Malta Economic Update by JP Advertising

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APRIL 2013

Newspaper Post

exeCutive interview of the Month

A Vision for More pg28

Cover Story

Extraordinary Properties for Extraordinary Lives pg6 An exclusive interview with Malta Sothebyâ&#x20AC;&#x2122;s International Realty

An extraordinary interview with Bluhull Marineâ&#x20AC;&#x2122;s Jonathan Borg

Bov top entrepreneur year awardS 2013

of the

Presenting Sara Grech in an exceptional pull-out pg33 We interview ten new nominees

06 | Covery Story

contents 17 | Tourism

Extraordinary Properties for Extraordinary Lives

In our Cover Story Interview we get the exclusive story from Ian Zammit , General Manager for Malta Sothebyâ&#x20AC;&#x2122;s International Realty

Synergising Relationships

In this interview first with Tourism Minister Dr Karmenu Vella, we discuss wide-ranging issues affecting the tourism industry

Winds of Change

28| Executive Interview

Ing. Ryan Xuereb, Managing Director of Econetique Ltd, talks about the benefits of conventional vertical axis wind turbines

A Vision for More

Jonathan Borg shares his outlook about the role Blu Hull Marine intends to play in developing Maltaâ&#x20AC;&#x2122;s potential in the oil and gas industry

Main Feature: BOV Top Entrepreneur of the Year Awards 2013

Presenting Sara Grech and ten exceptional entrepreneurial nominees

33 | Main Feature Securing our Environment

We come face-to-face with Ing. Oliver Fenech, Projects & Development Manager with PTMATIC, talks with us about environmentally sound management of hazardous wastes,

A Brand New Way of Thinking

Geoffrey Farrugia describes how in just two years, HandsOn has established itself as a technology leader

46 | ENVIRONMENT

60 | Aviation Interview

Making An Impact

DF Group Director Anthony Galea discusses the company’s recent expansion in the luxury aviation sector

Why Maltese Companies Need a Passport for Growth

An excellent article by Michel Cordina, Head of Commercial Banking, HSBC Bank Malta

Publisher Editor Journalist Sales & Publication Manager Graphic Designer Cover photography Printing “I

Generating sales leads that are actually followed up by sales is a basic business process that is broken in most companies. The reason is that marketing and sales are part of a Granfalloon. Kurt Vonnegut defined a Granfalloon as “a group of people who outwardly choose or claim to have a shared identity or purpose, but whose mutual association is actually meaningless”.

John Formosa Martin Vella Rebecca Hansen Margaret Brincat Jessica Camilleri Steve Muliett Union Print

I had the opportunity to speak with Dmax Director Ray de Bono, who agreed that companies do not truly align, and enjoy the benefits of that alignment. Mr. de Bono has over 15 years experience in the Branding and Online Solutions business in Malta having been one of the pioneers in this regard. Dmax estimates better results unless the most senior management in companies get on board. And that is whether the company is big or small.

NEVER WORRY ABOUT ACTION, BUT ONLY INACTION” WINSTON CHURCHILL

Network Publications Ltd., Angelica Court, Giuseppi Cali Str., Ta’ Xbiex, XBX1425, Malta Tel: +356 2131 6326/7/8 Fax: +356 2132 3432 Contributers: Jean Paul Abela, George Carol, Rita Chircop, Michael Cordina, Duncan Dimech, Rebecca Hansen, Patrick Hall, John Schembri, Matthew Taylor, Ana-Marija Zafirovska. Special Thanks: AirMalta; BPC; Corporate Identities; Inspire; MTA; Office Group; Ogilvy PR. Please feel free to email us with your viewpoint, whether you agree or disagree with the standpoint of the personalities we interview or the topics we focus on. Your opinion, contribution, concern and feedback on our articles and interviews are welcome. Please include full name, contact details

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

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n o t e.

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

The way I put it is that nobody ever builds a statue to a committee, so waiting for marketing and sales to “work it out”, or trying to poach customers, or entice advertisers by offering them meaningless value added benefits is doing the same wrong thing and expecting different results—and it simply is not going to work! Publicity stunts or attention-grabbing methods will yield neither revenue, nor friends. If marketing segments, measures, and qualifies, then marketing needs to be innovative and not imitate competition, so sales will learn to value what marketing sends their way. That translates into more deals and more revenue, and that’s good for sales, marketing, and the company. In the coming months we will be featuring interviews and art that is the offshoot of charitable and activist organisations around the world. Some will surprise you but all will inform and encourage artistic involvement. This months issue focuses on special interviews starting with our exclusive cover story with Malta Sotheby’s International Reality, followed by another first with Tourism Minister Dr Karmenu Vella, an excellent one-to-one with Jonathan Borg of Blu Hull Marine, and with Sara Grech, a truly outstanding woman who has endured and achieved success in a business that is fickle and she has done it by following her own path, embracing each phase of her life and career with enthusiasm. This month is packed with high profile interviews so I wish you enjoy the longer days of sun, the optimism of the month and take delight in art wherever you discover it on our pages and in this amazing world in which we live and share our version of events as they unfold. Martin Vella

