomes costlier and more effortful for companies in Malta engaged in international business or money flows. »

The more insidious effect is that Malta has become less attractive for international companies thinking of taking shop in Malta or investing in Malta.

MONEY

THE FINANCE EDITION

FINANCE

However, the more insidious effect is

experience in the criminal court before she

impressive, you stand a good chance of

that Malta has become less attractive for

became attorney general, mainly employs

getting away with it. After all, cases tend

international companies thinking of taking

young lawyers fresh out of university who

to stall or peter out at one level or another.

shop in Malta or investing in Malta, which

are still finding their feet. These are not the

And therefore, our focus on technicalities

has undermined the growth potential. Since

kind of sharp, seasoned lawyers you would

is misplaced, and our complacency is

economies are predicated on growth, any

want to handle complex cases. Even if cases

dangerous because it can turn out to be

effect on growth potential is inherently

make it through these gauntlets, they end

counterproductive and disastrous.

harmful. But this is not what we hear in Malta.

up in a court system where cases tend to

We keep hearing that greylisting, six months

stall for years.

We do not see the larger picture, and the

on, has not impacted the real economy and that it is not likely to have any significant

government is not doing – or not interested The result?

– in holistic reform that achieves results.

impact for as long as we get off the greylist on course in

months.

And, above else, our government or we There is often no result because if you are

are failing to read the signs that beyond

intelligent and resourceful, powerful and

the technical points highlighted by the

This is part of the spin by government

FATF, there is the more critical element of

proponents, or selective interpretation of

perception or expectations.

reports by agencies like Fitch by media or journalists sympathetic to the government, leading to complacency, which is one of the main pitfalls we face six months into our -month plan.

Another pitfall is focusing on technicalities and frontline institutional setup without realising that international monitors expect us to deliver something more tangible than laws, technicalities and institutional setups. They are looking for results and convictions. We have not delivered any of that and do not seem on track to deliver any time soon.

The chatter I hear from sources is that the view among foreign diplomats is that Malta has changed laws and put more resources and staffing into investigative bodies. Still, the results have fallen short of expectations.

There have been no convictions of influential people regarding money laundering – and the underlying crime of corruption and tax evasion.

Any analysis must start with the greylisting itself, which would show why our actions are falling short of expectations.

The FATF must highlight specific technical points to form its decisions. But for the people sitting in that room when a vote is taken, the unmet expectations and bad press and the idea that people are getting away with might matter more than presentations on laws enacted and agencies set up.

And the signs are that we are neither managing, much less meeting, those expectations.

Shortcuts will not work. For example, a law that gives the Financial Intelligence and Analysis Unit power to impose fines directly without resorting to the courts is bound to backfire because companies are likely to appeal, and cases would still stall in the court system. Therefore, holistic, radical reform is needed.

There are various reasons for these poor

We also must abandon the narrative that

results, and not all of them are sinister. For

greylisting has not impacted the ‘real

example, the police department on economic

economy’ so that we can see the perils that

crimes and money laundering is staffed with

lie ahead. Greylisting is, in fact, only one

officers who may be willing to investigate

of the economic headwinds that Malta is

but struggle with complex money laundering

facing. Another is the proceedings by the EU

cases due to gaps in their expertise and

Commission against the sale of passports.

knowledgeability. They are also overwhelmed,

And the third is the rise in the tax threshold

and that works against them. To crack cases

of companies registered in Malta that is

involving complex money laundering requires

being imposed internationally, something

experts who take their time probing a case and

that will take effect in

building the evidence. Yes, you heard right:

Malta’s attractiveness to international

you must build the evidence. But the police are

companies even further.

, which will erode

short on expertise.

If the police build a case, it must run the

These headwinds portend a storm that

gauntlet at the attorney general’s office. The

looms just beyond the horizon. So, we must

handicap there is that the Attorney General

change course and embark on holistic,

office, led by someone who did not have any

aggressive reforms to avert the storm.

ISSUE 69

MONEY

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COVER STORY

ISSUE 69

MONEY

COVER STORY

A WEALTH OF EXPERIENCE Duncan Barry speaks to Alistair Muscat, CEO of Sliema-based Integra Private Wealth, on the firm’s services, what differentiates between banks and wealth management firms, and the challenges tied to constant changes in investor protection rules.

Alistair, can you brief us about your role?

our clients provides the added value. Our international competitors are

often too large in scope and nature to afford the clients, even the most

I am one of the founding members of Integra Private Wealth and

important ones, with a personal touch. Ultimately our industry is based

currently act as CEO and a member of the board of directors.

on trust and values, and these cannot grow over time without a solid

personal interaction with clients.

What services does Integra Private Wealth offer, and do you mainly

cater to high-net-worth individuals?

What is the difference between using a bank and using firms

like yours?

Integra offers international holistic wealth management solutions to

private clients and fund managers. Through the years, the company

Banks or credit institutions’ primary job is not to provide investment

expanded its offerings, its network of partners, banks, fund managers,

solutions. Banks are generally focused and derive their primary income

service providers, as well as its global reach. This steady growth

from banking, which, in basic terms, is the management of deposits and

allowed the company to consolidate itself as one of the leading wealth

loans. Over the years, traditional commercial banks added several »

management firms in Malta as well as delivering customised and unique solutions to our clients. These range from money market to growth or income portfolio management solutions to more sophisticated alternative strategies in property, private equity, high-value classic cars, cryptocurrency funds and other types of alternative investments.

Our business model and structure cater mainly for high-net-worth individuals, family offices and institutions. Accordingly, we do not offer the traditional brokerage service associated with the retail market but focus primarily on personalised wealth management to a restricted group of clients.

How do you stand out from the rest of the wealth management firms?

Whilst some of our offerings are unique, the typical wealth management is relatively standard for the industry. Our clients also tend to use our services for the longer term, focusing less on speculative investments and more on succession planning in a stable and steady portfolio.

Capital preservation is by far more important to our clients than

Integra Operations & Compliance team — (top) Thaffiny Martins,

significant returns at high risk. Apart from the technical nature of

Kyle Pace, Shanel Carr, Marilena Vella, Andrew Scott Pace and

wealth management, we believe that, and ultimately the extremely low

Valentina Esposito; (bottom) Daniela Pace Bonello, Analise Despott,

client turnover confirms this, the personal relationship we have with

Alistair Muscat, Bartosz Gawronski and André Micallef

MONEY

THE FINANCE EDITION

COVER STORY

expanding our network and global reach. In the future, we will continue to seek new acquisitions by finding opportunities both domestically and internationally.

COVID- 9 disrupted operations at the height of the pandemic and caused significant fears in clients and the markets. How did the company navigate through these difficult times? Are things smoothening out now?

COVID-

presented two main challenges for us. The first was

operational, and the second was market-related. From an operational point of view, we had been preparing and testing for contingency planning for several years. Thankfully, these preparations meant that we had a seamless transition when we switched to home working practically overnight. Our business relies heavily on personal contact.

However, clients appreciated that whilst we could not travel to meet them, we kept in constant contact with them and ensured that our Integra Management — (top) Marilena Vella manager operations,

services continued to be offered online. This was possible because of

Bartosz Gawronski asset mgt. coordinator, André Micallef investment

our significant investment in IT, which allowed us to provide clients with

advisor & business development; (bottom) Daniela Pace Bonello head of risk &

sophisticated online services. These services were fundamental during

compliance, Alistair Muscat CEO

lockdowns.

new services, including wealth management, to their suite of client

The other challenge was market-related. Financial markets reacted

offerings. However, their primary role remains the traditional banking

violently to the spread of the pandemic and lockdowns. Equity markets

service. It is always tricky for banks to achieve expertise and personal

suffered significant losses during the early part of

client relationships that an investment firm can achieve by dedicating

increased volatility must first be managed. Then we try and profit from

all its resources to this aim. When a client approaches us to provide our

it. Our strict risk and portfolio management controls ensured that

. For us,

services, the interest is purely one related to investment solutions. Of course, given the range of services we can offer, clients usually use us as the first point of reference for all their banking and investment needs, and we guide them accordingly.

How do you leapfrog the competition and capitalise on emerging market opportunities?

Boutique firms have over the years been nimble enough to capitalise on new opportunities by acting faster and more decisively to new opportunities. However, the increasing regulatory requirements imposed on the industry also meant that smaller firms are finding it harder to survive without increasing their fees to counter the added costs linked to compliance and anti-money laundering requirements.

We are lucky that we manage a significant amount of client assets whilst retaining a very lean structure in terms of decision making. This gives us a significant advantage in that we can absorb most of the additional costs whilst at the same time investing not only in ensuring the highest level of portfolio management but also in new investment ideas and opportunities.

Furthermore, by catering to a restricted group of clients and given the size of each new mandate, we have grown our assets much quicker than some of our competitors. We are also very active in mergers and acquisitions. We are constantly looking for new partners that can add significant value to our overall structure without increasing our overall risk profile. For example, we successfully merged our business with an asset management company regulated and operating in Uruguay in and have recently concluded a new partnership with a UK-based firm. These deals allow us to increase our assets overnight whilst

ISSUE 69

MONEY

COVER STORY

we contained our losses during the heavy sell-offs. However, we also reacted very quickly to invest in specific areas and sectors in the second quarter of

. By adding to the Asian market exposure, technology

and healthcare stocks, we recovered the losses quickly and ended up

We are steadily approaching €700 million in Assets Under Management and aim to reach the €1 billion mark in the next three years

registering an excellent year in terms of performance. Nevertheless, we believe the real challenges will likely present themselves in the next few years, and markets will most likely have to adjust due to unorthodox fiscal and monetary policies.

Investor protection rules are constantly changing. So how does this affect your firm?

