The Commercial Courier June/July 2020

THE COMMERCIAL/89

COURIER THE OFFICIAL BUSINESS MAGAZINE OF THE MALTA CHAMBER OF COMMERCE, ENTERPRISE AND INDUSTRY SINCE 1947

JUNE/JULY 2020

MASP Awards winners An outstanding contribution to local architecture

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IN THIS ISSUE THE AFTERMATH OF COVID-19: REBUILDING OUR ECONOMY / THE MALTA CHAMBER’S RECOMMENDATIONS TO GOVERNMENT / A CHAT WITH DUE DILIGENCE EXPERT L. BURKE FILES / BENJI GRECH ON THE CURRENT SITUATION IN THE PROPERTY INDUSTRY / INTERVIEW WITH ECONOMY MINISTER SILVIO SCHEMBRI / THE ART OF ALEXIA COPPINI / THE LATEST BUSINESS NEWS

THE COMMERCIAL/89

COURIER JUNE/JULY 2020

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10 COVER STORY THE AFTERMATH OF A PANDEMIC: AFTER COVID-19, WHAT’S NEXT? How will Malta and its economy recover from the crisis brought about by the pandemic, and what does the future hold? Martina Said speaks to the experts across several industries to find out.

19 IN FIGURES COVID-19… IN NUMBERS A look into the figures related to the impact of COVID-19 in Malta.

20 INTERVIEW A HOLISTIC ECONOMIC RECOVERY PLAN Economy Minister Silvio Schembri tells Ray Bugeja about the holistic economic plan that Government is implementing on the long road to recovery from the havoc wreaked by the COVID-19.

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STYLE REVIEW

MASP AWARDS WINNERS: MAKING AN 22 Foreword by President Perit David Xuereb OUTSTANDING0CONTRIBUTION TO LOCAL Logistics 026 Shipping and Introduction by DG Kevin J. Borg ARCHITECTURE 031 Tourism Council of the Malta Chamber 2018-2019 Sarah Micallef meets the teams behind 031 Yachting Ser Malta Chamber Staff the winning projects 0 3 3 for the Malta The year in pictures – Events Highlights Architecture and Spatial Planning Awards, R OJ E C T S & 34 INTERVIEW spanning restoration and P conservation P O L I C YWITH GOOD 0 5planning, 3 IN TERN AT I O N A L I S “ORGANISATIONS through to urban interiors and Policy Positions 2019-2020 054 Relations with Diplomatic Co GOVERNANCE DO NOT WASTE TIME ON BAD commercial projects.

Policy Committees 068 Enterprise Europe Network ( CHOICES” Sustainability 068 Following his contribution to a webinar Human Resources 068 International Scene 111 BUSINESS Family Businesses on good governance hosted

by The Malta 069 BUSINESSEUROPE MEET THE PEOPLE 0 6 9 BEHIND THE YOUNG EUROCHAMBRES Chamber in May,Marketing Martina Said catches up CHAMBER NETWORK with L. Burke Files, due diligence expert and Executive Committees – President International Due Diligence S EofCthe TO RS Sarah Micallef0meets Maggi, 7 3 Angelique Business Sections, Policy Co Economic Groups Executive Organisation.

0 74 of MMH Deputy Chairperson Malta Ltd, and and Business Councils Committee Members Niki Travers Tauss, Managing Director Malta Chamber Commissions at Esprit Yachting Malta to discuss their 0 7the 6 YCN.Nominees on Boards and Co Economic Groups 38 INTERVIEW involvement with Importers, Distributors ENVISIONING THE FUTURE OF OUR BUILT and Retailers EG 0 7 6 Administration 076 Healthcare ENVIRONMENT Examination Services 0 7 7 Professional Community Lead 118 MEET THE ARTIST Surveys Benjamin Grech, Chief Executive Officer Pharmacists THE CALL OF THE 0 7 7SEA ISO:9001 of Engel & Völkers, discusses the and future Wines Spirits, Beverages and Tobacco of Malta’s built environment and how the Martina Said chats to artist Alexia Business Bureau Chamber’s new committee can help forge the Coppini to learn about herMalta love for all Trade Malta 0 7 8 Manufacturers and Other Industries EG way, with Rebecca Anastasi. things art.

Tech.MT 081 Electrical and Electronics Education Malta Food and Beverage Processors 0 8 1 0 8 2 Street, DIRECTOR OF Plastics andis the Rubber The Exchange, Republic stablished in 1947, The Commercial Courier Public official magazine of the TheManufacturers Malta Chamber of Valletta VLT1117 SALESRelations & BUSINESS Commerce, Enterprise and Industry. It is the leading Media Releases Tel: +356 2123 3873 DEVELOPMENT business magazine, having one of the best distribution Matthew Spiteri Fax: +356 2124 5223 082 Services Providers EG channels in the sector.

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This issue covers the month of June/July 2020.

Articles appearing in this publication do not PUBLISHER necessarily reflect the views of The Malta Chamber of Commerce, Enterprise and Industry.

EDITOR

Kevin J. Borg

DEVELOPMENT MANAGER

Bernard Schranz

EDITOR: EDITORIAL COORDINATORS SENIOR BRAND Kevin J. Borg Sarah Micallef SALES EXECUTIVE All rights reserved. Reproduction in whole or in part without Edward Bonello EDITORIAL COORDINATOR: Matthew Sciriha written permission of the publishers is strictly prohibited.

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ON THE COVER Winner of the Restoration and Conservation & Sustainability Award by MODEL. Photo by Espais Roca

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Because we care about the enviro Administrative Report is printed o certification which provides assur sustainable and well-managed so environmental impacts.

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The Annual Administrative Report of the Malta Chamber of Commerce, Enterprise and Industry is distributed to all the members of The cut-off date for information published in this Annual Administrative Report is 15th February 2020. Events occurring after this d

CHAMBER/89

EDITORIAL

Resilience, adaptation and innovation These are truly historic times we are living. The COVID-19 crisis has destabilised anything we knew for certain until a few weeks ago, and froze the economy to an almost complete halt.

The challenges faced by many, on a personal as well as on a professional and business level, were intense, with many of us describing the past weeks as the most difficult of our careers.

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JUNE/JULY 2020

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EDITORIAL

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his veritable perfect storm however, did not come without its silver linings.

The crisis has brought to the fore a rare and renewed sense of resilience which has allowed the members of our business community to rise to the challenges and work hard to see the light at the end of the tunnel.

As Malta’s foremost representative body for small, medium and large businesses working in all sectors of the Maltese economy, we have made it a point to be catalysts in this regard. Since the outbreak of this pandemic back in March, we mobilised all our resources to be in the best position to service and support our members and beyond. We carried out numerous surveys through which we could tangibly measure and understand what our businesses were going through and accurately measure the extent of the damage we were expected to face.

The prospects did not look good, and that is why we used the full weight and respectability of our organisation to lobby and negotiate a series of assistance packages for businesses that were being forced shut down for an indeterminate amount of time.

Our incessant and adamant calls on Government yielded fruit as we saw the strengthening and widening in scope of the initial assistance packages to sectors which were not accounted for initially. The Malta Chamber’s hard work also paid off, as on numerous occasions, Government enacted a number of support measures which were directly lifted from a document we published

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titled ‘Making a Success of the New Norm’, a document which listed what the country needed to do to manage and possibly overcome the effects of this pandemic and sought to actually turn COVID into a once-ina-lifetime opportunity.

In the past days, we have witnessed our country and many others taking on a new semblance of normality. As Malta becomes increasingly stable from a physical health point of view, the economy, in its major part, has been given a green light to start operating afresh, and this was extremely important for us. The Malta Chamber remains adamant that as a country, we need to get creative to see how we can get as close to the new normality within the limitations and considerations we need to make to protect our vulnerable and each other.

We have said it in the past and it remains true that this storm may not be over as soon as we wished it would. So rather than waiting it out and hoping to find a world we recognise, we need to be courageous, fashion ourselves the best protective gear we can muster, and invest in our human and physical resources, and go out and get on with our lives with confidence.

We need to understand that the way we live our lives will change drastically, be it how we work, do business, sell our products, and so on. We must hence do all in our power to get ready for these changes and make sure that we are best equipped and resourced for them. cc

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The aftermath of a pandemic: After COVID-19, what’s next?

As Malta, along with the rest of the world, returns to some sense of normality following the devastating impacts of COVID-19, the question that weighs on everybody’s mind is: what’s next? How will Malta and its economy recover from this crisis, and what does the future hold? Martina Said speaks to the experts across several industries to find out.

David Xuereb President of The Malta Chamber As Malta’s foremost representative body of business, President David Xuereb says The Malta Chamber has remained close to and sympathetic towards businesses over the past months, while making sure that Government understood the real issues at grassroots level and providing the adequate and sufficient support that was direly needed. “At the same time, The Malta Chamber has been looking fiercely ahead towards a brighter and better future during and post-COVID-19.”

“The disruptions caused by this pandemic have presented us all with an opportunity.

“I consider the world to have pushed a reset button, and where we decide to go from here is all fair game.” – David Xuereb, President of The Malta Chamber 10

We don’t want to merely survive through the crisis. We wish to grasp the resulting opportunities and strive to be better off in social, economic and environmental terms than we were last February,” says Perit Xuereb. “I consider the world to have pushed a reset button, and where we decide to go from here is all fair game.”

The President asserts that this new reality brings endless opportunities, “and, as business leaders, it is our role to digest and mould these prospects. We need to understand that the way we conduct our businesses, interact with our customers and sell our products or services will change significantly with respect to renewed client values and expectations. We must hence do all in our power to get ready for these changes, make sure that we are best prepared for them, and get it right.”

He adds that adapting to the new normal will entail re-thinking business models and strategies. “It is now more essential than ever that companies are incentivised to think differently, work hard to become more JUNE/JULY 2020

CC COVER STORY longer than we all wish for,” he adds. “Waiting for the storm to be over is not an option.”

In this vein, a Chamber Think Tank Strategic Group has been set up with the purpose of reading the signs of the times to come, while researching and developing various scenarios of how the post-pandemic business and social landscape might look.

“The Think Tank’s ultimate objective is to develop strategic initiatives which will need to be undertaken in the short, medium and long terms to address what many are calling the new normal,” says Perit Xuereb.

“Contingency planning and adaptation are crucial in these circumstances. We must ensure that our businesses are aware of the opportunities that are arising in this new world and embrace them with open arms.”

Simon Schembri Partner & Philip Mifsud Senior Associate, Ganado Advocates

innovative and resilient to grow and develop further in a competitive international market with fast-changing dynamics.”

The President points out that, although the effects of the storm may take a while to pass, people in business “are blessed with an ability and ambition to be able to see the light at the end of the tunnel in an entrepreneurial manner, and identify opportunity while others are detecting clouds,” he asserts. “At The Malta Chamber, we have made it a point to be catalysts in this regard and enable our members as well as all members of the business community to rise to the challenge, be more courageous and resilient in the face of these challenges, and strive on.”

Perit Xuereb says the Chamber presented Government with concrete proposals on how to address determinate subjects such as meeting liquidity needs, mobilising labour supply, incentivising business activity, jumpstarting the economy, a shift in mindset and stimulating innovation. “It is evident that the current situation is expected to take JUNE/JULY 2020

“The situation with COVID-19 is an ever changing one, making it hard to gauge the impact on the world and local economy, but also presents a real challenge in identifying solutions which address the situation in a manner which is sustainable,” Dr Simon Schembri, Partner, and Dr Philip Mifsud, Senior Associate, from Ganado Advocates assert. “In rebuilding Malta’s economy without compromising health, Government needs to look towards creating measures which are commensurate with the guidelines issued by the health authorities but also face the economic realities we are exposed to.”

Highlighting that Malta is largely a service-based industry – with the two main contributors to its GDP being tourism and the associated services, and the financial industry in its broadest terms – Dr Schembri

and Dr Mifsud state that, in ensuring that the economy can regenerate without compromising public health, the various industries need to work together in a collaborative manner to create an environment which is conducive to maintaining and attracting new business to our shores.

“Within the financial industry, it is crucial that the picture presented reflects reality. Therefore, all the players in the public and private industries need to be uniform in demonstrating that notwithstanding the current measures in place, the advantages that Malta offers can still be availed of,” they explain.

“We are fortunate enough to live in a digital and paperless age, which allows Malta’s private service providers to keep servicing local and international clients in their interaction with various government entities in the manner in which clients are accustomed to.”

With respect to the tourism industry and associated services, “it is essential that the industry seeks to create a modus operandi that is innovative, unique and engaging towards clientele. Malta has a lot to offer in terms of outdoor spaces, and the service industry needs to adapt its game plan to create opportunities within the current scenario.”

Although restrictions have been eased, Dr Schembri and Dr Mifsud assert that in recent weeks, a number of businesses had already started adapting themselves to the new reality, and others will have to follow suit to survive. “Similarly, within the financial services industry, clients want to ensure that their processes remain seamless and that the business world they are familiar with has not undergone a radical face lift,” they assert.

“Accordingly, it is incumbent on service

“Within the financial services industry, clients want to ensure that their processes remain seamless and that the business world they are familiar with has not undergone a radical face lift.” – Ganado Advocates

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“Effectively, all must see that nobody remains above the law and we see an end to impunity.”

– John de Giorgio, Chairman, Shireburn Software Ltd

providers to ensure that they work with government entities to forge new methods of doing business which give comfort and security to clients that they are well accustomed to.”

Speaking of their own sector, they state that the legal sector has also been negatively impacted. “We too had to adapt to the new realities and managed to successfully implement the move to a virtual environment, not only in the way we assist our clients but also in our internal dealings,” say Dr Schembri and Dr Mifsud. “In truth, the recognition that it is possible to work and communicate effectively while living in

a new reality will benefit the legal sphere, by ensuring that needs are met in a timely manner through increased flexibility around working environments.”

Julian J. Mamo Managing Director, GasanMamo Insurance Ltd “Public health is of paramount importance and all necessary measures must be in place to safeguard the population’s health,” says Julian J. Mamo, Managing Director at GasanMamo Insurance Ltd. “This said, one must keep things in perspective and

“This is an opportunity for economic operators to adapt to new realities ensuring that their offering is in line with the new norms.” – Julian J. Mamo, Managing Director, GasanMamo Insurance Ltd

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recognise that the public has always been and will always remain exposed to health challenges, yet has been able to operate normally.”

Mr Mamo highlights three closely-linked key elements that are needed in order for Malta’s economy to recover: positive transparent data on the real health risks that are posed – “once the data is statistically positive and is trusted, then confidence will be rebuilt”; continued measures promoting good health and containing the spread of the virus; and transitional Government support.

“Once confidence starts to return, people will gradually revert to more normal patterns of life. This may take some time and things may never be identical to pre-COVID-19. This is an opportunity for economic operators to adapt to new realities, ensuring that their offering is in line with the new norms and delivered in a way that suits its target audience,” he asserts. “The health measures are crucial if they are to be effective to keep the health data positive and consequently boost confidence. Effective Government support is essential during this period of transition while businesses and citizens adapt to new realities.”

Mr Mamo adds that Malta should take the opportunity to render itself more resilient to such shocks by avoiding sector specific dependence, such as the building or tourism sectors. “While these are and should remain important pillars of the economy, they need to be sustainable and rendered less critical due to growth in a more diversified economy.”

As restrictions for businesses and consumers across the islands have eased, Mr Mamo foresees the initial hurdles for businesses will be of a practical nature, as working practices and buying patterns have been upended. “Businesses will struggle to adapt to new measures that are imposed.

This will take time and in many cases some investment, however, most business owners appreciate that it is unrealistic to hope that they will simply continue to operate in the same way that they did pre-COVID-19.

Change always brings new opportunities, and those who identify new and improved systems will benefit from this, while those who are not as swift to adapt might struggle more. Adaptability is key for survival.”

Asked to share how Mr Mamo’s industry has been impacted, he asserts that it has been hit in the same way as all other sectors, and had to adapt, practically overnight, to operating remotely, interacting with stakeholders through virtual means and delivering a service without direct contact.

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CC COVER STORY “On a personal level, we have also encountered the new challenge of keeping our staff safe from this virus, as well as our customers, while at the same time delivering a service that is in line with what the public has been accustomed to,” he explains. “It is a fact that all parties responded brilliantly, with customers cooperating fully and staff determined to maintain the highest possible standards. It has been challenging but we have learned a great deal. I have no doubt that there will be further changes in our sector as there will be in many others.”

Maria Micallef CEO, The General Soft Drinks “In both the short and long term, the overriding priority must always remain public health and well-being through measures and

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strategies that are proportionate to the scale of the current issues at hand. Such measures and strategies must be constantly monitored and tweaked as we now face a very fluid reality,” states Maria Micallef, CEO at The General Soft Drinks.

From an economic perspective, Ms Micallef asserts that the short-term strategy must focus on safeguarding as many jobs as possible, which is only possible via measures that effectively provide support and access to cashflow for operations in all sectors of the economy. “Such frameworks have been forthcoming but more rapid implementation and roll-out to the market would have resulted in much less uncertainty and instability throughout the economy.”

In the short to medium term, Ms Micallef believes the revival of the local economy will be heavily dependent on internal tourism.

“With traditional tourism being such a

“With traditional tourism being such a large contributor to the economy, it will be essential to cultivate as much internal tourism as possible within the acceptable parameters of social distancing.” – Maria Micallef, CEO, The General Soft Drinks

large contributor to the economy, it will be essential to cultivate as much internal tourism as possible within the acceptable parameters of social distancing in order to drive the wheel of the tourism sector and the various other sectors that are directly and indirectly reliant on tourism,” she explains.

“In the longer term, internal tourism as well as traditional tourism of higher value, rather than volume, will be essential.

Furthermore, the long-term priorities that were always discussed for Malta preCOVID-19, namely education, upskilling, innovation and digitalisation, sustainability and the environment, will be of even greater importance going forward.”

Reflecting on the return to a so-called normal pace of life, Ms Micallef asserts that the island still faces a reality of ongoing local transmission of the virus and numerous asymptomatic cases. “Therefore, although the restrictions are being lifted, there will always remain a portion of the population who, for various reasons, will not be willing to revert to their previous lifestyle.”

“This portion of the population coupled with the loss of traditional tourism for numerous months and the restrictive measures in place regarding gatherings of groups of people, will mean lower footfall for many businesses and thus further contribute to the vicious cycle of less cashflow and lower disposable income,” says the CEO. “On the other hand, we now fully understand and appreciate the value of a modern and digital economy, and hence this experience should be used to accelerate the ongoing transition into a modern and digital economy.”

Turning towards the impact of the pandemic on her sector, Ms Micallef says overall consumption of beverages has decreased due to the closure of the Hotel/ Restaurant/Catering (HoReCa) sector. “With the staggered easing of restrictions and hotter months ahead, we look forward to increasing levels of consumption and we will continue to monitor developments closely in order to adapt to the requirements of our customers and consumers. We will also strive to ensure that our brands play a large part in the road to recovery of our clients in the HoReCa industry.”

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Joshua Zammit Founder, NOVARGO Ltd “In discussing post-COVID-19 scenarios, we are basing our work on a number of principles which we believe should underpin any discussion related to economic recovery. One of the most important ones is resilience,” says Joshua Zammit, founder of NOVARGO Ltd. “Being resilient means having the ability to recover quickly from tough situations and respond to the unexpected.”

Mr Zammit says that expert reports indicate Malta has a resilient economy, but resilience also applies to businesses and people. “Until now, we have always given substantial weight to efficiency when evaluating businesses and, although this will remain an important indicator, how resilient a business is will become a central consideration going forward.”

This is coupled with sustainability, he continues. More than just a buzzword, Mr Zammit regards sustainability as “the ability to maintain the activity at the required level for the length of time it is required without compromising the ability to meet the needs of the future. Central to our thinking is the need to have an economy which serves society and not drives it, and therefore, all economic activity should be geared to meet society’s needs and enhance the standard of living of its citizens while protecting future generations.”

Together with these, Mr Zammit stresses that the economy must flourish in an environment where the institutions are strong and governance takes centre stage.

“There are a number of red lines which cannot and should not be crossed and we need to have serious conversations about fiscal morality, enforcement of rules and ethics,” he asserts.

As a self-proclaimed “eternal optimist”, Mr Zammit says every adversity presents opportunities and Maltese businesses have always been extremely able at identifying them, even in the bleakest of situations.

“Central to our thinking is the need to have an economy which serves society and not drives it.” – Joshua Zammit, Founder, NOVARGO Ltd

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As for the challenges, he says that, unless the virus mutates into a weaker strain and loses its virulence, it is likely to stay with us for a while with periodic spikes of infection, “people cannot live under a cloud of fear indefinitely,” and the lifting of measures is an important step towards a newly defined life.

“Initially, the biggest hurdle for businesses will be fear, but as people become more comfortable and understand better what needs to be done, we will hopefully start seeing demand for goods and services increasing.”

Mr Zammit chairs the Malta Chamber Think Tank on the future of business in Malta – an idea which stemmed from discussions between himself and Chamber President David Xuereb last year, with the aim of having a group within the Chamber that imagines and discusses the type of future needed for businesses in Malta to flourish.

“Then COVID-19 struck and we quickly refocused the work of the Think Tank to develop a set of scenarios of how the future

might look post-COVID-19. We have a core group and sectoral roundtables, and close to 140 people directly involved. We have now developed six possible economic scenarios, out of which we have a best-case scenario, a worst-case scenario and a most likely scenario. We are now moving into the next phase, which is the application of these scenarios. At a macro level we are starting to develop models to understand how the economy will behave under these scenarios,” Mr Zammit explains.

“On a sectoral level, the roundtables will study the scenarios and tell us what they think is the most likely one and how they see things panning out in their sector. Based on this, they will develop initiatives and interventions which need to be undertaken at different levels and by different players to continue safeguarding businesses and ensure growth. At the end of all this, we will come up with a series of documents which will provide a blueprint on which together we can define what needs to be done.” cc JUNE/JULY 2020

CCCC COVER CCIN INTERVIEW BUSINESS FIGURES STORY

COVID-19…

IN FIGURES

€2

BILLION The maximum level of borrowing necessary to meet the immediate financing needs resulting from Government’s response to COVID-19.

€607.1 MILLION

The deficit in the Government’s Consolidated Fund at the end of April.

18.2%

85%

Local businesses whose local and export sales were impacted by COVID-19.

The decrease in the number of guests staying in hotels and other collective accommodation establishments between January and March compared to the first quarter 2019.

€1.4 BILLION

5.4%

The estimated loss in tourism income this year also taking into account a certain level of incoming visitors until December.

The decrease in economic growth expected this year.

€109 MILLION

The drop in income tax revenue in the first four months of the year.

21.3%

20,000

The drop in the number of Maltese residents travelling abroad in the first quarter compared to a year earlier.

The number of people in the tourism industry who benefitted from the COVID-19 supplement launched by Government.

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Sources: Finance Ministry; National Statistics Office; Malta Chamber of Commerce, Enterprise, and Industry; Grant Thornton; Tourism Minister; President, Malta Hotels and Restaurants Association.

The mean number of hours per week during which workers were actually on the job in the second half of March when compared to the average of 37 hours a week registered in 2019.

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Source: All figures were sourced from the 2020 Budget document.

The decline in turnover in the accommodation and food service activities in the first quarter this year compared to the previous quarter.

Source: Gozo In Figures, National Statistics Office, Malta

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22.1%

CC INTERVIEW

A holistic economic recovery plan Restimulation, diversification and boosting domestic demand are part of a holistic economic plan that Government is implementing on the long road to recovery from the havoc wreaked by the COVID-19 virus. Economy Minister Silvio Schembri tells Ray Bugeja that his job is to ensure all pull on the same end of the rope.

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ccelerating the diversification of the economy was among the top priorities Silvio Schembri set himself when he was promoted to Economy Minister in January. “Diversify, diversify, diversify,” is one of his main messages now as the person politically responsible to steer the country’s economic revival after the devastation brought about by the coronavirus.

Faced with these challenging times, Government sought to protect as many businesses and safeguard as many jobs as possible, he remarks, adding that it is investing ¤50 million a month to assist myriad employees in a variety of sectors across the board.

The COVID-19 wage supplement will be supporting 100,000 employees, a quarter of whom are in the accommodation and food services sectors, and another fourth in wholesale and retail. One tenth are in manufacturing, and another tenth in transport. The rest are spread all over the economy, from creative industries to employment services, to outsourcing firms.

He promises that Government will continue to work diligently, shoulder-toshoulder with all relevant stakeholders, and remain vigilant as to the needs of businesses and workers, tweaking support as necessary.

Every effort would be made to tailor the assistance package better to become a plank for economic recovery and investment, he adds.

“However,” the Minister asserts, “we do not want the economy to stagnate in the here and now, and, to this end, we are looking beyond this scenario. We believe in the need for revolutionary entrepreneurship, and research is imperative for the wellbeing of any country.” For this reason, the Take-off Seed Fund Awards programme, aimed at supporting new researchers and entrepreneurs, has been relaunched. Also, ¤2,500,000 were invested in the Industrial 20

Rent Subsidy Scheme 2020, which will assist companies and self-employed to start, develop or further expand their operations by renting property from the private sector.

More initiatives are expected to be unveiled to propel the economy forward.

Since one cannot be sure about external demand, Mr Schembri says the focus will be on spearheading domestic demand, pointing out that Maltese households and firms have accumulated deposits with the banks, and it is now time to make this money flow back into the economy.

As the restrictions imposed to contain the outbreak are gradually lifted, the Minister points out that the country now enters a new phase: the restimulation of the economy. This will not happen overnight, he acknowledges, insisting that it is essential for everyone to collaborate towards this common goal.

“With shops now reopening, precautious have to be taken according to the health directives issued and, consequently, we are very much aware that businesses will not experience the same level of business activity as that enjoyed prior to the pandemic. Hence, the wage supplements have been extended for the months of May and June.”

“The situation is a dynamic one and the necessary actions will be taken in the best interest of all,” Mr Schembri assures.

Notwithstanding the pressure to address the effects of the pandemic, the potential of the economy was not sidelined, and meetings continue through virtual business delegations with those interested in investing in Malta, Mr Schembri shares. Thanks to technology, meetings proved to be more efficient, and he believes these should be conducted permanently in this way.

He insists that Malta must keep its feet on the ground and a holistic economic plan that includes significant measures to stimulate economic activity is a must for the coming

“We believe in the need for revolutionary entrepreneurship, and research is imperative for the well-being of any country.”

months. The country must also position itself in the post-COVID19 economic recovery as a place where it makes sense to do business, he asserts.

Although he would not be drawn into making any forecasts on when the Maltese economy will be returning to precoronavirus levels, the Minister remarks that the institutions qualified to make such predictions indicate that Malta has the potential to start to recover in the later months of this year and, especially, in 2021.