APRIL 2013 | THE ECONOMIC UPDATE COVER STORY INTERVIEW

Extraordinary Properties for Extraordinary Lives TEU: What value added benefits does Malta offer to Sotheby’s International Realty global clientele? IZ: The demand for luxury residential properties is increasing all over the world and Malta is certainly no exception. With its ideal warm climate, stable political environment, local qualified workforce, attractive tax incentives, and excellent flight connections, the demand for special high-end and well-located properties in Malta is being strongly felt which is what Sotheby’s International Realty is all about. In addition, the unique friendliness shown by the Maltese, has increasingly attracted visitors wishing to settle in. Our office is wellpostioned and networked with local property owners to offer those special properties that buyers are after. Malta Sotheby’s International Realty Luxury Property

In our Corporate interview of the Month, we get the exclusive story from Ian Zammit General Manager, Malta Sotheby’s International Realty, who tells us that the official launch of Sotheby’s International Reality to Malta heralds a brand that treasures the uniquely beautiful and the simple joy of presenting to clients not just a house, but a perfect home. Offering many nuggets of valuable information can only come from an agent who has been through all major real estate cycles, Ian says. Whether your property is a flat or a mansion, Malta Sotheby’s International Realty will market your home with the utmost warmth, passion and attention to detail.

06 |

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TEU: How will Sotheby’s International Realty coming to Malta serve the high-end real estate market and how will the Malta office provide access to the Sotheby’s International Realty network’s exclusive real estate services in key countries around the world? IZ: Sotheby’s International Realty was founded in 1976 to provide independent brokerages with a powerful marketing and referral programme for luxury listings, the Sotheby’s International Realty network was designed to connect the finest independent real estate companies to the most prestigious clientele in the world. Sotheby’s International Realty Affiliates LLC is a subsidiary of Realogy Holdings Corp. (NYSE: RLGY), a global leader in real estate franchising and provider of real estate brokerage, relocation and settlement services. In February 2004, Realogy entered into a long-term strategic alliance with Sotheby’s, the operator of the auction house. The agreement provided for the licensing of the Sotheby’s International Realty name. Affiliations in the system are granted only to companies and individuals that meet strict qualifications. CSB Group met these criteria and have been granted the exclusive franchise for Malta.

TEU: What has propelled the Sotheby’s International Realty brand to invest in Malta? IZ: Malta and the CSB group enjoy a profile that fits incredibly well with the Sotheby’s International Realty brand. The office in Malta will be joining the Sotheby’s International Realty network which currently has more than 12,600 sales associates located in approximately 650 offices in 47countries and territories worldwide. This year alone it envisaged that the brand will be awarding further franchises in approximately another 10 countries. Malta and Gozo possess a number of properties, including luxury high-end apartments, houses of character, palazzos and villas that are in line with the type of properties marketed by the brand worldwide and so settingup in Malta with the right partners was just a question of time. TEU: Everyone who thinks of Sotheby’s thinks very high-end. How much of a niche is your market? IZ: The link of Sotheby’s International Realty to the Sotheby’s auction house is perceived to be high-end, and this is in fact so, but high-end has a number of meanings: high-end properties need to be beautiful homes that are in the right

APRIL 2013 | THE ECONOMIC UPDATE COVER STORY INTERVIEW

Ian Zammit, General Manager together with Michael J. Zammit, Joint-Owner

location, well-priced, and well- finished. The Malta Sotheby’s International Realty team will be careful in the way properties are selected and marketed. The relationship with the owners of these properties is also very important and needs to be dealt with in a professional and discreet manner. The Sotheby’s International Realty marketing programme is designed to reach a global audience of pre-qualified consumers seeking that special property. The Sotheby’s International Realty brand provides a truly global network allowing us to offer our clients the advantage of a relationship with a national and worldwide community of professionals providing extraordinary exposure to all our properties.

continue to promote Malta and place it firmly on an international platform. This will be done through our various marketing platforms including our website which is directly linked to all 640 offices of Sotheby’s International Realty. Our Malta office is also linked to the Sotheby’s International Realty marketing plan which has been designed to deliver 700 million overall impressions, generating valuable exposure among our core audience of consumers: the connoisseurs of life. This targeted approach in our marketing plan, will help us create global connections with likes of the New York Times, The Wall Street Journal, BBC, The Daily Telegraph and Architectural Digest and showcase Malta’s extraordinary homes all over the world allowing them within reach of clients far from our shores.