We built our company on the concept of placing the client’s interests first and treating clients fairly. Thus, investor protection comes second nature to us, and we built all our policies and procedures on this principle. We look at added investor protection rules as a clear benefit to the industry. It brings operators that may overlook certain fundamental investor principles closer to where they should be. We are proud to say that we had implemented most of the new investor protection regulations years before they were drafted in law.

The country has, unfortunately, been greylisted. How has the company adapted to this, and has it affected your clientele or operations?

We have been dealing with large and market-leading international counterparties for many years and are used to in-depth scrutiny. Whilst

damage to our country reputation is harmful, we were also pleased with the reaction of international banks and fund managers we deal with that looked primarily at the sterling reputation of Integra before that of the jurisdiction. This allowed us to retain these relationships and build new ones. Of course, some banks have considered the jurisdictional risk a stumbling block to doing business, but overall, our experience so far has been positive. We have identified new opportunities that ultimately add value to our clients by engaging more with our counterparties.

What are your plans for Integra PW in the not-too-distant future?

This is an exciting time for our company. We have just concluded a new partnership with Burlingtons Group, a Mayfair based multidisciplinary firm catering for international high-net-worth clients. The synergies between the two parties are evident. Following Brexit, establishing a base in the UK will present another opportunity to expand our network and client base even further. We are steadily approaching €

m in

AUM (Assets Under Management) and aim to reach the € bn mark in the next three years. We might also tap the capital markets to fund further acquisitions and are looking forward to representing Malta in international circles whilst rubbing shoulders with some of the most influential companies in our industry.

THE FINANCE EDITION

BUSINESS

MARKETING AND FINANCE

— a partnership for growth

Lyndsey Grima analyses the relationship between finance and marketing and why both departments must work together for success. She catches up with Luca Caruana and Susan Weenink Camilleri, the pair having experience in both departments, to find out more.

Whether you own a sizeable company with structured departments or a small business with a few key employees running the show, there is the false perspective that all that marketing wants to do is spend; in contrast, the finance department is solely interested in saving. This misconception creates an ‘us vs them’ mentality that could be highly unhealthy for business. However, the key to achieving success lies within effective communication and a deeper understanding that, essentially in business, one department cannot function without the other.

Luca Caruana, head of marketing at KSi Malta, a local audit, tax, and advisory firm, graduated in International Relations in

and started working as a journalist in that same year. He also

worked in several companies, holding roles related to copywriting, PR, and project management.

He also graduated with a master’s degree in Finance and Investment Banking and obtained a post-graduate diploma in Digital Marketing.

Susan Weenink Camilleri is the head of sales and marketing at Simonds Farsons Cisk plc, a household name in Malta. She joined the company almost

years ago as an accounts clerk,

spending the first ten years studying and working in the finance department. Then, moving on to the marketing department, Susan initially worked mainly on market research programmes, sales analysis, and sales forecasting before moving on to brand management and marketing plans of various beer and soft drink brands in Farsons’ portfolio.

ISSUE 69

MONEY

BUSINESS

What attracted you to finance and

Do you think your background in finance

I regularly read financial and business

marketing, respectively?

helped you become a better marketer?

magazines related to the firm I work for and

LC: Marketing is closely connected to

LC: Yes, especially when planning the firm’s

copywriting, one of my passions; hence the

yearly marketing budget and maintaining it

In terms of creativity, marketing certainly

attraction was natural. Regarding finance, I

throughout the year.

complements finance, especially when it

the financial world in general.

am a part-time trader and investor, so linking marketing and finance is natural to me.

comes to planning the yearly marketing SWC: Most definitely. Commonly,

budget. Considering

accountants lack the creativity, flair, and

scenario, when COVID-

SWC: I was always a very numeric person

emotion necessary to be a good marketer.

marketing budgets became more stringent

and enjoyed working with numbers. I studied

Whilst, on the other hand, marketing people

and limited. Hence it was the marketer’s

Maths, Accounts and Economics at O and

are often perceived as being only emotional

job to be more creative with the available

A level. At the time, our tertiary education

and lacking the numeric grounding

funds that they had. In that way, despite the

system here was a bit complex, and after

necessary for looking after the bottom line,

lowered budget, the firm did not suffer.

completing Sixth Form and obtaining my A

which ultimately remains critical and central

levels, I opted to go straight into employment.

to any commercial activity. Having a nice

In such a budget scenario, you need to be

I continued my studies in Accounts through

mix of both is an asset and has undoubtedly

both practical and concrete, keeping in

distance learning. In the meantime, through

assisted me in my career over the years.

mind the situation at hand, and at the same

my exposure to leading local and global

as a case started spreading,

time as creative as possible to make the

brands present in our portfolio, I became more

The qualities that you need for each

most of the funds you have. The success of

involved and interested in marketing and brand

field are undoubtedly very different.

the funds allocated to marketing activities

management. So when the opportunity arose

For example, marketing is more creative,

boils down to the ROI achieved in terms of

to move to the marketing department here

while finance is more concrete. How do

clients acquired and the allocated billings

at Farsons, I immediately went for it, despite

you think that these qualities

of such clients.

having just obtained my initial qualification in

complement each other?

finance. Ironically, I moved to marketing only

SWC: I tend to see expenditure on marketing

days after being informed that I had placed

LC: Sometimes, it isn’t easy to do marketing

more as an investment rather than a cost,

first worldwide in the final examinations of the

for a financial firm as you must be more

and as with any investment, there needs to

Association of Accounting Technicians. In fact,

creative while keeping a professional

be a defined and measurable return agreed

the move to marketing was not understood by

tone throughout. If a marketer realises

to at the outset of any marketing activity.

many, but I was confident that it would serve

that link and makes the most of it, they

One can have the most super, wonderfully

me well in my career progression.

would succeed in a financial-marketing

creative marketing campaign running, with

environment. As with any other aspect,

fantastic visuals and videos and promotional

financial marketers need to study and keep

activities. However, suppose the campaign

up with current financial events. Therefore,

or activity fails to deliver the »

...given the restrictions and several regulations that financial firms must follow, it is somewhat more challenging to market a financial firm.

— Luca Caruana

MONEY

THE FINANCE EDITION

BUSINESS

I tend to see expenditure on marketing more as an investment rather than a cost, and as with any investment, there needs to be a defined and measurable return agreed to at the outset of any marketing activity.

— Susan Weenink Camilleri

targeted and agreed-to KPIs over a defined

budget and ensuring it is followed and

period, which is largely expressed in

maintained throughout the year. Marketing

financial terms. In that case, success is

is also about being creative, creating the

questionable no matter how many of your

necessary awareness, raising the firm’s

consumers ‘liked’ your ad.

credibility, and attracting clients to your firm. So, the challenge is to remember that

On the other hand, however, if success

it’s not just about the numbers. It’s also

is only defined in financial terms, and

about enhancing the brand.

your eye is only on cost management and

containment, then this will likely inhibit

SWC: I sometimes get lost in the numbers

creativity and stifle creative thinking

and analysis, and perhaps in this way, I risk

‘outside the box’. This is precisely why

putting creativity and innovation to the side

I see the two fields of marketing and

when evaluating marketing proposals or

finance as complementary to each other,

initiatives. I do make a conscious effort to

and if well managed, could result in more

wear both hats in such instances.

significant gains for the organisation or commercial activity.

Do you think there needs to be more union between finance and marketing

How does having a financial background

departments?

make your work easier?

SWC: My initial years working and studying

LC: Yes, definitely. One cannot survive

LC: It makes it easier because marketers

finance undoubtedly gave me the necessary

without the other, especially with increasing

need to plan and create marketing material

knowledge, discipline and understanding

competition and marketing awareness in the

according to the environment they’re

of financial systems and financial terms

financial world.

working in. It is undoubtedly difficult for a

in general, but more importantly, gave me

general marketer to work in a financial firm,

exposure to the financial backbone of our

SWC: I’m a firm believer and practitioner

especially if they are used to being more

internal systems and controls, and this has

of cross-communication across all

creative. I am not saying that there are

more than served me well over the years.

departments and functions within the

no ways and means to be creative with a

company. Over the years, I have found that a

financial firm, and there are some excellent

On the other hand, how does it make it

greater understanding of the point-of-view

examples locally where financial firms

more challenging?

and priorities of different departments and

are marketed in a fun and engaging way.

functions has led to less inter-departmental

Still, given the restrictions and several

LC: Sometimes, thinking outside the

stresses or conflicts and resulted in a

regulations that financial firms must

box becomes more difficult if you are too

more coordinated and smooth business

follow, it is more challenging to market a

knowledgeable about the financial world.

operation, the outcome of which has only

financial firm.

Marketing is not just about the marketing

been positive.

ISSUE 69

MONEY

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PROMO

A TIME OF GREAT OPPORTUNITY

“The time for businesses to consolidate is now,” says Luke Cann, who recently joined NOUV to head its specialist advisory company 36N Capital and lead its transaction advisory team.

ISSUE 69

MONEY

PROMO

NOUV set up

N Capital in

as a boutique

consultancy arm specialising in capital raising, mergers & acquisitions and advisory services.

Five years down the line, the founding partners have managed several angel investments, staged round fundings, M&A activities, and emerging venture-based private placement transactions.

And when it comes to the local financial advisory landscape, Luke Cann today is a household name; the type who sits with company owners to discuss the way forward and draft plans from inception and the way ahead.

Businesses should be thinking more long-term.