His role, he stresses, is enabling everyone to work closely in restimulating economic activity. It is essential to achieve a delicate balance: ensuring that the economy gets back on its feet while following and abiding JUNE/JULY 2020

CC INTERVIEW

by all health directives in place, Mr Schembri remarks.

“I have been in constant touch with all stakeholders to create a holistic plan to ensure we remain the best economy in Europe, and my Ministry’s resources are devoted to come up with significant economic measures that shall serve as an impetus for all economic sectors to relaunch their commercial activity.”

“I believe that what made us strong pre-coronavirus, will make us strong postcoronavirus. We have the resources and ingenuity to be economic leaders in the post-COVID-19 economic environment,” he declares.

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Given the unfolding scenario, it is difficult to say how long the recovery will take, however, the Minister admits that he is very satisfied to see manufacturing companies adjusting to the circumstances and seeking opportunities amid adversity. “It is this very sense of optimism that we aim to re-instil in order to restimulate our economic activity.

We have just got approval from the European Commission for a ¤11.5 million initiative to

support firms that change their production to COVID-19 related products. This will be just one of our many initiatives to kickstart our economy,” he says.

At which point will we be back on track economically? The Minister’s answer is clear: “We will be back on track when, once again, we return to being the EU economy with the fastest growth in employment. This is what counts for us. Not GDP, but jobs.”

“With shops now reopening, precautious have to be taken according to the health directives issued and, consequently, we are very much aware that businesses will not experience the same level of business activity as that enjoyed prior to the pandemic.”

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“We have the resources and ingenuity to be economic leaders in the post-COVID-19 economic environment.”

He insists that, just like Malta managed to cut the number of unemployed from 7,350 to close to 1,500, Government is committed to do all it takes to do it again and return those who were impacted by the pandemic to the workplace. Malta’s employment rate last year exceeded the EU’s average and Mr Schembri is determined to keep it that way.

Post COVID-19, the country must continue to “diversify, diversify, diversify”, he insists.

To be futureproof, the Minister stresses, the economy needs to be as diverse as possible. Government must work hard to attract FDI for Malta to lead in the new sectors emerging post-COVID-19, Mr Schembri notes, adding that, besides going digital, Malta must refocus its resources towards sectors that continue to deliver value-added despite the pandemic. He mentions manufacturing as his first priority, saying that it needs to remain a mainstay of the economy.

Looking ahead, the need to ensure Malta has the talent it would require in the years to come is raised. “The nurturing of talent and upskilling of our workforce has always been a main priority for this Government.

It would be useless to attract investment and then not generate employment by not complementing it with the necessary skills,” Mr Schembri explains. He notes that, over the past few years, efforts were made to bridge academia with industry, successfully creating educational niches that served to support new industries and create jobs.

“Curiously,” the Economy Minister continues, “this pandemic offered a silver lining in this regard; a surfeit of opportunities, especially online, to learn and enhance new skills, retrain, and develop talent, which, a few months down the line, will surely be extremely beneficial for both enterprises and the workforce itself.” In his opinion, industries facing low demand should invest in training now so they will have a competitive edge when the economy restarts.

He also thinks the pandemic is an opportunity for education establishments to reinvent themselves. “They have the ability to become more efficient and effective. If they manage to capitalise on this, it would help us in the forthcoming recovery,” Mr Schembri asserts.

The situation he has been experiencing over the past two months or so is far removed from the scenario he walked into when he was appointed Economy Minister in mid-January. At the time, the University economics lecturer notes, the Maltese economy, which was experiencing an JUNE/JULY 2020

unprecedented economic growth, surpassing that of its European peers, was entering a new phase: boosting and supporting local businesses to tap new markets outside the European Union.

For the first time in 30 years, Air Malta was included within the economy portfolio, and, Mr Schembri observes, it is in extraordinary times as these that one understands the importance for a small state like Malta to have its own national airline. It played a vital role in bringing back Maltese citizens stranded abroad through repatriation flights and carried crucial medical supplies to contain the pandemic as well as other medical equipment for life sustainment, the Minister points out.

Regrettably, he went on, the COVID-19 global crisis led Air Malta to ground the majority of its fleet as major airports across the globe, including Malta International Airport, were closed. Mr Schembri explains that the national air carrier had been following a restructuring programme aimed at repositioning itself because of several factors that were proving to be challenging to its day-to-day running. “It is no secret that the airline was still struggling to stay afloat,” he admits.

The COVID-19 pandemic, no doubt, opened the darkest chapter for the aviation industry in decades, forcing several airlines to make

some drastic decisions, and Air Malta is no exception, the Minister explains. Still, despite the challenges it faced, Air Malta is working on a post-COVID-19 plan to help in the country’s economic recovery, the Minister continues.

The relaunch of Air Malta was one of his top priorities when he assumed office.

Another priority, he says, was accelerating the diversification of the economy, and a third priority involved a sector Mr Schembri admits is very close to his heart: small- and medium-sized businesses.

“In essence, our SMEs remain the backbone of our economy. I remember that, together with Prime Minister Robert Abela, soon after assuming office as Minister, we visited some of the shops in Republic Street, Valletta. The sense of enthusiasm to keep on investing in their businesses, create more job opportunities and implement their ambitious projects, which would eventually be beneficial for our economy, was clearly evident.”

“To continue listening to these businesses and understanding better their needs and how we can improve our support was and remains one of my main priorities,” he maintains.

Only, his job has now become that bit more difficult. cc

Silvio Schembri visiting Air Malta (January 2020) - DOI

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Malta Enterprise and COVID: The road ahead for business support and FDI attraction Malta Enterprise CEO Kurt Farrugia tackles the next steps for business support and Malta’s ongoing efforts to attract FDI in COVID times and beyond.

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alta’s sustainable future can only be guaranteed if both health and economic considerations are sound.

Now that the health-related concerns have been mitigated and are under control, restrictions have been eased. The approach taken was to safeguard both the health dimension and ensure that the economy starts to be revitalised after the strong exogenous shock it was subject to.

The lifting of restrictions will ensure that the domestic economy is provided with room to be stimulated again. It is plausible to expect that it will take months for domestic consumption to reach levels similar to the pre-COVID-19 crisis. Even if we were to find a vaccine tomorrow, to get people back to spend as they did before will take time. This applies not only to Malta but across the globe.

Malta’s economic performance is highly dependent on the exports of goods and services. Whilst some products and services kept on being exported even during the peak of the pandemic, others had to be halted abruptly. Tourism and related activities in their broad sense (retail, taxis, diving, restaurants, etc), is a typical case in point 24

of the latter, and is one of the sectors that needs to be tackled with a long-term perspective.

Slowly but surely From our daily interactions with the companies that we support, the message is that by and large, demand is present for their products although to a lesser extent. This is encouraging as it shows that we can start to build economic momentum immediately. This is not meant to imply that everyone is back on track, as we know that there are segments that have restarted slowly, others with a stronger pace and others that until this point are almost still at zero sales, however we believe that with the recently announced measures, the further reopening of the local economy will also have a spillover effect on segments that were experiencing the most anaemic demand.

In the short-term, we must ensure that those companies who have a market to service are able to do so in the most efficient manner. It is worth mentioning that a number of companies were impacted positively

by COVID-19 and thus are also seeking to expand their business. Two particular cases

that have been highlighted recently were Baxter and Metallform, which actually hired new employees. This is not a one-off case but is also evidenced by others in the healthcare, life sciences and technology sectors.

The Maltese business landscape is characterised by SMEs. The pandemic has brought about various challenges. As we open again there will be a period during which SMEs will have spare capacity. As a corporation, we are fully aware of this and it was a well thought out decision to enable businesses to continue claiming the wage supplement for the time being. This measure will be tapered off gradually, and this will enable business to have additional breathing space until more economic traction is attained.

The markets to which we were exporting goods and services have definitely been impacted, and to different extents. This indicates that companies engaged in exporting their goods and services might need to identify new markets to export to, in order to compensate for the loss in demand.

This process will not be instant, as globally, demand will be feeble for the coming months.

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In terms of providers of professional services, they might need to adapt to the downscaled demand from their clients. This means that they will need to find new ways by which to highlight the importance of their services while potentially offering further flexibility in fees and packages.

Eyes on the world – FDI attraction throughout and after COVID In practical terms, all the challenges one can imagine can be transformed into opportunities. The pandemic has given rise to opportunities where if the appropriate solution is developed, it would virtually have a global market instantly.

Malta Enterprise has always adopted a proactive approach when it comes to strategy.

The COVID-19 pandemic has impacted the strategy of the organisation, but its core objectives remain intact – it is more the way of how these are achieved that varies.

Pre-COVID-19, the way in which we carry out business was already changing. This event has accelerated the rate of change and created new challenges, but also new opportunities.

The criteria as to which sectors should be targeted are clear. However, the pandemic has given rise to interesting opportunities within specific niches. This will require more of a micro targeting approach from our end. Areas which will definitely be of interest are related to life sciences (including medical devices and biotech), the use of AI in healthcare-related services and products (including Medtech), chatbots, robotics, biometrics and touchless technologies, e-learning, virtual and augmented reality, etc.

COVID-19 has significantly impacted the way we carry out FDI. The targeting relating to this, in essence remains unchanged, but how we engage with investors has changed significantly. Until a couple of months ago, one of the activities we used to engage in was attending international conferences/ seminars/fairs and interacting with potential investors during these activities. Today, these have moved online, and we have to adapt to this new reality, and therefore our engagement with potential investors during such events also had to change. Digital marketing and contact initiation will become more prominent than ever before. This approach also entails a new set of skills.

Since mid-March we have been carrying out virtual delegations with those who

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are showing an interest to invest in Malta.

Generally, we organise two days of meetings with other entities that potential investors would have met if they had to visit Malta to explore the island as an investment location. This approach has worked very well but it can never replace fully the real experience that a potential investor gets when visiting Malta. Post-COVID-19 we see this approach continuing, but we will also try to ensure that investors visit Malta too during their fact-finding missions. Our experience with investors shows that once they visit Malta, we have a high probability of actually securing them. We receive recurring comments by investors visiting Malta that we have much more to offer than they were aware of.

Globally, the pandemic has caused investors to rethink where they set-up their business. In the coming months various investors will be attentively assessing where to carry out their next investment or where to relocate their present business.

Supply chains globally were hard hit and experienced severe disruptions. Undoubtedly,

there will be various investors in this sphere seeking for alternative locations. We must be on the look out to capitalise on these developments. We are fully aware that the pandemic will increase the fierce competition for FDI even further.

The road ahead remains unchartered territory and what we are experiencing today is not necessarily what we will experience tomorrow. However, the response provided

by Government to the COVID-19 pandemic clearly indicates that irrespective of what will happen in the future, we are adaptive, agile, competent and able to deal with it successfully. The feedback we have received from businesses with whom we are in contact is overwhelmingly positive, and this is also a sign of confidence that we do not perform only when the going is good but also during challenging periods. This should provide reassurance to all businesses in Malta or those who are eyeing the country to do so that we are up for the challenge, and together we can drive the economy to even higher levels than before. cc

Photo by Kevin Abela

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“Our vision spans across generations and we believe that inclusive investment in education is a measure to achieve an inter-generational societal and economic benefit.”

Bridging the gap When the Malta Development Bank (MDB) was established in 2017, the Maltese business community gained a financial partner which aimed to support enterprises in their drive towards sustainable growth by offering financing facilities aiding fertile undertakings. Here, MDB Chairman Josef Bonnici speaks to Rebecca Anastasi about the bank’s role as “a counter-cyclical promotional instrument”, particularly in the times of COVID-19.

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rior to the onset of the coronavirus crisis, leading economists and business innovators had stressed the need to promote a sustainable economic model, which would allow Malta to thrive in the long-term. The COVID-19 pandemic has thrown this necessity in high relief, pushing governments across the globe to reconsider ways in which the capitalist system can accommodate the delicate balance between promoting self-sufficient entrepreneurship and aiding viable enterprises which may need state support.

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From the start, the Malta Development Bank (MDB), established three years ago by means of an Act of Parliament, aimed to do just that. Presciently, it looked to contribute towards tangible economic development by offering financing – guaranteed by the state and managed through local commercial banks, operating as intermediaries – to enterprises which struggled to fill their financial gaps.

“Malta is a small open economy. Inevitably, in a small economy, the market is imperfect, and this is reflected in occasional market

failures,” says MDB Chairman Josef Bonnici.

He attributes this to “the unavailability of sufficient collateral and start-up risks in the case of small-and-medium enterprises (SMEs)” as well as “the large size and long gestation period in the case of infrastructural projects,” which, he says create “financing gaps which restrain the pace of new investment.”

An awareness of these hurdles prompted the setting up of the MDB, the Chairman says, going on to explain that, over the first two years, the MDB proceeded to identify the gaps in the local credit market, in order to set up and establish the financial solutions which were needed. This was in line with the MDB’s vision to promote growth and development, in a non-discriminatory fashion, and in a way “that enhances positive outcomes in social inclusivity” he underlines.

Thus, particular attention was given to individuals and social groups who might have, traditionally, been left out in the cold – those with projects possessing “a strong social dimension such as education, health and affordable housing”. Moreover, the credit needs of SMEs – which “often lack sufficient borrowing history and are also unable to offer the necessary collateral” – were also prioritised.

“The MDB enables commercial banks to be more forthcoming in the provision of loans to SMEs by offering a partial guarantee on such loans, thereby sharing the credit risk with the banks. Through such facilities, SMEs are benefitting from reduced collateral requirements, lower interest rates and access to finance which would have otherwise been difficult to obtain,” Prof. Bonnici says.

In the same way, particular attention was given to family businesses – enterprises which usually depend on the critical completion of succession planning to ensure their longevity. Here, the MDB decided to offer a “dedicated guarantee scheme that greatly enhances access to financing for family business transfers from one generation to the next, thereby ensuring more long-term continuity of such enterprises.”

Yet the bank has, since its inception, also geared its processes to foster the JUNE/JULY 2020

CC FINANCE

development of young talent – what Prof.

Bonnici calls “Malta’s sole natural resource”, saying that the MDB “sees a long-term benefit in investing to enhance Malta’s human capital.” To this end, the Further Studies Made Affordable Scheme provides those at the beginning of their careers with the flexibility to continue studying, through guaranteeing study loans and providing subsidies on interest charges.

“Our vision spans across generations and we believe that inclusive investment in education is a measure to achieve an inter-generational societal and economic benefit. We believe that it will be essential for the Maltese economy to move deeper into sectors that demand a supply of more skilled and talented labour force that can boost productivity, competitiveness and efficiency,” he attests.

Eligibility for all the bank’s schemes is “very broad-based,” the Chairman underlines, reiterating the commitment to support those enterprises and individuals who hold great promise, and who would otherwise have difficulty accessing finance.

“MDB’s facilities are provided to viable, bankable and self-financing operations. As borrowers service their debts, the stream of income ensures the self-financing nature of the approved projects and programmes along with the assurance of commercial viability and bankability,” Prof. Bonnici continues.

And today, with the onset of the coronavirus crisis, help has never been needed more. To this end, in order to help businesses survive in an increasingly hostile environment, and in response to the challenges confronting small, medium and larger enterprises in the wake of the pandemic, the MDB has recently set up the COVID-19 Guarantee Scheme (CGS) and the Interest Rate Subsidy Scheme.

“With the current outbreak of COVID-19, the MDB is stepping in to help shield the Maltese economy, fulfilling its public policy role as a counter-cyclical promotional instrument. And we believe that we have evolved a support programme that adequately meets the financing requirements of the economy in the current difficult circumstances,” the Chairman explains.

The aim here is to provide “a lifeline to businesses to ensure their survival and

continuity” – desperately needed by many businesses which have seen their revenues decimated as the economy shuts down and people retreat to their homes in lockdown.

The CGS, “a temporary extraordinary aid measure” which is backed by a Government guarantee of €350 million, has the potential, Prof. Bonnici explains, of generating €777 million in new liquidity, addressing “access to, and the affordability of cash flow” to businesses affected by COVID-19.

“We seek to dampen cyclical fluctuations by moving in the direction contrary to the overall state of the economy. Hence, we have launched an extensive guarantee programme that mobilises the banking system’s liquidity into new affordable credit which is more easily available,” he says.

The structure of the scheme, Prof. Bonnici explains, is in line with its goals of supporting “the survival of businesses, to protect the existence of jobs, and to sustain the circular flow of money in the economy despite the challenging environment.”

As a result, preferential conditions for such working capital loans have also been implemented, with a moratorium of at least six months on interest and capital repayments. Moreover, the interest rate is less than the standard bank rates as a result of Government’s guarantee and an interest rate subsidy, which slashes the percentage borrowers would have to pay, to as low as 0.1 per cent.

And, in recognition of the commitment to helping businesses for as long as the pandemic remains a reality, the CGS is open until the end of the year. “This should have a considerable stabilising effect on the Maltese economy at such a critical time,” Prof. Bonnici says. “I believe that the CGS is a reaction to a crisis – as we emerge from the crisis, the market will show a reduced need for this intervention and actual conditions in the economy will guide decisions to sustain or to taper off the scheme.”

Looking ahead, to the MDB’s role even after COVID-19, Prof. Bonnici says the bank will remain committed to sustainability in its economic, environmental, social and human dimensions.

“We expect that all our programmes in the future will continue to seek to optimise the use of resources, minimising the ecological impact, ensuring inclusivity and cohesion in our community. They will also

prioritise health, education, skills, knowledge, leadership and access to services that we collectively consider to represent human capital,” he underlines.

Indeed, this is what the entity will continue to strive for. And to fulfil these objectives, the bank will remain “a counter-cyclical instrument, deeply analytical and constantly innovative,” promoting new programmes and initiatives which will aid local business, entrepreneurs and the entire economic landscape. cc

“We expect that all our programmes in the future will continue to seek to optimise the use of resources, minimising the ecological impact, ensuring inclusivity and cohesion in our community.”

“With the current outbreak of COVID-19, the MDB is stepping in to help shield the Maltese economy, fulfilling its public policy role as a counter-cyclical promotional instrument.”

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CC ECONOMY

A vision for a resilient, ambitious, fair, and forward-driven economy Earlier this year, The Malta Chamber launched a new Economic Vision for Malta for the years 2020-2025 with the aim to once again provide Government with a business plan conducive to sustainable economic growth.

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his was only four short months ago. Since February of this year, in the greatest economic crisis of our time, the economic landscape has changed dramatically, yet The Malta Chamber’s Economic Vision remains as relevant as ever.

The Economic Vision was based on solid research carried out on sound economic principles and founded on the coordinated extraordinary vision of Malta’s finest minds and exponents of business acumen.

The recommendations of The Malta Chamber’s Economic Vision for 2020-2025

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which we are reproducing here, dare to imagine beyond the current norms, and propose an economy which is resilient, ambitious, fair and exciting.

In the current disruptive era, we see a golden opportunity for our society, our economy and hence our country. Before COVID, we extensively discussed those matters that the world needed to change, things we all agreed needed fixing. This is the time to get all of that right – this is the opportunity.

The world has pressed the reset button,

and it is now our task to start building anew based on refreshed national and global values. Our Economic Vision provides a blueprint to design and assure a sustainable and competitiveness-based resilient economy in full respect and coordinated with national well-being and an improved quality of life for its population, now and in the future.

Perit David Xuereb, President of the Malta Chamber of Commerce, Enterprise and Industry

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The Malta Chamber’s recommendations to Government: A summary Long-term macroeconomic stability 1. Government should embark on further consultation with second pillar pension products providers to seek ways to improve the take-up of these schemes by employers and employees.

2. There is a need for Government to embark on a national discussion resulting in a bipartisan agreement on the reforms required in pensions, health, and long-term care so that these are rendered sustainable and adequate for current and future generations.

Digitalisation 3. A Prime Ministerial-led task force, which includes the Chamber and other important stakeholders, should be set up to lead the design and implementation of the fundamental elements that allow Malta to be at the forefront of the 5G-based new digital economy, just as it was in the Internet information economy.

4. There should be an extensive review of the use of e-/mgovernment services to identify bottlenecks hindering the uptake and use of these services. And subsequently, Government should undertake the requisite actions to deliver the expected economies.

5. The Malta Information Technology Agency should be tasked with building a Business e-Portal that is underpinned by virtual processes and functional alignment to create efficient, effective, and economic triggered processes, and directed to reduce the cost of administration to businesses.

Governance, Government and judiciary 6. The Chamber is ready to work with Government on continued, systematic and sustained reforms of the supervisory capacity over the financial services sector, which is a must to mitigate Malta’s reputational loss.

7. The Chamber is ready to work with Government to draw up and actively participate in a European and international communications campaign that explains and positions the facts regarding Malta’s governing institutions and the reforms currently underway to strengthen these institutions.

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8. It is imperative that Government adopts a zero-tolerance policy towards all levels of corruption, whether administrative or financial.

9. There is an immediate need for output and outcome-based budgeting reforms in Government that are underpinned by performance metrics and transparent public reporting.

10. Government should undertake an extensive review of its use of information management as a strategic resource to identify bottlenecks and take corrective action. It should also undertake renewed investment in the utilisation of information management as a strategic resource within public service and policy-making in general.

11. Government should establish efficiency as central to creating value. It should expand Malta’s productive base by releasing surplus staff into the private sector to enable further economic growth and ensure the most effective utilisation of human capital.

12. The Chamber reiterates its position stated in the 2014-2020 Economic Vision that it will support Government in reforms of the judicial system to ensure a judicial process that is swift, fair, accountable and transparent.

Infrastructural bottlenecks 13. Future transport policy should centre around people rather than cars. There should be no compromise on any infrastructure required for people to move around.

14. Public transport should be given more priority where possible and rendered more efficient so as to encourage more people to make use of it instead of private cars.

15. More effective and visible enforcement of existing transport regulations should take place as this will lead to less road accidents and less delays on Malta’s roads, contributing positively toward the economy.

16. Public Private Partnerships should be considered by which on-road parking spaces could be re-allocated to new multi-storey underground parking spaces, freeing up space on the road for people and putting cars underground. This can be integrated with

Park and Ride services where necessary or adequate walking and cycling infrastructure including sharing platforms.

17. Public transport systems in the country need to evolve. Technical and financial feasibility studies should therefore take place on rapid transit solutions that can be implemented in reasonable timeframes. In this context, Government should reconsider the investment in the tunnel between Malta and Gozo, and direct the investment towards building a multi-modal transportation backbone with metro connectivity to Gozo and a widened ferry network between Gozo and areas in Malta such as Valletta, Bugibba, Sliema and Cottonera.

18. The Chamber supports Government in setting up a holistic warehousing and logistics sector that includes the creation of additional warehousing space and logistics centres; connects inbound road traffic and sea and air transport through a physical and virtual Free Zone; and includes an advanced ICT system that integrates the supply chain process, as well as investment directed towards the deepening of skills and competencies.

19. Government should invite the private sector by means of the Private Financing Instrument to identify, build, finance, operate and maintain a waste-management technology that enhances recycling and, in doing so, spurs forward the circular economy.

Smart innovation economy 20. The Chamber supports a responsible research and innovation approach that focuses on a number of value-added economic sectors in addition to blue-sky research. Economic-based innovation should include value-added manufacturing; digitalisation; smart-city technologies; marine and aquaculture technologies; aviation and aerospace technologies; and health and biotechnology.

21. For Malta to have an innovation-based ecosystem, Government must introduce a significantly financed innovation fund – one that attracts innovative research and product development, including first-class talent and accelerators that select Malta as their base.

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ICT skills, as well as solid literacy, numeracy, and problem-solving skills to enable students to use ICT effectively.

34. The Chamber reiterates its position presented in the 2014-2020 Economic Vision that the stipend system across further and higher education should be positively biased towards those disciplines that are central to the continued economic well-being of Malta.

These include STEM streams and teachers of STEM subjects.

22. The necessary action must be taken by Government to establish ‘Test Bed Malta’, supported by an innovation-based ecosystem that includes Centres of Excellence.

23. Government should rationalise the roles and functions of government agencies that support research and innovation, and create a far more streamlined set-up.

24. To secure improved competitiveness for the manufacturing industry, the Chamber urges Government to reform the tariffs and port charges for domestic cargo transportation from local ports. There should be a shift from tariffication of charges to market forces.

25. Government should reduce the cost of energy for non-household consumers.

By doing so, it will render business more internationally competitive and reduce inflationary wage prices resulting from price transferring of energy costs from the retail and distribution sector to the domestic economy.

26. In the EU, Malta already occupies a leading position in social policy and frameworks of working conditions, hence decisions to introduce new measures for paid time away from work should be left to the individual employer.

27. Government and business should join forces to develop and implement digitalisation, innovation and technologydriven transformation pathways that are tailored to different sectors. The implementation of these pathways should be supported by fiscal incentives.

28. It is unacceptable for Malta to rank 84th with regards to the ease of doing business in World Bank rankings. Government should take all the necessary steps to ensure that Malta ranks among the top five EU member states by the end of the term of this Vision.

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29. In the immediate term, the Chamber will work with Government and regulatory authorities to conform with the requirements of the Anti-Money Laundering and Combating the Financing of Terrorism (AML/ CFT) regulations. Within this context, the issue of the time taken by a firm or foreign person to open a bank account in Malta will be tackled as this has become a serious obstacle to doing business or relocating to Malta.

30. Along the same lines as the commitment made by Government to modernise Malta’s roads, a similar commitment must be made to establish Malta as a quality, five-star product. This will enable the tourism sector to retain its competitive advantage, and other business sectors will continue to enjoy a comparative advantage with regard to attracting foreign investment.

31. Malta should initiate steps to modernise the current corporate tax framework. While having served the country well over the past 25 years or so, the framework in its current form is not the right instrument to take Malta forward. The Chamber emphasises that reforms should be such that the capacity of companies to engage in aggressive tax planning is limited. However, this would be without constraining Malta to apply corporate tax as an instrument of competitive policy.

Developing a highly skilled, highly productive workforce 32. Government, teacher-representing institutions and other stakeholders – including the Chamber – must re-evaluate past reforms; understand why Malta is falling behind international benchmarks; identify the teacher-student, soft infrastructure required; and agree on the next steps.

33. One particularly essential requirement in preparing future workers is for the curriculum to equip all students with basic

35. The introduction of the VET ‘My Journey’ pathway within the curriculum will increase the esteem of VET. However, it must be complemented by investment in infrastructure, including workshops and equipment at MCAST that reflect the current and future world of employment.

36. While Levels 4 and 5 of VET education constitute MCAST’s ‘core’ business, the College should have pathways towards VET Levels 6 to 8 to enable increased specialisation training. This will further improve the esteem and image of VET as a pathway to successful employment and a long-term career.

37. The Ministry for Education and MCAST should undertake the appropriate action, including the provision of fiscal incentives to SMEs, to increase demand and supply for apprenticeship and work-based learning opportunities. Increased investment in apprenticeships should prohibit employers from poaching enterprising apprentices as this jeopardises the apprentices’ development and future potential.