TEU: Will this investment attract many qualified international buyers into Malta, and do you consider the Island’s wealth in heritage, history, art, cultural and Mediterranean lifestyle as USP (Unique Selling Perspective)?

Sotheby’s International Realty marketing program is designed to reach a global audience of qualified luxury consumers

IZ: Malta - although possessing all of the attributes you mentioned above is still relatively unknown to millions of people all over the world. Our association with the Sotheby’s International Realty brand and our direct link to the Sotheby’s Auction house will

TEU: What are the synergies being created between CSB and Sotheby’s here and how will the Sotheby’s International Realty network of 12,000 sales associates worldwide be integrated?

IZ: The CSB group was established in Malta in 1987, having celebrated its 25th Anniversary last year. CSB offers a spectrum of specialized business and commercial services to its clients wishing to set-up or relocate their businesses to Malta. It is involved in Corporate & Trust Services, Financial Services, iGaming Support and Consultancy including other on line Businesses, Yacht, Ship and Aviation Registration, Legal & Tax Services, Accounting Services, Business and Credit Risk Services, and Recruitment & HR Services. Four years ago, CSB invested in a Business Centre the first of its kind in Malta offering Instant Office Space. Entering the Real Estate market is a natural progression as part of our development and commitment in offering a one-stop-shop to International Clients seeking to invest in our island. Now being associated with the Sotheby’s International Realty brand, clients wanting to purchase any property in Malta or indeed outside of Malta will find that the Group is very well positioned to offer a comprehensive solution especially with regards to luxury homes. Today our international network relies on 12,600 associates who daily share thousands of top level referrals allowing us to offer you the client the most extraordinary properties in the World. www.maltaeconomicupdate.com

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APRIL 2013 | THE ECONOMIC UPDATE COVER STORY INTERVIEW

• • • • •

From left: Tony Zammit, Michael J.Zammit, Andrew J. Zammit (Joint Owners), Ian Zammit, General Manager, Roger Strickland Jr (Joint Owner)

TEU: Considering the severe and deep economic crisis within the EU, what is Malta Sotheby’s International Realty’s positioning during this time and Sotheby’s worldwide? IZ: Malta Sotheby’s International Realty’s positioning is to have a clear understanding of what we stand for in the eyes of our customers clearly defining and encapsulating who we are and this makes us and our association with the Sotheby’s International Realty brand stand out. We are building our local team with seasoned, respected, and experienced associates who will offer a service that comes from being associated with such a premium brand. Notwithstanding what is happening in the EU, fantastic properties that are correctly priced WILL SELL. We believe in using our expertise to help our clients wishing to sell their properties place them on the market at a realistic price that will be a win-win situation for the seller and the buyer. Entering the Real Estate market is a natural progression as part of our development and commitment in offering a one stop shop to International Clients seeking to invest in our island

Having said that in 2012, Sotheby’s International Realty was responsible for well over 59,000 transactions representing sales in excess of $55billion. The importance in this business is service and understanding what your clients require, can afford, and showing them properties in line with their expectations. TEU: How will the firm’s brokers and clients benefit from an association with the Sotheby’s

auction house and worldwide Sotheby’s International Realty marketing programmes, and how will Malta contribute to Sotheby’s International Realty listings and be marketed on the sothebysrealty.com global website? IZ: When you associate yourself with a brand that carries a history so rich it can be traced back to 1744, you can expect great things! Unique properties occupy a different place in the world. They attract interest from far beyond our local market. The Sotheby’s International Realty brand provides a truly global network, allowing us to offer our clients the advantage of a relationship with a national and worldwide community of professionals providing extraordinary properties for extraordinary people. We have access to buyers from referrals whether by way of: • An unparalleled international and local database

Sotheby’s International Realty global referral network Leads from Sotheby’s Auction House International and local websites – 60 interconnected websites forming a cascading platform Offices represented in every corner of the world. 16 diverse languages on sir.com & sir mobile to effectively communicate with the world.