“I draw experience from capital raising, restructuring of companies, and assisting in clients’ strategic decisions within a wide range of industries. I have been involved in various projects and was lucky enough to have been involved right from their inception…. literally

areas relating to mergers and acquisitions

Luke’s work ethic is driven by trust, respect,

projects initiated during conversations over

together with capital raising, both locally

and honest values. “Businesses come to

lunch. And what I bring to the table is my

and internationally. It is a team that has

us not only because they trust our good

experience and the ability to overcome or

embraced the way the industry should do

judgement but because they know that our

mitigate challenges which I would have already

things, and we are all aligned to our mission

strategic consultancy goes beyond business

encountered on other projects.” Regarding

“to transform private family businesses to

transactions and is built on mutual trust,

the local financial services sector’s current

public interest entities”. Luke explains how the

understanding and a close relationship that we

situation, Luke states that the industry is

company’s primary work is to provide early-

develop over time.”

experiencing particular times. “Some would

stage, interim- and growth-round funding,

describe them as challenging, others would

predominantly in property markets.

say peculiar, and others would even go as far

“This is why they feel confident to provide us with sensitive data, and therefore, trust is key

as describing them surreal. What I see is a time

“Their requirements would generally centre

to the development of our service offering.

of great opportunity to put our act together to

around the raising of finance - from banks,

Respect to all stakeholders in the industry is

safeguard this essential economic pillar.”

capital markets or institutional investors.

also paramount, as is honesty in the way we

In addition, we advise them on strategic

conduct our business,” he added.

“I also believe the best way forward for the

decisions such as diversification, investing in

business sector is to start looking at things

new sectors, new companies or new markets,

“When it comes to business advisory, trust is

long-term seriously. Businesses need to

and we support our work by carrying out in-

key. Clients who seek advice look for someone

consolidate and think with an international

depth feasibility studies.”

they can comfortably trust and come with a

mindset. We are already witnessing some

proven track record. After all, the scope of

interesting business moves where some

“We service a wide portfolio of clients

seeking advice is to be open to opinions from

established brands form stronger synergies

from an equally diversified portfolio of

someone from outside the organisation who

instead of competing. I interpret this as a sign

sectors including property, real estate,

can bring factual and objective input, which

of maturity that reflects the attitude we need

hospitality, shipping, health and retirement,

ultimately drives a fundamental change in the

to start portraying across the whole sector.”

manufacturing, pharmaceuticals, IT,

company or organisation. This is what we do,

wholesale and retail and food and beverage

and we are proud of what we are achieving

amongst others. We also broker mergers and

with

Luke joined NOUV to lead

N Capital’s

Transaction Advisory Team earlier this year.

acquisitions for more mature enterprises.

Aside from the work ethic and how the

Within this context, our strength is twofold:

team operates, he feels privileged to have

experience and the ability to source local

found a very experienced team to work with.

and foreign finance providers. We also enjoy

“At NOUV and

considerable deal flow relating to the

N Capital, I found a team

who is determined to grow and evolve in

MONEY

mergers and acquisitions sector.”

THE FINANCE EDITION

N Capital,” concluded Luke.

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DEFI

A REVOLUTION IN FINANCE or

A MERE CRAZE? One of the buzzwords in cyberspace that is increasingly gaining traction is decentralised finance, better known as DeFi. The notion promises to challenge the way traditional finance has been done for the past decades and could shake up financial intermediaries should it be a successor of traditional finance as we know it. But what, exactly, is DeFi? Moreover, what is it looking to trump? Jake Aquilina asks. »

MONEY

THE FINANCE EDITION

DEFI

The traditional finance industry includes

week. However, some DeFi applications have

On the other hand, crypto traders can pair

companies that deal with investing, credit,

cemented themselves in the blockchain world

cryptocurrencies and stake them in ‘farms’ as

debt, money markets, lending, insurance,

and have become a popular alternative to

pairs to receive ‘harvest’ periodically. Farming

and anything related to managing money.

traditional finance.

involves placing LP tokens on a ‘farm.’ Staking

Traditionally, finance systems are known to

on a ‘farm’ is equivalent to executing a smart

be highly centralised and are usually run by

One of these applications is decentralised

contract to allow your tokens to be kept by

for-profit firms.

exchanges, better known as DEXs. Such

the ‘farm.’ As a reward, one would typically

online exchanges allow users to exchange

receive another token that is striving for

One of DeFi’s central points is that no single

currencies, both FIAT and cryptocurrencies.

popularity in exchange for your’ farm.’

and central authority controls currencies, as

DEXs are peer-to-peer markets where crypto

several entities within the blockchain world

traders conduct transactions directly. In

The future of finance?

would hold a copy of a history of transactions.

a way, they fulfil a core function of crypto,

In addition, those in favour of a blockchain

providing a platform for financial transactions

As indicated, DeFi is still a growing field, with

transition argue that DeFi enables more

not mediated by banks, brokers, or other third

many other innovative approaches to finance

speedy transactions as the intermediary would

parties.

being taken, and at times, adapted from

be removed from the equation of transactions,

the traditionally understood way of finance

thus allowing swifter transactions to be

There are also Automated Market Makers

management.

made. Finally, blockchain enthusiasts note

(AMMs). Using liquidity pools instead of

that this notion of DeFi allows for more open

traditional markets of buyers and sellers,

DeFi apps are gaining popularity, leading to

DeFi, trust arises from the open-source code in the smart contract, which runs with transparency, openness and immutability

transaction recording than privatised ones

digital assets can be traded without

a significant shift from traditional finance

through intermediaries.

permission and automatically. These types of

to this decentralised form of financial

applications have proven to be very popular

monitoring. In fact, in the space of a year, the

We must also note that DeFi is different from

among cryptocurrency users, with apps such

value of USD locked within DeFi stood at five

simple peer-to-peer transactions but allows

as Uniswap on the Ethereum blockchain and

times more by the end of November

for more complex transactions. This is where

PancakeSwap on the Binance blockchain

as from over $

smart contracts come in, which are programs

boasting over a combined $

stored within a blockchain and operate only

cap by the end of November

when predetermined conditions are met.

Executions of such contracts, therefore, are

As is always within the blockchain world,

Traditional finance versus DeFi, therefore,

made automatically. Cryptocurrencies such as

new terms get tabled in DeFi – which are

puts in place the questions of trust placed

Ethereum and Solana, two of the most popular

sometimes borrowed from traditional

by peers. By depositing money into a bank

cryptocurrencies, allow this to happen through

finance – to express certain functions of

as it is traditionally done, one trusts that

their platform.

smart contracts within the sphere. Such DeFi

the money will remain there. Governments

glossary includes phrases such as ‘liquidity

support this trust with laws, so laws will be

Types of DeFi applications

pools’ (LP) and ‘farming’. The former refers

enforced if the financial institution is in the

to a pool of coins locked in a smart contract

wrong. On the other hand, when it comes

Most DeFi applications are at conception.

that allows investors to receive a return on

to DeFi, trust arises from the open-source

The space is still yet blossoming, with more

their investments while facilitating an efficient

code in the smart contract, which runs with

innovative applications being created week on

asset trading system.

transparency, openness and immutability.

ISSUE

billion market .

,

billion locked in November

, it grew to over $

billion at the

current time of writing.

MONEY

SOFT POWER

MALTA’S SOFT POWER POTENTIAL (Part )

THE DIPLOMATIC FRONTIER Ray de Bono met with Minister Evarist Bartolo, Malta’s Minister for Foreign and European Affairs, in his spectacular office at Palazzo Parisio, adjacent to Castille Place, in Valletta. Frescoes and fine art adorn the office rooms, and its prestigious location, right next to the prime minister’s office building, is not a trivial detail here. So, what better way to learn about Malta’s diplomatic vision than the chance to have a frank chat with the man in charge of our foreign affairs?

Since the dawn of civilisation, nations have

has a long history as a means of promoting

diplomacy.” - Joseph S. Nye Jr. “Soft Power

been trying to win affection or favour from

a country’s soft power, and soft power was

and the Public Diplomacy Revisited. The

fellow states. Soft power is the ability to win

essential in winning the Cold War. Smart

Hague Journal of Diplomacy 14 (April 2019).

favour with one’s charms instead of coercion.

public diplomacy requires an understanding

Hard Power is when states use their military

of the roles of credibility, self-criticism

What are the criteria for determining a

or financial assets to reach their aims.

and civil society in generating soft power.

nation’s soft power credentials? Analysts

As authoritarian states today use new

consider many attributes, apart from

“A country’s soft power rests on its

cyber technologies and other means to

a country’s perceived identity in the

resources of culture, values and policies. A

disrupt political processes in democracies.

world’s eyes, ease of doing business, eco-

smart-power strategy combines hard- and

Questions arise about the boundaries of soft

friendliness, and the quality of the public

soft-power resources. Public diplomacy

power and the appropriate policies for public

service. They also focus on its citizens’

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Malta can only boost its soft power; it’s all that we’ve got — Evarist Bartolo

trustworthiness, friendliness, digital

growth. Finally, we discussed Malta’s

our foreign affairs handled well is paramount

readiness education, and global diplomatic

environment and tried to unravel why it was

if we are to one day be listed (let alone rank

stance, which is precisely the topic which we

in such a bad state. These were not random

high) on Global Soft Power indexes such as

are tackling this month.

themes. They constitute the essential

those of Monocle magazine or Portland.

metrics when defining our country’s soft We have analysed Malta’s soft power

power. Next in line in our series of articles

Diplomacy is our official voice on a global

potential from various perspectives in

about Malta’s soft power is diplomacy’s role

scale – alongside our world-renowned opera

previous articles. First, we discussed Malta’s

in shaping the country’s identity.

singer Joseph Calleja, or the voice of the late

architectural woes, its cultural and artistic

inventor of Lateral Thinking, Edward de Bono.

paradigms. We debated business and issues

In defining a country’s soft power prowess,

of fiscal integrity, corruption and economic

diplomacy is the cherry on the cake. Getting

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We may not have top international fashion »

SOFT POWER

brands like the Italians or the French, nor can

rule, to the Italians’ drive (and their age-old

from saying it as it is, and, with decades of

we speak about home-grown mechanical

affinity with the Maltese) for their country’s

political experience, his viewpoints are worth

engineering industries like they do in

unification. Way up to the recent British era in

their salt. So, we delved into how soft power

Germany or Japan. Still, we have our ancient

modern times.

is critical for the Maltese and the rest of the

history, rich archaeological assets and our

world.

political commitment to serve as a beacon

This

th-century building in Merchant’s

for peace - in a world that is increasingly

Street has seen it all. It radiates an

“Malta can only boost its soft power; it’s all

becoming more hostile.

international aura. Suffice to say that

that we’ve got”, opined Minister Bartolo.

