The Malta Business Observer, 12 December 2019

NEWS

Issue 105

Distributed with Times of Malta

| December 12, 2019

Chamber of Commerce calls on President George Vella to “step in”

e Malta Business Observer interviews former EU Commissioner, Joe Borg, on the possible outcomes of the UK elections, and their potential impact on relations with Malta. see pages 9, 13 >

Helena Grech In exclusive comments to The Malta Business Observer, the Malta Chamber of Commerce President David Xuereb has called on President George Vella to step in and be “a force that brings about balance and statesmanship during these troubled times.”

Perit Xuereb acknowledged that while “His Excellency’s role is limited by the Constitution,” he can still affect positive change since “as a highly respected individual, the President is in the right position and possesses the right qualities to make the much-needed difference.” Perit Xuereb’s call follows constitutional law expert Kevin Aquilina’s recent statement urging President Vella to step up to the plate, reminding him of his constitutional, legal and moral duty to act without delay.

Perit David Xuereb stressed that the Malta Chamber believes that failure to resolve the situation fast will have dire economic ramifications. “We have already clearly stated that the current political situation is doing unspeakable damage to the country’s brand, which will be painful and laborious to fix in the future,” he said, while adding that Dr Muscat’s decision to resign “in January has, unfortunately, brought the country to a standstill, characterised by a level of rare uncertainty.”

Moreover, Perit Xuereb lamented that “this hiatus for business and investment is rendered even more serious by the negative attention our country is attracting, in the international media, with potentially unimaginable consequences.” To

BUSINESS OPINION In light of Malta’s recent political turmoil, economist Gordon Cordina says the island must now focus on its resilience to withstand and rebound from a situation which could present more serious challenges now, and, possibly, in the longer term. see page 11 >

TRANSPORT PHOTO: ALAN CARVILLE

mitigate any further damage, Perit Xuereb stressed the need to carry out “a deep and expedited clean-up of the entire system”. He called for “problems to be dealt with in a clean, clear and transparent manner, in order to reinstate a sense of trust in Malta’s authorities.”

Perit Xuereb further underlined that “the country needs to deal with all forms of allegations of political corruption, since every hour of inaction is considered damaging to the country.” He called for a push to “reignite a genuine drive” for ethical standards and stressed that all members of society, especially the political class, “need to be kept accountable to the highest

“We call on the Prime Minister to once again rise to the occasion and do the honourable thing expected of a true statesman.” – David Xuereb, Malta Chamber President standards, free from any shadow of doubt.”

The Chamber President said that advocating for higher standards across public life and beyond, was a central theme of its Economic Vision for Malta. “We

proposed an upward shift in mentality, towards a culture of ‘nothing but the best’. Never in our history has this goal been more important than now,” he said. continued on page 3

As Malta’s car sharing leader GoTo completes its first full year in operation, statistics show that its 12,000 users have saved over 1,000 tons in CO2 emissions. see pages 18, 19 >

CASE STUDY Foreign exchange trading platform, FXDD, has reported positive results since its shift into online marketing techniques, says marketing coordinator Joanne Storace. see pages 20, 21 >

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Malta’s business bodies warn of dire economic consequences continued from page 1 Perit Xuereb concluded by saying that “on behalf of all hardworking entrepreneurs and ethical businesses, who provide jobs and a livelihood for thousands of Maltese families, we call on the Prime Minister to once again rise to the occasion and do the honourable thing expected of a true statesman. Only he can bring an end to this stalemate the country has crashed into. Within the context of the current confusion and instability, history will remember him for it.”

GRTU CEO Abigail Mamo also did not mince her words, saying that Malta’s “brand has changed and become the complete opposite of what it was and what it was built to be for long years.”

She remarked that current events will “weigh heavily on the choice investors will make, and, for many, Malta will no longer be on their investment map, as things stand today.” She also cautioned that this situation also exposes Malta to “the wrong type of investment”. She added that the impact of the situation will be “cashed in less investment – investment Malta has depended on over the last years to get us out of a state of deficit.”

Ms Mamo also referred to the survey the GRTU commissioned on the economic fallout among its members – mainly SMEs – so far.

“We ran the survey to see the extent of the immediate damage, with results that I have never seen in my over 12 years working at the GRTU. We experienced the effects of recessions some 10 years ago but never have we seen this immediate impact. And, looking a

“Suffering a corruption scandal is bad enough, not being able to handle it and give the right messages is much worse.” – Abigail Mamo, CEO, Malta Chamber of Small and Medium Enterprises bit further from the immediate, we also asked about their investment plans, and 45 per cent (of respondents) said that they will be postponing, rethinking or cancelling their investment plans.”

She remarked that businesses based in Valletta are “going through an even harder time because they are operating in the eye of the storm.” Elaborating on this, however, Ms Mamo said that “thinking the problem is only affecting Valletta is a big mistake.”

Echoing the Malta Chamber, Ms Mamo urged for a speedy resolution for “every day which passes is another day in which Malta’s name is being tarnished further. We are seen as a country that has corruption embedded within the most important deci-

sion-making positions and we are unable to rid ourselves of it. This is causing us tremendous damage and will continue to do so in the long term. Suffering a corruption scandal is bad enough, not being able to handle it and give out the right messages is much worse,” she said.

President of the MHRA, Tony Zahra, reiterated these sentiments and said that Malta’s brand has “suffered and continues to suffer a battering unseen before – with comments from some of the more aggressive international press portraying the island as a Criminals Paradise.” He cautioned that “regrettably, a reputation is easily

lost but it takes much effort and a very long time to rebuild.”

Underscoring the risk of damage to the hospitality industry, he lamented that it “will be hit very hard if there are any incidents of physical violence. Surveys continuously show that security is the number one concern for tourists when choosing a destination. We have seen in the past the losses suffered by countries such as Turkey, Egypt and Tunisia when these countries had incidents of violence. The MHRA is concerned that the higher the political temperature, the higher the risk of an incident. We all have to play our part to ensure that law and order is maintained.”

He too called for politicians to show “political maturity, especially now that the decision for a leadership change has been made.” Mr Zahra said the damage has been done, and with every day that passes, and more revelations emerge about the Caruana Galizia murder, more damage is inflicted.

“This is the price the population of Malta has to pay for the abuse of power, and the arrogance that comes with excessive power vested in one place. The faster the change, and the faster that a new institutional order is put in place, the quicker we can start the healing process,” he emphatically stated.

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Business stakeholders say damage to Malta brand “immense” Helena Grech As unions, lobby groups and constituted bodies representing a diversity of sectors issue statements to express varying levels of concerns about the turbulent political environment Malta finds itself in, business stakeholders speaking to The Malta Business Observer have now also decried the damage being done to the island’s reputation.

Hotelier Winston J Zahra said he has no doubt that the damage to Malta’s brand is “immense”, going on to underline that the island “must work extremely hard to restore confidence”. Having spent his life working in the hospitality industry, Mr Zahra has first-hand experience of the importance of this sector to the island.