The quality and distribution of our marketing materials combined with our international positioning and strategic partnerships enable us to streamline and enhance the sales process. By leveraging off our global websites, glossy print magazines - namely Sotheby’s Art Auction, Sotheby’s International Realty Reside magazine, newspaper inserts, national media coverage, advanced social media platforms and mobile technology, our clients will benefit from our marketing, allowing us to do what we do best – sell masterpieces in every area! TEU

FACTS 12 FOCUSED MINUTES – The amount of time a visitor spends on our website. Sotheby’s International Realty has been the recipient of many international awards namely: CNBC Five Start Gold Awards for “Best Real Estate Agency”, “Best Website” and “Best Real Estate Marketing” Malta Sotheby’s International Realty may be contacted on +356 2010 8070 or +356 9910 8070, by email at info@maltasothebysrealty.com and via their Facebook page – ‘Malta Sotheby’s International Realty’ or website www.maltasothebysrealty.com

Corporate Brief Ian Zammit is an Insurance professional with 30 years of experience in both Life and General Insurance and also Property Development. Former CEO of British American Insurance in Malta, Ian has until recently held the positions of the President of Insurance Division and President of Property Division of GlobalCapital plc. His experience extends across a number of markets in Europe, Middle East and Africa with unique insight and network in both financial and property industries, and an enviable track record for sustained growth of the operations under his management.

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APRIL 2013 | THE ECONOMIC UPDATE INSURANCE

Middlesea Insurance launches NEW

Family Health Insurance Scheme by Rita Chircop

Middlesea Insurance has launched the Family Health Insurance Scheme, a new insurance product which covers all the health insurance needs of all family members, upon payment of a single premium only.

This new health insurance scheme gives protection cover to all family members in case of any injury or other medical contingencies such as hospitalisation, medical expenses, and surgical expenses. This scheme offers generous out-patient benefits including refund for general practitionersâ&#x20AC;&#x2122; fees, consultations with specialists, a dental benefit, maternity benefit, as well as a benefit for funeral expenses. The family health insurance scheme offers a number of exclusive features. Clients only need to pay a single premium per family, including family discounts, whilst the premium can be paid monthly, quarterly, half yearly or annually. A unique and important benefit that this scheme offers is the unemployment benefit. Should one become unemployed as a result of redundancy, and therefore not be able to pay the family insurance premium, Middlesea will pay the renewal premium on behalf of the customer. Should the policy holder decide to transfer his/ her cover either from or to an individual basis, one can still enjoy continuous cover as long as he/she remains on the same level of cover.

For more peace of mind, a personalised card is issued to all insured members of the family. New born children can be included in the Family scheme free of charge, until the next date of renewal. This scheme includes the exclusive Second Medical Opinion service program. This means that if any member of the family is diagnosed with a serious illness and would like to get further confirmation, this benefit gives one access to a network of acknowledged international medical experts at no extra cost. If the insured or an insured member of the family requires emergency Treatment whilst outside of the Maltese Islands, then the Family scheme will cover the cost for the Treatment

Although the purpose of the Family scheme is to provide cover for Treatment received in the Maltese islands, if the insured or an insured member of the family requires emergency Treatment whilst outside of the Maltese Islands, then the Family scheme will cover the cost for the Treatment received up to the same level as what would have been paid had the same Treatment been received in Malta.

Another benefit is that apart from offering a full refund benefit for all eligible medical costs associated with hospitalisation for every person insured, one can save substantially by sharing some of the out-patient benefits between the members of the family. At the same time a whole out-patient benefit can be utilised by one single person in case of serious illness. â&#x20AC;&#x153;This new product is intended to introduce Health insurance to families. The Family Health Insurance scheme is flexible, understandable and cost effective and primarily designed with the typical Maltese Family requirements in mindâ&#x20AC;&#x2122; said Mr Simon Anastasi, Chief Officer Health Insurance at Middlesea. Joining the Middlesea Family Health scheme is simple as no medical tests are required as long as the person applying for cover is under 60 years old. One only needs to complete a Proposal Form. For more information, call Middlesea Insurance on 21246262, any of our authorised intermediaries or visit our website www.middlesea.com. Middlesea Insurance p.l.c. (C-5553) is authorised by the Malta Financial Services Authority to carry on both Long Term and General Business under the Insurance Business Act, 1998. COM100413745 TEU

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APRIL 2013 | THE ECONOMIC UPDATE SPORTS

Malta fight hard in difficult Rugby World Cup Qualifying Match against ruthless Switzerland Friday, 19 April 2013, Malta – On a warm day, in front of the largest crowd for 3 years, Malta’s National Rugby Union team battled it out with Switzerland in a FIRA-AER Division 2A qualifier at the Hibs Stadium, which was in immaculate condition for this World Cup Qualifier. Switzerland were coming off a number of excellent performances in recent months, buoyed by new French coaching staff and good results, with a point to prove against Malta who are currently ranked 39th in world rugby, Malta’s highest ever position within the sport.