38. The Chamber will work with the University of Malta, MCAST, and other educational institutions to build long-term partnerships and create an adult-education platform that is flexible and tailored to the needs of industry.

39. Businesses must share their workplaces with educational institutions as a learning environment where all forms of work-based learning – particularly apprenticeship programmes – become an integral part of the education and training programme.

Strengthening the structural framework of the economy 40. Government should adopt a strategy to rebalance the economy so that should a single sector fail, the knock-on effects will not result in a collapse of Malta’s economy.

This will minimise Malta’s exposure to arising disruptions in industries such as construction, financial services, iGaming, and other knowledge-based transient sectors.

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CC ECONOMY 41. Malta should take a lead role in introducing policies that promote reinvestment and innovation in new iGaming service offerings that create member value and elevate responsible gaming as a signature industry policy.

42. The financial services sector requires a new strategy that positions it as a catalyst for the long-term economic strategy and not an overweight economic pillar in its own right. This will ensure that Malta’s economic and financial services strategies function in harmony and reduce reputational risk.

43. For Malta to nurture and further evolve a tech sector that competes internationally, the provision of the right level of legislation is required. There needs to be a regulatory ‘sandbox’ in which tech enterprises can create and test innovative products, services, and business models without being immediately regulated. To achieve this, fiscal support from Government is imperative.

44. The Chamber believes that the tourism model requires a strategic reboot that moves the sector towards a high-quality, sustainable model. This reimagining will attract a lower number of tourists while simultaneously generating a higher yield.

45. The Chamber believes that there are significant opportunities for Maltese firms to internationalise. Government should further incentivise private sector-led initiatives to support Malta-based companies in their drive to expand their businesses abroad.

strengthen its enforcement and sanctioning regime.

49. Proper solutions must be found and introduced to reduce the high rate of turnover of foreign workers. These should be solutions that: (i) ensure the attraction and retention of international talent; (ii) retain cost competitiveness and bring the wage inflation spiral under control; (iii) protect Malta from an over-heated economy stimulated by the construction sector; and (iv) secure sustainable economic development.

50. The economy should be inclusive. When wealth is generated during periods of high economic growth (as has been experienced in Malta), businesses should be encouraged to channel part of said wealth into the pervasive implementation of corporate social responsibility strategies. Similarly, Government should invest part of the wealth generated in periods of high economic growth in social projects with long-term benefits.

Planned, safe and resilient built environment 51. Malta must adopt ‘carrying capacity’ as its approach to spatial planning. What this means is that there is a maximum number of individuals and buildings that the country can support in its environment without experiencing decreases in quality of life.

A carrying capacity approach will protect Malta’s unique environment and traditional characteristics. Furthermore, Gozo must not be allowed to become a replica of Malta.

Inclusive economy 46. By importing talented and skilled migrant workers, Malta will strengthen and expand its base of human capital. In turn, this will allow the country to meet the demand to spur an expansion of economic sectors already in place, as well as to build new ones. Like high-performing economies such as the UK, Germany, Australia and the US, Malta should seek and embrace foreign talent.

47. Malta should make more productive use of migrants who seek refuge in Malta on humanitarian grounds. If provided with the appropriate training, these persons can productively engage in the economy and contribute towards lessening potential emerging tensions in Malta’s fast-changing culture.

52. The Kamra tal-Periti and Government must take immediate corrective action and impose sanctions in the event of malpractice or abuse of the new construction regulations.

By doing so, they will strongly show that the reforms have drawn an unwavering line across the previous laissez-faire approach to construction.

53. The construction industry must be regulated by the state. Stringent criteria must be established for the provision of operating licences to constructors so

that the construction industry makes the related reforms and investment to reach the standards present in other EU member states.

54. The new Building and Construction Authority must be equipped with the appropriate resources and tools, as well as a strong enforcement function.

55. Trust and confidence must be reestablished within the Planning Authority and the Environment and Resources Authority. First, both entities should have their enforcement functions strengthened, and a robust spatial planning capacity should be established within the Planning Authority.

Resource efficiency and low-carbon economy 56. Government should introduce sustainable construction codes to ensure that new or rehabilitation developments with a footprint of 1,000m2 and above have a reduced environmental impact throughout their lifecycle; lower energy demand; lower consumption of operating materials, and increased utilisation of reusable or recyclable building products and materials; an extension of the lifetime of buildings; riskfree return of materials to the natural cycle; comprehensive protection of natural areas; and, that they make use of all possibilities for space-saving construction.

57. Malta should set the goal of having all new construction consist of positive green energy buildings.

58. The Chamber will provide all the necessary support to Government in the creation of reforms aimed at reducing traffic.

These reforms are required to improve air quality, and they must be well planned.

59. Given the revolutionary innovation taking place in e-vehicles, Government should draw up a new e-vehicle policy. A matter of particular importance is the infrastructure needed for charging vehicles. The policy should also seek to establish Malta as a test bed for hydrogen powered vehicles. cc

48. Malta needs to adopt a far-reaching, zero-tolerance policy towards employers who exploit foreign workers by providing them with employment conditions that do not meet legislative requirements. A name shaming policy should be introduced in the context of the exploitation of foreign human capital. In this regard, Government needs to JUNE/JULY 2020

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CC INTERVIEW

“Organisations with good governance do not waste time on bad choices” Following his contribution to a webinar on good governance hosted by The Malta Chamber in May, Martina Said catches up with L. Burke Files, due diligence expert and President of the International Due Diligence Organisation, to discuss his life’s work, his relationship with Malta, and his perseverance in the fight against financial crime.

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or due diligence expert and international investigator L. Burke Files, who has decades of experience in the international finance and corporate world, the case for sound decision-making and good governance is loud and clear. “If you have a business opportunity, who are you going to talk to? The professionals who are trustworthy. With good governance, your organisation is more efficient, more profitable, and will have more opportunities.”

Based in Arizona, USA, Mr Files’s attraction to finance goes way back – to his early school days, in fact. “I have no idea why, but it made sense to me,” he says. “In fifth grade, we were supposed to pick a stock and follow it over a month to see if we made or lost

“Your required scope and depth of due diligence is in direct proportion to how much damage a decision can cause the company or the public.”

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money. I may have misunderstood the example, because I was paper trading, buying and selling stocks. The instructor had a good laugh at parent-teacher night as he had taught a fifth grader how to paper trade.”

Mr Files left University and went right into trading commodities and stocks, becoming the head of an investment bank department at a small securities broker dealer. Here, he became deeply interested in the companies they were going to underwrite. “Deep dive due diligence helped us underwrite eight companies in two years, and all of them made money for the investors.”

This ultra-thorough approach to due

diligence, or “deep due diligence”, also helped his team defend a few lawsuits. “In fact, because of our due diligence, we won all of the cases.” However, the firm folded, and on his last day, Mr Files received a call that altered the course of his career. “As I was saying my goodbyes in the lobby, a lawyer for one of the plaintiffs that sued the firm called me and said if I was so good at due diligence, how would I be on investigations?

I said I don’t know but I suddenly had a lot of free time on my hands, so I took a look at the case.”

As President of the Financial Examinations and Evaluations Inc. as well as the International Due Diligence Organisation, Mr Files’s central message is of empowering better decision-making in any situation.

“Your required scope and depth of due diligence is in direct proportion to how much damage a decision can cause the company or the public. This is a central tenant of due diligence. Choice-makers are empowered with information and questions. The focus is to reduce the imponderable questions to a minimum. It is not a pass or fail process, but rather a question of whether the choicemakers have the necessary tools and skill.”

This aim is achieved through training on understanding information sources, how they can be skewed or manipulated. “We also look at how we make choices and how we are led into making choices that may not be in our

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“It comforts me when a client has chosen Malta as a jurisdiction because Maltese laws strike the right balance and the Courts are reliable.” best interest,” he asserts. “The checklist is a great example of a good tool and our worst enemy. With that understanding, it is now about finding the information you need.”

Having worked cases in over 130 countries, could cultural differences ever hinder the fulfilment of this goal? “Cultural divides (inner company and international) evaporate with a common interest and goal. If there is a ‘cultural divide’ that impairs you from gathering information, in whose interest was the divide created?”

Included in the list of countries Mr Files has worked with is Malta. He has had ties with the island for over a decade, working on behalf of clients within the financial community and as an instructor at the Malta Financial Services Authority (MFSA). So, how would he assess the current levels of good governance in Malta, following the political scandal that rocked the country last year?

“I am continually impressed with the calibre of the professionals in Malta. It comforts me when a client has chosen Malta as a jurisdiction because Maltese laws strike the right balance and the Courts are reliable.

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“Organisations with good governance do not waste time on bad choices, and spend less on compliance.”

This is why Malta has continued to grow as a jurisdiction of choice,” says Mr Files.

“Has Malta had some problems? Yes. The problems stem from Malta’s success not its failures. Organisations, public and private, suffer a series of predictable crises as they grow, primarily tied to control and communication. Looking at the number of companies registered in Malta, it was growing at what looks to be 12 per cent per year, for four or five years. This is real growth.”

Mr Files continues that Malta is set up for the growth through innovation. “The classic crisis is a failure to control your deliverables.

The deliverables for Malta were supervision and regulation. Just like a successful dress maker, they grow quickly because of quality, but the quality of the dress can suffer in trying to keep up with the orders,” he asserts. “For Malta, what suffered was governance. It was not any systemic problem of Malta, but a predictable managerial hurdle.

Most do not see this hurdle – it is only when they trip over the hurdle that they look back and see the problem.”

Tied to the issue of good governance is The Malta Chamber’s ‘Ethical Business Calls for Change’ manifesto, which was published at the beginning of this year and presented to Prime Minister Robert Abela.

The manifesto contains over 60 concrete recommendations in favour of a culture of good governance. Asked to share his thoughts on it, Mr Files says “I like it, and I am going to use it as a model of what can be accomplished by the business community in commercial leadership.”

He maintains that governance is a fancy concept for the care, maintenance and supervision of a business or department.

“These concepts must be regularly applied for the organisation to operate at maximum efficiency. Organisations with good governance do not waste time on bad choices, and spend less on compliance.”

Mr Files also raises the discussion of ethics, explaining how in the US, there was a history of sharp dealing from independence to the 1930s, but when Quaker missionaries – members of The Religious Society of Friends, who were pacifists and believed in equality between all men and women – moved to a city, opportunities for sharp dealings declined rapidly.

“The Quaker merchants became the preferred merchants. The ideas of integrity, a fair price, quality workmanship and honesty were preferred. Not exactly shocking,” says Mr Files. “This is still true today. All relationships, personal or business, built upon lies and duplicity, will fail.”

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With years of experience and expertise dealing with financial criminals, what red flags would Mr Files single out, that every industry professional should look out for?

“There are personality red flags – pompous, overbearing, lack of empathy, yells a lot, always has to be right, always has to be the centre of attention, and is poor at long-term relations. Operational red flags are very secretive, overly complex business structures and poor record keeping, among many others.”

“Yes, there are predictable patterns for criminal behaviour,” he asserts. “Yes, there are predictable ways to catch them. My favourite is trying to out-scam the fraudsters to find out what they’re up to. It seems to be genetic, but a con man cannot resist a bigger con.”

Looking back at his long career in finance, Mr Files says his most rewarding cases are the complicated ones. “I love a good complicated case – divorces, international frauds, corruption and any tough case that takes a bit of brains and dare-do. I have worked insurance fraud cases as well in Haiti, Honduras, Ghana, Mexico and many other countries. I am still fond of the young highway men in Haiti who threated to stone our car unless we gave them money. We survived by giving them our supply of fruit and fried breadfruit chips.”

And the most challenging? “Seeing that I could help a case, but the client does not have the money. Equally, in either litigation or a business, where I can see exactly how the disaster is going to unfold, sharing this information, and being ignored. The pain is seeing the cascade of failures that could have been prevented.”

Despite the ups and downs along the way, Mr Files says he’s never been tempted to give up the fight. What keeps him motivated?

“One part is selfish – I like what I do a great deal. It is very hard work, but it is also fun for me. Another part is the hope of getting the chance to do good, as well as teaching and sharing what I have learned with others. The last part is I need to work, my creditors like to

be paid, and I have utterly no idea what else I could do where I would not be a pain to my employer.”

Like the rest of the world, America is also grappling with the restrictions and fallout caused by COVID-19, and Mr Files says his work too has been impacted by the pandemic. “I typically teach two to three classes on due diligence, Anti-Money Laundering (AML), anti-corruption and other assorted topics every month, as well as working on cases,” he states, adding that the last event he attended was at the end of February at the University of Ibadan in Nigeria. He got home three days before the lockdown order and flights being cancelled, and has been home since.

Three months indoors have encouraged Mr Files to work on the third edition of his book, Due Diligence For the Financial Professional, to be called Due Diligence For The Professional. He is also working on a new book, titled How To Launder Money. “It is about how money is and/or can be laundered, as well as strong push back against the perverse impact of the wave of AML laws coming out of the OECD (Organisation for Economic Cooperation and Development), FATF (Financial Action Task Force), and now the EU,” he asserts. “The laws are not stopping criminals and they are damaging to honest commerce. I am also working on a podcast for the American Anti-Corruption Institute interviewing people who have made a difference in finding and ferreting out corruption.”

Over the coming months, Mr Files would like to have both of his books published, and to have recorded and shared up to 12 podcasts, but also get back to training and investigations. “Our collective reaction to the virus has had some very perverse consequences to all of our health and wellbeing. Not unlike the AML laws.” cc Mr Files was the main speaker during a webinar organised by The Malta Chamber titled ‘Embracing Good Governance’, which took place on 27th May.

“I love a good complicated case – divorces, international frauds, corruption and any tough case that takes a bit of brains and dare-do.”

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CC INTERVIEW

Envisioning the future of our built environment After a tumultuous 2019, many professionals working within the real estate, building and construction sectors joined the general public in calling for fundamental change. Benjamin Grech, Chief Executive Officer of Engel & Völkers, was one of these, with his work leading to a collaboration with The Malta Chamber. In this frank conversation with Rebecca Anastasi, he pulls no punches to discuss the future of Malta’s built environment and how the Chamber’s new committee can help forge the way.

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alta’s buoyant economy of the past few years, motivated by an influx of foreign investment and a focus on the servicing sectors, has pushed the need for more real estate, encouraging demand, which, in turn, accelerated the creation of supply. As a result, the sector experienced an annual growth rate of 5.3 per cent, while employment grew at a rate of 9.4 per cent, 38

according to figures by the National Statistics Office and Jobsplus.

Sale and rent prices increased multi-fold, while contractors, developers and those working in the building industry focused their attention on meeting the needs of an inflated market, which had ballooned, much to the chagrin of the average man and woman in the street. For, as construction sites

continued to bore the island, Maltese citizens had to deal with daily inconveniences – and, in some cases, wholesale destruction of their peace, and homes. For some time, it has been clear that change is necessary.

“I think that in recent years we’ve had an exaggerated inflation.”

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“My relationship with The Malta Chamber and the new committee is to look at the entire sector and see where the weakest links are.”

prices were being advertised 20 to 30 per cent higher than market value, though the posted rates would not reflect the actual selling price, which would stabilise down to what the property was actually worth,” he explains.

However, COVID-19 has upended the status quo and thrown any projected future growth into doubt. As a result of the pandemic, Mr Grech asserts, the long-let market has seen an influx of 9,000 properties which would usually be sold as short-let leases. The resulting over-supply has resulted in a 30 per cent reduction in long-let prices, the CEO says, quoting figures collected by his firm, which has also seen an 80 to 90 per cent reduction in the number of promises of sale, recently.

“These are numbers that people may not tend to speak about, out of concern that they will damage the market. But I’m a believer that transparency will allow it to correct itself and become more sustainable and healthier in the long run – without any huge fluctuations in prices.”

Nevertheless, he thinks the pandemic is a game-changer. “As a country and as an industry, we have important decisions to make. We must not get the market to recover as quickly as possible, but we must make sure it is resilient for the future. Now we have the chance to emphasise the need for long-term sustainability, as well as quality and innovation in building regulations, and to tidy up the entire sales process, making everything less bureaucratic,” he asserts.

For, according to Mr Grech, change was desperately needed even prior to the onset of the coronavirus crisis. “I was involved in the Economic Vision paper [prepared by the Malta Chamber of Commerce, Enterprise and Industry] and our main principles were always centred around the need for a more sustainable built environment,” he says.

But what does that look like? Mr Grech points to a number of operational and regulatory adjustments which would make for more aesthetically pleasing – and less disruptive – streetscapes. First is the necessity for contractors, rather

“I’m a strong believer that every market regulates itself and that there has to be little intervention, for the dynamics of supply and demand cater for themselves.

But I think that in recent years we’ve had an exaggerated inflation,” Benjamin Grech, Chief Executive Officer of Engel & Völkers says in a frank interview where he does not mince his words on the changes he deems necessary for a better built environment.

“For a while, we were able to ride this wave of inflated market prices,” he continues, explaining that, preCOVID-19, the average rental price – according to Engel & Völkers statistics – was approximately ¤900 per month, increasing every year by ¤50 to ¤100 per annum. “On average, sale and rental JUNE/JULY 2020

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CC INTERVIEW

“We have the chance to emphasise the need for longterm sustainability, as well as quality and innovation in building regulations, and to tidy up the entire sales process, making everything less bureaucratic.”

than the commissioned architects, to take responsibility for the build, with the creation of a licence or registry which would log any works being done. “Along with this there needs to be a set of building regulations,” Mr Grech says, stressing that the central question everyone should be asking is: what is the minimum standard of what should be built?

“Whenever we talk about regulations, people think we want to restrict them from earning money,” the CEO adds. By way of example, he points to the initial resistance to the new rental laws specifying that rental properties need to be registered with the Housing Authority. “But we are now beginning to see the positive effects. In fact, since this January, 10,000 properties have been registered with the Housing Authority.

If we need to regulate then we should, and we’ll start to see the improvements. It doesn’t mean that we’ll get it right the first time, but we should have a starting point.”

Such changes need to be shorn of any excessive bureaucracy, the CEO reiterates, and there needs to be an emphasis placed on transparency, which should even be applied to the entire sales process and the valuation of property. Indeed, Mr Grech is very critical of the current systems, saying that the authorities have a tendency to keep information to themselves – to the detriment of all parties in the sector.

“A lot of the time, developers want to sell properties at higher prices because they are unable to buy a piece of land at the right price. Today, what is the market value of a particular piece of land? We don’t know. Is Government prepared to share contractual details to do with the sale of land to the private sector? No. In Malta everything is hugged tight to the chest. Nobody wants to share, even if this transparency can result in a better market value,” he asserts.

But Mr Grech is not an armchair critic.

Rather, he is putting his time where his mouth is – by leading the Malta Chamber’s new Building and Construction Industry Committee, which aims to create an awareness about the importance of the sector and lobby for essential shifts in procedures, operations and mentalities.

“My relationship with The Malta Chamber and the new committee is to look at the entire sector and see where the weakest links are,” he explains, describing the 12-strong team as “diverse” with lawyers, business contractors, developers, an interior designer 40

and an estate agent serving as members.

“What we all share is the want and the motivation to improve the quality of the sector,” he affirms.

So far, they’ve had two Zoom meetings, but the pandemic has slowed things down a bit. Nevertheless, Mr Grech’s proactive stance means plans are afoot to, in his words, “get things going”. Indeed, the team is, at the moment, “aligning our vision of what we want to achieve, and we’re analysing the recent report of the Kamra Tal-Periti (KTP) to see how we can add more value. While not meeting all together has been a bit more challenging, the meetings we have had have been very productive,” he adds.

Yet, apart from the collaborative work being done here, Mr Grech is a firm believer in speaking openly, saying that this is the only way in which things can improve. And one of the issues he feels the responsibility of speaking out about is the way in which lobby groups within the building and construction sector have, effectively, hijacked the political sphere.

Improvement in the industry, he says, needs to “start with political parties not being financed by the private sector.” For if these links are re-assessed, “people will feel more comfortable giving their personal opinion and they’ll be freer to express themselves. We should not be scared to voice our views and we need to be more aggressive, just as politicians and the main

lobby groups – including the developers – have been aggressive in expressing themselves. Everybody is scared to voice their honest, true opinion, especially in the private sector, and this is something we should really address. The only wrong thing to say is to say nothing.”

And one of the main points of contention, which is affecting the entire industry, in his opinion, is the selling of public land to private enterprise. “If I were Government, I would be buying, not selling, land. And then I would issue a tender or create a competition for a proposal to consolidate projects which would win the approval of the general public. Why can’t we do this? Don’t we have a strong GDP and the money to spend on our own land so we can enjoy it?” he asks.

He reiterates the need for policies to be put into place – so people are more conscious of what is being built and why. “Otherwise, we have no hope,” he attests. “This is more important than votes. We need to be more concerned about our public space – because we’ll have none of it otherwise.”

Mr Grech’s honest and passionate approach comes from a place of good business sense. His intention – as he himself states – “is to have a healthy company, which is not necessarily growing, but which is earning good profits and delivering something of quality and service to my clients.” And that, for the CEO, is the essence of sustainability. cc

“We need to be more concerned about our public space – because we’ll have none of it otherwise.”

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CC ENERGY

Enemed works in silence to reduce emissions Emissions from energy in Malta remain high, but Enemed Executive Chairman Kevin Chircop tells Ray Bugeja the company works quietly to offer cleaner fuels.

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nemed operates in a liberalised fuel market, and although the Government of Malta is a shareholder, it receives no assistance from the state and is run as a fully commercial company, Executive Chairman Kevin Chircop asserts.

“The company wants to become a benchmark for other operators within the industry and also those in other sectors, he continues. It upgrades the quality of products through significant investment in its own quality assurance laboratory, introduces new products on the market, helps upgrade fuel stations through franchise agreements and holds continuous audits of all its franchises to ensure the level of service motorists deserve is maintained,” the Executive Chairman explains.

Its ISO9001:2015 certification proves to clients that all Enemed’s products and processes are up to the highest standard and quality consistency throughout, he continues.

Mr Chircop notes that ensuring that every single molecule of fuel delivered to clients is of the best quality is the only way to maintain market growth and establish a strong and lasting presence.

In the aviation market, he says, Enemed faces a competitor that is established in a large number of airports in Europe and, in the case of inland fuels, the diesel market is very competitive, yet the company has managed to maintain and grow its market share.

Although Enemed is the only petrol importer, the threat of another player entering the market is always present, Mr Chircop remarks, hence its determination to continuously conduct research to enhance the performance of its fuel to maintain customer loyalty.

In its mission statement, among others, Enemed refers to the supply of cleaner fuels, yet the latest Eurostat figures show

“Very few people know that Enemed is the only company in Malta that does not use FAME (fatty acid methyl ester) products in its diesel products.”

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CC ENERGY that emissions from energy in Malta remain high. One has to analyse what is contributing to the increase in emissions, the Executive Chairman points out, adding that the GDP growth in Malta pre-COVID-19, among the highest in Europe, would have a direct bearing on energy demand. In addition, there has been a significant increase in the number of vehicles.

“Is it Enemed’s failure? We think not.

However, as Enemed, we did our part to reduce emissions from cars without much publicity. When we say we want to develop and provide cleaner fuels, actually we have achieved this,” he says.

“Very few people know that Enemed is the only company in Malta that does not use FAME (fatty acid methyl ester) products in its diesel products. Both E-Diesel and E-Power diesel are, in fact, the Super and Super Plus diesels in Europe, but with the price of normal fuels.”

“Our fuels emit approximately 20 per cent less particulate matter in the air that we breathe. Our E-Power diesel is specifically designed in our laboratory to allow the diesel particulate filter (assembled in cars) to regenerate without problems normally associated with small countries like Malta.

Our cleaner products improve the efficiency of the motor engine to such an extent that even heavy industry is opting to buy our products.”

“Having more efficient engines means less consumption and less emissions,” Mr Chircop explains.

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“Our cleaner products improve the efficiency of the motor engine to such an extent that even heavy industry is opting to buy our products.”

As to fuel prices, the Executive Chairman remarks that every motorist in the world complains that fuel is expensive. Yet, he adds, a look at the comparison chart published every week by the European Commission shows that, for more than 104 weeks, Enemed’s fuel prices were below the EU average.

He attributes such perception to “the lack of understanding of what makes up the price of fuel at the pump”, adding that it is not only the Brent Crude or WTI (West Texas Intermediate) that determines the price motorists pay, as there are other contributing factors.

“All I can say is that Enemed’s margin has not changed for these last 10 years, at least. The only increase in profit is coming from focus on spending, growth in sales and, definitely, not by profiting on the back of our clients,” Mr Chircop stresses.

Eurostat has just reported that the sale of automotive fuels fell by almost 21 per cent in the euro area and by just under 20 per cent in the EU last March when compared to February as a result of the coronavirus restrictions.

According to the Executive Chairman, Enemed started seeing a significant dip in fuel sales by the third week of March, with sales losses exceeding the EU average. This led to challenges, especially in the aviation sector, where, he says, the situation is almost at a standstill.

On a positive note, Mr Chircop reports, the easing of certain restrictions had an immediate effect on Enemed’s inland fuels division, and sales are improving every day. This, he explains, is compensating for the losses in the aviation division, meaning that, although this will definitely not be a good year for the company, it will come out stronger than ever.

Mr Chircop also thanks employees who rose to the occasion and are giving their all to maintain the level of service clients are used to.

Noting that the coronavirus outbreak served to accelerate certain programmes so Enemed would obtain benefits earlier, the Executive Chairman says that a continuous improvement programme has been in place from practically day one of the company’s inception. Coupled with other lean management techniques, he adds, Enemed continuously reduces operating costs and keeps abreast of technological advances to ensure it always remains a leader.

The management is seriously considering allowing employees who can work from home to do so. Practically all head office employees have been working from home for these past weeks, and Mr Chircop reports that an improvement in output has been noticed. “Hence, the myth that teleworking does not work was debunked,” he says.

In tandem, Enemed is facing another new reality: the shift to electric vehicles.

Mr Chircop is very categorical on the matter: “Enemed is considering the shift to electric vehicles as a threat in the long term since recent studies are showing that, should a ban on combustion engines be introduced at the earliest by 2030, the percentage of vehicles by that time will be of approximately eight per cent.”

Still, the inland fuels market is only one of the three sectors in which Enemed operates, with aviation and marine storage for bunkering purposes highly unlikely to see a decline, he explains.

Although Enemed closely monitors developments in the use of electric cars, “the future is still a bright one for the company,” Mr Chircop concludes. cc 43

CC BUSINESS

Family businesses must open doors to new generations Family business structures need to be strengthened by involving the new generations, Family Business Office Regulator Joseph Gerada says when speaking to Ray Bugeja.

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ore than 160 family businesses are currently registered with the Family Business Office, and a number of applications are being processed.