“Without a doubt the situation in Malta – institutionalised corruption at the highest level of Government and the murder of a mother, wife and journalist with clear connections to the corridors of power – is incredibly serious on many levels. I had personally previously spoken about the danger of closing an eye, indeed both eyes, to clear indications of corruption both at a political and at an electorate level,” he stated, looking back at the events of the last few years.

Mr Zahra also emphasised the urgency of the matter. “The result of action not being taken in a timely manner is that we are now being painfully embarrassed internationally as the details of what happened emerge daily from the Court proceedings,” Mr Zahra said, going on to state that he has “no doubt that the damage to the name of Malta will hurt various

industries from the financial sector to the tourism sector.”

Drawing on personal experience, Mr Zahra claimed that he “has been questioned numerous times in the UK simply based on my Maltese passport”. He said that, irrespective of what people say locally, “the truth of the matter is that a Maltese passport today is a red

flag and, in some cases, sits on the blacklist of certain institutions.”

Asked about his views on what action should be taken to mitigate reputational damage, Mr Zahra said that the first step must be taken “by politicians taking responsibility for the sericontinued on page 6

“e truth of the matter is a Maltese passport today is a red flag and, in some cases, sits on the blacklist of certain institutions.” – Winston J. Zahra, hotelier

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NEWS

“We are all guilty of turning a blind eye” – real estate entrepreneur continued from page 5 ous mistakes made.” He drew upon a lack of action against politicians involved in the Panama Papers affair as having resulted in “this mess” and called for assurances that the justice system is working “on a level playing field” for everyone.

The solution, as he sees it, is cross-party collaboration by those of good will. “In my opinion, the best thing for the country, in the next few years, would be a Government of national unity focused on bringing the nation together and working hard to restore Malta’s image,” he concluded.

Echoing these concerns, Benjamin Tabone Grech, the Managing Director of leading real estate firm Engel & Völkers Sara Grech, noted that “it has become a really difficult time but it is important we remain optimistic, with our feet on the ground.”

Onto what has led to such a culmination of events, Mr Tabone Grech believes that “we are all guilty of turning a blind eye – of not conducting work in the best way possible.” He added that Malta “needs to strive for quality, for better education and better infrastructure. We, as a nation, are stressed out and it has been piling up for some time.”

Onto the resilience of the local economy in broader terms, Mr Tabone Grech believes that Malta “can pull through quite swiftly – so long as the right people, with good intentions, who want to see the economy grow sustainably – become more involved.” He concluded by pointing towards Malta’s size as an advantage and believes the country must unite, “and not in terms of political parties, but as a country”.

Alan Alden, who possesses years of experience in the iGaming and financial services sectors and

“I think it has become a really difficult time and that it is important we remain optimistic, with our feet on the ground.” – Benjamin Tabone Grech, Managing Director, Engel & Völkers Sara Grech sits on the Remote Gaming Council – but stressed he was commenting in his personal capacity – also slammed the authorities’ failure to act on allegations of corruption and money-laundering. As evidence, he pointed towards the reputational damage stemming from the Panama Papers scandal and Satabank’s mammoth €3.5 million fine over money-laundering breaches. Mr Alden argued that “when there are glaring situations of potential money-launder-

ing cases, and those cases are not investigated at all, that is where the damage has been done.”

He stressed that the roots to the current crisis lie in “the fact that the mistakes of three years ago have still not been remedied” and he, too, questioned how the people involved had not been investigated.

“If the problem is coming from the top then it’s the top that has to resolve the issue. We cannot fix it ourselves and no amount of processes will be taken seriously

until the elephant in the room is dealt with – and seriously.”

He noted a drop in investment in the islands, saying that he believed “that the number of investors in Malta has dropped because the feel-good factor has been lost. If we do not continue to attract gaming companies, financial services, and similar industries who is going to take up all these offices and flats being built?

Everyone is going to suffer.”

He also lamented that calls for political maturity and ethical decision-taking are not being heeded. “Even hearing people talk just baffles me, we have absolutely lost the ability to distinguish between what is right and wrong or what is ethical and not. We have to relearn these things from scratch. Having a growing economy has come at a huge cost to the credibility of the nation and also to the integrity of its people,” he concluded.

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Malta likely to lose strong EU ally, if UK election leads to Brexit – former EU Commissioner Martina Said

PHOTO: TYLER CALLEJA JACKSON

“The solution that will create more certainty in the shorter term is, given the circumstances, the better solution all around.”

If the outcome of the UK general election leads to the UK leaving the European Union in 2020, Malta will likely suffer in that it will lose a strong ally within the EU, said former minister and former EU Commissioner Joe Borg in exclusive comments to The Malta Business Observer.

“Malta and the UK are like-minded in several areas, such as the provision of services, tax harmonisation, company culture, and banking culture, and share a common language – we think alike on many fronts,” said Dr Borg. “In this sense, we would lose a strong ally, and, on certain matters, where Malta has its own interests, we will likely end up defending that patch on our own.”

Current standings in a poll compiled by the Financial Times, which combines all voting surveys published by major British pollsters (until the time of print), show that Boris Johnson’s Conservative party has a comfortable lead of 43 per cent. That’s approximately 10 points more than the Labour party which stands at 33 per cent, followed by the Liberal Democrats with 13 per cent, the Scottish National party (SNP) and Welsh Plaid Cymru (PC) with four per cent, and the Brexit party and Green party with three per cent each.

“The Conservatives’ lead means there is a good probability it will have an absolute majority of seats in Parliament,” said Dr Borg.

However, the British first-past-the-post voting system makes it difficult to determine this with certainty, as seats are dependent on the outcome in each constituency, as opposed to the proportional representation system where an absolute majority of votes means a majority of seats in Parliament.

If the Conservative party is elected with a majority of seats, Boris Johnson, as new Prime Minister, will be tasked with getting the most recent deal he negotiated with the EU through Parliament. “This still leaves a measure of uncertainty, in that, by 31st January, which is the new deadline set by the EU, the new legislation would have passed through the House of Commons and possibly the House of Lords. There would be an 11-month transition period until the end of

2020 for technical legislation, regarding freedom of movement, goods, persons, trade and more, to be negotiated, which is an extremely tight deadline. What happens after this deadline remains uncertain.”

All other parties, with the exception of the Brexit group, have shown an inclination, to varying degrees, of remaining in the EU. Dr Borg assessed that, even though it is unlikely this will happen, a coalition government could be formed led by a Labour majority.

The Lib Dems, SNP, PC and Greens are all in favour of remaining, while the Labour party has said that it will negotiate a new deal within six months of the general election and hold a binding, non-consultative referendum on whether the British people want the new deal or to remain in the EU. Dr Borg stated that although Labour would be the stronger component in the coalition, the arrangement would be a “marriage of convenience”. Each party would campaign for its own cause in the run-up to the referendum – “Labour for its new deal, Lib Dems to remain, and Conservatives it’s uncertain for what”.