On the Thursday before the match, the Maltese team received a surprise visit by Parliamentary Secretary for Research, Innovation, Youth and Sports Rt. Hon. Stefan Buontempo, who met with the team and wished them well for the upcoming match. These good tidings could not overcome Swiss star Simon Perrod who kicked home nine points against a valiant Malta, despite tricky wind conditions, and exposed a skill that had Malta scrambling to catch up throughout the match. Malta started slowly and it was the Swiss who were much quicker out of the blocks. When talking with the President of Swiss Rugby postmatch, this was a clear part of the Swiss game plan, to surprise Malta early on. Switzerland were awarded a penalty 20 metres out after a few minutes which was converted by in-form scrum-half Perrod, who was in lethal form. Malta were unlucky just before 15 minutes, when a miscued clearance by James O’Brien hit a Swiss player with the ball falling kindly to Cyril Lin who darted through to score the first try of the match. Talisman Perrod uncharacteristically missed the conversion to leave Switzerland 8-0 ahead. With the Southend Core now roused, Malta finally made their pressure felt ten minutes from the break when Robert Holloway punched a hole in the Swiss defence then feeding Holloway on the overlap who went over and scored. The swirling wind and difficult angle meant O’Brien missed the conversion and Switzerland still held an 8-5 advantage. The Swiss hit back almost immediately due to Maltese indiscipline, as they won a penalty from a few metres out and the dependable Perrod banged the ball over from the place-kick to make it 11-5. Perrod was again on the scoresheet at the hour mark when he converted another Swiss penalty to put Switzerland 14-5 ahead. Indiscipline and 14 |

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Malta’s National Rugby Union team faced a well-organised Switzerland on April 6 in a crucial World Cup Qualifying match at Hibs Stadium.

missed chances were beginning to cost Malta dearly, and good work at the ruck by Malta was occasionally penalised by the Portugese referee. Malta kept plugging away and looked for the key to get back into the match. Robert Holloway initiated a move which saw Stivala make a sparkling run forward before a nimble pass that reached O’Brien who stole over to get a second try for Malta to reel the visitors in to a nail-biting 14-10 in the final quarter. There was everything to play for, and the 3000 Maltese supporters cheered their team on, however, any celebrations in the stands were disrupted by a yellow card to Luke Watts, another case of Maltese indiscipline, leaving Malta with a man short for the rest of the game. Switzerland quickly capitalised as they launched an irresistible driving maul which saw Jonathan Wuullschleger score a winning try for a well-deserved victory away from home, and to avenge the defeat suffered in Switzerland at the hands of Damian Neill’s boys in 2005. Malta played with their usual courage and conviction, but were ultimately undone by being unable to execute their game plan this time around. Post-match Team Manager Steve Busuttil reiterated what he had been saying for three weeks prior to the match, “I have a huge amount of respect for the Swiss after this display, they caught us cold, and the French coaching staff have done a good job with these players, we might have beat them in Switzerland, but they returned the favour with interest against us on Saturday.”

Coach Damien Neill has assembled a crack coaching and management squad to guide the National Rugby Team and this includes Assistant Coaches Tony Garrett and Noel Thomas, Video/Game Analyst Marc Carter, as well as two team managers, a structure that will be maintained despite the loss to Switzerland. Malta Rugby is supported by Cisk Lager, Mediterranean Bank, GasanMamo who are helping to develop the next generation of Malta Rugby players, Bortex Fine Tailoring, Intercontinental Malta, Sundreams Travel, LH&A, PWC and Melita. The Institute of Computer Education, ICE Malta, were a supporting sponsor for the Switzerland international. TEU

THE SQUAD Kyle Mason, Adam Kennedy, Alistair Livesey, Clayton Cassar, Darren Deguara, Luke Watts, Sam Borg, Daniel Apsee, Thomas Holloway, Robert Holloway, Vince Stivala, Dominic Busuttil, Toby Quarendon, Matthew Camilleri, James O’Brien, Daniel Holliday, Dragan Cerketa, Christian Schranz, Joseph Cutajar, James Morris, Nicholas Wright, Malcolm Attard. Courtesy: Edwin Ward, Ogilvy PR, (+356) 9920 7677 Skype ID: ogilvymalta www.ogilvy.com www.facebook.com/OgilvyMalta www.twitter.com/ogilvymalta

APRIL 2013 | THE ECONOMIC UPDATE TRAVEL

Laferla Healthplans launches the new Family Health Cover scheme by Keith Laferla An innovative new product, the Family Health Cover scheme, part of the Laferla Healthplans, provides the perfect solution for an all-in-one cover for your entire family. The Family Health Cover scheme gives you and your family protection for medical contingencies such as hospitalisation, medical expenses, surgical expenses etc. This scheme features very generous out-patient benefits, including refunds for general practitionersâ&#x20AC;&#x2122; (family doctor) fees; consultations with specialists; dental benefits; maternity benefit, as well as a benefit for funeral expenses - and many more. This scheme offers you the facility to cover your whole family with the payment of a single premium. We also offer increasing discounted rates according to the number of family members, increasing your familyâ&#x20AC;&#x2122;s savings. If you

would like to benefit from a further discounted rate, you may also opt to include an excess of on the payment of claims. For the first time in the local scene, families can now enjoy a plan with shared benefits. This means that benefits are not limited per insured member, but one higher overall limit is applied and may be utilised by any insured member as needed, thus reducing the probability of a benefit limit being reached.