Minister’s Bartolo’s office lies in the very The encyclopaedia Britannia defines

place wherein June

diplomacy as “the established method of

Bonaparte himself resided after he took

, Napoleon

we are experiencing new global political

influencing the decisions and behaviour of

possession of Malta from the Knights of St.

shifts and rifts. While neutral and

foreign governments and peoples through

John. If that detail isn’t impressive enough, I

sovereign, Malta is ‘committed to the

dialogue, negotiation, and other measures

don’t know what else is.

EU’s Common Security and Defence

short of war or violence.” The definition is most apt in Malta’s case.

In a post 9. , post-Arab Spring world,

Policy (CSDP)’ and adheres to the EU’s On a much more personal note, Evarist

foreign policies. How do you see neutrality

Bartolo taught me journalism at University,

helping or retaining its relevance in the

If his office could talk, it would reveal the

so, since we knew each other on a first-

foreseeable future?

most startling information about Malta’s

name basis, we both felt at ease, and the

past centuries, from the Knights’ period

discussion flowed naturally. The minister

“Malta needs peace for it to succeed. It is

to a seminal couple of years under French

is a frank talker. He does not shy away

in our best interest that all nations act as per the statutes of the United Nations and stick to their international commitments for peace and disarmament. Peace in the Mediterranean, for instance, is in our best interest. Despite its size, Malta needs to play its role to promote the peaceful resolution of conflicts both near and far.”

I could join the dots in the minister’s narrative; all this talk about peace and preserving our neutrality was not a cliché.

Our island has a long-standing reputation as a peace broker.

“It was almost exactly

years ago, one

cold and rainy day, back in December

,

when we hosted the historic Malta Summit between US President George H. W. Bush and Soviet General Secretary Mikhail Gorbachev.

This was a dramatic time in Europe, just a few weeks after the fall of the Berlin Wall.

The two superpowers could have held this meeting anywhere globally, but instead, they sat down for peace here in Valletta, sealing the end of the Cold War.” Napoleon’s quarters at the Palazzo Pariso, Valletta

Suffice to say that Minister’s Bartolo’s office lies in the very place where in June 1798, Napoleon Bonaparte himself resided after he took possession of Malta from the Knights of St. John ISSUE 69

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“For a non-Maltese person, all this talk about

“We should go for a positive agenda. The

the extraordinary role of an island with less

European Union and African Union must

that’s barely

together patiently and with perseverance

miles long sounds pretty

presumptuous. Indeed, some would say we

engage with Libyan authorities to

have allusions of grandeur; however, Malta

recognise the status of UNHCR and IOM and

does stand out geo-politically.”

involve them in the running of migration reception centres. But first, we need to

“There are over

islands in the

build trust between the EU and Libya and

Mediterranean, and many of these are

reset our relations with them. The EU’s

much larger than Malta. Take Sicily, for

self-righteousness and its demonising

instance; it has over five million inhabitants and a surface area of ,

square km.

Nonetheless, despite its minute geographical

Libyan authorities dealing with migration Malta’s foreign minister addressing

while stopping cooperation with Libyan

Glasgow Conference

coastguards will be counterproductive and

footprint and the small population of less

worsen the situation. It is in the interest

than half a million, Malta is a sovereign nation

Colonisers have come and gone, but their

of Libya to be made safe for Libyans and

and UN and EU member state.”

footsteps are visible today. We still live

migrants in Libya, and we must all assist

with the remainder of colonial times. We

Libya in becoming so.”

Are we the mouse that roars? I jokingly asked

have not woken up from our post-colonial

the minister: “We do not roar – and we do

hangover yet. We still feel superior to our

Returning to the broader notion of soft

not want to be a mouse neither,” he replied

neighbours and lecture them at the slightest

power, I quizzed the minister further.

smiling.

opportunity. We talk to them but do not listen to them, so we try to impose our priorities

Malta’s reputation and, indeed, its soft

“Residents in small islands often think of

and agenda. We must sit down as equal

power prowess have these last few years

themselves as the centre of the world. We

partners and explore common ground and a

been dented. How do you see your role

can try to influence the rest of the world, but

common agenda. We must have a frank and

at the helm of Malta’s foreign affairs

the rest is constantly influencing us through

open relationship to build trust. The political

ministry, making a difference and bringing

global political shifts that affect economies,

process of atonement is indispensable to

about a change, in this regard?

peace, and peoples’ flow. So, despite our best

overcome the current stalemate and reset

efforts, there is always a limit to what we can

the relationship between the two shores and

“The whole world is going through a difficult

do.”

become equal partners.”

time. But, unfortunately, hard power »

“Diplomacy offers Malta the podium to voice its concerns at par with any larger nation. We are conscious of our limitations but do not shy away from saying it as it is.”

When I spoke to him, Minister Bartolo had just returned from the Mediterranean Dialogues event in Rome. This event is an annual high-level initiative promoted by the Italian Government and ISPI (Italian Institute for International Political Studies); it brings together participants from all Mediterranean nations, Europe, North Africa and the Middle East.

In his intervention, Malta’s Foreign Minister lived up to his creed as a flag bearer for peace in the Euro-Med area. Asked about overcoming the current stalemate and ‘revitalising partnerships’ across the two shores, with an accent on the turbulent realities afflicting Libya, this was his reply.

“As Europeans, we must change how we think and talk and behave towards

Russian Foreign Minister Sergey Lavrov greets Minister Evarist Bartolo in Sochi, Russia.

our neighbours on the Southern shores.

31 May 2021

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appears to be taking the precedent, and for a nation like ours, this is never good news. Unfortunately, Malta did suffer a blow to its reputation and, while ensuring that the country seeks justice and addresses shortcomings, the nation must continue to draw help from its best assets, particularly its people, to help it overcome present challenges.”

“From down under in Melbourne to Washington, and from Ghana to Tokyo, Malta has over

diplomatic missions or

representative offices around the globe.

However, these offices alone can only do so much.”

“We have thousands of its citizens and their relatives living worldwide, and the number of these people overseas would almost double our island’s population. The Maltese diaspora is an asset that we must work with to help promote our national identity, the immense history of our people, our common good and

Chinese Foreign Minister Wang Yi welcomes Minister Bartolo in Chengdou, China. 23 July 2021

our potential.” people, one finds nurses, doctors, surgeons,

do you see the Foreign Affairs Ministry

“Mistakes made by the very few should

scientists and engineers– all of them are a

helping make climate change more

not be allowed to mark the hard work and

living testimony to our national potential.

than just a fancy policy but a working

goodwill of the rest of our nation.”

We should work together and think of how

document with concrete results that one

to celebrate the image of Malta in the rest

can see and feel in action even here in

“We all have a role to play to help promote a

of the world, celebrate the best of what we

Malta?

better Malta; this is not just the ministers’

have to offer as people.”

responsibility. You find Maltese and Gozitan

“As a small island state with limited natural

religious missionaries across Latin America,

Malta was the first country to formally

resources, an ever-growing economy,

Africa and the Far East. These hard-working

table the issue of climate change as a

and high population density, the concept

people devote their lives to helping the

political agenda in the 43rd session of

of sustainable development must be at

poor through education and healthcare.

the UN General assembly; this was a

the heart of Malta’s economic, social and

There are thousands of Maltese in Australia,

significant milestone and a feather in

environmental development. Accordingly,

Canada, the US and the UK. Amongst these

our diplomatic hat. But, realistically, how

Malta recognises the

Agenda as the

most comprehensive global development plan thus far, and its value lies in its universal

Our nation has made tremendous economic, social and political strives since it gained its sovereignty. Our active neutrality as a nation devoted to peace and stability is an asset that has served us well and must be cherished and protected ISSUE 69

and transformative nature.”

“The

Sustainable Development Goals

(SDG) and accompanying targets offer a blueprint for a better future, preserving what we have today whilst working towards a better tomorrow.”

“Speaking about results - in the Index, Malta was ranked

SDG

nd out of

countries regarding SDG implementation.

This is a strong signal of Malta’s commitment to achieving the goals, as Malta strives to improve on such progress.”

“Yet, while Malta continues to play its part

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Soft power is less about propaganda and more about what people believe, what they see, how they behave and the quality of their lives locally and overseas, given the current

since its independence, our island has always

levels of globalisation and interconnectivity,

played its UN cards well and, according to our

no single nation-state can advance

minister, is highly respected in this regard.

sustainably without the collective support of other states, be it close or far. Malta

In

acknowledges that reaching the goals by

elected President of the United Nations

is a challenge for all, and the journey

, the late Prof. Guido de Marco was

General Assembly (

th Session). He

is long and requires the collective efforts

undertook several diplomatic initiatives

of all stakeholders within the international

leading to his visit to the refugee camps

community.”

in the Occupied Territories and Jordan to Ethiopia and Albania.

“Our country remains committed to continuing on this journey of sustainability

Wrapping up my interview, I asked the

and stands ready to work in partnership with

minister to recommend his viewpoints on

other States and stakeholders in this regard.”

boosting Malta’s soft power potentials.