Defining what constitutes a family business was one of the most difficult tasks when drafting the Family Business Act. This, Dr Joseph Gerada explains, was mainly due to the fact that the concept of what a family is has evolved through the years and keeps evolving. His advice is to always refer to the law, which describes each type of family business structure that is recognised.

He agrees that the term ‘family business’ can be a misnomer, as it may have connotations of a small set-up when there are some big family businesses by Malta’s standards; about 70 per cent of all Maltese SMEs are actually family-run businesses, Dr Gerada points out.

The family business dynamic itself, he notes, sometimes involves very difficult decisions. For example, although many small businesses that rely heavily on cashflow may have considered laying off workers in the present COVID-19 scenario, doing so

is very difficult in the case of small family businesses, for how can you make your own son, daughter, father, brother, sister or mother redundant?

Family businesses are, admittedly, a complex interrelation between the family dynamic and the business itself, the Regulator notes. The fact that such businesses are established on family relationships often further ensures resilience and prosperity, since the livelihood of the family would depend on the success and survival of the business itself, he points out.

Dr Gerada also believes that family businesses are able to weather the storm longer than other businesses.

One must look at the silver lining and the better days to come, which are just a corner away, however distant that corner may seem at the moment, he says. Dr Gerada pledges that his Office will continue supporting family businesses to ensure they remain strong and resilient.

To date, none of the registered companies have informed the Family Business Office that they would go into liquidation or fold up. However, the Regulator realises that the longer the situation persists, the harder the struggle for affected businesses to survive will become. Faced with the difficulties, family businesses, like many others, at first went into panic mode, but then sought ways to move on, and this led to the creation of new revenue streams, he notes.

As the COVID-19 situation developed very rapidly, the kind and level of support needed by each type of family business was different, Dr Gerada says, encouraging and reminding businesses to focus on the silver lining, and that there is strength in unity and collective responsibility applied to all.

The Office did its share in assisting the health authorities by advising registered family businesses to stay safe and stay inside, assuring them that it would be able to provide all the necessary assistance required via email and telephone communication.

“This experience has shown us that the unthinkable can happen when we least expect it, so we need to always be prepared.”

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The Family Business Office also changed its registration processes to avoid any paperbased communication. In addition, it focused on promoting incentives it considered to be most relevant in the circumstances, like authorising support for registered family businesses to attend webinars. The Office consistently advised registered family businesses to create opportunities that can be of benefit to them and to the community in general. Its Facebook page was used to promote free webinars by third-party service providers. During May, the Office collected information about family businesses that somehow changed their business operations to address the difficulties being faced.

Together with the European Family Business Office, it will be drawing up a paper on best practices compiled from various case studies.

Concurrently, the Family Business Office has been running a campaign themed One Nation. One Family, fostering the belief that it is through unity that the prevailing situation can be overcome, for all to emerge stronger than ever. “And what structure is more united than a family,” Dr Gerada asks.

Although the country appears to have started to exit the situation of the past weeks, the Regulator feels family businesses must continue exploring ways to create opportunities to meet the present needs.

They also need to look into the various

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“I believe that the COVID-19 situation will show us which businesses were based on strong foundations, able to stand the test of time.” incentives being offered.

“What we need to remember is that we are all in this together and we need to think out of the box… this experience has shown us that the unthinkable can happen when we least expect it, so we need to always be prepared,” is Dr Gerada’s wise advice.

In his opinion, the lessons one must learn from the coronavirus experience are that one cannot take anything for granted and that nothing is static.

“The shutdown of large parts of the economy,” he asserts, “poses an obvious threat to many businesses, particularly small businesses without large cash reserves. The fact that your business is doing well today

does not mean you should not think ahead for those rainy days. On the contrary, it is now clear more than ever that keeping something aside for situations such as these is a necessity.”

“I believe that the COVID-19 situation will show us which businesses were based on strong foundations, able to stand the test of time. And it would be a grave mistake to think that having a strong business and liquidity are only necessary in situations such as these.”

“The business world is ever-changing,” Dr Gerada affirms, adding that “it depends on the demand of our customers and consumers, and these are changing fast.

So many businesses have failed because they refused to adapt or seek new revenue streams when profits started going down because their business concept had worked so well in the past.”

“We need to keep alert at all times and family businesses must prepare themselves to be able to withstand shocks such as these if similar situations arise in the future. It is for this reason that we believe it is important to think of strengthening family business structures by involving the new generations,” he maintains.

“I think being open to adaptation and having an exit strategy in place is also something that many businesses will be thinking about a lot following this COVID-19 experience.”

What family businesses definitely need at this point in time is stability, the Regulator insists. cc 45

CC BUSINESS

Rising above the storm For Fabio Muscat, CEO of Ozo Group, the challenges brought about by the pandemic offered an opportunity for his company to give back to the local community. He tells Martina Said about the Group’s latest CSR campaign, and shares his outlook on the months and years to come.

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s a company that operates primarily in the services and hospitality industries, the last few months have been especially challenging for Ozo Group, as Malta ground to a halt and closed its doors to visitors to control the spread of COVID-19 through its communities. But for this company, the very same challenges were turned into an opportunity to give back.

Over 23 years, Ozo Group of companies have evolved into specialists in their field, outsourcing personnel to the hospitality, care, manufacturing and security industries and offering specialised cleaning services for aircraft and hospitals, among others.

Fabio Muscat, CEO of Ozo Group, reflects on the reality of the current scenario, and says that his business has been affected negatively just like the rest of the business community, particularly those in the hospitality sector. “This industry has been shut down for the past three months and

the opening of this sector will happen at a slow pace, which effectively will not see us going back to where we were prior to the pandemic,” he asserts.

“In other industries, such as manufacturing, we need to see the aftereffects given that consumer expenditure has dropped drastically and, therefore, this will impact the order books in the future. On a positive note, the company has been agile in providing innovative services, such as sanitisation, which has become a necessity during these difficult times.”

Mr Muscat says that 65 per cent of Ozo’s workforce operates within the hospitality industry, making this the hardest-hit segment of the group. In other areas, he asserts that demand has remained stable. Seeing as most preventative measures have now been relaxed, what are his forecasts for the recovery of local business?

“We are confident that the country’s resilient economy will bounce back to growth and, within the coming 18 months, we believe that we will be close to where we were preMarch 2020,” says Mr Muscat. “The opening of the airport and port by 1st July gives us confidence that the economy will get moving again, and we believe that it will pick up its momentum after winter.”

Since the outbreak of the pandemic in Malta, Mr Muscat sought to engage his workforce in a way that gives back to local communities through a Corporate Social Responsibility campaign called #thankyoumalta. Leading by example, the nationwide campaign sought to assist several communities and local councils in cleaning and maintenance work around the islands.

“Ozo Group of Companies believes in being responsible and has a duty of care towards our stakeholders and society at large. The pandemic led to a national crisis which Government managed and led exceptionally well, even from the economic and financial support perspectives,” Mr

Photos by Alan Carville

Muscat explains. “These economic initiatives gave us the opportunity to maintain our workforce. What else could we do other than #thankyoumalta? We felt that once we have been supported in the best way possible, we had to give back to society with what we do best: offer our care through our people.”

Within the first month of the campaign, Ozo Group offered its services to 35 local councils, 400 social housing properties, and engaged over 750 members of its workforce to offer over 90,000 free services towards local Government.

Mr Muscat states, “we are grateful for the support offered by Government, the monies of which come from the taxpayer.

“In other industries, such as manufacturing, we need to see the aftereffects given that consumer expenditure has dropped drastically and, therefore, this will impact the order books in the future.”

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It is citizens’ money that is supporting us and our employees. We had one thought in mind: returning our thanks to the local communities. This campaign is our thank you to Malta and to all hard-working people. It is our little contribution to a national effort, and together we stand and give our small share to it.”

Turning towards the response to the initiative, Mr Muscat says that it has been received exceptionally well. “Our employees, most of whom are third country nationals, have shown their commitment to our country and they have been greatly appreciated by the public. Although everyone was practicing social distancing, our employees still received thankyous from the public who showed their support by clapping from their balconies, as well as by the councillors and staff of the local councils.”

Looking towards the near future, Mr Muscat hopes that Malta will soon get back JUNE/JULY 2020

“The opening of the airport and port by 1st July gives us confidence that the economy will get moving again, and we believe that it will pick up its momentum after winter.”

to economic normality and Ozo Group’s employees can be deployed in the industries they know and work in. “We are positive that this will be happening shortly.”

The CEO and his team are also working hard to continue weathering the stormy seas caused by the pandemic, while trying to rise above the hardships and look towards a hopeful future. Mr Muscat reiterates that the economic and financial support given to businesses by Government in the form of wage supplements have been of immense

help, and although times are still uncertain, “we see other opportunities to contribute to society and also offer new services within the context of our new reality.”

Although 2020 has been a tough year for many thus far, there’s still room for optimism and hope for the rest of the year. Mr Muscat asserts, “notwithstanding that we are the largest private employer with over 3,000 employees, we have been agile to adapt to the new reality. We will continue doing this with an eye open for strategic opportunities, while keeping our people at the heart of our company.” cc

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Cash as a contactless payment Maronna Filletti, Executive Director at Joseph Cachia & Son Ltd, discusses cash and COVID-19 with The Commercial Courier.

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t is a challenging time for cash as a payment system. But not for the reasons that have been carelessly pedaled by some media. Let’s be clear about this. Cash is no more a vector for transmitting COVID-19 than many items we handle every day.

Here’s a more accurate view based on scientific tests: “there is no significant risk of catching the coronavirus from Euro banknotes,” the European Central Bank says, citing lab tests that showed that the germs survived far longer on other surfaces. [1] The Economist and ECB Executive board member Fabio Panetta says, “tests by 48

European labs showed that the survival rate of coronaviruses is 10 to 100 times higher on a stainless steel surface, like a door handle, than on Euro banknotes in the first few hours after contamination.” [1] Dr Christine Tait-Burkard, Expert in infection and immunity at the University of Edinburgh states that “the risk of contracting the virus is very small unless someone is using the bank note to sneeze in, and coins are actually very bad environments for viruses to survive.” [2] Think about how many times you handle your mobile phone every day. Do you clean

it regularly? Do you clean your credit cards?

Do you clean the console in the store before you key in your pin to pay for your goods?

Shining the spotlight on cash often has the very serious consequence of ignoring the risks surrounding other payment methods.

“Shining the spotlight on cash often has the very serious consequence of ignoring the risks surrounding other payment methods.”

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“The challenge for retailers is to reorganise how consumers can shop and pay safely for goods so that they can re-open their businesses.”

Challenges for retailers The current environment has seen a rise in contactless payments. Will this continue in the short-term only, or will it last into the long-term? Contactless payment methods have been rising for some time. Does this mean that we were heading for a cashless society and the COVID crisis has just accelerated this process?

Contactless payments are a way for customers to maintain a measure of social distance from cashiers. However, it is not solving the problem for all customers, because it is not a solution that all can use or choose to use. And it is vulnerable if system connectivity fails.

What we do know is that regardless of how people pay, it is critical for countries to restart their economies as quickly, but as safely, as possible. This will be the ‘new normal’ for the present, and potentially for many months and years ahead.

The real challenge for cash as a payment method is not using cash, but how you exchange cash with your customers in retail environments whilst maintaining a safe social distance. Advice on this distance varies from country to country. In many countries, if retail environments want to re-open, they must abide by local regulations that involve social distancing measures.

So what does a retailer do? Refuse to take cash? The data shows us that across Europe, consumers have adopted digital payment methods, but that they still choose to pay in cash for many transactions. Can retailers afford to turn cash-paying customers away as they try to get businesses up and running again?

Are we going cash-less?

And if so, when?

If retailers are building strategies that assume a future without cash, the challenge is – when? In three years? Five years? 10 JUNE/JULY 2020

years? When do they think this will happen?

The truth is that many stakeholders are involved in cash. Not least Central Banks.

There is no country that has created an environment that eliminates cash completely.

Even in Sweden, the government advises its citizens to keep an amount of cash in case of an emergency. [3] In the United States, some states, including New York City, New Jersey, Philadelphia, San Francisco and Massachusetts are writing into law that cash must be accepted as a payment method.

Cash as a contactless payment COVID-19 has seen a rise in contactless payments. It has also driven an urgency in retailers to turn to cash automation. It is a way for retailers to implement processes that allow consumers to pay in cash whilst complying with social distancing regulations.

Simply put, it turns cash into a contactless payment.

In this way, retailers can avoid turning away revenue generated by cash-paying companies and give confidence to both customers and retail staff at the point of payment. And it can be implemented as a self-service or assisted service solution.

Solution As a solution, we at Joseph Cachia & Son Ltd are recommending the use of CASHINFINITY™ – a solution set from Glory Global Solutions – which are note and coin recycling machines that can handle cash in an accurate, efficient and safe manner.

Front-office solutions within the product range can be deployed to help your staff and your customers keep their distance at the point of payment, transforming cash into a contactless payment method.

For every business person out there, the daily struggle at the end of the day is to reconcile cash, and CASHINFINITY™ backoffice solutions can do the reconciliation

without the need to count any cash. Notes are safely stored in a safe cassette, whereas the coins will be available as change in the machine for the next day.

The CASHINFINITY™ solution set comes in various sizes to suit every business need.

For more information on how these machines can help to improve your operations while complying with current health regulations, get in touch.

Summary In the current environment there will be less cash usage, but we are nowhere near going cash-less in the short or medium term.

It is true that cashless payments have grown, largely driven by contactless and mobile payments, but it is also the case that cash in circulation continues to increase and there is no infrastructure in place to support a cashless economy in any country.

Recently there have been some highprofile examples of large organisations such as Amazon stores abandoning plans to remove cash altogether, and even legislative intervention to protect consumers who choose to use cash.

The challenge for retailers right now is to reorganise how consumers can shop and pay safely for goods so that they can re-open their businesses. To avoid turning cash paying customers away, retailers would be wise to look at cash automation solutions like CASHINFINITY™ that turn cash payments into a safer contactless transaction. cc Joseph Cachia & Son Ltd T: 2552 9000; E: info@jcs.com.mt; www.jcs.com.mt References: [1] “RTE-ide,” 28 April 2020. [Online]. Available: https:// www-rte-ie.cdn.ampproject.org/c/s/www.rte.ie/amp/113534 0/?fbclid=IwAR0W0jsoSAVoa6MJDMG-m6Syb0sLlsoByi8 c8gaKOr5COTJrdreWGsxkvo4. [Accessed 21 May 2020].

[2] “Cash Matters,” [Online]. Available: https://www. cashmatters.org/blog/faq-cash-is-safe-to-use-intimes-of-coronavirus/. [Accessed 21 May 2020].

[3] Glory, “Presentation,” 2020.

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CC LEGAL

Harassment at the place of work

by Av Charlene Gauci

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ll places of work should offer a safe working environment, whereby employers and employees are able to carry out work efficiently and productively, free from any type of harassment.

The Employment and Industrial Relations Act, Chapter 452 of the Laws of Malta (hereinafter referred to as EIRA) makes a distinction between harassment of a more general kind, and sexual harassment which is classified under its own specific category. Article 29(1) of the EIRA explains that harassment takes place whenever an employee or employer is subjected to “any unwelcome act, request or conduct, including spoken words, gestures or the production, display or circulation of written words, pictures or other material, which in respect of that person is based on sexual 50

discrimination and which could reasonably be regarded as offensive, humiliating or intimidating to such per son.�

Unwelcome behaviour by a colleague which is aimed at offending, humiliating or intimidating a person is therefore tantamount to harassment. Such behaviour could leave an impact on the emotional well-being of an individual, who would feel constantly ridiculed and uncomfortable at the place of work. Many employees recount stories of having to go through such ordeals.

Although even one instance of such unwelcome behaviour is enough to constitute harassment, oftentimes this situation is made even worse as other colleagues start joining in, rather than exhibit clear concern and disapproval at these acts of harassment.

This tends to leave the individual feeling

more isolated at the place of work, as, naturally, the person in question would become more preoccupied with avoiding or tackling such behaviour on a day-to-day basis rather than with the workload itself.

Article 29(2) of the EIRA goes a step further and explains in more detail a more specific type of harassment, commonly known as sexual harassment. This type of harassment takes place whenever sexual favours are requested from the victim, or when the victim is subjected to an act of unwelcome physical intimacy. This behaviour is usually preceded by any act or conduct with sexual connotations against the victim, which behaviour in and of itself also constitutes sexual harassment. As explained

by Article 29(2) of the EIRA, the latter behaviour includes,

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CC LEGAL “spoken words, gestures or the production, display or circulation of written words, pictures or other material where – (i) the act, request or conduct is unwelcome to the victim and could reasonably be regarded as offensive, humiliating or intimidating to the victim; (ii) the victim is treated differently, or it could reasonably be anticipated that the victim could be so treated, by reason of the victim’s rejection of or submission to the act, request or conduct.”

Such behaviour is extremely serious as it jeopardises the safety of the individual at the place of work. The responsibility of ensuring that harassment does not take place at the workplace is placed on the employer, whereby in virtue of the Occupational Health and Safety Act, Chapter 424 of the Laws of Malta, the employer is obliged to “prevent physical and psychological occupational ill-health” of the employees. Therefore, the employer is responsible for working together with all employees to promote and safeguard the health of all individuals, and this can be best achieved by having sound and effective policies at the place of work.

An Anti-Harassment Policy at the place of work should emphasise the importance that behaviour tantamount to harassment of any type will not be tolerated either at the place of work, or at any place which can be considered as an extension of the workplace. This means that such a policy should also be applicable in such cases when harassment takes place during a social event or gathering of the employers and/or employees, even if such events take place after normal business hours. With the rise and impact of social media, it would also be advisable to prohibit harassment on social media platforms, particularly through the use of work group chats. An all-rounded policy prohibiting harassment would ensure that the relationship between all employers and/ or employees concerned is safeguarded from such behaviour.

Furthermore, employers must also ensure that such policies are effectively implemented and that victims are able to easily report any kind of harassment directed towards them. By means of an appropriate complaint procedure, the employer must then take all the necessary measures to investigate such complaints and to accordingly take the appropriate actions against anyone found in breach of an AntiHarassment Policy, including disciplinary actions.

Ultimately, should an individual still suffer from harassment at the place of work, then such person may resort to the Industrial Tribunal and lodge a complaint within four months of the alleged breach. Article 28 of the EIRA seeks to safeguard persons who lodge complaints of such a sensitive nature and clarifies that JUNE/JULY 2020

“It shall not be lawful to victimise any person for having made a complaint to the lawful authorities or for having initiated or participated in proceedings for redress on grounds of alleged breach of the provisions of this Act, or for having disclosed information, confidential or otherwise, to a designated public regulating body, regarding alleged illegal or corrupt activities being committed by his employer or by persons acting in the employer’s name and interests.”

This provides victims of harassment with an extra level of protection, empowering them to take action against any person harassing and/or victimising them. Upon hearing the complaint, the Industrial Tribunal will then proceed with carrying out an investigation as it deems fit. If it transpires that such complaint was justified, then the Industrial Tribunal may proceed and take such necessary measures as it considers most appropriate in the circumstances.

In this case, payment in the form of compensation for any loss or damages suffered by the individual as a consequence of the breach may also be ordered by the Industrial Tribunal.

Furthermore, the EIRA also clarifies that if a person is found guilty of harassing any other individual at the place of work, such person will be guilty of an offence, and upon conviction shall be liable to imprisonment for a period ranging from six months to two years and/or to a fine of not less than €5,000 and not more than €10,000.

Lodging a complaint in relation to harassment with the Industrial Tribunal does not preclude the victim from taking other actions. This includes actions before any other court of law, particularly before the Criminal Court and/or lodging a complaint before the National Commission for the Promotion of Equality (NCPE) in the case of sexual harassment.

Ultimately, the aim of any enterprise should be that of safeguarding the well-being of all, as only this would ensure that success may be truly achieved. cc Avv Charlene Gauci – Associate, Mifsud and Mifsud Advocates.

T: 7930 7392/2723 7172; E: cgauci@mifsudadvocates.com.mt

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Navigating the pandemic through Bitpod podcasts Driven by the ever-growing need for innovation, last year, PKF Malta founded the initiative Bitpod, the brainchild of Head of Legal Marilyn Formosa and Senior Partner George M. Mangion.

Bitpod is a quasi-lab that seeks to contribute to the local start-up eco-system by offering a meeting place at a Birkirkara premises for meetings and working space for use by entrepreneurs.

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he service is offered against a heavily subsidised fee in order to reduce variable costs and help them to flourish. The Bitpod concept is not new, but reinforces the fact that start-ups are essential drivers for research and innovation, which is the foundation for sustainable economic growth. Under the same umbrella, in an effort to expand knowledge on key subjects, the Bitpod facility hosts a number of business podcasts which are available on all of PKF Malta’s social media platforms.

In the midst of the COVID-19 pandemic, we have taken the opportunity to raise the bar by taking Bitpod to a higher level. Whilst the hosting of webinars has become the norm for a number of companies on various topics, PKF has opted to join the list of providers to extend an opportunity to clients and industry peers. The facility is open to all and sundry to participate on a number of podcasts, at their leisure.

As can be expected, when news broke that the World Health Organisation declared a pandemic, citizens across the world were in shock and disbelief. Such exogenous shock generated mayhem and a sudden shift in consumer behaviour, and the resulting disruption will prevail over the coming two years at the very least. Therefore, we have taken the opportunity to outline the main economic impacts which businesses may encounter and suggested a number of solutions.

In the first session, we conceived the pros and cons of a virtual conference, which is becoming quite a popular vehicle to meet peers across the business world. With most business trips being cancelled for the rest of the year, businesses are finding new and innovative ways to reap opportunities. We have hosted two sessions with a special focus on the global and local socio-economic impacts of the pandemic, and discussed the concept of triage for Government intervention.

As part of the Bitpod repertoire, we have also had the pleasure to collaborate with

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colleagues in New York from the office of PKF O’Connor Davies. In a special-edition session, we hosted Thomas DeMayo, a forensic specialist with extensive experience within security and managing information risks across a wide range of industries.

As the pandemic has incited fears of job losses and uncertainty into people’s lives, it has become more crucial than ever that employees retain their job by working from home. Unfortunately, at home there are limited IT firewalls and such lack of protection may lead to cyber-attacks, so workers are keen to learn how to prevent outsiders from acquiring unauthorised data. In this podcast, our expert Thomas highlighted how to combat cyber security attacks in this day and age, particularly as phishing attempts have become more predominant.

We are next keen to host Leo Parmegiani, a very interesting and special guest, all the way from New York. He is a tax partner having over 30 years of experience in accounting matters with a specialisation in international tax. During this session, he will be discussing the current situation in the United States concerning both the pandemic and the latest public protests, and how this is affecting the US economy.

Over the coming weeks, we will once again be collaborating with PKF in New York in order to discuss details of European company tax structures when trading in the United States. Further to this, as a significant amount of companies have shifted their operations remotely, Leo will note the tax repercussions arising from teleworking. In particular, one must be alert to the situation when workers who are remote working in states or countries away from the office base as this can expose companies and workers to additional income and employment tax obligations.

Moreover, we will also be collaborating with leading lawyer Dr Edward Mario Camilleri who offered to talk about the legal implications emanating from the pandemic.

These implications are wide-ranging, including new legal notices which were recently published and their impact on the property market, as well as civil issues. More importantly, this session will look at how at a time that the Courts are closed this has heaped pressure on local legal advisers to cope with unresolved legal briefs.

As economies across the world are slowly recovering from the pangs of the pandemic, our quest for introducing interesting topics to share with our listeners does not stop. PKF are more committed than ever to provide listeners with a good choice of interesting topics which are off the beaten track. As the custom of attending conferences and seminars is on hold at this point, the practical alternative is that of using digital platforms.

We invite you to stay abreast of the latest developments and stay connected to the business world by tuning in to our podcasts through PKF Malta’s Facebook, LinkedIn and Instagram accounts, as well as our website www.pkfmalta.com. We augur that you enjoy our sessions, as together we find ways of picking up the pieces and getting our economy back on its feet. cc

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Introducing the Quality Committee: A partnership between The Malta Chamber and Evolve Ltd Evolve Ltd, part of the Attard & Co. Group of Companies, has partnered up with The Malta Chamber of Commerce to establish a new ‘Quality Committee’. Christopher Busuttil Delbridge, Managing Director of Evolve, will be the first Chairman of this group.

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he pursuit of quality is a virtuous mindset. It pervades nations, organisations, and the notion of self.

At Evolve Ltd, we have always placed this as our cornerstone in the personal development of our employees, which eventually builds the company culture. Having been the first company in the Maltese healthcare and scientific market to have obtained ISO9001 certification, and having invested heavily in our personnel in terms of positive psychology, mindfulness and mental health, we have experienced first-hand what a quality shift in mindset can do for a relatively small group of people, let alone for a nation.

To reach that larger audience, we are collaborating with a like-minded organisation, The Malta Chamber, to start this initiative aimed at the heart of Malta across all business verticals.

In many sectors in business, the numbers do not seem to add up considering the pandemic, and all the fear and restrictions that it brought with it. That is why the need for quality over quantity has never been more pronounced than it is now.

The vision being proposed will be put forward through ubiquitous Quality Ambassadors from all walks of life, trained

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and approved by an appositely set up working group. All major stakeholders such as business owners will be able to sign up for programmes of improvement and continuous monitoring. It is our firm belief that we must also prepare our next generation, and that is why we plan to work with all stakeholders to strengthen within our curricula the building blocks of a quality mindset, such as debating skills as well as giving and receiving constructive criticism.

The mantra being upheld is that quality is a way of life. Furthermore, the committee’s main four focus areas will be: • The Malta Chamber as an Institution – Ensuring the Chamber is held to the highest standards and implements what it promises on time, every time. This committee will seek to develop the Chamber’s policy in key areas related to the upholding of quality in all aspects of business and the economy.

• Personal – By starting with the ‘man in the mirror’, one can work on adopting a growth and positive mindset. The ‘extrain-the-ordinary’ so to speak can make a huge difference. These are traits that make individuals stand out, making them more employable on the labour market and better all-round persons. The responsibility for our

actions is ours and ours alone, and that is why fostering continuous improvement is an essential trait in any individual.

• Professional – Another objective of the committee will be to research and make the necessary representations about the importance of quality to business activities and ensure they appreciate the return on investment and utmost importance of investing in their employees, work practices, and target market. Businesses who are members of the Chamber will be assisted in their drive towards solutions which are best suited to their target audience, in the most efficient way possible. A system of ‘mystery shoppers’ is being envisioned for those operators who sign up for this service, which would include a report on the findings followed by suggestions.

