25 years of strong alliances

This year, the Malta Business Bureau celebrates a quarter of a century of service to the business community, providing support and guidance on European Union policy and legislation, as well as representing The Malta Chamber, and the Malta Hotels and Restaurants Association on a European level. Here, Rebecca Anastasi speaks to Malta Chamber and MHRA Presidents, Marisa Xuereb and Tony Zahra, about the strength of their solid collaborations with the MBB.

Established in 1996, the Malta Business Bureau (MBB) has been central to the prosperity of local businesses, providing a link between Malta’s corporate communities and the European Union, while also representing The Malta Chamber, and the Malta Hotels and Restaurants Association (MHRA) on an EU level. Indeed, over the past 25 years, the MBB, through its head offices in Valletta and Brussels, has connected its members – Maltese companies and entrepreneurs – to opportunities, training and new horizons afforded by the bloc, becoming a crucial node towards internationalisation, particularly in the wake of Malta’s EU accession in 2004.

“Over the years, the MBB has developed a team of capable policy experts who have built networking relationships with policymakers in Brussels, and who are, therefore, able to act as lobbyists for the local business community,” Malta Chamber President Marisa Xuereb affirms, praising the MBB’s capable team and noting their vital function post2004.

“Ever since Malta’s accession to the European Union, local policy development has been very much EU-driven. The role of the MBB in anticipating policy developments, communicating them to the Malta Chamber and advising on possible outcomes, as well as assisting in the consultation process on the implications of such developments for local businesses, is of crucial importance,” she continues. “The main goal of the Malta Chamber is to help local businesses improve their competitiveness and grow, not just locally but also beyond our shores, and the MBB is a key partner in achieving this.”

This collaboration between the two entities has been thrown in sharp relief over the past 18 months, with the MBB providing support in helping local businesses operate in a new COVID-inflected environment. “The MBB was one of the first organisations to embark on a study on the implications of remote working for businesses and for the environment, and this study provided some very pertinent insights into how the future of work could be in those sectors that lend themselves to remote working,” Ms Xuereb says.

Moreover, “the MBB has also been following closely policy developments related to gender equality, adequate minimum wages in the EU, the Energy Tax Directive and

“The main goal of the Malta Chamber is to help local businesses improve their competitiveness and grow, not just locally but also beyond our shores, and the MBB is a key partner in achieving this.”

MARISA XUEREB, MALTA CHAMBER PRESIDENT

the Digital Services Act – policy areas that have become more pertinent over the last couple of years,” the President says, affirming the bloc’s policy priorities of digitalisation and environmental sustainability, and insisting that the EU’s Recovery and Resilience Facility (RRF) – which could see Malta receiving up to €316 million in recovery funds – be directed towards achieving Malta’s goals in these areas.

“Digitalisation and environmental sustainability are dominating the EU’s policy agenda, and meeting the ambitious goals that are being set as part of the EU Green Deal will require businesses to implement significant changes in the way they operate. The RRF funds need to be directed at public investments that provide the necessary infrastructure for Malta to be able to meet its ambitious targets and at schemes to incentivise and support the private investment required to make the transition.”

Underpinning these efforts is sustainability in the areas of energy, transport, waste management and building quality in Malta, which, ultimately affects energy consumption. “Businesses should be helped to finance additional investment in such technology” directed towards these areas, she says. “With regards to mobility, we are lagging behind many European countries in terms of electrification of vehicles when the relatively short distances we cover make us ideal candidates for electrification, at least on paper. The issue here is lack of investment in the charging infrastructure and in the required competence to handle electric vehicles.”

Moreover, “on waste management, the approach has been one of firefighting. A clear strategy needs to be adopted and the private sector needs to be roped in, not just in the generation, separation and disposal of waste, but also in its recycling and commercialisation. Major investment is required in the waste handling infrastructure and this needs to be financed sustainably as well. When it comes to the quality of buildings, we need to make a major leap and, unless we show national commitment to it, with clear incentives for developers who want to put on the market net-zero buildings and for people who want to renovate their existing buildings, we won’t make it by 2050. And let us be clear: within the current EU mindset, those who won’t make it will have to pay for their shortfalls. So, we cannot afford to be complacent,” she says.

However, beyond the RRF, particular sectors also need direct attention in order to bounce back post-COVID, the President insists. “We also need to find ways of regenerating our tourism industry by repositioning it for higher valueadded through a combination of product innovation and service quality upgrades that would improve the overall customer experience. We need to support our manufacturing industry to maintain a competitive advantage within the EU, particularly as rising transcontinental freight costs are seeing the return of some manufacturing business to Europe – those European locations with the more competitive cost base will get to secure this.”

Internationalising will also remain key to local enterprises. “We need to identify overseas markets for homegrown businesses to tap into, while attracting new innovative businesses that can help us rebalance our economy and provide us with niches that we can harness and establish ourselves as a hub. The latter requires some local public investment in the infrastructure to house start-ups and experimental development and some innovative financing models,” she says.