The opportunity of Malta sitting on the

“When strategic arms limitation talks are at

United Nations (UN) Security Council seat

a standstill and conflicts are on the increase,

is a positive development and will help

the world inches ever closer to the risk of

Malta’s international image, including its

war. Hard Power, sadly is making a comeback.

much-needed soft power credentials.

Our nation has made tremendous economic,

However, following our island’s experience

social and political strives since it gained

on the UN Security Council seat in 98 ,

sovereignty. Our active neutrality as a

what are the prospects of this prestigious

nation devoted to peace and stability is an

position being granted again soon?

asset that has served us well and must be cherished and protected.”

Next Month

“Malta stands a good chance of sitting in the “Malta should continue to strengthen

its reputation as a peace-builder”, and

The next focus in our series exploring

Malta is a candidate for one of the two non-

according to the minister, this will be “a

Malta’s soft power potential is tourism.

permanent seats up for grabs in the Western

feather in our hat, upping our soft power

This industry brings millions of

European and Other Regions group for

-

credentials over time. Soft power is less

people to our island each year, making

. The vote at the UN takes place in June

about propaganda and more about what

it an essential source of income for

, and so far, only Malta and Switzerland

people believe, what they see, how they

the country and offering us a huge

behave and the quality of their lives.”

opportunity to reach out to the rest

United Nations Security Council (UNSC).”

have put forward their bids for the two

of Europe and the world. Moreover,

vacancies. The Security Council consists of “While holding international titles or hosting

each visitor is gaining a first-hand

China, France, the Russian Federation, the

important international events is great

experience of Malta and the Maltese,

United Kingdom, and the United States of

at drawing media attention, one should

so it is apt that we ask how, despite

America.

remember that soft power needs a long time

the many challenges of the early 21st

to bear fruit. So, despite the challenges on

century, we can strengthen tourism as a

This will be an important and relatively

finds along the way, we should be humble

means of boosting our national identity

influential post, yet not the first of its kind.

enough to learn from past mistakes, focus on

worldwide.

Malta has already served as a member of

our progress and work towards reaching our

the UNSC from

goals,” concluded Minister Bartolo.

members, of which five are permanent:

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. It appears that

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Until then, see you in 2022. All the best!

GREEN FINANCE

FINANCING GREEN & GREENING FINANCE AN OPPORTUNITY FOR MALTA As countries recover from the Coronavirus pandemic, we must take the historic opportunity to tackle climate change simultaneously – to build back better and greener. We can deliver green recoveries across the globe that create good jobs, trillions in investment and ground-breaking new technology. And we must. JP Fabri explains.

COP-

has come and gone. It has achieved less than hoped for.

the country focuses on getting off the greylist, effort needs to be made

Despite this, there remain global objectives that all countries should

to find niches in which Malta can deliver a specific and novel service

strive for. First, although no formal agreement has been reached,

offering. Green finance should be one. Not only is it a fast-growing

countries should still secure global net-zero by mid-century and keep

sub-sector of the financial services sector, but given its positive tinge,

global warming . degrees within reach. To deliver on this, countries

it can also support Malta in relaunching its status as a regional financial

will need to accelerate the phaseout of coal, encourage investment in

hub. Malta can further leverage its small island status by focusing on

renewables, curtail deforestation and speed up the switch to electric

the international financing of such islands, especially concerning blue

vehicles. Secondly, there is a need to adapt to protect communities

bonds. The opportunities are immense. However, for Malta to succeed in

and natural habitats. Finally, countries need to work together to enable

this area, a dedicated strategy is needed, which in my opinion needs to

and encourage countries affected by climate change to protect and

be built around three main pillars: greening finance, financing green, and

restore ecosystems, build defences, put warning systems in place

capturing the opportunity.

and make infrastructure and agriculture more resilient to avoid loss of homes, livelihoods, and lives. To realise the first two goals, international

Greening Finance

financial institutions must play their part. All parties must work towards unleashing the trillions in private and public sector finance required to

The transition to a green financial system means fundamental changes

secure global net zero.

to the way decisions are made across the economy. To achieve the goals of the Paris Agreement and our broader environmental ambitions, all

The reallocation of capital towards green investment offers the

finance will need to incorporate the financial risks and opportunities

potential to reshape cities, energy systems and land use worldwide.

presented by climate change and other environmental challenges. In

Moreover, the nature of this investment over the coming decades

addition, there is increasing international recognition of the need to

will determine the future of our climate, the natural world, and the

integrate climate and environmental factors into mainstream financial

resilience of our communities. It also presents a substantial commercial

decision-making.

opportunity for countries with green finance at the centre of their financial sector strategy.

Momentum to green the financial system has grown significantly in recent years. There is now widespread support for the Task Force on

Malta needs to embrace this for several reasons. There is no doubt that

Climate-related Financial Disclosures (TCFD) recommendations and

Malta’s financial services sector has faced several challenges over the

an increasing number of high-profile global initiatives, such as the

past few years, including greylisting. Due to several specific jurisdiction-

Sustainable Insurance Forum and the Central Banks’ and Supervisors’

related challenges and a lack of innovation in devising new regimes or

Network for Greening the Financial System (NGFS), have been

frameworks, the sector has lost its international competitiveness. As

established. However, this transformation must accelerate and increase

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to match the scale of the challenge faced, particularly as we move to a net-zero economy. Considering the financial risks and opportunities from climate and environmental factors needs to move beyond ‘corporate social responsibility’ to become a financial and strategic imperative and normalised as good business.

Clear and consistent frameworks, such as green definitions and standards, will be essential to ensure confidence in the effective functioning of green financial markets. The government should be acting through matching the ambition of the objectives of the EU’s Sustainable Finance Action Plan, creating Sustainable Finance standards and working with the respective institutions to truly create a regional green finance hub.

Financing Green A strategy to green the financial system needs to be combined with specific actions to mobilise and accelerate private finance flows into key clean growth and environmental sectors at home and abroad.

The government has already launched several plans that should lead to the decarbonisation of Malta by

. This now needs to be matched

by initiatives that will support the required investment. Malta will be benefitting from a significant European Resilience and Recovery Fund package that has been dubbed by Ursula van Leyden as one of the greenest funding packages and which will undoubtedly support the transition. In addition, the Malta Stock Exchange has launched the framework for the launch of Malta’s first green bonds by local players, and the Malta Development Bank is also playing a pivotal role in securing finance for such projects. However, the government needs

clear role for government to act as a cornerstone investor, it is equally

to continue working on this pillar by establishing robust, long-term

essential that green projects can develop new revenue streams that

policy frameworks, improving access to finance for green investment,

provide rewards for the environmental benefits they deliver.

addressing market barriers and building capability, and developing innovative approaches and new ways of working. Whilst there is a

Capturing the commercial opportunity, Green Finance brings together many areas where the opportunity lies, not just in financial services but also in encouraging innovation, analytics, and low carbon technology.

Malta needs to start seeing itself as a potential regional hub to test

As the country focuses on getting off the greylist, effort needs to be made to find niches in which Malta can deliver a specific and novel service offering. Green finance should be one.

innovative technologies.

Demand for green finance from consumers, investors, and governments is expected to grow substantially over the coming decades. Malta should start working to capture a fraction of this market especially given its strategic positioning and its long-time pioneering approach in climate change, especially at United Nations level. To this end, Malta needs to seriously consider developing its green finance centre whilst developing its resources in the area. The National Employment Policy has also focused on this area by supporting investments in capabilities and skill-building in the green economy.

I believe that green finance offers a unique opportunity for Malta on several levels. Malta needs to seriously consider this growing niche and should also see it as a means to relaunch its financial services sector whilst also supporting the growth of other economic sectors. The transition to a net-zero economy requires a significant reallocation of resources, and having an attractive regime in this area can genuinely position Malta as a regional hub. The future is now and entirely in our hands.

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ECONOMY

THE PANDEMIC SAGA and ITS SOCIO-ECONOMIC IMPLICATIONS The fourth wave of coronavirus infections is raging across continental Europe, forcing governments, once more, to take drastic actions to mitigate the spread of the virus and stop from hospitals being overwhelmed. Jordan Portelli explains.

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Austria, Germany, and the Netherlands

with low vaccination coverage. Thus far,

have experienced Western Europe’s fastest

Austria’s vaccination rollout covering

increase in cases since the start of the

of the population remained susceptible to

month. Although aware of the economic

many political forces, vaccine sceptics, and

As expected, a rise in cases was inevitable.

repercussions set to pan out, governments

spreaders of fake news. Also, a mid-summer

However, the fear of the emergence of new

responded. Amongst all, Austria’s government

declaration that the pandemic has been

variants continues to weigh the most on

have thus far taken the most stringent

“mastered” with a vaccination campaign,

investors’ sentiment. Indeed, the unknown

actions recently, imposing a three-week

far from being complete, did not help. In

severity of the variant and its implications

national lockdown and making vaccinations

Eastern Europe, the situation is far worse

in terms of restrictions will undoubtedly

compulsory as of February ,

amid a notably lower vaccine uptake. Bulgaria,

condition the economy.

. In

an essential role in underestimating the yet %

dangerous pandemic threat.

addition, Germany restricts access to public

Europe’s worst in terms of vaccine coverage,

places for the unvaccinated, while the

saw the death rate surging, reaching an all-

On a positive note, undoubtedly, as opposed

Netherlands is shutting restaurants and bars

time high in recent weeks. Although we have

to

early.

seen a push in Europe, many countries still

how a rise in cases, as we are experiencing

, we are now more knowledgeable on

lag. Despite better vaccination programmes,

now, should be tackled. In addition, we have

Indeed, the countries suffering the most

herd immunity levels in many countries

scientific evidence that vaccines are doing

from a rise in infections and thus reacting

remained way below the desired levels.

their bit to mitigate the pandemic. Therefore, if

strongly against the virus’s threat were those

Unfortunately, politics once again has played

hospitalisations are kept at bay, we should »

Today, ‘technocratism’ ideology might be the more plausible solution to overcome the various socio and economic challenges.