“Even here the outcome is uncertain, because if Labour can negotiate a customs union package that is attractive enough, it will likely be backed by the Labour party, which is in Government, and a chunk of Conservatives. If it wins the day, there will be another prolonged period of uncertainty to phase in the deal. If the referendum goes in favour of remaining, then you wind back the clock to 2016.”

He added that poll surveys on whether the people want to remain or leave are quite balanced, and “what the outcome of such a referendum will be is anyone’s guess.” What is certain, however, is that it will create more uncertainty, at least in the short term.

From a personal point of view, Dr Borg asserted that he would have preferred the UK to remain in the EU, as he believes it is beneficial for them, for the EU, and for Malta too. “On the other hand, the question on whether or not to leave has been going on for so long now that a decision needs to be taken, so, in a sense, the solution that will create more certainty in the shorter term is, given the circumstances, the better continued on page 13

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e Malta Business Observer is Malta’s leading business newspaper distributed with Times of Malta every month.

Acting Managing Editor Rebecca Anastasi

EDITORIAL

Justice desperately needed to prevent economic earthquake The assassination of Daphne Caruana Galizia cast a long and deep shadow over this small island. For 26 months, the collective stain left by this cruel killing has been a blight on our conscience and an indictment on our culture, though many have been all-too-eager to just “get on with business as usual” – all while a family was left bereft, and a country’s stability teetering on the balance, its name muddied around the world.

The day of reckoning was inevitable. And, the revelations of the past few weeks have exposed the rot at the heart of our systems, plundered by unscrupulous individuals who simply want more, more, more, to the detriment of the country’s collective wellbeing. But when is more enough? As economist Gordon Cordina says in this edition’s Business Opinion, the time is now ripe for a focus on the creation of “virtuous circles between institutions, economic sustainability, and human wellbeing.”

And, shouldn’t that have been the Government’s brief to begin with? But, with one of the most influential people in power in the highest office within Government allegedly involved – in some capacity – in the murder of one of its own citizens (and that of a journalist), fundamental trust in the institutions has plummeted, and unprecedented harm is being caused to the economy and to the business community by the Government.

Joseph Muscat’s insistence on staying in office until January is only exacerbating the situation. Proof of this could be seen last Sunday when the two contenders for the post of Labour party leader appeared in public – all smiles and warm salutations – with the outgoing Prime Minister. These images will continue to fuel public perception that justice may never be served, and the Labour leader contenders would do well to note just how toxic such imagery is. Moreover, Robert Abela’s proclamation, just this week, that he “tolerates” the current wave of protests have no place in a democratic EU nation, and do not signal unity in the face of national trauma.

Significant harm is being done to Malta’s reputation and the nation’s capability to pick up the pieces. As the island’s main business bodies say

in this edition, justice needs to be done, and there needs to be – in the words of Perit David Xuereb, President of the Malta Chamber – “a deep and expedited clean-up of the entire system”. Perit Xuereb goes further and calls on President George Vella to step in for things to get back on an even keel – a call which reiterates the statements made by Dr Kevin Aquilina on the President’s constitutional, legal and moral duty to act without delay.

GRTU CEO Abigail Mamo also did not mince her words in this edition when she notes that the current political crisis will “weigh heavily on the choice investors will make, and, for many, Malta will no longer be on their investment map, as things stand today.” Indeed, MHRA President Tony Zahra also reiterated that “this is the price the population of Malta has to pay for the abuse of power”, underlining “the faster the change, and the faster a new institutional order is put in place, the quicker we can start the healing process.” These are sentiments which have also been expressed by the iGaming industry trade association iGEN, which has recently called for stability and adherence to the tenets of the rule of law for the sector to keep on thriving.

For that is the crux of the matter: all the people involved in the murder – whoever they may be – must be brought to justice and all cases of related corruption investigated. For this to happen, the office of the Attorney General and the police force must also function as they should. And, an urgent clean-up of the current political system is imperative, with trust in the institutions restored. Failure to do so will lead to dangerous economic and business repercussions.

In 2020, the country needs to face reality and we expect the Labour Government to start treating Malta as a European democracy. Anything short of that will spell prolonged business and economic damage, and risk public unrest. In the meantime, much soul-searching is needed by all who call this country home – and who would like to continue doing so.

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BUSINESS OPINION

Resilience and wellbeing: Imperatives for our survival and success

Gordon Cordina The ongoing crisis will be followed by economic after-shocks. There is a risk of home-grown or foreign investment projects being postponed or reconsidered. Business and consumer confidence are likely to wobble at least for a period, affecting demand, growth, and ultimately the pace of job creation. Up to some time ago, we were discussing the ability of our economy to manage an economic slowdown in an orderly manner.

We must now focus on its resilience to withstand and rebound from a situation which could present more serious challenges now, and possibly in the longer term.

The progress registered over past years will to an extent prop our economic resilience. Jobs were created in sectors where Malta enjoys important competitiveness advantages, though these are also in good part dependent on foreign demand and global reputation. The country can also rely on a strong fiscal position which

can be used to overcome temporary difficulties, though fiscal stimuli are by no means a recipe for long-term success. Malta has also historically shown itself to be resilient to global economic challenges thanks to a strong base of savings and prudent risk management in the financial system. We possibly face fresh challenges to ensure that this aspect continues to serve us in good stead.

The way out of these difficulties is two-pronged. One is the obvious fact that the country needs sufficiently rapid political and governance solutions to problems which in most part originate from these domains. This is a necessary, but possibly not sufficient, condition to sustain long-term economic growth. The other is to reinforce our economic model on the fundamental selling propositions that can be offered by a stable and secure Mediterranean island that is also an EU and Euro area member.

This approach ties very well with an ongoing global initiative focusing on wellbeing as the key objective of economic policy which in turn serves as a prime mover of growth. Among the strongest proponents of this are island and peripheral regions such as Iceland, Scotland and New Zealand. The essence is to espouse a vision to render Malta the regional Mediterranean hub of choice where to work, conduct business, relax, learn, heal, innovate and be creative. Our economy has the potential to achieve this, to the benefit of its permanent and temporary resi-

dents and visitors. This approach would permeate the key economic sectors, ranging from tourism to high value-added services and manufacturing activities.

We will of course need to continue to build our productive capital base, but more selectively and in a way which valorises investments in other forms of capital that are equally essential to wellbeing. These include the environmental dimension, which is not only critical for our duties as global citizens with respect to climate change, but also a shaping element of our Maltese identity, health and quality of life.

Social capital is equally essential. This has traditionally supported us through close-knit family and community ties. It is now facing the challenge of rapid demographic change and individualistic economic behaviours. The avoidance of financial, health and social empowerment poverty, which, ironically, typically follow from rapid economic growth, is integral to this.

Investment in institutions will play a key role to provide the safety, security, stability and peace of mind that are an indispensable part of the fabric of our national identity and economic success.