Looking ahead, and on the topic of the EU’s minimum wages proposal, the Malta Chamber sees this as an infringement on Malta’s national prerogative to set wage standards, and a threat to local company growth. “In Malta, the minimum wage is not a wage level that people generally get stuck in but more of a peg on which salary scales are calibrated. What this means is that the moment you touch the minimum wage, everyone’s wage shoots up to maintain relativities. When that happens, you get cost-push inflation whereby local businesses become less competitive internationally while the purchasing power of local workers remains virtually unchanged.” Over the next few months, Ms Xuereb sees the Malta Chamber and the MBB continue to work together for the good of the business community. “The immediate priorities are making sure that every business that has a feasible business model survives the pandemic and that every opportunity created by the current disruption is exploited to its full potential by local businesses. The key to survival is liquidity and the key to exploiting opportunities is agility – or being able to react quickly,” she says, stressing the need to work pre-emptively.

“The MBB continued its usual sterling service in keeping us and our members up to date at what is being discussed at European level.”

TONY ZAHRA, MHRA PRESIDENT

“While the rapid vaccine rollout has provided us all with a lot of hope, the uneven handling of the pandemic globally leads us to believe that the world will be in the midst of a pandemic for some time longer, and all the disruption that we’ve seen in everything from logistics and work organisation, to education and healthcare, to retail, entertainment and travel, is likely to persist to a greater or lesser extent, until every part of the world that matters in terms of trade, labour supply or tourism, has brought the situation completely under control. This will require the Chamber to remain very close to its members and to be vigilant on all developments to ensure that businesses are adequately supported and always mindful of the risks and opportunities of the moment,” she concludes.

MHRA President Tony Zahra echoes these sentiments. “Amid a fall in COVID-19 cases, now is not the time to let our guard down and act as if everything is back to normal. The pandemic is still among us and the risk remains if we do not stick to the appropriate safety measures,” he asserts, pointing to the support provided by the MBB in such a challenging time for Malta’s tourism sector.

“The MBB continued its usual sterling service in keeping us and our members up to date on what is being discussed at European level,” he says. Indeed, the collaboration between the entities, which stretches since the organisation’s inception, “was doubly important during the COVID-19 pandemic, and the MBB upholding our representation at HOTREC [the umbrella Association of Hotels, Restaurants, Pubs and Cafes in Europe] proved crucial in ensuring we were aware of industry developments in other member states. In addition, this year has also been tricky with a plethora of new EU legislation that will likely affect the tourism industry, and the MBB has been at the forefront pushing for the interests of Maltese businesses during discussions on these issues,” Mr Zahra says.

Indeed, the MBB has, the MHRA President continues, “been working on the frontlines to ensure that businesses are kept informed about the digital and green transition, which have been sped up during the pandemic.” Along the same lines, Mr Zahra also makes reference to the MBB’s study on remote working which, he says, “provided a window into post pandemic employer-employee relations”; furthermore, he continues, the MBB has embarked on a plethora of other initiatives aiming to support the local business community operating in a COVIDenvironment.

“The MBB has also spearheaded initiatives which looked into food waste management in the hospitality sector. In addition, the organisation timely study on EU funds, coinciding with the introduction of the new Multiannual Financial Framework, is pushing for administrative burden reduction for businesses applying for EU funds – a crucial source of financing for so many in the tourism industry aiming to increase the sustainability of their operations,” he outlines.

Turning to the future of the tourism industry – and initiatives being touted by Brussels, also being introduced locally – Mr Zahra points to the EU Digital COVID Certificate as “a good step forward”, in that it will provide peace of mind and a “a harmonised level of recognition as to whether visitors are vaccinated, received a negative test result, or recently contracted COVID-19.”

However, he cautions that this certificate “does not preclude Member States from introducing further restrictions, based upon scientific evidence and the epidemiological situation. It is important that this is introduced swiftly, and in an equitable manner whereby all bearers are treated the same way, with no discrimination. Any added restrictions should be proportionate and not go beyond what is necessary to ensure public safety.”

Over the next months, while this balance between safety and economy will continue to be of concern to policymakers, governments and stakeholders in the tourism industry, the longterm sustainability of Europe’s tourism product must also take centre stage through, for instance, safeguarding heritage sites, Mr Zahra insists.

“Natural and cultural resources need to be better preserved, and negative environmental impacts

“We need to identify overseas markets for homegrown businesses to tap into.”

MARISA XUEREB, MALTA CHAMBER PRESIDENT

at tourist destinations, such as waste, pollution and over-use of natural resources, need to be limited. Long-term planning, involving all stakeholders is needed to ensure that businesses and the national government are able to make tourism more sustainable. There is no doubt that the green transition is coming sooner rather than later, and businesses need to understand this and start preparing from now,” he insists.

Thus, over the next few years, the key issues to look out for, in relation to Malta’s business relationship with the EU, “will be initiatives surrounding sustainability reporting and corporate governance, where the EU is pushing for more social responsibility to be borne by companies.” Moreover, on a related note, the President underscores to extend the notion of sustainable practices in business models, particularly with the rise of online service platforms, for “the relationship between companies and online platforms is also under the spotlight, with the Commission targeting unfair practices by platforms towards companies and consumers.”

Despite these challenges, the MHRA – aided by the MBB – is also committed to liaising with all stakeholders to keep the island’s tourism industry flourishing. “These are challenging times and the MHRA pledges to keep working together with the authorities to ensure that the tourism, hospitality, and travel sector remains an important element in the Maltese economy. These are times of seeking synergies and not divisions in the best interest of citizens, employees, and employers,” he concludes.

“These are times of seeking synergies and not divisions in the best interest of citizens, employees, and employers.”

TONY ZAHRA, MHRA PRESIDENT