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ECONOMY

manage to navigate the rise in cases.

Critical macro-economic data trackers

We now see low levels of

Nonetheless, economic recovery might be still

that financial politicians use for monetary

level since

a shot in the dark despite some encouraging

decisions show that the economic picture

psychological impact.

signs.

is unconvincing. Case in point, looking at

. %, the lowest

, possibly given the pandemic’s

‘capacity utilisation’, a company’s potential

Indeed, delving deeper into the underlying

Interestingly to analyse from an economic

output in simple terms, is still weak compared

dynamics of this critical economic metric, it

perspective at this point, the current inflation

to pre-pandemic levels. There is a clear

is visible that the spike in employment during

levels are supply-driven rather than demand-

dispersion in the U.S. between the ability

the pandemic has pushed many to rethink

driven. Supply bottlenecks, the key source of

to increase output and the current levels.

their position within the labour force. For

inflationary pressures, is a phenomenon we’ve

Possibly this could be twofold - the current

example, many people who lost their job in

been witnessing in

supply disruptions and/or still weak consumer

the age group between

by a second coronavirus wave, a blockage in

demand, with the latter being a substantial

for early retirement. In contrast, the younger

the Suez Canal earlier in March, port closures,

long term concern as it shows that consumers

generation within the labour force has

and capacity limitations have over the year

remain vigilant following the pandemic shock.

deliberately opted to move out of employment

. Disruptions worsened

seemingly persisted.

-

have opted

and improve their quality of life. The recent In Europe, despite it varies across

increase in quits in the U.S. poses a severe

Unfortunately, the recent rise in coronavirus

countries, we have seen a strong pick-up

economic risk in the future.

infections may worsen an already tense

following the lows of March

situation. Thus, we may once more envisage

capacity utilisation in the euro area

the shift of retail consumption in favour of

averaged 8 . % from 98 until

goods rather than services. That said, supply

reaching an all-time high of 8 . % in the

has brought about drastic, irreversible

chains, thus far proving vulnerable – even

fourth quarter of 989 and a record low

changes. Businesses had to take difficult

if caused by excess demand, may further

of 9.

decisions to survive, with many believing that

experience disruptions. A practical example,

Thus, we have more encouraging levels as

this might have been a blessing in disguise in

seaports, should lockdowns continue to be

opposed to our peers.

identifying unnecessary costs which can now

. Thus,

% in the third quarter of

As said, the structural implications are ,

9.

reinstated, may face limitations in terms

inevitable. We must accept that the pandemic

do without over the long term. In contrast,

of container handling, inevitably impacting

What is certain is the clear linkage between

we individuals might have taken a different

loading and further increasing supplier

capacity utilisation and inflation, with

approach to our day-to-day challenges.

delivery times – a key barometer of supply

the latter hinging on monetary decisions.

delays.

Moreover, in an augmented economic

Indeed, the changes brought about by

argument, unemployment is another crucial

the pandemic have had positive long-

On the contrary, services that rely on contact

factor within the equation, with the latter

term implications, possibly more from a

amid the pandemic’s first and second waves

and capacity utilisation, economically,

sociocultural perspective. However, these

were harshly impacted as governments

complementing inflation. Put simply, if

positive attributions will inevitably have also

and health authorities imposed mitigation

unemployment remains elevated. Capacity

negative long-term economic implications.

measures to reduce the spread of the virus.

utilisation levels will remain subdued on the

Thus, the way forward is bumpy. The

However, as expected, we’ve experienced

assumption that demand is weak, which will

economic dynamics have become way more

a strong rebound in mid-

also condition inflation. This is one of the many

complicated, and thus finding a balance

interesting is that we have seen sustained

chain arguments we discuss daily to try and

in this ever-evolving complicated world is

high levels over the past

analyse different economic scenarios and their

undoubtedly an uneasy challenge. Political

impact.

nonsense, as we have been experiencing

. What’s more years and above

historical averages. This bodes well going forward to mitigate the possible softness

over the past years globally and domestically,

in manufacturing activity due to possibly

Moreover, unfortunately, the scars triggered

is undesirable at this point. At these difficult

prolonged periods of supply disruptions.

by the pandemic will eventually be more

times, ‘technocratism’ ideology might be

Indeed, with supply shortages worsening,

visible, and long-term structural implications

the more plausible solution to overcome

manufacturing growth is likely to remain

are inevitable. A fascinating example is the

the various socio and economic challenges.

subdued for some time to come, leaving the

current U.S. labour participation rate, i.e.

Being highly rational in our decision making

economy reliant on the service sector to drive

the percentage of all working-age people

should command the plan now more than

growth.

employed or actively seeking employment.

ever going forward.

In Europe, despite it varies across countries, we have seen a strong pick-up following the lows of March 2020.

ISSUE 69

MONEY

SEARCHING FOR YOUR PREFERRED INCOME Vilhena High Yield Fund

4.68%*

Vilhena Sterling Income Fund

2.82%*

Vilhena Malta Bond Fund

2.12%*

*Current income yield as at 31/10/2021.

Talk to us | 2131 2020 | bovassetmanagement.com Past performance is not necessarily a guide to future performance. The value of the investment may fall as well as rise and currency fluctuations may also affect the value of the investment. Any initial charges that may apply may lower the amount invested and the amount received upon redemptions. Investments should be based on the full details of the Vilhena Funds Prospectus, Offering Supplements and the Key Investor Information Document, which may be obtained from BOV Asset Management Limited, Bank of Valletta p.l.c., Branches and Investment Centres and other licensed financial intermediaries. The investments underlying these financial products do not take into account the EU criteria for environmentally sustainable economic activities. BOV Asset Management Limited is licensed to provide investment services in Malta by the Malta Financial Services Authority. The Vilhena Funds SICAV p.l.c. is licensed by the Malta Financial Services Authority and qualifies as UCITS. Issued by BOV Asset Management Limited, 58, Triq San Żakkarija, Il-Belt Valletta, VLT 1130, Malta. Tel: 2122 7311, Fax: 2275 5661, Email: infoassetmanagement@bov.com, Website: www.bovassetmanagement.com. Source: BOV Asset Management Limited.

FINANCE

INVESTMENT ALTERNATIVES UNDERSTANDING THE RISK

How do you gauge the risks involved for the different options available if you seek to invest your money?

The Malta Financial Services Authority explains.

People invest their money for various reasons,

Return on investment risk

not the least believing that it is safer to do

amount invested. The risk of losing your capital depends very much on which investment you

so than to leave it as cash under a mattress.

Some investments bear more of a link than

choose. If you are after capital protection,

However, overcoming the risk of theft (which is

others to how the economy is performing. For

you may choose to put your money into a

ever-present even with investments) does not

example, in general terms, money deposited

bank, as you are covered by the depositor

mean that other investment opportunities are

into a commercial bank and fixed-income

compensation scheme administered by the

entirely risk-free.

bonds offer an interest rate that should not

MFSA, which protects you against default for

fluctuate. This means that you can plan ahead

up to €

Perhaps it would be opportune to explain

to calculate how much return you would get on

bank account, so your money is protected up

what is meant – in this context – by risk. In an

your savings.

to this threshold.

of the outcome not being what you expected.

Given that bank deposits are generally less

With bonds, the situation depends on various

However, that implies that what you expected

risky, you can expect lower returns compared

factors, including whether the bond is

was based on

to an investment in bonds or shares. However,

secured or guaranteed or both. First, one

case. Since investor protection and education

you must consider that if interest rates are low

must distinguish between guarantee and

of consumers in financial literacy are essential

and your money is tied up for years in deposit

security. A guarantee is a ‘promise’ by another

remits of the Malta Financial Services

accounts, inflation can reduce the value of

person – usually, an operating company within

Authority (MFSA), we have put together a

your savings over time.

the same group as the issuer – to honour

,

of the sum invested for each

ideal world, the risk would be the possibility

/

vision, which is rarely the

guide to some of the main risks and how to

the payment of bond interest and principal,

assess them. Inadequate information about

When it comes to bonds and shares, the

should the issuer fail to pay the bondholders.

financial instruments and trading venues can

economy’s poor performance or the company

In the case of a guarantor, one must analyse

result in consumers investing in an unsuitable

itself might result in the issuer being unable

the financial soundness of the guarantor. One

or inappropriate product. Therefore, investors

to pay interest in the case of the former or

crucial question is whether the guarantor and

need to understand the possible outcomes

dividends in the case of the latter. Again,

the company issuing the bonds are dependent

and how these ties into their particular

this might be difficult to gauge at the time of

on each other. If yes, does the guarantor add

circumstances. Thus, they must make

the investment, mainly if it is one with a long

any value?

informed decisions about their investments

duration, as things can change considerably

and weigh higher risks against the need for

over time. However, it is nonetheless

On the other hand, security takes the form

higher returns.

something to bear in mind when comparing

of issuer’s assets which are segregated from

investment categories. It is also vital to know

the rest of its assets and held by a third party,

All forms of investment carry some degree of

all there is to know about a product and the

usually a security trustee, to be sold or used

risk. A few aspects one should consider are:

entity before investing in it!

to the benefit of the bondholders, should the

»

The original sum invested.

»

The return on that investment.

»

The liquidity– in other words, being able to

»

issuer fail to pay bond interest and/or the Risk of capital loss

principal. Therefore, in the case of a secured bond, one must analyse the value of the

get your money back when you need it.

Some investments carry the risk of capital

security and the risks associated with that

The time horizon.

loss, meaning that you can lose part or all the

security.