For more information, visit www.laferla.com.mt or email medical@laferla.com.mt. All products in the Laferla Healthplans are underwritten by Middlesea Insurance plc. Laferla Insurance Agency Limited is licensed to act as an insurance agent for Middlesea Insurance p.l.c. and both companies are authorised to transact insurance business by the Malta Financial Services Authority under the Insurance Business Act, 1998. COM NO 120413 747. TEU

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APRIL 2013 | THE ECONOMIC UPDATE TOURISM

Hon. Minister Karmenu Vella during a courtesy call by H.E Gina Abercrombie-Winstanley Ambassador for the United States of America

While the Maltese economy has been thriving when compared to EU member states such as Italy, Spain, Greece and Cyprus, the tourism sector in the country has been a key driver behind this strong performance. The importance of tourism to the Maltese economy becomes clear in light of the eurozone crisis and financial instability sweeping across Europe. The Economic Update sits down with the newly appoint minister to discuss just what comes next for this tourism powerhouse in this extensive first part interview.

TEU: It is noted that the Budget allocation for Malta Tourism Authority stands at 37 million. How do you see the Malta’s tourism industry at this juncture? KV: Malta’s tourism industry is built on good foundations with all the traditional benchmarks indicating that the industry’s performance is based on good fundamentals. However, we also have to acknowledge that the industry is facing continuous and sustained competition from a wide number of quarters which means that we cannot ever afford t o be complacent. As tourism supply continues to expand at a pace which is stronger than demand, only those destinations which are forward looking and offer consumers a tourism experience which

SynergiSing relationShipS by Martin Vella

stands out are destined for success. The MTA’s budget looks huge and is indeed substantial, but continues to be a mere drop in the ocean when viewed against the backdrop of what our competitors out there are spending. This imposes upon us the responsibility to generate best returns for each and every Euro spent from that budget. TEU: How will you be strengthening investment in the creative and cultural sector through the implementation of the Creativity Strategy? KV: The Cultural and Creative Industries in Malta contribute directly towards an important emerging sector in the local economy, with 4.5% of the GDP and an employment level of over 7000 persons. The sector is characterised by a large number of micro and nano-enterprises. The sector has shown both locally and internationally that it is more resilient to economic crisis scenario than other sectors, however there are a number of structural challenges that we need to address in a concerted, strategic manner. The Creative Economy Strategy provides a holistic framework for the way forward, and this ties up directly with the emphasis government has placed on cultural and creative development in its electoral manifesto. Our emphasis shall be on consolidating our governance framework, addressing lacunas in the educational and formative process leading to professionalisation, enhancing access to finance for start-ups and established creative enterprises,

We are acutely aware of the segment’s complaints that in spite of the overall positive results, ensuring that gross profits are strong enough to generate net profits remains a greater challenge

and making sure we keep transforming the Maltese Islands into an attractive hub for international collaboration and creative endeavour. We have a clear target for the 2018 European Capital of Culture, and must make sure the investments we make will have an impact that benefits the sector in a sustainable and long-lasting manner. TEU: What are the current drawbacks in the industry that you see? KV: While it is indisputable that the three basic measurements of arrivals, overnights and total expenditure are on the right track we need to ensure that we further improve the industry’s performance by giving due attention to factors such as economic viability and sustainability issues. We are acutely aware of the segment’s complaints that in spite of the overall positive results, ensuring that gross profits are strong enough to generate net profits remains a greater challenge with obvious strong impacts on reinvestment programmes and therefore the industry’s longer term competitiveness. We are also aware that in spite of the fact that we are one of the least seasonal Mediterranean destinations the fact remains that there remains a huge gap between our peak season www.maltaeconomicupdate.com

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APRIL 2013 | THE ECONOMIC UPDATE TOURISM

the INVESTMENT AID scheme. The benefit means that a sum equivalent to 15% of the capital expenditure incurred by a hotel may be utilised as a ‘tax credit’ to offset any income tax due. If the amount of the tax credit is higher than the tax due, then the tax credit will be brought forward to cover future years, that is to offset any future income tax due.