• National – Lobbying national authorities but also helping raise the bar all around (the Chamber’s Corporate Social Responsibility so to say) will also be part of the Quality Committee’s remit. By inculcating a different approach in the younger generations and helping to raise the next generation better than us, we will continuously strive to help Malta be better placed and more competitive than before in an ever-changing landscape. cc JUNE/JULY 2020

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COVID-19 and its implication on the audit profession Neil Maniscalco, Director of Audit and Assurance at DFK Malta, discusses the impact of the coronavirus pandemic on the accounting and audit profession, and the new terminology, new processes and new way of working it has brought about.

Photo by Rene Rossignaud

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o one would have ever imagined a couple of months ago that we would ever be in the situation we find ourselves today. The interruption of normal life routines on a world-wide basis has led to some drawing parallels of the COVID-19 pandemic to World War II. Even though this analogy can prove to be a bit misleading, what the current pandemic and World War II undeniably have in common is that they are both situations of crisis, and thus ask for a radical change in the way we live.

This new way of life came about in the accountancy and audit profession as well. Even though, thanks to advances in technology, remote working practices were already being widely used by many in our profession in the past couple of years, regular face-to-face communication with clients and colleagues, together with a physical office presence were still deemed to be important for carrying out our job effectively and in an efficient manner.

Thereby, the sudden change, back in March, to 100 per cent remote working with only virtual communication, brought about its own challenges and inefficiencies, particularly with those clients who were not accustomed to the virtual world.

This pandemic has basically impacted every business, in one way or another.

Those in the tourism, non-essential retail and entertainment sectors were mostly impacted as they were forced to close down, resulting in zero revenue and outflow of fixed expenses. Other sectors which continued to operate were still adversely impacted by other factors such as cash flow problems due to exposure to companies which

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stopped operating, reduced level of work due to less demand and higher costs due to inefficiencies. The demand in the auditing sector remained relatively unchanged so far, particularly because most of our work relates to statutory audits and is carried out in arrears (i.e. after the reporting period ends). On the contrary, due to the various challenges brought about by COVID-19, the level of work for auditors increased, resulting in increased costs to carry out audits.

One of the main reasons for the increase in the level and complexity of work is due to the obligation to report on the going concern of companies. As a result of the circumstances explained above, coupled with the uncertainties this pandemic has brought both on the economy and the companies, it is more difficult and time-consuming to assess the going concern. Gathering of audit evidence has also proven to be more challenging, given that both the auditor and the client are working remotely, hence the exchange of documentation is taking longer.

Another impact of COVID-19 on the execution of audits is the risk assessment process, which has become more complex due to increased inherent risks as well to changes in internal controls in some instances.

Since most of the audits being carried out relate to 31st December 2019 year ends, there is no impact on the financial performance of the year being audited due to coronavirus, given that the outbreak and declaration by the World Health Organisation as a global pandemic occurred in early 2020.

Thereby, according to accounting standards, COVID-19 is considered as a non-adjusting post balance sheet event. In this case, due to

the scale and impact of the event, companies should disclose a post balance sheet event note in the financial statements describing the impact COVID-19 is having on the company after year end, up till the approval of the financial statements and, if possible, quantify its effect.

The scenario would change for those audits being carried out with a 2020-year end as it is more likely that COVID-19 is an adjusting event (depending on the month of the year end), meaning that on the balance sheet side there is the possibility that certain assets may be worth less than the carrying amount in the books and hence would have to be impaired.

Furthermore, it may be the case that part of the decline in operations due to the pandemic is factored in the income statement. Thereby, in this instance, there would be an impact on the financial results being audited.

New terminology, new processes and new way of working – it seems that the only constant is change. 2020 has shaken us all to an extent that no one had ever imagined. There have been announcements, advisories and guidance by all standard setters and regulators on how to deal with the accounting and auditing aspects in the COVID-19 situation.

Unfortunately, this pandemic which has come upon us is not a sprint but a marathon, hence people need to adapt to endure these conditions and the same applies to our profession and to the execution of audits. cc www.dfkmalta.com

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“Every operation will struggle, and challenges will be there, but the wise ones will see these challenges as opportunities” A pioneer in the insurance industry, Lawrence Pavia admits that the sector is responding very well and appropriately to the current circumstances. “Within days, most operators were operating remotely, and whilst already having shed away certain embedded practices, the industry has already started adapting and reshaping its future.”

“B

eing prepared for any eventuality is the spirit behind the idea of being insured or uninsured. And we too were prepared, so much so that with the first signs of the pandemic erupting, the first immediate action we took was reverting to the Business Continuity Plan we already had in place to ensure that all that needs to be in place is there, and to redefine it to developing circumstances. An internal task force was set up where all involved met daily and had a specific function to perform, cascading down throughout the organisation,” says Lawrence Pavia, Managing Director at Island Insurance Brokers.

Whilst IIB’s portfolio features some of the top corporate brands in Malta, Mr Pavia points to the fact that all clients have had to adapt to the different circumstances, albeit some more so than others.

“Everyone was affected, be it a hotel, restaurant or a manufacturing operation.

On our part we tried to get in touch with those affected most to try and see how we could be of assistance to them. Changes to insurance programmes and policies needed to be effected promptly to cater for the circumstances prevailing to the individual clients.

Mr Pavia stresses that given how brokers and insurers are dependent on one another, cooperation and understanding of the changes brought about by COVID-19 need to be exercised by both.

“Of course, there is still a feeling of shock among some operators, not just in the way that the industry operates, but also on the effect the situation is likely to have on their results. But I must say that even the regulator has been very proactive in its approach, issuing guidelines and expectations from operators which helps us act in unison.” Asked for his opinion on the business support measures announced so far by Government, Mr Pavia says that it is understandable that any support Government gives will never equate to the normal operations one was used to.

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“One appreciates that some industries will suffer more than others, and we in the insurance industry will also suffer the consequences, both in terms of potential higher operating costs and reduced revenues. One tends to think that the financial services industry will not suffer, but that is certainly not the case,” he says.

“So far, however, the industry is coping well, and I have not seen any signs of distress from insurers or from brokers. The best thing that operators can do at this stage is to ensure that they support their clients as much as possible in these difficult times.

Operators need to realise that we are part of the ecosystem and need to play our part positively.”

In a similar manner to supporting clients and industry, Mr Pavia also believes in the importance of supporting staff, who might not be used to working remotely. “Thanks to technology, we are keeping in touch, not only to discuss work-related issues but also to maintain the amazing synergy that exists between us. We meet virtually to have our lunch breaks together; we interact socially and encourage each other to keep up some form of physical exercise as this helps our mental well-being.”

“However, I remain a social animal and I miss my interaction with my colleagues and clients. Personally, I must admit that the first few days were disorienting, until I organised my own space and made it a point to start being disciplined in separating my work life and time with the family and for myself.

This is crucial, especially when we are now working unrealistic hours.”

What will be the main lessons post-COVID? “Necessity is the master of invention.

Whatever seemed impossible or difficult pre-COVID became doable in a matter of days – such as the use of paper and printing. We suddenly became a paperless industry, which, until a few weeks ago, seemed unrealistic. This also applies to how we are now embracing concepts like remote working, more use of technology and cashless transactions.”

“I hope that from now on, we will keep going forward and not regress to some of the archaic practices we have been indoctrinated to accept,” he continues.

“As for the global insurance sector, there will be challenging times for some operators, but also opportunities. Consolidation will continue and I do predict some new mergers and acquisitions internationally. Smaller operators will undoubtedly struggle because of the scale and necessity to invest in technology and bolstering of the capital base required as result of regulations and the pressure put on revenues and profits due to the foreseeable recession.”

“Malta is very resilient, and most will survive, but not unless we adapt to the new realities. Standards will be higher, expectations from clients and regulators will be steeper and more challenging, and these factors will distinguish the best from the rest.

Those who do not adapt or invest will fall by the wayside.”

“Every operation will struggle, and challenges will be there, but the wise ones will see these challenges as opportunities. My advice would be to question your past ways, let go of the inefficiencies and strive to make tomorrow’s operations more efficient. cc www.islandins.com 59

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Digital transformation in a post COVID-19 world The unprecedented impact of COVID-19 has left its mark on the vast majority of businesses. The financial slowdown caused by the pandemic has left businesses reeling, with three in four finance leaders expecting significant difficulties in their operations due to the coronavirus.

M

any businesses have put their ability to work from home to the test, albeit forcibly. In 2018, less than 10 per cent of European employees occasionally worked remotely. This number sharply rose once coronavirus-related preventative measures were being adopted throughout Europe.

Businesses that deemed working from home as a non-essential investment rapidly felt the impact of this decision once employees were advised to continue their work from their own makeshift office spaces at home.

Thus, the importance of digital transformation became more evident, as businesses needed to become more flexible. As employees swapped meeting rooms for video-conferencing, the optimal collaborative tools have become more sought-after than ever before. However, the recent controversies related to the popular video-calling application Zoom have also forced businesses to rethink the reliability of their collaborative tools. It became evident that unprepared companies could no longer maintain their reactive approach to digitally transforming their business processes.

On the other hand, businesses integrating collaborative software best practices have not been as strongly impacted by the change 60

in work venue. Industry-leading collaborative software such as Microsoft Teams has seen an all-time high increase in usage, thanks in no small part to the reliability and overall security of the platform.

As business reduced their meetings with clients, so too rose the need to maintain brand engagement through social media.

Forbes reports that there has already been a 20 per cent increase in social media-related activities by businesses. Thus, the need to establish a multi-channel form of client-tobusiness communication has become more useful than ever before, with Customer Relationship Management solutions proving to assist in the maintenance of the various interactive channels chosen. Through the ability to obtain a 360° view of all interactions with customers on social media, email and messaging, CRM should efficiently assist businesses in making up for the lack of physical presence with a solid, well-rounded digital multi-channel experience.

The financial slowdown caused by the COVID-19 situation has also proved to be a problem for the financial departments of affected businesses. Pressure has been put on financial officers to predict how their company will fare for the coming

months. Given the sensitive nature of these predictions, accuracy is pivotal. Businesses that have not effectively integrated their financial software with the rest of their business digitally will most likely be facing many obstacles to get a clear insight into what lies ahead for their business.

As uncertainty about the pandemic still lingers, one thing is for certain, the world of business will surely never be the same. Industry experts claim that digital transformation has now become the best option to ensure that businesses can survive the next crisis. A Gartner report of 317 CFOs found that 74 per cent intend to permanently shift some staff to work remotely, increasing the need to further invest in digital transformation as a viable solution. However, digitally transforming business processes is no simple task. Achieving the desired results of a digital transformation project, especially while recovering from the impact left by the COVID-19 pandemic, is no small feat.

At Exigy, we bridge the gap between business and technology. We are proud to help digitally transform our clients’ business processes through the expertise of our consultants and our knowledge of industry best practices.

Contact us to find out how our solutions can help increase your business resilience and take your business to the next level! cc Send an email to info@exigy.com or visit www.exigy.com fur further information.

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NEWS EVENTS & INITIATIVES

06. Meeting with Tourism Minister

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01. A sustained drive for good governance A delegation from The Malta Chamber headed by President David Xuereb was received by the Minister for Justice, Equality and Governance Dr Edward Zammit Lewis in February, where he was formally presented with a copy of ‘Ethical Business calls for Change – a Manifesto for Good Governance’.

Perit Xuereb stated that the document, containing more than 60 concrete recommendations in favour of a culture of good governance, was an initiative taken by the Chamber’s Council in December 2019, in response to the legitimate concerns raised regarding the state of good governance in Malta.

Perit Xuereb was accompanied

by Director General Kevin J. Borg and Board of Management member Chris Vassallo Cesareo.

02. Chamber hosts PM for lunch Welcoming the Prime Minister to the Exchange Buildings for a lunch given in his honour in February, President David Xuereb said that it was the Chamber’s aim to be an active player in the country’s national debate on all subjects that determine Malta’s socio-economic journey.

In the presence of a packed hall, he said that the Chamber made it a point to speak its mind frankly and honestly, both when things go well and praise is due, but also on other occasions.

03. 40 Years at the Helm Former President and business pioneer Louis A. Farrugia presented a copy of his biographical book ‘40 Years at the Helm’ to Chamber President David Xuereb and the members of the Chamber’s Board of Management during a meeting in February.

Receiving the book, Perit Xuereb saluted Mr Farrugia’s long career at the helm of one of Malta’s most iconic and successful business empires. He said that Farsons was precisely the case when entrepreneurship becomes an appointment with history and carves itself a place in the collective consciousness of a people.

opportunity that could be instrumental in bringing about the needed equilibrium for the country. For this reason, in our document ‘Ethical Business calls for Change – A Manifesto for Good Governance’, we argue that the President’s role ought to be reformed to be allocated more executive powers, through a Constitutional reform,” said Perit David Xuereb, President of The Malta Chamber, during a meeting with the President H.E. George W. Vella in February.

Perit Xuereb was leading a delegation from The Malta Chamber to present the President of Malta with the document, which contains more than 60 concrete recommendations aimed at cleaning Malta’s reputation.

H.E. President George Vella welcomed the Chamber’s proactive approach and invited the Chamber to submit the document to the Constitution reform website.

05. Looking forward towards a smart sustainable island “Through its business-leader members, The Malta Chamber is proactively being a force for change as it is once again proposing an economic blueprint to Government to sustain and assure a sustainable and competitiveness-based economy for the future,” said David Xuereb, President of The Malta Chamber, as he presided over the launch of ‘An Economic Vision for Malta 2020-2025’ in February.

The Economic Vision is the result of a long process of research, foresight and vision. The document is in line with the Chamber’s mission ‘To support, represent and connect businesses to grow and engage in shaping Malta’s future.’

During a meeting with the Minister for Tourism held at the Chamber in February, Chamber President David Xuereb underlined the importance of the tourism sector.

He said that the dedicated business section within the Chamber worked to assure a favourable environment that is conducive to sustainable growth in this ever-so important economic sector.

Perit Xuereb emphasised the importance of a continuous communication line between the Chamber and the Ministry, that guaranteed a mutual understanding of each other’s vision.

Perit Xuereb was accompanied by Director General Kevin J. Borg, Tourism Business Section member Genevieve Abela and Policy Executive Julia Aquilina.

Minister of Tourism, Minister Julia Farrugia Portelli, was accompanied by Permanent Secretary, Ronald Mizzi, and MTA CEO, Johann Buttigieg, MTA Deputy CEO, Carlo Micallef, and MTA Chairperson, Gavin Gulia.

07. Situation requires calm, clarity, common sense and consistency Business needs clarity and so do employees. In the context of the coronavirus situation, the health and welfare of employees is the foremost priority but damaging effects on businesses and jobs need to be mitigated.

The Chamber called on the authorities to open urgent consultation on all matters related to COVID-19 and industrial relations and business at the end of February.

08. Need for complete reform of the building and construction industry reached new high The Malta Chamber expressed its shock following the incident which resulted in loss of life, following the collapse of the

04. President’s role ought to be reformed constitutionally to be allocated more executive powers “In the office of the President of the Republic, The Malta Chamber sees an JUNE/JULY 2020

02.

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fourth building, due to excavation works taking place next door, in less than a year, in a press release in March. The Malta Chamber sent its sincere condolences to Miriam Pace’s husband, family and friends.

“This loss of life is an expression of injustice by those responsible for this killing.

It is unacceptable that safety in one’s home is compromised in this brutal manner. The Malta Chamber has already, in the past, called for a complete rehaul of the building and construction industry,” the statement said.

09. Chamber calls for emergency fund to safeguard businesses experiencing coronavirusrelated slow-down During a meeting of the MCESD in March, The Malta Chamber once again underlined the concerns of the business community in relation to the coronavirus situation unfolding internationally, and how the uncertainty brought with it, was already having an adverse effect on their operations.

President David Xuereb noted how business was voicing its apprehension, as certain sectors were already being affected by hesitations or even cancellations due to fears related to travel. In order to mitigate this situation, The Malta Chamber together with the other Employer Organisations, proposed the setting up of an emergency fund to sustain and safeguard businesses that may experience challenges in the weeks and months to follow.

10. Chamber voices COVID-19 concerns with PM During a meeting with the Prime Minister on 9th March, The Malta Chamber voiced the concerns on behalf of Malta’s business community on a number of issues relating to the COVID-19 situation.

The Malta Chamber stated that national health should remain an absolute and undisputable priority, as instructed by the country’s public health authorities and Ministry of Health.

“Nevertheless, businesses must be assisted in this time of extraordinary circumstances,” The Malta Chamber said.

11. Chamber calls on businesses to exercise maximum ethical standards in pricing of basic need products In a press release on 10th March, The Malta Chamber called on all the business community to practice the highest ethical standards when it comes to market-pricing, especially on necessary items, at this time.

“At a time of national pressure on all 66

14. aspects of life, the business community has an important role to play. While safeguarding our operations, we must act responsibly towards our patrons,” said David Xuereb, President of The Malta Chamber.

The Chamber said that it is aware that at a time of heightened demand, the rules of the market can easily provide for a price increase.

12. Chamber calls on Government to launch assistance measures for companies On 12th March, The Malta Chamber called on Government to immediately and without any further delay launch a set of measures to assist companies in Malta to weather the initial storm which the pandemic was bringing onto the Maltese economy.

The Chamber called for Government to push for a concerted effort at European Union level with the President of the Commission committing itself to establish a so-called Corona Response Investment Initiative to the tune of ¤25 billion to offer assistance to EU member states in relation to their public health system, vulnerable groups and SMEs.

13. Chamber calls on employers to observe COVID-19 health and procedural guidelines and regulations very strictly The Malta Chamber called on all employers to keep themselves abreast of all COVID-19 regulations and guidelines issued at regular intervals by the Commissioner for Public Health and health authorities on 15th March.

The Malta Chamber maintained regular contact with the health authorities at the highest level with a view to coordinate, assist and receive guidance in the wake of the unfolding coronavirus situation. Consequently, it appealed to the business community to observe the published guidelines and health and procedural regulations to the full.

14. Chamber presents Economic Vision to PM During a meeting on 16th March, The Malta Chamber presented the Prime Minister with its Economic Vision for Malta 20202025. The vision was launched in early

March and presents an economic blueprint intended to bring about sustainable economic and social prosperity for the country in the coming five-year cycle.

Addressing the Prime Minister, the President David Xuereb said that the Chamber’s Economic Vision presented an economic plan which at a time of uncertainty brought about by the COVID-19 outbreak, was even more relevant than ever.

15. Employer organisations ask Government for support to retain staff on payroll Following discussions with the key stakeholders of the country, in its bid to support businesses through the challenging times currently unfolding, The Malta Chamber, together with the country’s other employer organisations, wrote to the Prime Minister, to ask for assistance in weathering the COVID-19 storm on 18th March.

The letter was signed by The Malta Chamber, the Malta Employers’ Association, the Chamber of SMEs and the Malta Hotels and Restaurants Association.

16. Government announced measures will not stop job losses The Malta Chamber regarded the measures announced in March by the Prime Minister as falling short of the responsible calls made by the Chamber to Government in a repeated fashion over the past weeks.

The Chamber could responsibly declare that the employees would suffer from the support package announced. The Chamber was in a central position to make this claim because it was in touch with the needs and pains of business during these challenging times.

On a more positive note, the Chamber noted Government’s long-awaited announcement to partially offset the employer’s cost for quarantine leave at a rate almost equivalent to the minimum wage (or ¤350 per employee).

Even this was believed by the Chamber to not fully compensate employers for abuse by those employees who intentionally self-inflict quarantine.

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17. Chamber upfront to provide top professional and expert support

20. Employer bodies send strong signal of unity

The Malta Chamber conducted a survey to understand the expected effects of Government support measures announced on 18th March.

Over the same period, the Chamber organised a high-powered e-meeting with the participation of 25 expert CEOs from the world of finance, banking and innovation. The meeting chaired by President Perit David Xuereb served to evaluate creative and tangible solutions to protect employment and address the economic impasse in Malta, in the immediate and short term, caused by the effects of COVID-19 whilst collecting researched and expert thoughts on the country’s potential future steps in the current circumstances.

On 30th March, the four employer organisations represented at Malta Council for Economic and Social Development (MCESD) jointly nominated Stefano Mallia and Doris Sammut Bonnici as their representatives on the European Economic and Social Committee (EESC).

The move towards a joint and unanimous nomination is unprecedented since Malta joined the European Union and the EESC. It is indeed a rare occurrence on the European level. Malta’s employer bodies felt duty bound to join forces and unite particularly at this most challenging juncture facing Malta, Europe and the world.

18. “Revised business support measures reflect Chamber’s proposals” The Malta Chamber welcomed the revised measures aimed at supporting hard-hit businesses throughout the COVID-19related economic downturn, as announced by the Prime Minister, on 24th March.

In essence, the revised measures reflected the proposals of The Malta Chamber, as made via various channels, intended to safeguard the interests of businesses from all sectors, both large and small, and the jobs they generate. The Malta Chamber lauded the Government’s disposition for dialogue which allowed for a successful outcome to materialise.

21. Successful lobbying results in inclusion of more sectors in Government’s COVID-19 help list On 31st March, The Malta Chamber welcomed the addition of more sectors in the list of businesses that would be helped by Government in view of the current COVID-19 crisis, following extensive lobbying efforts on behalf of its members.

The Chamber had in the past days been in talks with Government authorities to represent the interests of operators from a number of fields such as retail, the film industry and English language teaching schools, among others.

These discussions served to evaluate creative and tangible solutions to protect employment and mitigate the collateral damage to the Maltese economy from the current economic impasse.

19. Chamber reiterates offer to provide constructive and objective support

22. “We must prepare for and seize the opportunities ahead!”

On 28th March The Malta Chamber once again offered its constructive and objective support to Government, on behalf of the vast majority of Malta’s employers, at this trying time.

The extraordinary times we are living can be considered completely unchartered territory, which every Government around the world is navigating with a degree of uncertainty. Within this context, The Malta Chamber reiterated its offer to assist Government in a bid to ensure misunderstandings and uncertainty remain at an absolute minimum.

The Chamber stated that sound consultation with all relevant parties involved, prior to decision taking, can save time, remove confusion and avoid frustration for all.

On 4th April, The Malta Chamber launched a thematic group aimed at thinking outside the box and create various scenarios of how the post-pandemic landscape will look. The Group will create various scenarios of how the post-pandemic landscape might look and develop strategic initiatives which will need to be undertaken in the short, medium and long terms to address what many are calling the new normal.

“It is most clear that the Maltese and indeed the Global Economy which will emerge post the pandemic will look, feel and operate differently from we have assumed until today,” said David Xuereb, President of The Malta Chamber.

The group is led by Joshua Zammit and draws on the experience and expertise of leading CEOs, entrepreneurs and academics.

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23. Chamber was first to call on businesses to practice highest standard in market-pricing On 4th April, The Malta Chamber made reference to the claims made by the Minister for the Economy Silvio Schembri about alleged cases of price-abuse.

The Malta Chamber clarified and reminded that it does not have any legal jurisdiction on pricing as it is not a Government authority and has no regulatory role of any kind. It is out of a sense of social responsibility, that The Malta Chamber has been vociferous in encouraging businesses to be ethical in this regard.

24. “The most sensitive time yet, the time for the boldest of decisions” In its drive to support businesses counter the effects of the current crisis, on 7th April, The Malta Chamber once again presented Government with a costed proposal to extend its support to more businesses based on their loss of turnover rather than a NACE code approach.

In its new proposal, The Malta Chamber argued that assistance needed to be provided to all businesses irrespective of the economic sector they operate in, as this should be based on the loss of turnover they are currently experiencing when compared to the corresponding period last year.

The Chamber’s fresh proposals are covered by detailed costings that refer to the possible needs of a wide cross-section of sectors taken individually which are being affected by contagion from hardhit sectors to rest of the economy.

25. Full disclosure on former ITS site project needed The recent NAO report on the disposal of the site formerly occupied by the Institute of Tourism Studies, highlights a number of serious and legitimate concerns about the regularity or otherwise of the tender for the transfer of the Institute of Tourism Studies building in St Julian’s by Projects Malta five years ago. As a result, The Malta Chamber is compelled to call for transparent, honest, detailed and comprehensive explanations on this case in the interest of good governance.

The Malta Chamber found the NAO’s findings disturbing as they leave serious doubts as to the sense of urgency that drove Government to dispose of the ITS site. This seemed to happen at a time when there seemed to be no alternative premises available, with an unclear negotiation process and ownership of responsibility for the decisions taken.

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26. Support measures positive, more support needed On 8th April, The Malta Chamber reached out to its members once again to obtain feedback on the effects of the COVID-19 pandemic on their businesses while gauging the suitability or otherwise of the latest support measures announced

by Government on 24th March.

The Chamber conducted the survey exclusively among its members with a view to obtaining first-hand information on their needs and opinions in an effort to be in a better position to make the necessary representations in their favour with the authorities.

Compared to a previous survey conducted between 20th and 23rd March, the forecasts for redundancies as extrapolated on a national level appeared to have attenuated by almost one half.

27. Chamber teams up with leading brands In the past weeks, as we all witnessed our entire worlds shocked, and the planet drift into crisis mode, The Malta Chamber continued to make sure to be the first port of call to its members as well as all businesses from all economic sectors, to assist them on a representation level, but also in practical terms.

In April, The Malta Chamber concluded a number of partnership agreements with Engel & Völkers, GasanMamo Insurance, eie Institute of Education, Evolve Ltd and Klikk. These agreements were aimed at sustaining and strengthening the operations of the Chamber in a number of theme-focused areas of specialisation and beyond. These collaborations all came into effect in March 2020 and join the existing family of The Malta Chamber sponsors.

28. Chamber President appeals for strategy on economic recovery to European business leaders Earlier in April, Perit David Xuereb participated in a high-level conference meeting involving his counterparts, presidents of all national business organisations members of BusinessEurope in order to discuss the serious impact of COVID-19 on the European economy, the EU response and business’ role for the recovery.

During this discussion, Perit Xuereb commented on the need to manage the crisis but also to look beyond it.

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29. VFA Agents Business Section within Chamber established A new business section dedicated to the Virtual Financial Assets (VFA) Agents operating under the VFA Act, Chapter 590 of the Laws of Malta which came into effect on 1st November 2018, was set up within The Malta Chamber, with the election for the executive committee taking place on Monday 23rd March.

The objective and purpose behind the setting up of the VFA Agents Business Section is to provide a common platform for registered VFA Agents to put forward proposals for the bettering of the VFA framework and acting as a liaison between industry and regulator. In doing so, VFA Agents will ensure that the concerns of industry players are raised with the appropriate entities, while ensuring that the principles outlining the current VFA regulatory framework are safeguarded.

The committee is composed of Silvan Mifsud as Chairman, Dr Christina Scicluna, Dr Bernice Saliba, Dr Franklin Cachia, Tanja Dimitrijevic, Dr Rebecca Mifsud, Daniel Bilocca and Dr Malcolm Falzon as members.

is needed,” said Perit David Xuereb, President of The Malta Chamber.