ISSUE 69

MONEY

FINANCE

With an unsecured bond, if the company that issued the bond fails for any reason, then the investor could lose all the money they put into it. Because the risk is, therefore, higher for such bonds, the issuer may offer a higher interest (coupon) rate to attract investors.

If a bond offers a higher return than other bonds, it is often a sign that the investment in that bond or company is riskier. Therefore, investors need to seek professional advice to help them assess whether the product is suitable for them and if they can afford to absorb the worst-case scenario of losing all the investment.

The fact that there have never been any defaults in Malta should not lure investors into believing that this is not a possibility – no matter how remote. However, investors – and their financial advisers – should scrutinise the associated prospectus to understand the company they are entrusting their money to and understand that no one has a crystal ball to see into the future.

Whereas with a bond, investors are essentially financing a company, with equities, they are buying part of it, so if something happens to the company – it stops trading or goes bankrupt – then they need to understand that they may not take precedence when it comes to recouping their investment and lose their capital.

The features of a security can impact the ranking of the investors in the case of a default. Investors must understand the ranking of their investment before investing.

Investors need to consider that only if they invest in authorised firms will they receive the protection of the Investor Compensation Scheme, which covers certain types of

investor’s timeline: a young couple investing

with the bond or equity is in high demand

investments through licensed investment

for their retirement in a few decades will have

and possible to sell. With shares, the investor

firms. Failures by authorised firms qualify for

a different risk appetite to a retired couple

also must bear in mind that the share price

compensation under the Investment Services

wanting to have enough money at short notice

fluctuates and – since these are considered to

Act, but the cover per person is limited to

for their golden years.

be long-term investments, the time when they

€

,

.

might want their money might not be the most Fixed deposits at a bank may not allow early

Investment horizon considerations

auspicious time to sell their shares.

withdrawal unless in specified circumstances, and evidence of these is provided. Still, most

Concerning bonds, it should be considered

Investors need to consider whether they

savings accounts allow the account holder to

that fluctuations in interest rates can affect

might need to liquidate their investment at

withdraw some or all their savings on short

the market value of the bonds if you want to

short notice. Say there is another investment

notice.

sell them. The bottom line is that investors

they are considering, or an unexpected

must seek information on their investments

expenditure such as sickness crops up: how

With bonds, the moment when the investor

from a reliable source such as the prospectus,

long would it be before you could recoup your

might want the funds back by selling the

company announcements, and advice from a

capital? This will vary greatly depending on the

financial instruments might not coincide

regulated investment adviser.

MONEY

THE FINANCE EDITION

MARKETING

SLOW STEADY WINS THE RACE AND

There are very few things in life that frustrate Richard Muscat Azzopardi more than a panicked approach to marketing that seems to believe that the role of the discipline is to save a business when it’s doing poorly. But, convearsely, these businesses seem to think that, in a classic Schrodinger’s cat logic example, you should cut down on marketing the minute business starts looking bad.

I want to address why both statements

you should scale back on advertising, even

are flawed in their nature, especially when

if not necessarily on brand and marketing

it comes to marketing businesses that do

communications. If you’re a tourism company

work with other businesses. I’m separating

in the middle of a pandemic, for example,

these today because of the nuances I’ll be

spending money on trying to fill bed nights is

discussing; however, this applies to every

a bit of a fool’s errand. However, these cases

business we’ve worked with in broad strokes.

are extreme and serve as the exception, not the rule.

I also want to make one thing clear before I proceed any further. There are times when

MONEY

THE FINANCE EDITION

So, let’s get cracking. »

MARKETING

Simple. Start looking at marketing for your

We don’t perform magic for them; we help them articulate what they already know.

B B business like something you can’t work without. You don’t file your taxes or work on your accounting only if something or other happens to your business. You always pay the rent on time. You always pay your employees, and I’m sure you don’t consider your electricity bills optional, to be paid only when the business is doing well or when you need a boost at the end of your quarter.

Maintaining (or increasing) marketing spend when business is bad

Marketing should be the same. It’s something that should be on every one of your agendas.

Why is it a bad idea to stop marketing when

You should constantly consider leaving any

business is bad? Because by doing that, you’re

marketing opportunities on the table. It should

only stopping the inevitable. Suppose you

be a central part of your annual strategy. It

think that you should stop marketing when

should have a budget tied to performance,

your business is failing (unless it’s because of

and it should have a practitioner who owns the

an external factor such as the pandemic, I’ll

function from top to bottom.

reiterate). In that case, you either have your marketing function working exceptionally

With long-term marketing efforts, you should

badly, or you’re running a business on highly

also see a dramatic increase in the return on

conservative and, quite frankly, flawed ideas.

investment you get from marketing to other businesses because the buying cycle for B B

The purpose of marketing is to generate

purchases tends to be much longer than the

business, so if you are doing poorly, it should

cycle for B C. You might decide to buy a €

be the first thing to get more budget, not less.

phone cover on a whim, but you’re not going

Sometimes, if your marketing function has

to choose your next audit firm because you

been failing you, you might need to invest

saw a single ad that promises

money in figuring out why marketing is failing

Black Friday.

% off for

you. However, there are very few scenarios where you need to stop getting business to

B B buyers expect to buy from a brand

save a business. This is especially true with

that they can trust, and you can only build

B B businesses since, with B B marketing,

this trust by putting effort into long-term

you can usually measure the success of your

marketing efforts that establish your brand

marketing efforts with even more certainty.

(or your key executives) as people who are worthy of trust.

Trying to save a business with Marketing Most B B businesses we work with tend to be Just like it’s a silly idea to kill your marketing

excellent at what they do. They would have

when your business is passing through bad

grown organically by word of mouth, adding

times, it’s a false expectation to think that

clients on as people move jobs or as their

marketing can save your business if it’s not

clients recommend them to other businesses.

doing well. Of course, marketing can be the

But overall, we see that they don’t have the

cornerstone of a successful business. It can be

knowledge to create a repeatable process to

a vital part of a turnaround strategy. But very

build a proper relationship with audiences at

few times have we been in a situation where

scale.

a burst of marketing (alone) would have been enough to solve the problems of a business

We don’t perform magic for them; we help

in trouble. B B marketing takes time, and

them articulate what they already know,

decision-makers are rarely ready to decide

bringing their knowledge to the front in a

in a few minutes or a few days. Thus, the

way that allows them to shine in their clients’

processes behind most B B transactions are

minds. By looking at marketing efforts as a

much longer.

long-term process, they win over the hearts and minds of their audiences, ensuring that

What should I do for long term B B

they’re the first port of call when services or

marketing ROI?

products in their area are needed next.

ISSUE 69

MONEY

bloom@bloomcreative.com.mt

We build remarkable brands.

To view a selection of our best work, visit bloomcreative.com.mt

ESG

ISSUE 69

MONEY

ESG

INITIATING “ESG” THROUGH SUSTAINABLE INVESTMENT The demand for transparency on sustainable and socially responsible practices is rising, mainly since millennials, naturally more environmentally conscious, are slowly taking over in business. Over the last decade, ESG (Environmental, Social and Governance) has replaced CSR as companies are becoming more and more accountable to their various stakeholders like investors, customers, employees, and non-governmental organisations that want to evaluate a company’s impact on the world. Michael Psaila Debono explains.

What is ESG?

Governance refers to establishing a set of

A BoF & McKinsey report estimated

rules or principles defining rights, structure,

global millennials are willing to spend more on

ESG stands for Environment, Social and

responsibilities and expectations between

brands with a CSR commitment.

Governance, essentially a framework to

different stakeholders in the governance of

analyse companies and assess how well

corporations. Active corporate governance is

A

they compare to their peers in terms of

essential for the development of companies

questions to consumers to understand the

performance against these metrics:

and provides long-term benefits for

perception of these big companies and how

shareholders, employees and society.

they are performing in terms of keeping in

Environmental factors look at the

% of

global PWC survey put forward

line with ESG tactics. The consensus is that

contributions a company or government

When one puts all these together, you’re

consumers (especially millennials) want to see

makes to climate change through greenhouse

looking at how you can assess a company

businesses play an even more significant role

emissions, along with waste management

without looking at its balance sheet but

in accelerating progress on ESG concerns.

and energy efficiency and looking after the

instead, look at how it impacts the broader

They want businesses to invest in making

environment around them.

society at large.

sustainable improvements to the environment

and society, not just comply with regulation,

Social factors include:

Consumers have spoken

and they’re prepared to reward (or penalise)

»

Employee rights and wellbeing

»

Labour measures in the supply chain

According to Morgan Stanley,

»

More routine issues such as adherence to

millennials are interested in sustainable

Building your brand through ESG practices

workplace health and safety

investing, and a sustainable brands survey

found millennial investors are more likely to

In a world of social media and

Establishing and encouraging a diverse

integrate sustainability into their consumer

companies are under constant scrutiny

workplace culture that integrates positively

behaviour. As millennials become employees,

by investors and customers alike, from

with its local community is fast becoming a

buyers, and investors, they note positive

their investment selection process to their

requisite among younger consumers.

corporate action and reward them with loyalty.

employees’ health and wellness benefits. »

MONEY

brands accordingly. % of

THE FINANCE EDITION

-hour news,

ESG

While the idea of sustainability isn’t new,

be perceived? To reach that perception, what

employees and establishing the “ambassador”

incorporating ESG efforts, strategies,

is the brand story going to be? The proper

approach. Sharing success stories and helping

and reporting into a core business model

narration takes a novel to the next level.

employees take ownership of ESG efforts

is becoming increasingly important to

This is no different in marketing your brand.

promotes success through a decentralised

companies. Centring your marketing efforts

Consider all media and elements within your

management approach.

around the company’s sustainability strategies

brand as they can help as you develop your

and telling that story effectively will increase

sustainability narrative.

brand loyalty and value.