Hon. Minister Karmenu Vella addressing journalists during the launching the 12th edition of the International Fireworks Festival 2013

and our low season performance both in terms of volumes and in terms of expenditure. We need to work hand in hand with our industry partners to enhance operator profitability by helping them cut down costs and generating increased revenues by attracting a more even seasonal flow of visitors from more lucrative segments. TEU: What are the steps you are taking to promote tourism and improving direct air connections with important markets that sustain tourism industry? KV: The decision to place Tourism and Aviation within the same Ministry is based on our understanding of the great importance which the two sectors have to each other. There is no tourism without aviation links and no aviation links without tourism. Therefore the development of the two needs to take place jointly. We cannot afford situations where either one of the two sectors attempts to steer a course which is detrimental to the other. Our tourism needs to spread more evenly throughout the twelve months of the year while our airline routes need to remain profitable through the attraction of acceptable load factors and profitable prices which are also marketable. I will ensure that these two different aspects of economic activity synergise as closely as possible to ensure that each one of them sustains the other in the healthiest way possible. The fact that both Air Malta and MTA now report to the same Ministry will ensure that the relationship between the two organisations will feature better synergies whilst avoiding misunderstandings

TEU: How will you further promote the Maltese and Gozitan touristic product through innovative and technological means? KV: Tourists today are increasingly using technology in all stages of the travel process: from background research and planning to booking and actually realising their trip. This necessitates

different technological services aimed at catering for all the different stages. I believe that we have already achieved a lot in terms of the first two stages but can achieve much more in terms of taking full advantage of technological advantages to enhance the visitor experience once at the destination. Malta also needs to progress from the current information heavy aspect to the transaction aspect of technology. While we seem to be very good in providing information we may not have started to realise the full financial benefit of using technology such as mobile web to increase sales and induce further tourism expenditure.

The hotel operators that are planning an investment programme will need to apply with Malta Enterprise in order to receive an INCENTIVE ENTITLEMENT CERTIFICATE. This application is a simple declaration supported by the latest accounts and the latest version of the M&A. Subsequently, there will be an annual return which is submitted to Malta Enterprise right after the submission of the annual income tax return. Usually, this return will be coordinated by the auditors of the Hotel as part of the annual income tax return submission process. TEU

Part II of this interview will appear in our May Issue.

TEU: Can you give us your views on the 40 million euro investment in Air Malta to support restructuring programme. As you know, the relationship between Air Malta and the MTA has been strained in recent years. Has this issue been sorted out and what do you intend to do about it? KV: Air Malta’s predicament was reached after years of wrong decisions in areas such as fleet composition, the continued operation of loss-making routes, a failure to adapt to changes in the structure of the airline market and an inherent inability to prioritise strategic matters which required urgent action. As a result it slid into a vicious spiral of loss-making which eventually threatened its very existence as the backbone of Malta’s accessibility by air. Our immediate priority is to return the airline to profitable ways even ahead of the schedule so as to free it from the onerous limitations imposed upon it by the European Commission which paradoxically limit its capacity to increase business within the European Union to compensate for the State Aid which it received. The fact that both Air Malta and MTA now report to the same Ministry will ensure that the relationship between the two organisations will feature better synergies whilst avoiding misunderstandings. TEU: How will licenced hotels benefit from Investment Aid on 15% of capital expenditure (in form of tax credits)? KV: As from 2013, all the hotels licenced by the MTA may benefit from 15% tax credits under

Editor’s Note Hon. Karmenu Vella was born on the 19th of June 1950. He graduated in Architecture, Civil Engineering and also with a Master of Science in Tourism Studies. He served as member of the Labour Youth Movement and was first successfully elected to Parliament in 1976 and continued to be elected in succession for nine consecutive times. Dr Vella was appointed as Minister for the Industry and as Minister for Tourism from 1996 till 1998. In 2001 he was appointed as executive Chairman of Corinthia Hotels International and a year later he served as executive Chairman of the Mediterranean Construction Co. Ltd. During the past three years he occupied the post of Chairman of Orange Travel Group. He served also as a Foundation member of Vodafone Malta Foundation and a Board Director of Betfaiir Group Ltd. Last March he was appointed again as Minister for Tourism.