31. Chamber welcomes Government subsidy on business loans as a step to support business resilience On 16th April, The Malta Chamber welcomed the Government subsidy up to 2.5 per cent of interest, on business loans related to the COVID-19 predicament, announced. This measure, together with other measures announced previously such as the Government guaranteed loans and moratoria on loan repayments, many of which were proposed by The Malta Chamber, was appreciated as a step in the right direction and further support to businesses at this time of unprecedented challenges.

Since businesses will still be expected to make good for a minimum of 0.1 per cent, based on the discretion of the banks, The Malta Chamber called on the latter to exercise maximum flexibility with businesses who are experiencing great credit-related hardships as in many cases, their revenue streams are drying out fast if not already.

30. Assistance should not be limited to contribution to wages if we are to assist economy in crisis

32. IMF forecast understated

Further to its recommendations to expand assistance to companies, based on their registered loss of activity rather than their specific sector of operation, The Malta Chamber shed light on the more recent proposals it made to Government on 15th April.

All proposals result from intense consultation processes which the Chamber continuously engaged in with its members and which were aimed at providing businesses with the necessary help to survive the COVID-19 crisis and to be given a fighting chance to land on their feet once the current impasse is over.

“The assistance Government has afforded businesses so far has already gone a long way, as it has allowed some businesses to keep their employees on board. This will come to their great advantage upon resumption of normal business. But more

On 17th April, Malta Chamber President Perit David Xuereb said that the International Monetary Fund’s (IMF) economic forecast was being deemed “understated” based on the continuous feedback from Chamber members.

Perit Xuereb said that “The Malta Chamber understands that this forecast, as worked out by the IMF, is based on a timeframe of economic effects that are brought about by the COVID-19 pandemic which is significantly shorter than any estimate which the Chamber is deeming realistic at this stage.”

Speaking to Malta Today, Perit Xuereb claimed that “the percentage forecast is low, even by simply considering the relatively high contribution of tourism to the Maltese economy and the plausible possibility that this will be completely shut down for at least one third of the year.”

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33. Chamber President urges businesses to update operations to reflect ‘new normal’ On 17th April, Malta Chamber President David Xuereb called on businesses to recognise that the changes brought about by COVID-19 will not be ending shortly, necessitating business owners to embrace change and adaptation.

In a vlog uploaded to his personal social media, Perit Xuereb urged Chamber members and the business community at large to be realistic in its thinking about returning to life as it was prior to the pandemic. He called for people to be honest with themselves, adding that until a functional vaccine is found, the pandemic will remain with us to varying degrees.

34. More openness needed On 22nd April, the Young Chamber Network (YCN), The Malta Chamber’s dedicated branch for young entrepreneurs, met electronically to discuss how its members were being affected by the current COVID-19 crisis. The takeaway message was unanimous – while appreciating the unchartered territory the globe has found itself in, it is expected that authorities will by now have a number of scenarios mapped out, on which they will be basing their actions.

Sharing these scenarios would allow members of the business community to be proactive and sketch out their business plans, at least tentatively. While no one is expecting Government to provide solid predictions, businesses would appreciate if the scenarios being developed could be shared with the business community, through The Malta Chamber.

35. Chair of Malta Chamber Think Thank discusses work of committee On 30th April, Chair of The Malta Chamber’s Think Thank, Joshua Zammit, discussed the ambitions of the Chamber’s newly established committee, which is briefed to propose a way forward, with Mario Xuereb on Ras imb’Ras. “In reality, every issue applies in a distinct manner to each different industry. Every sector needs to find its way to adapt.”

Mr Zammit explained how “this is in fact, what the Think Tank is aiming to do. We have gathered a group of experienced people from the world of business and academia, who are working hand in hand to determine how such scenarios will evolve.”

“We have created about 10-11 sectoral round tables, to link with the different JUNE/JULY 2020

sectors of our economy. These round tables will discuss how the different scenarios will apply to each sector and what things will need to be done to be able to adapt to such scenarios,” he said.

36. Third Chamber study confirms need for wider support and better guidance to business At the end of April The Malta Chamber carried out a further survey among its members to gauge the opinions of business in the face of the continued economic stress and stagnation, and the current extent of business support. The regularity of such surveys is aimed at ensuring that the Chamber is continuously updated with the real situation on the ground at all times during its discussions with the authorities on behalf of business.

The results of the survey confirmed the trends emerging from the previous two conducted in the past weeks. It is clear from the pattern of results that businesses need wider support and more realistic guidance from the authorities in order to avoid further redundancies.

37. Chamber happy with first steps towards economic and social normality to support national resilience On such an important day as Workers’ Day, on 1st May, The Malta Chamber welcomed the announcements by Government to relax the economic lockdown, predominantly measures affecting non-essential retail. This was a first step in what hopefully would lead us to a new normal in the near future and allow us to start regaining economic traction in order to save as many livelihoods as we can.

As Malta’s foremost support for businesses, the Chamber remains committed to provide guidance and support to the authorities. It appealed for the cooperation of all involved so that the announcement would be the first in a series of steps which will bring the country back to normality without unnecessary delays or hiccups.

The Chamber said that it is aware of the cost of supply from the international markets and the competition for such essential products to be attracted to Malta.

“The Chamber will strongly oppose price orders issued in times of extraordinary crisis especially when other alternatives available to the Government to support customers and the public at large would have been discounted,” stated the Chamber.

39. GasanMamo Insurance supporting Chamber with Post Pandemic Strategic Group The Malta Chamber recently concluded a number of partnership agreements aimed at sustaining and strengthening the operations of the Chamber in a number of theme-focused areas of specialisation and beyond. Through a Bronze Collaboration Agreement, GasanMamo Insurance shall support the foundation of a Post Pandemic Strategic Group.

In his comments on this partnership agreement, GasanMamo Insurance Managing Director Julian J. Mamo said that “I am proud that GasanMamo Insurance is partnering with The Malta Chamber during this time of national and international crisis. I am particularly pleased to be supporting the Post COVID-19 Think Tank with the main aim of developing sustainable strategies to rebuild a more resilient economic framework post COVID-19.”

40. Chamber clarifies price cap on medical and surgical masks On 6th May, The Malta Chamber clarified that according to the Official Notice published in the Government Gazette, the maximum retail price of ¤0.95 for masks refers only to masks of a surgical/medical type.

Surgical/medical face masks are prescribed by the health authorities for the purposes of COVID-19 social distancing measures.

Any other masks are not covered by this price cap or by Government’s agreement for subsidisation of cost/selling price differences.

38. Chamber offers alternative solutions to price orders

41. Good health imperative to sustain economy

In a statement issued on 4th May, The Malta Chamber said that it is sensitive to the needs of its members and consumers at this time of unfortunate hardship on the country so much so that it warned against price hikes and potential abuse on prices of essential products deemed essential in the fight against COVID-19.

“No economy is healthy without good health and there’s no good health without a good economy.” These were the words stated by Malta Chamber President Perit David Xuereb, who was interviewed by Jesmond Saliba on Newsbook Hour on the radio station 103 Malta’s Heart in early May. The Chamber President said that 73

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“normality today is definitely different from what we considered normal in the past. This is especially relevant moving forward, since there will come a day when people will realise that what will be deemed as normality in the future was all created during these tough times.”

42. “Resilience, adaptation, innovation” The Malta Chamber held a webinar on the subject of employment conditions vis-à-vis the current COVID-19 situation on 8th May. The first in a series of webinars, ‘Question Time by The Malta Chamber’ offered more than 200 members the exclusive opportunity to ask the pertinent questions to the Minister within the Office of the Prime Minister Carmelo Abela as well as to the Director General of the DIER Diane Vella Muscat. Dr Matthew Brincat participated in his capacity as The Chamber’s representative on the Employment Relations Board, while Andre Fenech, Head of Policy, moderated the webinar.

43. IIP Scheme needs to be suspended and a new scheme launched During an e-meeting with Alex Muscat, Parliamentary Secretary for Citizenship and Communities, The Malta Chamber made a set of proposals aimed at strengthening the Individual Investor Programme (IIP), with a view to ensure it is consistent with the country’s efforts to consolidate the country’s reputation while ascertaining the highest level of good governance.

The Malta Chamber proposed that a new, strengthened scheme would feature changes to the length of effective residence required from persons applying for IIP, as well as improving the criteria related to the rental requirement for a residential property.

44. Chamber welcomes Ambassador’s resignation The Malta Chamber welcomed the resignation of Michael Zammit Tabona from Ambassador of Finland on 10th May, following his comments on social media.

Such comments do nothing but harm the country’s reputation. All persons holding public office and diplomats no less, should take extra care when expressing themselves, as the country’s reputation is no one’s to put in compromising situations.

Good governance demands high ethical, professional and diplomatic standards from our Ambassadors. The country ought to have representatives of the highest credibility that attract strong 74

trust levels in the interest of Malta.

45. In memory of Anthony J. Tabone The Malta Chamber saluted the memory of Anthony J. Tabone, former Senior Vice President of the Federation of Industry (2004-2008) prior to its merger with the then Malta Chamber of Commerce and Enterprise.

As the numerous eulogies attest, apart from being a successful man of business, Mr Tabone was an upstanding example of ethical conduct. May his memory be a testament to honesty and integrity for all persons in business and public office.

The Malta Chamber sends its sincere condolences to all Mr Tabone’s family and loved ones.

46. We must seize the opportunities around us During a meeting with Minister for the Economy Silvio Schembri, The Malta Chamber made a series of fresh proposals to Government to assist businesses through the extraordinary COVID-19 crisis on 12th May. The new proposals build on the already existing programme of assistance which Government is providing businesses with, as it provides a structure for resilience and adaptation on behalf of businesses.

“The Malta Chamber has been in constant contact with members of the business community in the past weeks, and is cognisant of the difficulties they are facing at this unprecedented time and hence is in the best position to represent their concerns as well as their ambitions at this time,” said Malta Chamber President David Xuereb.

47. Chamber President appointed on Education Think Tank Malta Chamber President David Xuereb has been appointed on the newly established Think Tank for Education. The announcement was made on 13th May by Minister Owen Bonnici. The Think Tank has been set up with the aim to propose ideas on the educational sector of the future, in light of COVID-19 and beyond.

On the Think Tank, the Chamber President is joined by Prof. Edward de Bono, Prof. Richard England, Dr Frank Fabri, Joanne Grima, Julianne Grima and Frederick Schembri.

48. Initiative laudable, budget too low In a statement made on 14th May, The Malta Chamber welcomed Government taking on board its proposal to create a

scheme to subsidise commercial rent for small businesses. This was a proposal made

by The Malta Chamber in its continuous feedback to Government on the needs of businesses at this challenging time.

The Malta Chamber noted that “the budget of ¤2.5m dedicated to the initiative is too low to cater for the expected demand it will attract. It is noteworthy that rent is generally the second greatest expense for any business following salaries.

Therefore, it is crucial that Government implements this scheme correctly with adequate budget right from the start.”

49. Chamber welcomes Government’s efforts to implement Venice Commission recommendations The Malta Chamber welcomed the letter sent to the Council of Europe’s Venice Commission on 13th May by the Ministry for Justice, Equality and Governance outlining the Government’s efforts to implement the recommendations made by the Commission to the Maltese Government in December 2018, which focuses on the appointment mechanism of members of the Judiciary, powers vested to the Prime Minister and persons of trust.

These were all themes listed in the Chamber’s document titled ‘Ethical Business Calls for Change – a manifesto for Good Governance by The Malta Chamber’ published in January of this year.

In his first reactions to this letter, President of The Malta Chamber David Xuereb said that this is a step in the right direction. The Chamber is satisfied to note that a number of its recommendations have been taken on board by Government.

50. Maritime and logistic industry require more aid from Government During the past months, the Maritime and Logistics industry has been facing a great deal of challenges, primarily due to the restriction of port operations to only allow essential services. As such, The Malta Chamber established a taskforce made of different business sections of The Malta Chamber and other associations forming part of the wider transport and logistic associations in Malta.

The taskforce members conducted a survey amongst its respective membership base that highlighted certain difficulties. The largest challenge that will persist over the coming years, is having to balance the loss in revenue with employment retention and the industry JUNE/JULY 2020

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NEWS INTERNATIONALISATION

remains predominately driven by the competences of the people it employs.

51. Chamber welcomes relaxation of measures, calls for discipline The Malta Chamber welcomed the further relaxation of measures allowing for the rekindling of the economy, as announced by the Prime Minister in May. The Chamber President had called on Government to cautiously consider enabling a responsible return to normality.

The announcements were seen as a step in this direction, which will hopefully inject confidence in our society.

The Chamber called on all economic operators as well as members of the public to exercise maximum discipline and strictly observe the protocols put in place by the country’s Health Authorities.

52. We cannot remain in a state of emergency “The country needs to find a new sense of competitiveness and an energy of resilience to successfully navigate the postCOVID realities,” said Perit David Xuereb, President of The Malta Chamber during a cordial meeting with the Leader of the Opposition at Dar Centrali in Pieta in May. The current economic disruption which is resulting in great hardships for businesses and citizens alike were top on the agenda of the discussion during the meeting.

The Chamber delegation insisted on the importance of the country being given clear and safe direction on the way forward in a responsible and structured manner.

Perit Xuereb was accompanied by Deputy President of The Malta Chamber Marisa Xuereb and Director General Kevin J. Borg. Leader of the Opposition Adrian Delia was accompanied by Kristy Debono and Claudio Grech.

01.

01. Chamber actively involved in Ghana to explore new business opportunities “We are here to find the suitable partnerships for our members with different companies that can either work in Ghana or Ghanaian companies setting up in Malta.” This was stated by Lino Mintoff, Head of Projects and Internationalisation at The Malta Chamber during the second Ghana-Malta Business Forum which took place in Accra in early March.

The Malta Chamber was actively involved in the delegation to Ghana through the its co-owned arm TradeMalta and the participation of Mr Mintoff encouraging Ghanaian businesses to experience first-hand what Malta can offer.

The Mission was led by Minister for the Economy, Investment and Small Businesses

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Silvio Schembri, aimed to boost Diplomatic and trade relations between Malta and Ghana with the participation of 27 Maltese companies and local institutions.

Commenting to the media in Ghana, Mr Mintoff said that The Malta Chamber is interested in enhancing the collaboration between businesses in both countries, underlining the fact that trust needs to be created with the identification of business sectors of mutual interest.

During this mission, Ghana and Malta signed five Memoranda of Understanding (MoU) for the establishment of partnerships between the two countries.

Such will facilitate, amongst others, the enhancement of international connectivity to Ghana via a new route operated directly from Malta by Air Malta. cc 77

CC MAKE THE HEADLINES

Leveraging what we’ve learned It is quite amusing to see how COVID-19 has revolutionised the way business looks at technology. We are living proof that what was impossible a few months ago, was easily adopted at a very fast pace.

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here are companies that never considered working from home as an option, and with all its hurdles, this way of working became a priority for continuity. Technology was never an issue to make all this happen, and those who embraced it prior to COVID-19 had an easier transition. Nonetheless, the current situation all companies found themselves in questioned the status quo completely and the old guard had to adapt and, in some cases, become champions of the transformation.

This is a major opportunity for enterprises that see this as their future and want to be flexible, dynamic and build on what was achieved in the last few months. We have been engulfed in the ‘cloud’ rhetoric, we all have played with some shape or form of ‘cloud apps’ or ‘cloud infrastructure’, but through this pandemic we have realised the true value of having a portable business, able to immediately scale to the circumstances and ensure that wherever our people are working from, and whatever systems we are using for whatever processes, all works seamlessly without a glitch.

Now that most enterprises have, in different forms, harnessed the potential, the key now is what to do with all the data that has been generated. We faced the reality of how data can be used to mitigate for a pandemic, using predictive models to determine the R factor. We have continuously

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accessed dashboards indicating the spread of the pandemic, not just locally but across the globe. That value can be translated to businesses; it is a matter of applying modern approaches towards business intelligence and predictive analytics using cloud platforms to finally deliver actionable insights.

Eunoia is a focused data analytics company which has been providing industryfocused business intelligence solutions. As a cloud first company, we build solutions that deliver scale and speed, ensuring optimal ROI through highly engineered orchestration, paying only for the value consumed. Today many of the platforms we use are commoditised as platforms which are consumed as a service. The partnerships with Microsoft and Panorama Software give us the flexibility to deliver these solutions putting us in a position to deliver insights at the right time, to the right people, helping our customers take decisions faster and supported by facts and figures.

Our journey has led us to build business intelligence products, specifically CFOUR which has, earlier this year, been released as a software as a service and is available on the Microsoft marketplace. CFOUR is a financial consolidation tool targeting multi-group organisations, enabling them to generate their management accounts and financial consolidation reporting, whilst monitoring their financial performance. “We

are very excited about the new feature-set that is currently in production. Our hope is to provide our customers integrated operational insights which will ultimately complement the financial data, exposing new amazing insights. Our business intelligence solutions share a common data model which is used by hundreds of users daily, providing right on time and highly visual insights and placing our users in a better position to manage and improve business performance. Bringing this value to CFOUR will enable new potential, combining financial and operational reporting, exposing insights that would otherwise be hidden to the business.

Our objective is to actively empower our users to look for potential risks and opportunities, and to increase the automation and correctness of these processes. The discussion on the use of machine learning and predictive analytics has long started, but it all boils down to how good the ground data is. Therefore, we apply rigorous cleansing methodologies to ensure the veracity of the base data to deliver on the promise of predicting outcomes.

Eunoia is a proud Microsoft Gold Partner in data and analytics, and locally represents Panorama Software which are considered market disruptors in telecom and media by GlobalData. cc www.eunoia.tech

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Discretionary portfolio management in these unprecedented times The importance of obtaining a professional investment service has never been as relevant as during the current period.

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ollowing the COVID-19 outbreak and the measures taken by authorities and governments all over the world, there has been a significant change in how people and organisations interact with each other and function. This change, coupled with the sheer amount of state aid and market intervention that continues to grow as the days unfold, has had a very big effect on the markets. It has made it both more difficult and important than ever for one to choose their investments wisely and re-balance their portfolio in a way that considers the many factors that are being affected by the unfolding scenario. This is a service that Michael Grech Financial Investment Services Limited (MGFIS) excels at, with a mature and highly knowledgeable team that has been offering its services for over 20 years. The company is made up of a team of 18 professionals, including 8 experienced investment advisors, each with a minimum of 10 years’ experience within the field.

When it comes to investment services, there are different types and the highest level that any investor (individual or entity) can receive is that of discretionary portfolio management. A simple execution only service might be good for those who like to carry out their own research and have a higher level of investment knowledge. An advisory service is more suited for those who need guidance on how to choose the investments that are most suitable for their needs. The portfolio management service

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takes the advisory service to the next level and puts more onus on the investment services company.

For this reason, the portfolio management service is much more comprehensive and requires us to conduct daily monitoring.

Moreover, every investment decision taken by our portfolio managers must be carried out strictly in line with the agreement signed with the client. The discretionary service also requires a higher level of client reporting and transparency, where third party inducements are strictly prohibited, bar some minor nonfinancial ones. Another great advantage is that this service takes a portfolio view to choosing investments. This means that when choosing to trade an investment the portfolio managers will assess the effect that such a move is expected to have on the entire portfolio, and they would not just consider the particular investment in isolation.

Hence, they would carefully consider how the returns of different investments move together with other investments, keeping a watchful eye on the expected risk of the overall portfolio.

Some investors may consider this level of service to be unnecessary, especially since the added work and higher quality service would necessarily be more expensive than a simpler one. However, never has a portfolio management service been so important as it has become recently. The aftermath of the pandemic is very uncertain and any investor attempting to do their own research will

soon understand how conflicting analysts’ reviews can be. This is where engaging an experienced investment team becomes paramount. The portfolio managers at MGFIS have over 13 years’ experience each in investment services, with a background also in banking services. They are overseen by an investment committee which is governed by a board of directors whose senior members have over 40 years’ experiences in banking and finance.

Even if an investor simply buys into a well-diversified fund or exchange traded fund, the current situation warrants further research into the underlying investments the fund holds within its portfolio. Our portfolio managers employ a five-stage process to construct any portfolio they manage which incorporates both macro (general) economic analysis and research on particular investments, assessing both quantitative and qualitative elements. More importantly they will assess the underlying holdings together as one portfolio to understand their combined expected risk-adjusted returns. cc Michael Grech Financial Investment Services Ltd is licensed to conduct investment services in Malta by the Malta Financial Services Authority under the Investment Service Act, as regulated under the laws of Malta.

For further information, contact T: 2258 7000; E: info@michaelgrechfinancial.com; www.michaelgrechfinancial.com 81

CC INVESTMENT

Is now a good time to invest in a merger arbitrage investment strategy?

CIO of AUM Asset Management Limited and Portfolio Manager of Abrax Merger Arbitrage Fund, Xavier Robinson, explains the benefits of merger arbitrage investment strategies and why now is a good time to get involved.

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erger arbitrage is a sophisticated investment strategy that buys and sells stock of two merging companies at the same time. Before we look at why merger arbitrage is a sound investment strategy for those who understand the market, let’s define the concept. ‘Arbitrage’ can be defined as buying and selling a product or stock (or other asset) in different markets simultaneously. The idea is to capitalise on the spread between the asset’s buying price and selling price.

In very simple terms, an example of arbitrage can be seen when people buy a product from a shop and then sell it through Amazon for more money. If a seller buys a TV from a company for ¤100 and sells it through Amazon or another online retailer for ¤120, then there is arbitrage. In this case one would make a ¤20 (20 per cent) profit.

Within capital markets there are numerous types of arbitrage, including convertible bond arbitrage and currency arbitrage. One of the most tested and trusted involves merger arbitrage – where profits are made from announced mergers and acquisitions. Let’s break down how this works.

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How does a merger arbitrage investment strategy work?

When an acquiring company wants to buy a target company, it usually has to pay a premium. The premium has to be over the target company’s share price, so that it’s a worthwhile deal for its board of directors.

Merger arbitrage is an investment strategy that makes money from the difference between the target company’s current share price and the amount paid for its acquisition against the context of the announced merger.

Therefore, merger arbitrage can be described as an event-driven investment strategy, which makes profit from pricing inefficiencies that may happen after the announcement of the merger, acquisition, bankruptcy or other major corporate event.

If we take an example of a potential merger: when a company makes it public that they intend to acquire another, the stock of the target company will usually rise. The stock of the target will trade in function of the transaction terms announced, and will trade at a discount (a spread) to the transaction consideration to be ultimately received (whether in cash and/or stock of

the acquirer), depending on the risks of completion of the transaction or on the upside optionality in the form of a potential counterbid or the need to see improvement in the transaction terms (where the price will be above the terms of the transaction consideration).

This is where a merger arbitrageur will step in. So, how is it profitable for the arbitrageur? Firstly, it’s important to realise that corporate mergers are usually split into two categories – stock-for-stock mergers and cash mergers: • Stock-for-stock merger – this is where the acquirer exchanges its own stock for stock of the company it wants to buy. During this kind of merger, a merger arbitrageur will buy the stock of the target company and short the stock of the acquiring company. When the merger is through and complete, the merger arbitrageur uses the converted stock (from target company into acquiring company) to cover the short position.

• Cash merger – where the acquiring company buys the target company’s shares for cash. Until the acquisition is complete, the target company’s stock will trade in function of the acquisition price. If you buy the target JUNE/JULY 2020

CC INVESTMENT company’s stock below the offer terms before the acquisition closes, therefore, you can make a profit should the acquisition go through.

Merger arbitrage formed as an investment strategy during the boom years of the 1980s, when returns were very high. This was because it was a new strategy with no real competition. Some arbitrage firms made returns of more than 20 per cent per year.

This made it more popular as a strategy and the field became much more competitive, lowering the available returns.

What are the risks of merger arbitrage investment?

The biggest risk is that the merger doesn’t go ahead at all, resulting in a share price drop of the target company. A deal can fall apart for numerous reasons, including shareholders voting against it, a company performing badly, losing funding or regulators blocking the deal.

The compensation is the merger spread previously mentioned and is payment to the arbitrageur for the option they provided to long-term shareholders – that is, to exit their stake quickly without having to wait for the deal to close.

These risks are why merger arbitrageurs must have high levels of knowledge, skill and understanding of myriad factors. They must accurately analyse the potential of a merger and determine whether it is likely to actually happen and how it will play out. This is why large institutional investors such as hedge funds, investment banks and private equity firms are the primary user of merger arbitrage as an investment strategy.

Is merger arbitrage the right investment strategy for you?

A merger arbitrage investment strategy aims to collate a diversified portfolio of arbitrage trades. Each trade must offer the following: • An annual return above the cost of capital.

• Market implied probability of success.

• An expectation of a return with little correlation to other trades.

The market will set the spread of each opportunity and overall, merger arbitrage continues to outperform other hedge fund strategies on a risk-adjusted scale because of its recurring and compounding income stream nature. There are other advantages of merger arbitrage compared with bonds, including that usually returns therefrom are taxed more favourably.

Merger arbitrage as an investment strategy can provide consistent, relatively low-risk attractive returns which are compounding over time. But a broken deal can cost the arbitrageur. Losses can be higher than the profit expected from a successful investment, so diversification is JUNE/JULY 2020

“COVID-19 has created unprecedented opportunities in price dislocations across live deals and that there is also evidence to show that there will be a surge in new M&A activity during Q3 and Q4 of 2020, making now an ideal time to invest.”

– Xavier Robinson, CIO and Portfolio Manager, Abrax

very important to minimise risk.

Historically, 94 per cent of mergers have completed. Stats show that 87 per cent closed with the initial deal terms in place, a further 6 per cent with higher terms and 1 per cent with lower. Around 6 per cent of announced mergers have failed to close. So, while merger arbitrage is a good bet as part of a diversified portfolio due to its low-risk, low-correlation with other asset classes and absolute return, it also needs expertise and resources to run as a strategy.

Individual investors should work with professional merger arbitrage funds This is why individual investors are best off allocating funds to a professional merger arbitrage fund, such as the Abrax Merger Arbitrage strategy managed by AUM Asset Management Limited. Based in Malta, AUM has been founded in 2015 by Jean-François de Clermont-Tonnerre, is headed by Roberta Bonavia, and is one of the country’s biggest privately owned investment management companies.

Abrax has been trading in announced mergers and acquisitions since 2011 with an annualised return since inception of ~ +8 per cent and consists of a traditional hedge fund and a UCITS structure.

Xavier Robinson, Portfolio Manager of Abrax Merger Arbitrage Fund, says: “by exploiting late-stage M&A opportunities across North America and Europe, Abrax aims to deliver absolute returns regardless of market conditions. Abrax Merger Arbitrage has a 99.6 per cent success rate for deal competition across its portfolios since it launched in May 2011 and the investment team think now is the best time to get on board.”

offers daily liquidity to investors, backed by the MontLake brand. This makes it an excellent cash management alternative to the more illiquid asset investment strategies out there, particularly in a system compounded with generally negative interest rates.