As millennials become employees, buyers, and investors, they take note of positive corporate action and reward them with loyalty

Results-driven stories As mentioned in the introduction, ESG

Consistent communications approach

initiatives skip away from consumers checking

What is your unique company point in terms of

the balance sheet. While this is all true, a

ESG? Have you identified it? If you have, then

company remains a company at the end of

how are you communicating it? First, make

the day. Trustworthiness cannot exist solely

sure that your communications approach

through ESG efforts, but consumers do

consistently aligns with your mission, values

consider its performance and the products/

and goals. The consistency must prevail across

services it must offer. All this, combined with

investors, employees, and consumers to

ESG efforts, will undoubtedly be the most

ensure a unified message.

effective. Consider pushing out success stories and enabling partnership programs

Focused content marketing

with other companies and consumers.

We live in an era of constant communication.

Being top of mind is the most crucial yet

How to track your ESG progress

challenging aspect in today’s marketing world.

Once your ESG strategy has been implemented

As consumers, we are drenched with so much

from both an operational aspect and a

content coming from all angles that if content

marketing point-of-view, as a company owner,

push-out is paused, even for a little while, you

the final thing needed is to track the progress

would be risking losing consumer interest as

and analyse whether all the ESG investment

a company. To stay authentic, you should not

was worthwhile. If not, it is essential to see

address every nationwide issue, nor do you

how to optimise the ESG strategy to make it

have to! Be focused and narrow it down to

worth the investment.

issues that integrate well within your company identity, values and mission. Promote success

How can one track ESG progress?

stories, use educational ESG infographics,

Since we are considering brand identity and

share employee/consumer testimonials, push

brand perception here - the best way to track

out brilliant articles, and always push out

your ESG progress would be to go directly

informational and not promotional content.

to the consumer and potential consumer.

The best way to do so is by pushing out

Clever public relations

pulse surveys which, depending on your

The media plays a crucial role in shaping public

business, could set a benchmark against your

perception. Consider developing a public

competition and get real-time knowledge on

relations strategy that gets the word out

where your brand stands. Like that, you would

about your company’s ESG efforts through

analyse whether you are on the right track

appropriate media channels. However, this

with your ESG strategy.

includes riding an excellent line. Companies who go down the PR injection route must

Pulse surveys are short, concise and flexible.

be wary that the brand narrative is being

They can be targeted to specific demographics

presented consistently and, most importantly

and are the perfect way to collect real-time

There are several ways a company can achieve

- not overdo it. Hence the adjective “clever”

feedback that you can then work on for

this and gain a competitive edge in the

in the subtitle. Consumers can check out

optimisation in whatever the feedback is

process, primarily if marketing efforts focus on

companies that try too hard to look good and

as they inform and enable more thoughtful

communicating proactive and integrated ESG

get on consumers’ good books. In the eyes

decisions.

policies.

of the average Joe, this can compromise the genuineness behind the brand story.

With passions in writing, football (not soccer), music, and the culinary arts, Michael, a

Marketing your ESG efforts Beyond PR

business development executive at Anchovy,

Analysing your ESG story

A company’s ESG marketing efforts must

has formed a character that appreciates the

Your brand, your brand, your brand. How is

extend beyond blogs and public relations to

understanding of creativity being all around

your brand perceived vs how do you want it to

ensure your story is authentic. Empowering

us - no matter how mundane.

ISSUE 69

MONEY

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WINTER EDITION JANUARY 2022 Follow us on

PROMO

GO FURTHER FASTER IN 2022!

Frank Borg and Gordon Attard

Perseverance is at the heart of every success

acts as though time is of the essence because

History records that King Solomon was one

story because it is the driving force that

he is energised by a deep sense of desire to

of the wisest and wealthiest men to have

empowers individuals with the motivation to

see his goal translate into reality. This strong

lived. He wrote, “Whatsoever your hand

keep ongoing. Synonyms for “perseverance”

desire ensures resolve, otherwise the slightest

finds to do, do it with your might…”. These

are “insistence, urgency, firmness, resolve,

difficulty (or fear of failure) that surfaces will

powerful words are designed to be a source of

determination”. These words accurately

bring one’s journey to a grinding halt.

encouragement. They admonish us to forge

characterise “perseverance” and perfectly

ahead with sheer focus, diligence, enthusiasm

emphasise the attributes needed to reach

Perseverance means that you act with passion

and energy. The intent of his words

any worthwhile goal. There is no doubt that

and purpose to follow a dream. It resists giving

communicates that one must hunger and

to reach any level of success, a sense of

up or slowing down because it understands

thirst after goals to the point where it becomes

urgency and insistence must inspire one. A

that failure isn’t an option. Successful people

an obsession. This obsession for success will

successful person allows nothing to get in

are on a mission; that mission is to see their

guarantee that no stone is left unturned in

the way of reaching his goals and decisively

goal materialise.

reaching the next level.

ISSUE 69

MONEY

PROMO

Perseverance is a state of mind. It can be

lead you to over-perform and obtain what

for everything to be perfect before you

developed and nurtured by implementing

you desire because you don’t doubt yourself

start on your path. Success is reaped when

five easy steps, which we’re going to outline

and your abilities. As we always say, self-

you “go for it”. Use initiative and take the

for you in this piece. You’ve got to, first of

confidence is a superpower; you will see the

first step. When you come to any level of a

all, have and set the right goal! Simply wanting

magic happen when you believe in yourself.

roadblock, break the barrier by researching,

something isn’t enough. You must have a deep,

It is the one attribute that will help you strive

asking questions and figuring out a creative

burning desire for your goal; this can only

unceasingly to surpass your expectations and

way to proceed. There is always a solution to

come if you fix the right goal.

the expectations of others.

every problem; it’s just a matter of finding it.

Leave no stone unturned in moving forward

You then need to have a good plan to reach

Fourthly, you’ve got to ensure single-

to achieving and reaching the next level.

your goal. This is the second point. A good plan

mindedness! Focus and concentrate all your

Forget naysayers; run from them. If you allow

lays out the steps that you need to implement

energy on your goal and how to get there. Let

your goal to become an obsession, you will

Whatsoever your hand finds to do, do it with your might... to reach your goal. It will also prepare you for

nothing blur your vision or distract you from

automatically be proactive and determined

what needs to get done next in your journey.

where you are headed. Let your goal be your

to reach it.

Finally, a well thought out plan will keep you

overriding purpose. Immerse yourself in it and

motivated and will ensure that you persevere,

allow it to become an obsession, as this will

These five steps will help you develop and

especially as you see progress and mini-

keep your focus where it needs to be to reach

intensify the perseverance you need to

milestones being reached along the way.

your desired end. Be steadfast and unwavering

practice to reach your goals. Keep in mind

by focusing your attention and energy on

that perseverance is the driving force that

Self-confidence is the third important step in

reaching your goal. Single-mindedness will

empowers motivation. So jump out of bed

ensuring perseverance; this means that you

help maintain your perseverance.

every morning and hit the ground running.

believe in yourself and the results that you

Go for it! Your dream cannot wait. Use these

can achieve. Self-confidence will give you the

Finally, the fifth step is to be proactive! Get

five steps to break out of the ‘average’ cycle.

courage and energy to keep trying even in

up, look in the mirror, and tell yourself you

Persevere for a better life where you are living

the face of adversity or setbacks; it can also

are ready. Don’t tiptoe through life, waiting

your true potential!

With shared interests and goals, Frank Borg and Gordon Attard have, over the years, built a formidable work relationship that has extended to a solid friendship. Their families have travelled together. They often talk about sales, goals, motivation, family, life’s hurdles, mistakes, lessons learnt and much more. In line with their work ideals, which revolve around commercial operations and human resources, they have a strong desire to reach out to the largest audience possible by offering tools, tips and strategies to help others reach their goals as quickly and as efficiently as possible. Aside from giving talks, training and coaching, they regularly release episodes of their increasingly popular ‘Frank and Gordon Show’, aired on their YouTube channel. Consider subscribing at youtube.com/FrankGordonShow to keep up with this dynamic duo and, importantly, to obtain a regular dose of motivation that will help you to ‘Go Further Faster!

MONEY

THE FINANCE EDITION

FIERCE Photography Marvin Grech

Styling Peter Carbonaro

Model Christian @ Models M

Hair Adrian @ Barnuz

FASHION

Shirt, jeans by Charles & Ron

Pants by Charles & Ron

Shirt by Charles & Ron

Roll neck top by Dan John, necklace model’s own

Scarf by Charles & Ron

FA SHION

A BEAUTIFUL YEAR MONEY spells out your new year resolutions in luxury and style.

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ISSUE 69

MONEY

FA SHION

LORO PIANA Slim-fit tapered stretch-cotton twill trousers €

BALENCIAGA Tool . XL north-south logo-debossed full-grain leather tote bag € ,

ADIDAS ORIGINALS Stan smith prime

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green sneakers € KITON Slim-fit textured cotton and linenblend sweater € ,

GUCCI + the North Face logo-embroidered monogrammed canvas and leather hiking boots € ,

MONEY

THE FINANCE EDITION

mm, Oyster steel

and white gold €

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GIFTS

FENDI

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true wireless ceramic

appliquéd canvas holdall

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TOM FORD BEAUTY Ombré Leather Eau de Parfum,

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A STOCKING FULL of STARS Start the new year in style with MONEY’s gift list.

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PURDEY Pewter flask €

ISSUE 69

MONEY

GIFTS

TOM FORD Full-grain leather cardholder €

THE NORTH FACE Borealis ripstop-trimmed camouflage-print nylon backpack €

HESTRA Tricot-panelled leather gloves €

LORENZI MILANO Bamboo, leather and stainless steel cocktail set € ,

HAYDENSHAPES + Arsham + Stampd sketch erosion foam, resin and carbon fibre surfboard € ,

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