Wellbeing is, above all, a function of the investment in human capital, as manifested in education and health, within which mental health is very much intertwined. It also entails a focus on the quality, just as much as on the quantity, of jobs created.

Wellbeing as a source of longer term economic success has been discussed in Malta for quite a time now. The ongoing debacle should only serve to bring this to the very forefront of the national agenda, and to focus on the creation of virtuous circles between institutions, economic sustainability, and human wellbeing. I look forward to a time, hopefully over the coming months, when we will be placing equal emphasis on each of the aspects of capital necessary to

build an economic model based on wellbeing, for which Malta is eminently suited.

Dr Gordon Cordina is the Executive Director of E-Cubed Consultants. He has served as Director General of the National Statistics Office of Malta, as Economic Advisor to the Malta Council for Economic and Social Development, as Head of the Research Department of the Central Bank of Malta, and as Head of the Economics Department of the University of Malta.

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Former EU Commissioner says bloc needs to speak more with one voice continued from page 9 solution all around. The worst-case scenario would certainly be a no-deal Brexit.”

With the prospect of the UK leaving becoming increasingly likely, Dr Borg expressed what he believes could be one positive side effect of Brexit, and that is a move towards a stronger union. “For the EU to have its own real foreign policy and defence policy, not as it is today, and for it to be relevant in the world we currently live in with the likes of the US, China and Russia, it needs to consolidate and speak more with one voice.”

He added “it cannot be” that the US takes a decision within days while it takes the EU months, and, with the UK out of the EU, this becomes more possible. “As a country, the UK dragged its feet on decisions which sound federalistic, and those of us, like me, who are in favour of a stronger union, this, in my opinion, is the silver lining in the whole scenario.”

As for trade relations between the two sides, Dr Borg argued that, when it comes to the issue of trade, solutions can always be found. “There are teething problems at first, and, in the short term, there could be a

measure of uncertainty which could lead to economic turmoil, but solutions will be found. They will take time,” he said. “This all depends on what the results will be. Although it appears to be far less likely, a nodeal Brexit is still possible if the new government fails to pass the deal through Parliament, and the deadline elapses, and the EU will no longer be disposed to extend.”

On the assumption that the deal negotiated by the Conservatives will go through and arrangements are made within the transitional period, concerns regarding the movement of goods, services, capital and all, will be addressed during that timeframe.

“In this scenario, a customs window will need to be set up since goods entering Malta from the UK are no longer entering from the EU but from a third country. If the customs union prevails, the way forward is clearer as the EU already had, and has, such trade agreements with other countries,” asserted Dr Borg. “Bottom line, adjustments will need to be made, but in the medium and long term, I don’t think Malta will be losing out in this regard, and business people are always capable of keeping one step ahead when it comes to such strategic decisions.”

PHOTO: TYLER CALLEJA JACKSON

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CASE STUDY

Family Business Office attends European Family Businesses Summit in Spain Jo Caruana The Family Business Office (FBO) Regulator has recently returned from attending the successful European Family Businesses (EFB) Summit in Spain, a meeting of the EU federation of national associations which represent long-term family-owned enterprises, including small, medium-sized and larger companies.

“The EFB is the main organisation in Europe established with the aim to promote the growth and continuity of family businesses in Europe, through a European project based on freedom, shared values, the rule of law, prosperity and social justice,” explained Malta’s FBO regulator, Dr Joseph Gerada, adding that the EFB was founded in 1997.

“Its summit is organised once a year and it brings together family business offices like ours, as well as key stakeholders and main players established as family businesses.”

Throughout the summit, discussions and presentations were held on the main hurdles and obstacles faced by family businesses in Europe today, as well as other mainstream issues that may affect business in general. This year, it was organised in Madrid, and featured renowned speakers including the President of Spain, Pedro Sanchez; the former Prime Minister of France, Manuel Valls; the Lord Mayor of Madrid Jose Luis Martinez-Almeida; and Mariano Puig, the former President of Puig, the $2 billion revenue multinational fashion, perfumery and cosmetics company behind world-renowned brands such as Puig, Paco Rabanne, Nina Ricci, Carolina Herrera and Jean Paul Gaultier.

“Being part of the forum of discussion was crucial for Malta, as

“The family business community sent out a clear message to decision-makers: improve the Single Market, and focus on fostering global trade.”

PHOTO: JUSTIN MAMO

it’s vital for us to participate in decision-making processes which may ultimately lead to policy changes affecting Europe and its member states,” Dr Gerada continued.

This is especially true, he said, since family businesses make up between 65 to 80 per cent of all European companies, accounting for – on average – more than 40 to 50 per cent of all jobs in Europe. Family businesses also constitute a substantial part of existing European companies and have a significant role to play in the strength and dynamism of the real economy.

Considering the key takeaways from this year’s event, Dr Gerada highlighted the presentation of the eighth European Family Busi-

ness Barometer, which was prepared in collaboration with KPMG Enterprise. The survey received more than 1,600 responses from family business executives in 27 countries across Europe and highlighted family businesses getting ready to hand control over to the next generation. During the presentation, facts and figures on family businesses in Europe, including their performance, were presented and discussed.

“The information collected showed that Europe’s family businesses remain positive about the future, even in a time of rising economic and geopolitical uncertainties,” Dr Gerada said. “Innovation, training and education, and diversification are key priorities as they adapt to a fast-chang-

ing world – while planning for succession is increasingly on families’ minds. Beyond that, this year, the family business community also sent out a clear message to decision-makers: improve the Single Market, and focus on fostering global trade.”

Dr Gerada explained that one of the topics that attracted most comments and interaction was sustainability, with two items on the agenda dedicated to it. “The topic of sustainability in its various facets has become of utmost importance over the years, including locally. During the event there were presentations from companies that have been developing entrepreneurial ideas that are both profitable, and respectful or beneficial to the environment.”

Two of these presentations were

by Jean-Nicholas D’Hondt, CEO of Pollet, and Javier Goyeneche, Founder and President of Ecoalf.

“Mr Goyenche explained how he gradually grew frustrated with the amount of waste he saw being produced by the fashion industry. He embarked on a mission to create an entirely new concept that would combine his design sensibility and understanding of the fashion consumer with the latest in recycled materials. In 2012, he launched Ecoalf, named after his son Alfredo. The idea was to create a fashion brand that is truly sustainable, with the goal to create the first generation of recycled products with the same quality, design and technical properties as the best non-recycled products. That way he could demonstrate that there is no need to use our natural resources in a careless way.”

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CASE STUDY

The Regulator said he was inspired by Ecoalf’s ambitious 2015 project, Upcycling the Oceans – an unprecedented effort to help to remove waste from the bottom of the oceans thanks to the support of the fishermen off the East Coast of Spain.

“Watching Javier’s presentation helped me understand the extent to which Maltese family businesses can contribute to the preservation of the environment,” he continued. “Unfortunately, many companies feel that initiatives of this sort are not profitable. But, from the experience of companies such as Ecoalf, it is clear that, with the right attitude, dedication and development of profitable concepts, even activities that ultimately lead to the benefit of our environment can be lucrative.”