As to what sets the Abrax fund apart, much of its success lies in its long-standing market-leading performance. For just under 10 years, Abrax has been beating and consistently coming out ahead of all merger arbitrage indexes. Mr Robinson says: “we focus solely on late-stage M&A transactions with firm, legal merger contracts in place, rather than special situations or pre-event deals that are more uncertain and geared towards higher market correlation.”

All of this is why Abrax Merger Arbitrage has an extremely low deal break rate of 0.04 per cent rate versus the 6 per cent p.a. witnessed in merger arbitrage. Its extreme focus on capital preservation has shown predominantly positive monthly performances at a time when global indices fell by more than 5 per cent. Despite the fact that since August 2011 there have been 10 months of significant market corrections, the Fund’s performance has held strong. The most recent example of this is the global market correction of 10-20 per cent between February and April 2020 following the first wave of COVID-19. cc www.aum-am.com

Why right now is a good time to invest in Abrax Merger Arbitrage Mr Robinson believes that COVID-19 has created unprecedented opportunities in price dislocations across live deals and that there is also evidence to show that there will be a surge in new M&A activity during Q3 and Q4 of 2020, making now an ideal time to invest. The Abrax investment team has more than four decades of investment experience and this, along with its track record of high returns and strong focus on capital preservation during challenging times make it a unique proposition.

Abrax’s CBI-regulated UCITS fund also 83

Style Review

While spring failed to provide much opportunity to dress up due to widespread lockdowns, Sarah Micallef looks ahead at fairer summer days, and the trends that will help to brighten them.

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04. Maximalist prints Maximalist or power prints are ideal for summer, so it’s no surprise they’re everywhere this season, for both women and stylish men. Think oversized florals, colour-blocked hues and large-scale prints – they’re sure to put a smile on your face in the office and out of it.

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05. Broderie anglaise

01. Puffed sleeves A trend that’s been in the works since last year, shirts and dresses with puffy sleeves are going to be huge in 2020.

They range from dramatic and voluminous to subtler, gradual puff sleeves, and look great dressed up or down.

This classic trend is one that’s seen many variations and can be worn in multiple ways (and on multiple pieces). This year, intricate patterns and irregular embroidery take centre stage, and can be seen on dresses, shirts and shorts.

06. Shorts suits

A familiar feature we’re used to seeing on our sports and lounge wear, the humble (and comfortable) drawstring was all over the spring/summer 2020 runways, and it’s no longer just for casualwear.

03. Sheer layering The possibilities are endless with this trend, which is perfect for creating a layered look without suffering in the summer heat. Opt for a sheer shirt over a vest, or a light sheer jacket over a simple outfit and you’re sure to be on trend.

If you love a bit of tailoring no matter the season, the shorts suit could be just the ticket to see you through the summer months. Choose from variations that are cut just below the knee, military-inspired sets and preppy separates – you may be sceptical now, but you’re sure to fall in love. cc

Valentino

02. Drawstrings

Brunello Cucinelli

04.

Charles & Keith

03.

02.

05.

Bally

Max Mara JUNE/JULY 2020

06.

Zimmermann

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CC DESIGN TRENDS

MASP Awards winners: Making an outstanding contribution to local architecture Every year, the Malta Architecture and Spatial Planning Awards, organised by the Planning Authority, and this edition held under the patronage of President of Malta George Vella, are intended to recognise architects, interior designers and anyone making an outstanding contribution to the industry through research, education, theory or practice of architecture and the built environment. Sarah Micallef meets the teams behind the winning projects for 2019, which were grouped under 10 categories, spanning restoration and conservation through to urban planning, interiors and commercial projects.

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Photos by Espais Roca

Award for Restoration and Conservation & Sustainability Award: MODEL Local architecture firm MODEL was given two awards for its restoration of Aster House, a Sliema townhouse built in the Art Nouveau style.

Nestled among a street of houses dating back to the 19th century, the building corresponds to the traditional construction of this period of growth in Sliema, with long and narrow townhouses, each having its own unique elements, making the town a rich architectural gem. “Aster House is a prime example of such uniqueness, with its architectural elements having Art Deco inspiration somewhat different to its immediate surroundings,” says the team behind its restoration, comprised of Alan Galea, Simon Grech, Sam Bonello, Francesca Scicluna, Nils Feldmann (Feldmann Architects) and Susan Butler.

The brief entrusted to MODEL was one which required the design team to emphasise the beauty of the architecture, keeping sustainability in mind and including modern technology that will allow the user to manipulate the internal climate with maximum comfort.

The intervention proposed by MODEL was to create an upside-down house and

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sought to move away from the traditional programme of Sliema townhouses by adding a third level to the property. “This new level accommodated the living areas, whereas the lower levels accommodated the sleeping areas. This deliberate shift of layering became clear during the design process once the light levels throughout the property were linked to the way this house would be used,” the team explains.

Revealing what made the project unique, the architects point to the design concept, which deviates from the traditional layout of a single-family home, as well as the sensitive approach to its restoration. “The respect that its architecture deserved helped the final result stand out in an area of Malta where our heritage is not always respected,” they say.

Furthermore, the technological elements integrated by the team also take on a prominent role in this new language, allowing for the regulation of the natural moisture, temperature, light levels and acoustics of the

house. “The house’s interior automatically responds to the external environment through intentionally located sensors which communicate with the intelligent make-up of the heating, cooling and solar control systems, all of which adapt the internal environment to suit the end user.”

Speaking of the recognition, the team admits that “behind the scenes of any project lie many sleepless nights, countless discussions, many design concepts, presentations, variations and the list goes on. Looking back at completed projects, knowing all that went into getting there is already a proud feeling. Being recognised by colleagues with an award is highly appreciated, considering that there is so much talent among us.”

On behalf of MODEL, they add, “with or without an award, we will always strive and continue to contribute positively to our built environment.”

“Looking back at completed projects, knowing all that went into getting there is already a proud feeling. Being recognised by colleagues with an award is highly appreciated, considering that there is so much talent among us.”

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Urban Design Award: Studjurban Studjurban received the Urban Design Award for a mixeduse project in Mosta combining a childcare centre at ground floor with residential apartments.

This development in Mosta comprises two buildings, each fronting separate streets linked together at underground level through a common parking area accessed from the lower street. It comprises 14 two-bed and three-bed apartments, and a childcare centre at ground floor, separately accessed from the upper street. Its design by Studjurban has carefully sought to exploit the site’s configuration, orientation and the potential of its location.

“An initial contextual analysis of the surrounding neighbourhood revealed that, in spite of the array of architectural typologies and the proliferation of redeveloped terraced houses into apartment blocks of varied architectural quality, one could still identify important urban design principles that could be reinterpreted into this design, as opposed to simply repeating neighbouring architectural motifs,” explains Studjurban Founding Architect and Urban Designer Antoine Zammit.

Referencing the award, and what made the project stand out in its category, Dr Zammit affirms that in the firm’s view, “it has elevated the quality of its surrounding urban fabric through the careful implementation of urban design principles,” maintaining that “the development’s façades complement the streets’ geometry and are built on the façade proportions that are present within the streetscape, while the vertically oriented apertures are built on similar proportions and provide an important rhythm to the corner, together with a well-studied solid-to-

void ratio adopted for the brise soleil.”

Meanwhile, he continues, part of the ground floor is purposely set back at the chamfered corner, allowing for a comfortable pedestrian walking and waiting zone at its forefront. “The mixed-use of this building, with the inclusion of a childcare centre, adds to the vitality of the neighbourhood, and provides an active frontage at pedestrian level.”

Dr Zammit describes the award as “a great honour” within a difficult category, particularly given the “poor culture” of urban design locally. “We were even more pleased to win this award with a residential (apartment) complex, generally perceived negatively out there, given that there are not many good examples of apartment buildings around us,” he affirms, adding that the team wanted to illustrate that good design quality and a contextual response may also be achieved with this project typology.

“To obtain recognition for our work means that the quality that we strive for, on a daily basis, does not go unnoticed. It is therefore very encouraging for us. On a personal level, this project was an opportunity to put into practice the DC15 planning policies and guidelines that I had formulated with the PA; furthermore, given that I also lecture in urban design at the UoM, it has given me the possibility to use the project as a tangible example of important streetscape principles with my students,” Dr Zammit concludes.

Photos by Ramon Portelli

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“To obtain recognition for our work means that the quality that we strive for, on a daily basis, does not go unnoticed. It is therefore very encouraging for us.�

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“At GHRC we believe that the project itself is one-of-a-kind, not only due to its location and design, but also because it is a true example of sustainability of open public spaces.”

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CC DESIGN TRENDS

Public Open Spaces Award: Grand Harbour Regeneration Corporation Grand Harbour Regeneration Corporation (GHRC) received the Public Open Spaces Award for Gnien Laparelli, the garden in the ditch below the entrance to Valletta, in collaboration with the Restoration Directorate.

“The project included the embellishment of the City Gate Ditch, which was the last part of the jigsaw of the City Gate entrance,” explains Mario Bonello, Head Project Development within the Project Development Coordination Unit.

The ditch was transformed from a parking area into a public garden, through the planting of indigenous and endemic trees and plants, he maintains – a feat which required a lot of research into selecting the species that could thrive within its particular micro-climate. “It was also to be ensured that the garden provided a different setting throughout the different seasons,” Perit Bonello continues, affirming that the team used natural materials such as local hardstone, steel and wood, creating small meeting spaces kissed by the shrubs at waist level and shaded by the foliage of the trees above. The project also included the necessary reservoirs for water harvesting and lighting for use in the evenings.

“At GHRC we believe that the project itself is one-of-a-kind, not only due to its location and design, but also because it is a true example of sustainability of open public spaces,” he affirms, looking into the reasons Gnien Laparelli stood out in its category.

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“Most of the materials used have been locally sourced. The plant selection, being all indigenous, requires much less watering, as they are apt to the local conditions. We are thus managing to attain extensive ground cover without the continuous need for irrigation.”

Meanwhile, he also notes the intricate use of local hardstone, with each section of stone being individually designed and cut, together with the use of corten steel in the formation of the planters, which provide containment for the soil mix and which in turn helps the indigenous trees and shrubs to grow.

Speaking of the award, Perit Bonello maintains that the competition is always tough, highlighting the exceptional work of outstanding local architects in the private sector. “The public sector is often overshadowed, so this joint venture between GHRC and the Restoration Directorate has indeed proved the exceptional work employees from the public sector can produce through design and implementation, with GHRC having also taken on the Project Management role. It is an award towards our team work, rather than for an individual effort,” he says.

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Commercial Buildings Award: Bezzina & Cole Bezzina & Cole received the commercial building award for their work on the Crane Currency building in Hal-Far. Local firm Bezzina & Cole was tasked with the design of a state-of-the-art printing facility for US-based company Crane Co., which designs, prints and supplies banknotes to central banks around the world.

“Strategically located in the Hal-Far Industrial Estate, the Crane Currency banknote printing facility has been developed on a greenfield site having an area measuring circa 25,000 square metres,” explains the team at Bezzina & Cole. The facility consists of four blocks and additional ancillary buildings, and given its nature, was designed to ensure high security.

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Apart from a specifically designed Customer Experience Centre, administration facilities and service buildings which are located within the different blocks, the main activity of the facility, which consists of banknote printing, is carried out in the Printing Hall. “This space, which features the industry’s most modern equipment capable of producing the latest security feature enhancements and production efficiencies, has a clear height of 9.5m and covers an area of circa 9,000 square metres. The customer experience route extends to this large hall via a viewing gallery cantilevering over the

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“[The award] is a recognition and an attestation of the quality of the design work created and delivered by the whole team at Bezzina & Cole.”

production area,” the team maintains.

Describing the structure of the extensive facility, the architects explain that, apart from the Customer Experience Centre, which was constructed using in-situ reinforced concrete, precast concrete technology was implemented in building the project. “This technology ensured quality control of the fabricated elements as well as speed of construction on site.”

A noteworthy feature is the team’s treatment of sustainability and energy efficiency, for which the project employs

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a combination of passive design features and systems. Apart from these, the project also features an impressive bespoke design of insulated precast wall panels which enclose blocks A, B and C. “Internal constant temperature and humidity levels, which are so essential for the banknote printing industry, have been attained,” they affirm, adding that “the structural roofing slabs, including their build up, have been designed to be consistent, in their thermal properties, with those of the precast wall elements.” Meanwhile, the space at roof

level above the printing hall is intended to cater for a proposed photovoltaic system, while rainwater is harvested in underground cisterns.

“Naturally, we are indeed pleased and honoured to have been presented with such an award, as this, together with awards bestowed for other projects designed and executed by our practice, is a recognition and an attestation of the quality of the design work created and delivered by the whole team at Bezzina & Cole,” the architects say of the award.

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Interior Architecture Award for Residential Projects: Forward Architects Forward Architects were presented with the residential interior award for their work on a villa in Birguma, resulting in a bright, sophisticated family home.

“When the clients approached us to take over as architects of their villa in Birguma, construction of the property had just about reached completion,” explains Michael Pace, Partner at Forward Architects, adding that the clients also requested that Forward re-work the exterior look and feel, and to take on the design of all interior and exterior spaces from scratch.

“The clients, a family unit, had a clear idea of the lifestyle they wanted their future residence to accommodate. They trusted the professional opinion of the architect and were quick and clear with their feedback,” he maintains, affirming that the team’s first challenge was remodelling the exterior appearance of the house.

With the client’s trust, the architects were able to carry out discreet changes to the architectural form of the building and radically transform its appearance using bold volumes and an acute attention to detail.

“The front façade was transformed through the modification of volumes and elimination of all external apertures other than the main door of the house. The introduction of an insulating layer onto the façades provided a useful additional skin to the walls, enabling 96

the creation of new visual proportions and custom housing for fully openable single leaf sliding external apertures,” he describes.

The team chose white plaster and slate as the material of choice for the façade, with the slate repeated in the external paved areas and planters. “The result is a monotone emphasis on simplicity, materiality and proportion.”

The general layout of the house was the second challenge, Perit Pace reveals. “A very particular lifestyle on the part of the client led the designers to distance themselves from the more obvious kitchen/living/dining area that they would have taken almost for granted, in exchange for a living area that was physically separated from the kitchen/ breakfast area,” he says, affirming that the living area was shifted to the lower level of the house – a floor reserved specifically for entertainment and work, as well as housing client-specific spaces such as a gaming area, study, gym and cinema room.

This provided for an upper floor dedicated solely to cooking, eating and sleeping. “The oversized kitchen/breakfast area has every piece of equipment and gadget only a keen

cook could hope for,” he maintains, adding that “the master bedroom, possibly the most unique room in the house, hovers over the swimming pool, complete with ensuite and 20 square metre wardrobe.”

Finally, the third and major challenge was the interior design. “The house has been technically equipped with the most advanced installations, including underfloor heating, PV panels and fully integrated smart home automation. This all needed to be housed and kept discreet within a visually minimalist interior, requiring meticulous detailing and coordination,” Michael maintains. As with the external areas, the architects kept the materials to a minimum, comprising mainly concrete floors, white walls and simple light wooden joinery, with exceptions in areas like the master bedroom and kitchen, where a dark slate floor replaces the concrete, and dark tones and custom wooden panelling single out the space from the look and feel of the rest of the house.

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“A very particular lifestyle on the part of the client led the designers to distance themselves from the more obvious kitchen/living/dining area that they would have taken almost for granted.�

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Interior Architecture Award for Commercial Projects: Perit Kenneth Zammit Endrich and Perit Samuel Cassar Kenneth Zammit Endrich and Samuel Cassar of Architects Studio were presented with the commercial interior award for Vinaccia, a townhouse they converted into an Italian restaurant.

In essence, Kenneth Zammit Endrich and Samuel Cassar describe this project as the restoration, conversion and regeneration of a terraced courtyard house in the historic centre of Rabat. “The building was last split between two resident families and a grocery store. It was totally unrecognisable to the new fine dining restaurant Vinaccia,” explain the architects, who were involved in every aspect of its design, from major planning and restoration decisions to the design of all micro level elements.

“Found in a quaint alley in the Rabat village core, our client came across a dilapidated casa bottega with several unique architectural features. It was love at first sight, and immediately the dream began of restoring the old townhouse into a unique fine dining restaurant with both indoor

and outdoor spaces, to allow the guests to experience the entirety of the building and its original architectural fabric,” they say.

The result comprises a formal entrance and bar at the ground floor, along with a private dining room that seats up to 10 people, for an authentic home dining room feel. On the first floor, the main dining area hosts around 20 guests, and for the warmer months, an al fresco dining area in the courtyard can house the same number of guests.

“Restoration decisions and all the contemporary design materials and ideas were stripped back and executed to a basic principle: to have all dining clients appreciate being surrounded by centuries of evolving Maltese architectural history, whilst enjoying a lovely meal prepared by the chef

Photo by Brian Grech

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owners and brothers Marco and Mario,” the architects say, reflecting on what makes the project stand out.

“This was a labour of love shared with the restaurant owners, who would create prototypes of designed elements before executing them in their own workshops,” Perit Zammit Endrich and Perit Cassar continue, describing the project as a rewarding experience, and the end result as “a clear reflection of the decisions we are prepared to take for the vision of the design work tandem that exists between us, a father-in-law and son-in-law periti workshop.”

Referring to the award as a proud moment, the pair affirm that it also “proved to us that our passion for design is in sync and is fast developing into a successful vision and service to the community.”

Photo by Brian Grech

Photo by Alex Attard

“[The award] proved to us that our passion for design is in sync and is fast developing into a successful vision and service to the community.”

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“Having our work recognised and also awarded is a motivational boost for all the team. We look forward to our project being completed, seeing the residents living there and boosting the quality of life of the whole community.”

Urban Planning Concept Award: X,Y,Z Architecture & Design The award for the best urban plan at concept stage went to X,Y,Z for their proposed Cospicua Social Regeneration Project.

“The project consists of a residential development complex including a community centre together with a childcare facility,” explains Janice Fiorentino, Architect and Director at X,Y,Z Architecture & Design, within a site which consisted mostly of abandoned post-war housing blocks, hence presenting an opportunity for regeneration of the area.

“Instead of maximising the footprint of the site as built-up area, the change in levels was exploited to obtain an adequate number of units in smaller more relatable housing blocks and parking spaces, whilst introducing a new public open space of 800 square metres. This meant a reduction in footprint take-up of 30 per cent,” she continues, maintaining that the intention is not only to provide a recreational space for the eventual residents, but also a gathering spot for existing residents in the vicinity.

Being in an urban conservation area in a highly sensitive scheduled context, a number of factors were taken into consideration during the design process, the architect affirms, highlighting “massing, materials, proportions, long-range views, impact on skyline and permeability of the development,” as factors leading to

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the desired end result: a contemporary development which respects its context.

“According to the jury, the project adopted a sensitive approach to achieving a balance between conservation and rehabilitation objectives, and the need to provide an attractive living environment for housing local residents,” she explains, speaking of the project’s category within the awards.

“Our submission also included detailed conceptual studies showing the principles

behind the dynamic approach adopted for regeneration.”

“Having our work recognised and also awarded is a motivational boost for all the team. We look forward to our project being completed, seeing the residents living there and boosting the quality of life of the whole community. This confirms our approach in working hard to put forward projects which have a wider benefit based on analysis, consultation and innovation.”

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Hospitality Tourism Accommodation and Leisure Award: Forward Architects

Photos by Jeremy Debattista

Forward Architects received a second award on the night for their design of Rosselli, a five-star boutique hotel in Valletta.

AX Rosselli is a lifestyle hotel located within a 17th century palazzo in Malta’s capital.

The hotel offers 25 rooms, each belonging to one of six unique design collections. The collections pick on different settings to create a particular mood. “An element of design timelessness is achieved as fashion and current trends are side-lined and mood becomes the main driver of the design. The result is an eclectic fusion of styles resulting in a bold, whimsical atmosphere that aims to stir emotion,” explains Michael Pace, Partner at Forward Architects.

Describing the materials used as undeniably contemporary with an artisanal emphasis,” Perit Pace notes the use of composite marble flooring, mosaics and terrazzo, which co-exist with intricate wood panelling and hand-crafted brass inlays. “Furniture and furnishings follow an equivalent passion for craftsmanship, with

a clear preference for tailored details and reworked design icons from past masters.

This is further enriched with a top layer of bold patterns and geometrical fabrics. The result is an unapologetic and uncompromised nod to the baroque context setting within which it exists, so much so that it would feel out of place anywhere else,” he describes.

Speaking of what made the project stand out in its category, the architect believes that the Rosselli was a strong contender because the team managed to successfully accommodate the complex operations of a five-star hotel within the existing palazzo.

“This was quite a challenge from a spatial point of view,” he admits, adding that every detail was meticulously mapped out to ensure a seamless interface between the back and front of house, whilst respecting all heritage, safety and sanitary concerns.

“Any accretions and alterations that had been implemented over the years were removed to expose and celebrate the original architecture of the building. Once we had succeeded in this, we focused on making a powerful interior statement. Our design aims were to create something that is bold, strong and evokes emotion.”

“Winning the award definitely felt like a public token of appreciation to the entire team that put so much effort into the tiniest detail of the project. It opened up a new door for the practice into hotel design, which is now one of our main foci,” he says.

“Winning the award definitely felt like a public token of appreciation to the entire team that put so much effort into the tiniest detail of the project. It opened up a new door for the practice into hotel design, which is now one of our main foci.”

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Emerging Architect Award: Atelier Maison Atelier Maison scooped the award for best up-and-coming architectural firm, owing to their design of The Sacred Auditorium in Blata l-Bajda.

“The project consisted of the complete renovation and refit of an existing auditorium which belongs to the religious society of M.U.S.E.U.M., founded by St George Preca,” explains Co-Founder and Partner at Atelier Maison, Paula Agius Vadala.

While the community has a number of centres spread all across the island, the auditorium is located at their headquarters, and the M.U.S.E.U.M. society uses this space for regular gatherings of both large- and small-scale events. “The auditorium had been built around 60 years ago and had never been renovated since then,” Perit Agius Vadala says, revealing that the community had approached three different architecture practices to come up with a proposal for the interior design of the space, before choosing Atelier Maison.

“Despite it being a large open space, our goal was to create a space that felt 104

welcoming and intimate. We did this by using three main elements,” she affirms, “by making the lower level appear as though it was carved out of warm honey coloured travertine; by introducing a dynamic wave ceiling hovering above the entire space, which was created using 3,600 copper pipes; and by connecting the upper part of the space with the lower part of the space using a ‘blue void’.”

Noting the unique elements of the project, the architect explains that essentially, it had to be both a sacred space as well as a functional space. “There is a lot of technical research and collaboration behind designing an auditorium. Not only did we want the space to look good, but it had to perform too,” she says, affirming that since the initial proposal for the interior design was a competition submission, the team felt that the sky was the limit with what they wanted

to achieve. “We knew from the get-go that we wanted to create something that was never done in Malta, and if you had to see the initial concept sketches, we were completely loyal to the very first ideas we had.”

Finally, speaking of the award, Paula maintains, “it always feels really good to win an award that recognises excellence.

It means so much to be recognised for a project that is so dear to us. The whole duration of the project was five years – from the initial presentation to the official opening.

When we were engaged to be the architects in charge, we had only been practicing as Atelier Maison for six months, so it was quite an honour that the M.U.S.E.U.M. society entrusted us with a project that you could call their second home.”

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Photos by Alexandra Pace

“We knew from the get-go that we wanted to create something that was never done in Malta, and if you had to see the initial concept sketches, we were completely loyal to the very first ideas we had.�

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A special commendation: The President’s Award In 2019, a new category was added to the standard awards: President’s Award for Outstanding Achievement for Services Related to Architecture and Spatial Planning, commemorating a person who made an outstanding contribution to the industry. That person was veteran architect Godwin Cassar, the man who contributed to the setting up of the Planning Authority in the late 1980s and early 1990s.

“I consider the award to be a public recognition of my contribution towards the setting up and development of the Planning Authority from scratch over a period of 17 years,” maintains Godwin Cassar, whose other accolades include being appointed Fellow of the Royal Town Planning Institute, and receiving an Honorary Doctoral degree from the University of Central England in Birmingham.

Looking back on his career, which spanned over 36 years in public service, Dr Cassar

recalls how it started – a managerial post of supervision for housing development within the Works Department following his graduation, followed by a short-lived stint in road infrastructure before being called upon to prepare a dossier for the Council of Europe about the function of planning in Malta.

“The next move was the assignment of responsibility for development control; issuing permits, planning for major housing layouts; evaluation of major developments;

“I consider the award to be a public recognition of my contribution towards the setting up and development of the Planning Authority from scratch over a period of 17 years.”

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and design of enforcement procedures,” he says, describing this as the major highlight in his career, during which he prepared the groundwork and detailed studies in anticipation of the adoption of a Structure Plan for Malta.

“This involved negotiating with EU funding proposals for consultancy services and securing funding from the UK for staff training to service the various planning functions,” he maintains, having set up training measures with the involvement of the University in Central England and the local University for technical staff. In parallel, preparations were being made for the setting up of the Planning Authority, involving the adoption of new legislation; recruitment of professional staff; and public consultation activities, among others.

Towards the end of his career at the Planning Authority, Dr Cassar also assumed responsibility for the Environment Directorate for some three years – a period he describes as “difficult” once EU membership brought various environmental measures for which new legislation had to be adopted.

“When I received the invitation to attend the award function at the Casino Maltese, I was not aware that I had been nominated, together with three other nominees,” Dr Cassar reveals. Recalling his excitement as his name was called, he reiterates the sentiments of the short address he made on the night.

Commending Government for bringing together the responsibility for planning and the environment under one Ministry, he went on to make a plea to the new Minister to consider how the Planning Authority can achieve a balance between protection of the environment and planning for development.

“Currently, the environment lobby has only one vote at the deciding board which decides major applications, whereas the planning and building lobby has the remaining 12 votes,” he maintains, suggesting that the voting rights be restructured to achieve a balanced development which takes environmental issues into account.

“I think it is significant that my nomination to be considered for the award was submitted by the Environment Directorate, as it put a stamp of approval on my efforts to integrate the two functions of planning and environment within the Planning Authority framework.” cc 107

Food Trends The new realities brought about by the COVID-19 pandemic have impacted all aspects of life, including food. Sarah Micallef discovers the food trends that will define the new normal.

01. Chef-driven deliveries

03. Mock meat Meat alternatives have also been a rising trend, and once again, the pandemic has further served to drive this forward. With more people switching to a plant-based diet, the demand for mock meat will continue to rise, in a bid to add protein content in place of carb-heavy vegetarian foods.

04. At home experiences

Worldwide lockdowns and the forced closure of restaurants have spurred chefs in fine dining restaurants to turn their attention to delivery. This has happened in Malta too, where 26 restaurants receiving a coveted Michelin mention a few short weeks before COVID-19 reached our islands.

This trend is expected to carry on into the long-term, changing the landscape of the delivery business locally and abroad.

With social distancing continuing to be enforced around the world, it’s looking likely that many will continue to keep their distance after the immediate threat is over. Meanwhile, with restaurants only allowed to operate in a limited capacity, more brands will emphasise ‘at home’ experiences, including catering services for small groups, family-style meal kits and grocery-style orders which customers can use to prepare dishes at home.

02. Vegan and organic food

05. Comfort food

2020 was always forecast to see a shift in favour of vegan and organic food, and COVID-19 has only served to cement this.

It is expected that people will be more conscious about what they eat and where their food comes from as a result of the coronavirus outbreak, getting involved in finding out how their food is sourced, prepared and delivered to them.

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As many took to their homes in a bid to selfisolate, they sought comfort in food, taking to their kitchens to whip up whatever would make them feel better. Comfort food staples like home-baked bread, cakes and cheesy pasta dishes have been popular on social media, with people forgiving themselves for indulging a little more than they’re used to.

06. Healthy options On the flip side, now that countries have begun relaxing some of the stay-at-home regulations and warmer weather is upon us, it is expected that people will seek to go in a healthier direction. So, while consumers were more interested in comfort foods at the beginning of the crisis, it is expected that there will be a shift to healthier options moving forward. cc

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Meet the people behind the Young Chamber Network Last year, The Malta Chamber launched the Young Chamber Network (YCN), a specialised forum within the organisation aimed at inducting young businesspeople into its folds. In this series of interviews, The Commercial Courier introduces its readers to YCN members. This month, Sarah Micallef meets Angelique Maggi, Deputy Chairperson of MMH Malta Ltd, and Niki Travers Tauss, Managing Director at Esprit Yachting Malta.

Angelique Maggi Deputy Chairperson, MMH Malta Ltd “At MMH we pride ourselves on delivering reliable, cost-effective marine and oil and gas industry service support across the Mediterranean region,” explains Deputy Chairperson Angelique Maggi by way of introduction.

“Our hub is home to a multitude of services, from 1,200m of berthing space and 160,000sqm of lay down areas that cater for logistical operations, maintenance and repairs on vessels to fabrication, inspections and blasting and painting services. We support the activities of the hub through various work streams, ranging from personnel recruitment and logistics for both offshore and onshore, to first rate training at our academy,” she continues.

Being a family business, the industry has been part of Angelique’s life since 2001, however, as Angelique attests, her personal journey within it kicked off in conjunction with The Hub. “As an architecture and civil engineer by profession, this new venture allowed me to really bring my skills and knowledge to the table. It was a growth opportunity both for my career development as well as for the family business, and so the move into my current role was natural to me,” she says.

Speaking of her relationship with the Young Chamber Network, Angelique maintains that the YCN has “a huge potential to be a catalyst of change within the business community” and that she joined because she wanted to be part of that change. Viewing it as “a space to meet like-minded people with a drive to be the catalysts for change, to provoke and instigate different sectors of the economy to do better and be better,” she also notes that from a business perspective, the networking opportunities are beneficial, and it presents opportunities to learn about new industries as well as meet others within one’s industry.

Within the maritime industry, Angelique believes that the YCN provides an opportunity to strengthen the bonds between key members in the sector, “giving you the right space to learn who’s who and fostering the right environment to build working relationships,” while the JUNE/JULY 2020

“The shared energy and entrepreneurial spirit helps give the right creative impetus to find innovative ways to find common ventures and link businesses which do not usually work together.” – Angelique Maggi, Deputy Chairperson, MMH Malta Ltd possibility of collaboration is made easier across industries. “The shared energy and entrepreneurial spirit helps give the right creative impetus to find innovative ways to find common ventures and link businesses which do not usually work together,” she says, adding “I would argue that it is in the interest of all professionals and entrepreneurs to be involved, as the YCN allows them, and those new to the business world, to widen their network and increase their growth prospects.”

Looking at the opportunities the YCN can present moving forward, in the wake of COVID-19, Angelique affirms that the network is well-placed to provide answers and best practices for businesses to adopt

within the ‘new normal’.

“With a lot of young people from various industries coming together, we can find a new way of working that is just as vibrant but with the added attention of what we have learnt following COVID-19. The business industry needs to think long-term about how we will work to mitigate the consequences of the pandemic on the various industries affected. Proposals and suggestions by members on more collaboration between entities has already shed light on actions we can take to move forward together. It has been a difficult time for everyone, but there is clearly a space for more collaboration so that we can foster prosperity for mutual benefit.”

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Niki Travers Tauss Managing Director, Esprit Yachting Malta Joining family-run Esprit Yachting Malta in late 2005, Managing Director Niki Travers Tauss threw himself into the establishment of the Azimut Yachts brand in Malta, and 15 years later, he proudly asserts, “we are acknowledged for having the larger share of new power yachts sold in Malta and having established Marina di Valletta and a yacht finance company in partnership with our Italian principals and local partners.”

As a child, Niki was “brought up on boats”, travelling to boat shows, spending summers tagging along to deliveries of boats with his father and visiting production plants for LARSON in the USA – a brand which he says was already a household name for boating in Malta in the early nineties.

“From the early 2000s I was involved in preparing Azimut and Atlantis boats, and readying them for their deliveries down to Malta. It was a great learning curve and provided me with a deep technical insight into the systems onboard and was the beginning of a 10-year journey and over 25,000+ nautical miles and counting clocked on deliveries to-date,” he says fondly.

“Our key success has always been the after-sales experience offered. In 2016 we embarked on the mammoth task of developing Marina di Valletta to continue to offer a 360-degree product offering to our clients, and many sleepless nights later I am very proud of what has been accomplished.

Driving by the marina in Pieta, the Azimut presence is immediately apparent, and closer-up, customers’ testimonials continue to reconfirm the marina as the local benchmark for service and support,” he maintains, adding that the success of the brand and marina project continued to galvanise their relationship with the Azimut Benetti Group.

This was followed by the company’s third diversification into finance in late 2018.

“Today AB|Finance plc offers yacht finance to all European Azimut customers and the European Azimut Dealer network building on the 360-degree service offering with the addition of finance, supporting registration services and the implementation of Malta VAT deferral system,” Niki explains.

“I am a firm believer in the sharing of business experiences – the good, the bad, the unsure and sometimes also the unusual.” – Niki Travers Tauss, Managing Director, Esprit Yachting Malta

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Speaking of his involvement within the Young Chamber Network, which continues on from his involvement with The Malta Chamber for the last six years – and his third term on the Yachting Services Business Section – Niki describes the experience as “rewarding and advantageous on many levels, from networking with industry peers to interfacing with Governmental bodies and having the opportunity to shape our industry in a very direct and practical manner.”

YCN presented an opportunity to extend the Chamber experience beyond Esprit Yachting’s specific business section with likeminded young entrepreneurs, he continues.

“I am a firm believer in the sharing of business experiences – the good, the bad, the unsure and sometimes also the unusual.

All of these are ingredients in successful business. At every point of exchange of ideas, I always believe that these shared experiences and concepts will almost always offer a different point of view and may offer

balance, caution or reconfirm a direction you are about to embark on,” Niki asserts.

Speaking of the changing face of the local economy in the wake of COVID-19, the Managing Director believes that the pandemic has “clearly galvanised online communication and has brought mass deployment and reliability to online video conferencing platforms,” and, as a result, “has exponentially increased the possibility and ease with which very busy young individuals may still manage to efficiently dedicate a slot in their agenda for personal and business growth.”

“It’s clear that when such a group of likeminded individuals from diverse business backgrounds, each successful in their own right and within their own industry, regularly dedicate time to meet for the benefit of the economy, this may only augur a positive and long-term future for the Chamber and the wider business community in Malta,” Niki concludes. cc

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Celebrating HR excellence As local organisations face the new reality of operating in a post COVID-19 world, with all the implications on their workforce, it is now more than ever of vital importance to ensure that they have their HR practices recognised.

The Foundation for Human Resources Development (FHRD) HR Quality Mark, recognises organisations of all types based in Malta for their excellence in HR practices.

The HR Quality Mark initiative was launched towards the end of 2019. During the first quarter of 2020, almost 30 local entities applied to be among the first to obtain the HR Quality Mark certification.

The Quality Mark is conferred following a rigorous evaluation carried out by external competent evaluators who assess applicant organisations on their HR practices in seven core functions. These are: HR Policies; Recruitment and Selection; Compensation and Benefits; Employment and Industrial Relations; Performance Management; HR Information Systems; People Training and Development.

As the national HR practitioners’ body, having the ultimate aim of promoting the Human Resource community in Malta, FHRD always felt the need to create a quality standard for the Human Resource function.

The idea behind the standard is to recognise organisations for their professionalism and competence in the field of HR and in turn encourage further investment in their human capital.

“FHRD has worked hard and incessantly over the past months to create a framework and process for the Quality Mark, and I am pleased to say that for the first ever intake, a good number of organisations have applied

for recognition. We hope that others will follow suit in the months to come,” FHRD President Matthew Naudi says.

The first organisations that have applied range from various sectors and industries.

Each application has been assigned two evaluators. The independent evaluators have been calling on each applicant company for an onsite assessment, followed by a detailed report. Based on the visits, the evaluators report and a pre-set score sheet, an assessment is fashioned on whether a particular organisation qualifies for the Quality Mark or not. In every case, a post evaluation report is sent to the respective applicants with the outcome of the assessment, highlighting their strengths and areas for improvement.

While the initiative is currently on hold as COVID related measures start to ease out, the plan is to have a ceremony, publicly recognising those entities that qualify for the Quality Mark. Details of the event will be communicated in the coming weeks. cc

engine on the forward structural bow fitting.

Riding on their reputations for high quality builds and great hull design, Nuova Jolly continue to expand their model range and enter new markets. They currently build ribs from 5.3 to 15m, in their family-owned factory on the outskirts of Milan, Italy. Locally

represented by Strand Marine, who also represent Suzuki Marine outboards, offered as a package with Nuova Jolly ribs. cc

For further information about FHRD’s Quality Mark please visit: http://fhrd.org/hr-qualitymark

Nuova Jolly Marine enter the fishing market with two new seven-metre ribs Strand Marine welcome the new NJ 700XL Se@Fish, launched in two versions, one for big game fishing and another for trolling.

Both models – the only seven-metre inflatable boats on the market – are supplied with a live bait tank with recirculation and discharge system, tuna door, fishing rod holders integrated in the gunwale, two insulated bow fish boxes with discharge system, high-pressure freshwater shower in the cockpit, pop-up bollards, three small parts organisers, a floor watertight compartment that can be used to accommodate a regulatory raft, a large bow anchor locker, an electric windlass with anchor and chain, aft pop-up seating, folding bathing ladder, a support for auxiliary engine and the possibility to install an electric 114

Strand Marine & Auto Systems Ltd, Valdor Bldgs, Triq is-Sebh, Qormi. www.strandmarinemalta.com JUNE/JULY 2020

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HSBC Malta launches the Malta Development Bank COVID-19 Guarantee Scheme HSBC Bank Malta p.l.c. is further enhancing its support for the business community during these challenging times by confirming its participation in the Malta Development Bank (MDB) COVID-19 Guarantee Scheme (CGS).

The complete ERP solution for a multi-brand distribution business Direct Store Delivery (DSD) refers to an essential distribution method that includes route and truck load planning, route sales and delivery, merchandising, mobile intelligence, inventory control and route accounting. DSD is essential for companies that distribute Fast Moving Consumer Goods (FMCG) to other businesses.

The key to growth and sustainability for distributors is to provide better customer satisfaction through speedy and effective route management without increasing costs.

They need to optimise resources, improve their invoice-to-cash cycle, and at the same time reduce operating costs per route. The optimal Enterprise Resource Planning (ERP) solution can help companies reduce errors, payment disputes and administrative costs.

Expected benefits include increased revenue, larger orders, faster and more accurate delivery, accelerated cash flow, JUNE/JULY 2020

This development complements a series of initiatives already taken by the bank at the outset of the COVID-19 pandemic, including capital repayment holidays, fee-free temporary short-term working capital and trade finance support.

This government-backed scheme provides banks with credit risk mitigation and capital relief in respect of loans granted to eligible and viable businesses which may be experiencing cash flow and liquidity pressures resulting from the adverse business conditions following the virus outbreak. HSBC Malta’s normal credit guidelines will continue to apply.

Joyce Grech, Head of Commercial Banking at HSBC Malta, says “the launch of the Malta Development Bank COVID-19 Guarantee Scheme will further enable us to support

business customers who are looking for financial support during this uncertain time.

The COVID-19 Guarantee Scheme facilitates the provision of additional financing for businesses facing a sudden acute liquidity shortage. HSBC Malta has already introduced a significant number of other measures to support the business community and I would encourage all our commercial customers who feel they need assistance to contact their Relationship Manager in order to discuss the best options available for their specific requirements.” cc

smarter inventory management, improved customer loyalty, better performing sales and delivery reps, and reduced administrative costs.

Provide your field staff with mobile access to all customer, product, and sales information while on the road. Enable your sales reps to sell more with account-specific pricing for individual customers, based on what you know about customer preferences and order history. Give discounts and crosssell and up-sell promotions for different customers. Allow your field reps to use any Android or iOS device – including offline functionality, so that they can access data and information from any location. cc

Manage the quote-to-cash cycle with a modern ERP system Distributors of any size face many of the same challenges, including rapidly changing customer demands, complex product inventories and fluctuations in the supply chain. To overcome these issues, forwardlooking companies are implementing a single ERP solution that integrates and automates the entire quote-to-cash cycle.

A modern ERP system for distributors provides tools to help manage sales ordering, pricing, shipping, sourcing, and billing – letting you streamline your business processes so all your information is in one secure location. With accurate, real-time information available, situations requiring attention can be identified early and addressed quickly.

More information on the Malta Development Bank COVID-19 Guarantee Scheme is available at www.business.hsbc.com.mt/MDBscheme

For more information on how Computime Software can help you optimise your distribution operation, increase customer satisfaction and unearth new sales opportunities for field staff, visit www.computimesoftware.com/acumaticaerp or email info@computimesoftware.com.

Drive competitive advantage with a flexible field sales platform Integrate your field sales, distribution logistics, inventory management, invoicing and payment collection. Enable your sales reps with access to relevant information quickly and efficiently – eliminate the errors that come with pen-and-paper order entry or legacy software.

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MAPFRE Middlesea introduces new benefits in light of COVID-19 crisis MAPFRE Middlesea has upgraded some of its services in order to better meet clients’ insurance needs during these difficult times. Find

out more about the company’s newly introduced benefits below.

25 per cent discount on Home, Motor and Health Policies MAPFRE Middlesea understands that many people today are facing the challenging situation of being unemployed as a result of the COVID-19 crisis. For this reason, it has decided to support clients who have found themselves unemployed by giving them a 25 per cent discount on Home, Motor and Health policies. This benefit is also available to the sole-traders and self-employed who qualify for COVID-19 related Government assistance schemes.

Online claims made simpler MAPFRE Middlesea has made the lodging of claims by its clients simpler. Whether it is for Home or Health, clients can now file a claim through the online portal www. middlesea.com in a matter of minutes.

Status updates on vehicle parts now available online Clients who have had a car accident and are eagerly waiting for their vehicle parts to arrive can now check the status of their vehicle parts via the MAPFRE Middlesea chatbot, Emma, by visiting the company’s website.

Provision of masks to healthcare front liners and funding of vaccine research Fundación MAPFRE, the non-profit foundation of the MAPFRE Group, has donated 100,000 professional masks to be used by frontline health care workers who are helping us fight the virus in Malta.

Fundación MAPFRE has also donated €35 million worth of medical equipment worldwide and as a contribution towards research in finding a vaccine for COVID-19.

Remote working measures for all employees In order to keep everyone safe, the company introduced remote working measures from the outset of the crisis. All employees were encouraged to work from home in order to minimise the risks not only for the company but also for its clients. cc More information on the above benefits can be found on MAPFRE Middlesea’s website at www.middlesea.com/insurancemt/services/customerbenefits MAPFRE Middlesea p.l.c. (C-5553) is authorised by the Malta Financial Services Authority (MFSA) to carry on both Long Term and General Business under the Insurance Business Act, Cap 403 of the Laws of Malta.

MAPFRE Middlesea p.l.c. is regulated by the MFSA.

SGS: The world’s leading inspection, verification, testing and certification company SGS are recognised as the global benchmark for quality and integrity. With more than 94,000 employees, we operate a network of more than 2,600 offices and laboratories around the world.

Established in 2011, SGS Malta has sought to foster the SGS corporate values and key characteristics that have enabled SGS to become globally recognised. Our team consists of highly motivated and experienced individuals who are all committed towards achieving the same aim.

Our core services can be divided into four categories: inspection, certification, testing and verification, covering a wide range of industries, such as:

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• Petroleum inspection and testing services (bunkering, ship-to-ship transfers, LPG, chemical gases, LNG) • Seed related unloading and loading inspections • Pre-shipment inspections locally and in other countries • Draft surveys • Certification services (e.g. ISO9001, ISO14001, ISO45001 and food related FSSC 2200, BRC).

To complement our petroleum inspection services, our laboratory covers the full spectrum of fuel oil and diesel tests, as well key analysis on other petroleum products.

The Malta branch is ISO 9001:2015 certified and ISO 17025:2017 for an array of accredited

test methods, such as density, sulphur, viscosity and derived cetane number.

We partner with you to offer independent services that will help you reduce risk, streamline your processes and operate in a more sustainable manner.

Customer satisfaction is at the forefront of all our operations, and for this reason we strive to make use of all the knowledge within our team and the group so as to provide the best possible service.

We are committed to delivering quality and making a difference to society. cc SGS Italia S.p.A. - Malta Branch, Andre Escave Industrial Park, Immaculate Conception Street, Birzebbuga.

T: 2165 0600; E: sgs.malta@sgs.com; www.sgs.com JUNE/JULY 2020

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Assisting the business community The business landscape has changed fundamentally in a couple of months, with COVID-19 drastically hitting bottom lines, pushing the conventional out of the window and challenging the way of normality.

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The easing of the precautionary measures was a burst of oxygen, but as businesses restart their operations, one cannot expect them to jumpstart to a pre-COVID state of play.

Bank of Valletta continues to assist local businesses during this tough period by providing them with access to necessary funds and financing through the BOV-MDB COVID Assist.

The BOV-MDB COVID Assist is a financing scheme that benefits from the support of the guarantee schemes launched by the Malta Development Bank and the Ministry of Finance. Local SMEs and large enterprises facing unprecedented disruptions brought about by the COVID-19 outbreak can benefit from this type of low-cost financing to get through this period and meet their working capital requirements and running costs and expenses critical for the smooth-running of the business. Interest rates start from a fixed rate of 2.5 per cent for the first two years and minimal collateral is requested, depending upon the size of the loan and associated risk. The cost for businesses will

be 0.1 per cent for the first two years after Government rebate plus the guarantee fee.

Businesses seeking to avail themselves of the BOV-MDB COVID Assist are to send an email to smefinance@bov.com, or if they are BOV customers to their Relationship Manager, Business Centre or Corporate Centre. Further information can be found at www.bov.com/content/bov-mdb-covid19-assist.

Bank of Valletta will be there throughout the journey, ensuring that enough liquidity is injected into the economy so that local businesses will bounce back and flourish once again. cc All loans are subject to normal bank lending criteria and final approval from the Bank. Interest rates will start from a fixed rate of 2.5 % for the first two years exclusive of guarantee fees. As from year three, a variable interest rate which will be inclusive of the guarantee fees, will not exceed a 3.00% per annum over the three months Euribor rate floored at 0% for loans up to â‚Ź 5 million. Issued by Bank of Valletta p.l.c., 58, Triq San Ĺťakkarija, il-Belt Valletta VLT 1130. Bank of Valletta p.l.c. is a public limited company regulated by the MFSA, licensed to carry out the business of banking in terms of the Banking Act (Cap. 371 of the Laws of Malta).

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The call of the sea The sea, the sky, the moon and many other wonders of nature have captivated artist Alexia Coppini’s imagination from a young age, and today, her seascapes are sought-after pieces of fine art. Martina Said chats to the artist to learn about her love for all things art.

“I

’ve been drawing ever since I could hold a pencil, so my dear mother says,” explains artist Alexia Coppini, whose name is synonymous with stunning seascapes so hypnotic and absorbing, that you really do feel, even if temporarily, that you’re right there by the water.

Alexia’s love for art spans across many years, and many different forms, “be it painting, sculpture, interior design, and anything that caught my eye. It is sometimes quite exhausting looking at the world and interpreting every scene as though it were a painting, but that’s me and how my mind works,” she asserts. “This has helped me with 118

my observation skills and choice of subject when painting a picture.”

Despite harbouring a love for art from a tender age, Alexia’s professional journey as an artist began 13 years ago. “I used to work in interior design and was commissioned to paint three seascapes by my client. I was reluctant at first as up until this time, I only used to paint for pleasure and friends. I went ahead with the commission and never looked back.”

A big change in the artist’s life led her to take her talent and passion to the next level, including furthering her education through courses in Malta and overseas. “I studied

art at school with Margaret Chircop – she was a great inspiration and taught me how to see the unseen,” Alexia explains. “Anton Calleja, the well-known and brilliant artist, helped me further my great love for art and instil a sense of discipline in proportion and technique. I studied figure drawing under his guidance for many years, and attended art courses in France and London.”

Her practice in figure drawing gave Alexia a strong base for anything she would come to draw. “A good drawing is key,” she says. “Once a solid foundation is there, interpretation must come from within. Styles change and evolve. Listening to one’s soul JUNE/JULY 2020

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“Anton Calleja, the well-known and brilliant artist, helped me further my great love for art and instil a sense of discipline in proportion and technique.”

and enjoying one’s creations lead to a great piece.”

While her sources of inspiration are practically infinite, encouraging Alexia to paint whatever she feels, there’s no denying that the sea and natural environment have a special meaning to her, and stir sentiments that translate into marvellous mirages before viewers’ eyes.

Her seascapes feature calm, moon-lit waters, dark caves, dramatic waves and cloudy skies, brought to life in all shades of blue, grey, green and white. Some pieces focus on a detail, such as a wave, others a complete and breath-taking scene, like JUNE/JULY 2020

swelling seas crashing against a lighthouse – and all so full of movement and rhythm, they force you to sit still for a while, and observe.

“I was brought up in Sliema and ever since I can remember, the sea formed a very important part of our lives. We spent our childhood enjoying the sea in all its forms. Summers were for long days at the beach and winters for long walks along the seafront,” the artist explains. “Later in life, I spent time living in The Caribbean, and this only enhanced my love for all things marine. Scenes are very different there, much brighter and calmer, so this made for a different collection and varied inspirations.

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“I was brought up in Sliema and ever since I can remember, the sea played a very important part of our lives.” olive trees,” she asserts. “I’m fascinated by their beauty, their age, their story. During the Easter period, I worked on a number of biblical drawings, oil paintings and watercolour portraits of Jesus. I found this very comforting in the time we are living at present.”

Asked to share her artistic process, Alexia says mental preparation before starting a piece is key. “When approaching my studio, I try and clear my mind of all earthly matters.

Music, classical music, is my only companion when painting, and the process of completing a painting all depends on the medium and technique chosen for that piece.”

Does she have a preferred medium?

“My two preferred mediums are oil and watercolour. For years, I painted portraits in watercolour, then seascapes introduced me to oil. I’ve been using the latter for the past decade and every time I paint a picture, new colours and different ways of using the medium come to me.”

While her art studies, commissions and exhibitions have introduced Alexia to many influential artists and people from all walks

Every time I paint a seascape, I feel a great sense of energy, whether it be a calm or rough sea.”

Her connection to the sea exists on a deeply personal level too. “The sea has always been there for me, in times of happiness and troubles. I feel a strong connection when observing storms or calm seas, when researching antique paintings of the sea, of the artists that were famous for painting this great force of nature, when sketching, when painting – I feel one with the sea,” says Alexia. “I’m sure that having been brought up on an island surrounded by water has a lot to do with my passion and I feel blessed to be able to put my thoughts, feelings and deepest emotions on canvas.”

Not one to be confined to a niche, Alexia says that everything inspires her, and if she could, she would paint all day, every day.

Recently, she began a series of watercolour animal portraits, including cats, dogs and monkeys, painted with the utmost fluidity in vivid and vibrant colours. “I take many photographs and interpret them as I go along. Winters bring rough seas and trees – trees are my latest muse, particularly JUNE/JULY 2020

“When approaching my studio, I try and clear my mind of all earthly matters. Music, classical music, is my only companion when painting.”

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of life, there is one person she singles out as the greatest influence on her life and work. “My father is also a painter. He is a great collector of all things beautiful; antiques are his passion and his paintings are often inspired by antique works. He has been a great inspiration throughout my life, not only in art, but in everything I do, everywhere I go, his words are always with me.”

Looking back on some of the highlights of her journey so far, it is clear that family has played, and continues to play, an important part in it all. “My son is also very passionate about art and this pleases me immensely. My husband, my strength and constant voice of reason, I met through painting. He is a master mariner and always full of exciting stories to inspire me.”

“[My father] has been a great inspiration throughout my life, not only in art, but in everything I do, everywhere I go, his words are always with me.”

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Alexia also recalls fond memories of some of her most memorable exhibitions, the most recent being in September 2019, when she was invited to participate in an exhibition celebrating the 250th year since the birth of Anton Schranz, who she is related to.

“He too was a marine artist so I like to think I owe a lot to him. This exhibition was held in Germany, and five of my large seascapes were chosen to form part of this great show.”

“My first exhibition is another very vivid and happy memory,” the artist says. “I exhibited 50 paintings for the first time and had a complete sell out on the opening night.

This was a very clear indication that painting was what I was born to do and will hopefully continue to do until my dying day.”

Such is Alexia’s love for what she does, that she can only associate her work with positive outcomes and meaningful rewards. “The challenges... I struggle to think of any! I’m grateful for the fact that I am able to paint practically every single day,” she enthuses. “I consider this a great

luxury, being able to do what I love as my profession has been an absolute dream come true. Each and every painting brings great excitement, deep concentration, solitude and satisfaction.”

Asked to share any upcoming projects or exhibitions, Alexia says she is currently working on a new collection which she plans to show in October. In the meantime, given the current restricted circumstances, she is keeping in touch with her students through a WhatsApp channel, for them to follow from home.

“We have over 80 little artists enjoying daily demos. This has kept the rapport I hold with my art students alive and has given us great moments of joy,” says Alexia. “In times of lockdown, quarantine, call it what you will, painting has been a very big part of who I am, and sharing this with others, be it in art classes, paintings, or live demos, is something I am immensely grateful for.” cc

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