Reflecting on the summit, Dr Gerada said that it did not change his agenda for the year to come as such, but listening to the discussions definitely helped him to develop ideas that he will be able to share with local family businesses.

“It also helped me realise how important it is to build a strong network with other family offices and organisations, as well as family businesses around Europe,” he said. “Shared experience may

“Our workload is increasing and the Family Business Office has an important role to play in the years to come.” lead to the creation of synergies within our own ecosystem. We often complain that businesses in Malta have an additional obstacle than those located in mainland Europe – insularity.

However, with the internet and easier communication, barriers are starting to come down. I believe that there is great potential for creating a platform for family businesses in Europe where networks can be created and pursued. This could lead to further cooperation, the sharing of experience, expertise and knowledge, and the development of sustainable concepts in collaboration between European family businesses,” he asserted.

As the year draws to a close, Dr Gerada is now taking stock of the work completed in 2019 and preparing the annual report for the year. Having only taken over in September, he is now considering what has been achieved and what still needs to be done.

“Our workload is increasing and the Family Business Office has an important role to play in the years to come. Over the past two months, I have had some meetings with the Family Business Committee of the Chamber of Commerce and there is clearly a lot of enthusiasm by its members to continue developing the reach of the Family Business Office, both with its members as well as with other family businesses in general,” he noted.

Moreover, education and training will take priority. “We shall definitely be focusing more on the educational aspect, so that we can reach out to those generations that require guidance and help to ensure their business’ continuity. Plus, in January, we will be holding an event with the Gozo Business Chamber and launching the Family Business Office in Gozo to provide our services there too, supported by and situated at the Ministry for Gozo,” Dr Gerada concluded.

PHOTO: JUSTIN MAMO

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e Malta Business OBSERVER

| December 12, 2019

TRANSPORT

GoTo users drive 1.8 million kilometres in 2019 Jo Caruana As Malta’s car sharing leader GoTo completes its first full year in operation, statistics show that its 12,000 users have driven over 1.8 million kilometres in the last 12 months – saving over 1,000 tons in CO2 emissions and helping local society to move towards a more shared and balanced economy.

Thanks to this growth, each of GoTo’s cars, now, potentially replaces 16 vehicles on the roads. “If we had to pick one word to describe 2019 it would be ‘change’”, said GoTo Chief Marketing Office (CMO) Johnny Tominaga. “We have tested, learned, failed and evolved a lot.”

The team at GoTo believes change to have been key to their success so far: improving their technology; implementing smarter ways of distributing their vehicles; increasing the number of vehicles available; and trying to stay as close as possible to their customers have been key, the CMO said. Moreover, the ability to constantly change and evolve – by learning from their mistakes – has enabled the company to

“Our vision is that if it’s worth going, the best way to get there is with GoTo.” grow and establish a strong presence in the competitive mobility landscape that Malta has grown into throughout this year.

Looking back on a year of milestones, Mr Tominaga cited the launch of the service’s Basic Plan as key to making it accessible to more customers, “even if they don’t need to use shared mobility as regularly or simply don’t want to pay for a recurring subscription fee,” he explained.

“Then, with Roundtrips – our service which is ideal for planned journeys – we started addressing multiple consumer needs, by enabling customers to start booking trips further in advance and pay per hour, which reduced the pressure for bringing the car back.

Now, continuing to understand and address mobility needs is where we see our path for growth.

That’s what we hope for with the

launch of our scooter fleet. With scooters, our customers can ride shorter distances more freely, and take advantage of more flexible parking options.”

Meanwhile, the launch of GoTo’s Business Plans also helped to make car sharing service more appealing to business customers.

To date, over 50 companies have incorporated shared mobility into their operations and offerings to employees. “And along with all that, our technology is constantly evolving to accommodate different demands and incorporate improvements into our services,” Mr Tominaga said.

The benefits of car sharing are, of course, numerous. As the GoTo fleet is shared between its users, this uptake has reduced the amount of vehicles on the road, helping to build an effective transport solution that

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TRANSPORT

lessens the time that cars sit idly in parking bays or garages. The fact that the majority of the fleet is electric also has knock-on positive effects for local air quality and the environment. “The sustainability side of what we do is very important,” he continued.

“Not to mention the fact that, as GoTo’s popularity grows, traffic reduces because there are actually less cars on the road.”

Going into further detail about the success of the last 12 months, the CMO explained he is pleased with the level of growth. Indeed, the GoTo fleet grew from 150 vehicles to 450, and made upwards of 700 trips per day and more than 200,000 trips overall.

“Incorporating AI into our operation was critical in helping us narrow the availability gap, while using smart metrics and outreach tools was essential to help us reach thousands of people who became loyal advocates. But putting together an outstanding team of astonishingly talented people made it all possible,” he said of recent successes. “It’s extremely inspiring to see such passionate individuals working together and going the extra mile to make ends meet. I believe that finding the right people for the right positions was our greatest

“Incorporating AI into our operation was critical in helping us narrow the availability gap, while using smart metrics and outreach tools was essential to help us reach thousands of people who became loyal advocates.”

achievement this year, and we couldn’t have made it this far without each of them.”

And with 2020 now firmly in focus, Mr Tominaga said the company is confident it will continue to see more and more people start using shared mobility solutions like theirs. With this in mind, it will continue to create new ways of bringing shared mobility solutions to the population in Malta. “Our vision is that if it’s worth going, the best way to get there is with GoTo,” he said. “We’ll strive to continue to build on that in every aspect of our operation.”

As for the future of the island’s mobility as a whole, Mr Tominaga expressed his belief that, as the island keeps growing and thriving economically, continuous investment in transportation infrastructure and mobility solutions are not only vital, but will also help to create a virtuous growth cycle. “GoTo will continue to play an important role, not just by bringing a more sustainable approach with shared mobility solutions, but also by building the infrastructure for charging electric vehicles, which we plan to open up to everyone in the future,” he concluded.

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e Malta Business OBSERVER

| December 12, 2019

CASE STUDY

FXDD shifts into digital marketing to increase outreach and engagement

PHOTO: INIGO TAYLOR

Caroline Curmi

“All efforts are now centralised online, offering a high level of engagement and interaction worldwide.”

Foreign exchange trading platform, FXDD, has reported positive results since its shift into online marketing techniques, aimed at bolstering interaction and increasing exposure, the service provider’s marketing coordinator Joanna Storace said.

The decision to venture into digital marketing was the result of technological advancements which have made the foreign exchange industry more accessible to the general public, she explained. Moreover, the exponential growth reported in the sector in recent years, and the shift towards online trading rendered traditional marketing methods ineffective, Ms Storace continued.

Indeed, FXDD, today, operates primarily through its website and offers individual investors, institutional traders, hedge fund traders commercial entities, brokerage firms and money managers access to trading facilities in Forex and precious metals (gold and silver) on a 24-hour a day and five-plus days a week basis.

And, since its foundation in 2002, FXDD has “seen many brokers come and go”, pushing the firm to re-assess the most effective ways of connecting with new and existing clients. As a result, while, previously, each desk at FXDD

handled their own promotions separately using traditional marketing tools, it became increasingly more evident that maintaining an online presence was vital in ensuring the company’s upward trajectory.

To this end, a marketing department – specialising in digital marketing – was set up within its

pre-existing structure. A year on from its launch, the company is already on its way to achieving its main goal of gaining more leads and, consequently, more conversions, the marketing coordinator said, going on to confirm that that “all efforts are now centralised online, offering a high level of engagement and interac-

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CASE STUDY

tion worldwide.” Part of this shift has also involved the extension of the company’s presence to foreign expos and forums, with FXDD participating in three major gatherings over the past year: the iFX Expo in Cyprus – a B2B expo where FXDD shared a stand with US-based affiliated company Forexware – as well as the IT Forums in Rimini and Milan. While all three proved enlightening, Ms Storace confirmed that the company is looking to repeat their experience at both IT forums in the future: “Rimini and Milan are more interesting to us, since they are retail oriented,” she explained.

Ms Storace added that another strategic shift is imminent for the company, with the firm looking to build its expertise in educational camps to help break new ground.

To this end, “we will be focusing on education marketing with trading campuses and disseminating educational materials through our website and social media,” Ms Storace said.

As a result, FXDD has also this year hosted the first edition of the FXDD Training Summer Camp which was aimed at the Italian market. During the five-day gathering held in early September this year, participants were offered several training sessions given by various

“We will be focusing on education marketing with trading campuses and disseminating educational materials through our website and social media.” well-known active traders in the Italian market. They were also granted the opportunity to convert theory and newly acquired knowledge into practical and positive results by trading on FXDD platforms.

Ms Storace clarified that the aim of the programme was to “incentivise prospective traders and interested parties in educating themselves on trading forex,” and the overwhelming feedback received has validated their efforts.

The summer camp’s triumph has

initiated a plan for the event to be repeated, with next year’s workshop likely to welcome both the Italian and Spanish desks.

The company’s channelled focus on educational pursuits may

potentially widen to include an online trading competition targeted towards, but not limited to, students pursuing a career in finance. Although the plan is still in its initial stages, Ms Storace con-

firmed that compliance studies have already been carried out to assess the risk and effectiveness of such a contest. “It is early days still, but I can say that it is set to be an exciting project,” she said.

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STOCK MARKET REVIEW

Global investment themes for 2020

Josef Cutajar As 2019 is coming to an end, various market participants would now be looking ahead for the start of the new year and examining the themes that are most likely to have the greatest impact on the performance of major asset classes over the next 12 months.

Undoubtedly, US international trade policy will remain at the top of the list, shaping investor sentiment and the global economic outlook. In this respect, although at the start of Q3 2019 US President Donald Trump seemed to take a conciliatory approach towards the possibility of striking a ‘Phase 1’ deal with China, the latest developments continue to highlight his unpredictable and impulsive character. At one point, the US President also suggested that any possible trade agreement with the world’s second largest economy could be postponed for after the US Presidential election which is scheduled to take place in early November 2020. Coupled with the latest new trade disputes with other important global economies such as Argentina, Brazil and France, it is very likely that trade tensions triggered by President Trump will continue to spill over throughout all of 2020.

In this context, the US Presidential election in the latter part

of 2020 has broad implications that go beyond the ‘usual’ boundaries of international relations and geopolitics. The hard stance taken by Donald Trump over the past three years via his ‘America First’ slogan has already dented the foundations of the world’s trading system. Although Donald Trump is currently facing impeachment proceedings, it is expected that these will, at some point, stall due to the lengthy procedures involved and the bipartisan agreement which is necessary for Trump to be found guilty. At the same time, the overcrowded field of candidates within the Democratic party for the presidential nomination is a

“Political developments in the UK, China and the Middle East are also likely to impinge on the performance of major asset classes in 2020.” source of intra-party fragmentation, thereby increasing the probability that Trump (who will presumably be the Republican nominee) wins another four-year term as US President.

Political developments in the UK, China and the Middle East are also likely to impinge on the

performance of major asset classes in 2020.

In the UK, assuming that the Conservative Party obtains an absolute majority in Parliament in a crucial general election being held today, it is understood that the road to Brexit will be a relatively smoother process com-

pared to the endless twists and turns that have taken place in 2019. Nonetheless, there are still various uncertainties on the prospects for the British economy in the years ahead given that the UK still has to forge a trade agreement with the EU in the coming months, apart from also, possibly, facing another referendum regarding the independence of Scotland.

In China, the civil unrest in Hong Kong, experienced in recent months, is a cause for deep concern. Likewise, the geopolitical situation in the Middle East remains extremely delicate and investors would need to keep a constant eye on this ‘hot’ region, particularly given its huge importance to the energy and commodity markets in general.

The other key investment theme that is likely to keep investors on edge in 2020 is the extent at which the “synchronised slowdown” (as coined by the IMF) in global economic output will either translate into an overall ‘soft landing’ or else deteriorate further and lead to contractions in some parts of the world. In this respect, the EU seems to be the most vulnerable out of the world’s developed economies as the fragile dynamics of its underlying economy are also clogged by the disjointed political structure at supranational level. In fact, in a speech delivered last week, outgoing ECB Executive Board member Benoît Cœuré described the single currency as yet “an unfinished agenda” and that “the Euro area architecture is still not crisis-proof”. Mr Cœuré also stated that “the combination of weak potential growth and high debt is toxic in a monetary union with decentralised fiscal policy and insufficiently integrated financial markets”. continued on page 24

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STOCK MARKET REVIEW

2020 expected to be characterised by key international political developments continued from page 23 Against this background, overall macro-economic conditions in the Euro area are not only likely to remain dependent on developments taking place across the rest of the world, but also conditional on the ‘extraordinary’ monetary policy stimulus measures of the ECB which are projected to remain at least at their present levels for a number of years to come.

In contrast, following the three interest rate cuts that the US Federal Reserve effected in 2019, the short-term outlook of monetary policy in the US seems to be relatively stable at this stage. In fact, an analysis of federal funds future contracts indicates that the Federal Reserve is expected to maintain its target range for federal funds rate at between its current level of 1.5 per cent and 1.75 per cent until the first half of 2020.

On the other hand, what may be interesting to monitor over the

course of 2020 is the outcome of the Federal Reserve’s review of its strategy, tools and communication practices used in pursuing its dual mandate of maximum employment and price stability. Although this is not a theme that is now garnering much investor attention, the Federal Reserve’s assessment promises to introduce wide-ranging changes that could also have implications for other major central banks including the ECB. In fact, during her first hearing before the Committee on Economic and Monetary Affairs of the European Parliament, the new ECB President Christine Lagarde noted that the central bank will “in the near future” roll out a review of its monetary policy strategy. In the case of the ECB, this has now become an urgent matter – as it was back in 2003 when the central bank last did a similar exercise.

In short, 2020 is expected to be yet another eventful year characterised by a number of key politi-

cal developments that have significant bearing on economic and financial matters including the performance of financial markets.

Likewise, in Malta, amid the unprecedented events which have taken place in recent weeks, investors might need to re-examine certain positions to include a higher country risk. In this respect, however, it is very important to highlight the significance for market participants to avoid impulsive decisions and, instead, assess investments on the basis of company-specific strengths within the broader macro-economic environment.

2019 could well be put down in records as a year of significant, and widespread, financial market returns. However, the more important point to highlight is that, although bouts of volatility are always intrinsically unpleasant and very difficult to predict, nonetheless they most often represent considerable opportunities to be exploited. In this

Rizzo, Farrugia & Co. (Stockbrokers) Ltd, “Rizzo Farrugia”, is a member of the Malta Stock Exchange and licensed by the Malta Financial Services Authority. This report has been prepared in accordance with legal requirements. It has not been disclosed to the company/s herein mentioned before its publication. It is based on public information only and is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The author and other relevant persons may not trade in the securities to which this report relates (other than executing unsolicited client orders) until such time as the recipients of this report have had a reasonable opportunity to act thereon. Rizzo Farrugia, its directors, the author of this report, other employees or Rizzo Farrugia on behalf of its clients, have holdings in the securities herein mentioned and may at any time make purchases and/or sales in them as principal or agent, and may also have other business relationships with the company/s.

Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen.

Past performance is not necessarily indicative of future results. Neither Rizzo Farrugia, nor any of its directors or employees accept any liability for any loss or damage arising out of the use of all or any part thereof and no representation or warranty is provided in respect of the reliability of the information contained in this report. © 2019 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved

respect, the final weeks of 2019 seem to be indicating that 2020 will not be different, thereby emphasising the need for market participants to be wary of current developments whilst always

maintaining a long-term and disciplined approach to investing.

Josef Cutajar is a Research Analyst at Rizzo, Farrugia & Co (Stockbrokers) Limited.

e Malta Business OBSERVER

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BUSINESS UPDATES

Preparing people for the logistics of the future Over 200 employees trained by Express Trailers in 2019 “Building the Express brand, maximising shareholder value and sustaining the company’s growth are important. But, equally important, is developing our people into the logistics experts on whom the future of this sector depends.

And this can only happen when we embrace the technology that will be driving our industry.”

This was stated by Franco Azzopardi, Chairman and CEO of Express Trailers, following a recent course on Robotic Process Automation and AI organised by the logistics firm for its senior management team.

The course created a learning context where all the participants were able to appreciate better, not only what Robotic Process Automation and AI technologies are all about, but to understand better the practical advantages that these can bring to the business.

It was one of a series of courses organised by Express Trailers’ Training Academy at its new The Logic Training Centre. Over 200 employees have received training in various areas of expertise throughout 2019.

“Our growth is not only in terms of business activity but it is based on three important and distinctive pillars, namely space, equipment and people. As a CEO, I have made it my mission to constantly bring our people together to work as a team without ever losing focus of our main purpose: that of adding value to our shareholders.

At Express Trailers, our people are the heart of the organisation and, if we want to look at a positive future, we need to make sure our people are ready for this future,” the CEO said.

LOOKING AT TECHNOLOGY “Looking ahead, we plan to keep focusing on addressing the trade gap that exists between imports and exports. But, as operators in the transport and logistics sector, we also foresee that the harnessing of big data, the use of smarter technologies and more mobile applications, as well as the automation of technology and workflows and a renewed focus on sustainability will be driving our sector in the coming few years,” Mr Azzopardi explained.

“We want out people to understand the necessity of investing in technology because only then we will be able to capitalise on emerging technologies. At Express Trailers, we have always embraced the value of technology which over the years has enabled us to improve and strengthen our service and maximise our opportunities,” the CEO continued.

LOOKING AT HUMAN RESOURCE DEVELOPMENT Express Trailers sees its value in the people it attracts ensuring that the focus remains on investing in their development through continuous training and educational initiatives to turn them into true logistics specialists.

“The launch of our Training Academy last year and the recent huge investment in our new and modern The Logic Training Centre reflect the importance that the company is placing on its employees because they are the ones who can return most value to our customers and our shareholders,” added Mr Azzopardi.

The Logic, which hosts all the training organised by Express Trailers’ Training Academy saw a number of courses covering various topics. Health and Safety Training was given to Industrial Heads, Managers and Supervisors and more similar training is planned to be delivered for all office management and industrials.

Managers are constantly receiving management training and more courses are being planned in this regard for the coming months.

Employees have also started receiving training related to Express Trailers’ new IT System introduced this year and many more sessions are being planned for 2020. Training on GDPR & Operations, Man-

agement Training, Cyber Security & GDPR, Incoterms and on the company’s IT systems are now being planned for 2020.

LOOKING AT 2020 Commenting on his outlook for 2020, Mr Azzopardi said that, whilst local forecasts are indicating that the Maltese economy should expect to maintain a relatively positive performance over the shortterm horizon, opinions regarding the global economy, understandably, tend to differ.

“Whereas some leading analysts expect 2020 tobe a year of growth and global recovery, others, such the UN, feel that warning lights have been flashing around trade wars, currency gyrations, the possibility of a no-deal Brexit and movements in long-term interest rates. And there is little sign that policymakers are prepared. All we can do is wait and see while remaining prepared for any eventuality,” he said.

“We have come a long way and it was no easy task. The going was tough, but the tough kept everyone going. Hard work, courage, passion, dignity, determination and attitude were, and will remain the main ingredients for this company’s future success,” concluded Mr Azzopardi.

For more information, www.expressgroup.com

visit

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e Malta Business OBSERVER

| December 12, 2019

BUSINESS UPDATES

Virtu Ferries’ Saint John Paul II vessel ahead of its time in GHG emissions It is generally accepted that ships’ exhaust emissions can potentially harm human health, cause acid rain and contribute to global warming. The International Maritime Organisation (IMO), a regulatory agency of the United Nations, adopted legislation addressing the emissions of air pollutants from ships and enforcing mandatory energy-efficiency measures reducing greenhouse gas emissions from international shipping. Virtu Ferries, with decades of experience owning and managing ocean going vessels, adopted an Environmental Policy commensurate with the times we live in.

Saint John Paul II, the company’s newest build, delivered from Incat Tasmania is certified

by Classification Society Det Norske Veritas – Germanischer Lloyd (DNV-GL) on behalf of the Malta Flag Administration, complying with both IMO’s Fuel Oil Data Collection System (DCS), and the European Union (EU) MRV Regulation (Regulation (EU) 2015/757) through a “Statement of Compliance EU MRV Monitoring Plan” and a “Confirmation of Compliance – Ship Fuel Oil Consumption Data Collection Plan”.

Use of software prepared and approved by DNV-GL accurately records Carbon Dioxide (CO2)

levels produced both at berth and at sea. Yearly ship-specific emissions reports generated through this software, are verified and approved by that classification soci-

ety and, thereafter, uploaded to the European Union database “Thetis MRV”.

Energy efficiency measures adopted by Virtu, include:

Changing to shore electrical supply when at berth and where such facilities are available, thus reducing fuel consumption, and Carbon Dioxide (CO2) and Sulphur Oxide

(SOx) emissions. Such facilities installed at the Virtu Ferries Terminal, minimize emissions in Valletta.

The underwater section of the ship’s hulls are coated with an Organotin-free self-polishing hydrolysing anti-fouling paint, maximising ship speed to fuel consumption ratio.

Saint John Paul II is designed with a wave-piercing hull. Developed by Incat, this standard, was modified by Virtu after hydrodynamic model trials at the UK Ministry of Defence Ocean Basin Research facility, as supervised by Seaspeed Marine Consulting Limited. The design involves a fine bow, with hulls piercing through the water rather than riding on top of waves, resulting in a smoother and more energy-efficient ride.

IMO stipulates sulphur content of fuels used onboard ships following the 1st of January 2020 not exceeding 0.5 per cent m/m of mass. Saint John Paul II has, since commencing operations, like the vessel Jean de la Valette before, utilized fuels with sulphur content significantly below future minimum levels. Such high-grade fuels mean additional operating costs, but also ensure very significant sulphur emission reduction levels within both local and international waters.

Automated AML transaction monitoring can lead your compliance team out of the darkness Adherence to compliance regulations is no easy feat for financial institutions. The compliance team depends on immense accuracy and timely information to get their tasks done properly – and the right tools can lead them out of the darkness. An AML transaction monitoring solution has the ability to sift through millions of transactions, match them against risk profiles, and automatically identify suspicious behaviour in real-time or on a scheduled basis, while minimising false positives.

It’s critical that the AML transaction monitoring solution identifies and alerts the financial institution of any transaction that may lead to money laundering, fraud, and terrorist financing. The best types of AML transaction monitoring solutions include integrations with sanctions and watch lists, a robust rules engine with AI capabilities for customer profiling, a comprehensive workflow with full audit trail for investigations, and real-time alerts which will, undoubtedly, make the compliance team’s lives easier to detect suspicious transactions.

All transactions should be monitored based on a combination of customer profile and risk level, with specific details relating to customer behaviour and transaction detail taken into consideration. When a transaction is flagged, an alert should be generated and the investigation procedure to resolve the case should take place. This procedure needs

to be clearly defined in a written policy and enforced beforehand, so that quick and accurate action can be taken when suspicious transactions are flagged.

Streamlined investigation process It is important that the compliance team investigate each and every alerted transaction.

The AML transaction monitoring solution should provide account and transaction activity statistics on the customer in question, so that the information required for an investigation is all in one central system. Furthermore, financial institutions need to create a centralised investigative unit to follow-up on these flagged transactions while a standard protocol needs to be in place for all investigations.

In serious cases, these investigations can lead to the filing of a Suspicious Activity Report (SAR), an important source of information for law enforcement agencies to initiate action.

That is why it is critical for investigators to collect all relevant information, prepare the report, and submit it to senior management so they can decide whether or not to file an SAR. The ideal AML transaction monitoring solution is able to export key information into the format of an SAR report at the click of a button.

The compliance manager should have a global view of all the data collected through the transaction monitoring process. This

dashboard should illustrate the number of flagged transactions, false positives, true positives, SAR filings, and rule performance so that the AML transaction monitoring solution can be continuously fine-tuned. Finally, it is crucial to measure how investigators resolve cases so that it can be shown that follow-up procedures are being maintained with a full audit trail readily available.

ComplyRadar – it pays to comply ComplyRadar utilises a full risk-based ap-

proach to eliminate disruption to genuine customers, detect potential criminal behaviour, and demonstrate full ongoing compliance. It monitors transactions related to individuals, accounts, and entities to detect suspicious activity quickly and effectively, through a fully audited process to inspect and act on flagged transactions. For more information on how ComplyRadar can help you avoid reputational risk and potential fines, visit www.comply-radar.com or email info@computimesoftware.com.

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BUSINESS UPDATES

Turkish Airlines will start to fly to Xi’an, China Beginning its flights to China back in 1999 with Beijing as its first destination, Turkish Airlines is connecting Xi’an to its flight network as its fourth destination in mainland China after Beijing, Shanghai and Guangzhou on the 20th year of its presence in the country.

After the meeting between Turkish Airlines Chairman of the Board and the Executive Committee, M. İlker Aycı and the Secretary of the Shaanxi Province Party Committee, Hu Heping, an agreement was made for Turkish Airlines to start its flights to Xi’an.

Xi’an flights will operate initially three times a week starting towards the end of 2019, increasing

gradually as the 2020 summer schedule begins.

With the launch of Xi’an flights, Turkish Airlines’ reciprocal flights to China will increase to 24 flights a week.

On the flag carrier’s announcement of the new Xi’an flights, Turkish Airlines Chairman of the Board and the Executive Committee, M. İlker Aycı said: “We expect that the Xi’an flights will contribute to the tourism, trade, culture and economy connections between the two countries. I believe that the transportation bridge built by us will facilitate positive developments beneficial to both communities that have relations deeply rooted in history.”

A building which goes beyond your expectations Welcome to The Notch Conference Centre, a newly created space to host professional events, boost trade relations, business and networking, and act as a catalyst for knowledge. We have taken the expected to the surprising based on the philosophy that an event needs to be brought alive. Our role is to be our customers’ ally, sharing their vision and reinventing ourselves constantly to provide results that meet their expectations.

Our emblematic building is the perfect balance of beauty, function-

ality and versatility. Its spectacular façade and entrance are ideal for showcasing your event. The centre’s rooms and auditoria offer infinite versatility for all types of events, whatever their size.

The three-storey building features a foyer, reception area and a multipurpose conference room able to seat 98 people in theatre style on the ground floor, making it an ideal space for exhibitions or catering events. The conference room on the first floor can seat a total of 210 delegates, suitable for

large meetings and opening or closing ceremonies with large audiences. The top floor offers a world of options and essential flexibility with our five break-out rooms, the perfect complement to your event. Transformable and functional space is created by using adjustable soundproof panels, allowing you to create as much space as needed.

Complement your event with the latest state of the art audio visual equipment and a dedicated highspeed internet connection. Raised

adjustable flooring provide endless set-up options allowing you to be the mastermind behind the configuration of your event. On-site parking is also available providing a complete hassle-free experience.

We invite you to come over to view our venues and facilities in order to help you picture your event.

For further information and to book your event contact our dedicated sales team on 2138 5926 or events@urbanvalleyresort.com. We will ensure your meetings and events run successfully, every time.