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A WINNING TEAM Winners of the 2012 Malta Innovation Awards for our research project in Self Adjusting Vertical Axis Wind Turbines

Specialists in Renewable Energy Photovoltaic Systems, Thermal and Acoustic Insulation, Wind Turbines, LED Lighting, Domestic Heating and Cooling Systems

Triq it-Taflija, Industrial Estate, Xewkija, Gozo, Malta, XWK3000 00356 2156 9006 | 00356 7959 2767 info@econetique.com | www.econetique.com

APRIL 2013 | THE ECONOMIC UPDATE ENVIRONMENT

Winds of Change by Martin Vella

Ing. Ryan Xuereb

As we focus on the environment, Ing Ryan Xuereb describes why Econetique Ltd has become the local leader in small wind energy by supplying and developing the most innovative products such as the conventional vertical axis wind turbines. With years of experience, and a showcase project at FXB factory at Xewkija, Econetique has established itself as the market leader in wind technology on the Maltese islands. Econetique Ltd projects target the International Market.

TEU: How does design create a pull on the back side contributing to higher wind conversion efficiencies with self-adjusting vertical axis wind turbines? RX: Conventional vertical axis wind turbines (VAWTs) are designed to operate at maximum efficiency around the 12m/s (approx. 43kph) wind speed. This is due to the fact that the standard testing conditions dictate that the qualification of a turbine needs to be performed at this regime. This however is detrimental to the performance of the turbine in the field where normal operational wind speeds are far lower. In a nutshell a conventional fixed geometry wind turbine which is rated at, letâ&#x20AC;&#x2122;s say 10KWp, will generate its peak power at 12m/s. This will happen only on a few occasions throughout

the year. At half that wind speed (ie 6m/s or 21kph) it will only generate 2 to 3KWp, or sometimes even less. After assessing a good number of turbines on the market we found that this trend is pretty consistent throughout the industry, making the performance of certain turbines below what is actually quoted. What we set about to do was to get as close as possible to a linear correlation between the wind speed and the generation where it is actually needed. Our design will effectively change its shape automatically to keep the turbine running as efficiently as possible throughout all the wind speed range, especially where it really matters, that is when the wind is not so strong. Incidentally throughout the year there will be more occasions where the wind speed will www.maltaeconomicupdate.com

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APRIL 2013 | THE ECONOMIC UPDATE ENVIRONMENT

be 6m/s rather than 12m/s. Being efficient throughout a wider wind speed regime will give more conversion and hence produce more energy conversion throughout the whole year. What we set about to do was to get as close as possible to a linear correlation between the wind speed and the generation where it is actually needed

TEU: Is it true that these VAWTs do not kill birds, run more quietly, do not need to be installed very high, and blend better with the landscape?

Conventional vertical axis wind turbines (VAWTs)

RX: The effect on wildlife, especially birds, has been hotly debated. In essence VAWTs offer less frontal area. Hence there is less probability that a bird will impact it. There is also the fact that if a bird is flying in the trajectory of a turbine, in a VAWT there is one blade which is advancing in its direction, while the other is retreating (going in the same direction of flight of the bird). Hence, even if HAWT and VAWT were of the same area, the VAWT has half of its area being at a higher risk for impact. Of course this is theoretical, and effectively impact is down to probability rather than certainty. However it is true that in theory VAWTs affect birds less than HAWTs.

it is less detrimental to the performance of a VAWT compared to a conventional HAWT. In a wind farm, this also has the added positive effect of enabling one to stack them closer together, (since each turbine will not affect drastically the next one) hence maximising land usage and minimising visual impact.

As regards to noise there are a number of factors which make the VAWT quieter. A VAWT being more robust in design and having a more rugged construction can be coupled directly to a generator without an intermediate gearbox. Most of the noise associated with the conventional turbines is down to gearbox whine. Hence not having a gearbox makes the VAWT a quieter solution. There is also the fact that aerodynamically you have the advancing blade cutting into the wind flux more gradually. A conventional turbine chops the air giving the characteristic swooshing noise of a helicopter blade. Even though there is still aerodynamic noise associate with VAWT, this is considerably less and is mostly lower then wind howling against buildings and other obstacles, making it practically inaudible.

RX: At this point you may ask why then are most wind farms constructed from HAWT? This is where our innovation comes in. Theoretically a conventional HAWT is more

Another crucial aspect of VAWTs is that they have a more slender silhouette. Also when observed dead-on, the motion of a VAWT is linear rather than rotational. This makes it a lot less conspicuous to the observer. There is also the fact that a VAWT can also be installed at a lower altitude. This is due to its inherent trait that it can also thrive on less laminar wind when compared to a HAWT. This means that even if installed at lower altitude where the air flow gets disturbed, 22 |

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cantilevered) makes it possible to operate at higher wind speeds giving wider envelope of wind energy absorption. The flexing blade design then dispels extra power and keeps the turbine under control even at elevated wind speeds. We are also working on reducing the manufacturing costs. Eliminating the gearbox is a good start. We are also looking at employing an innovative manufacturing process in the blades which will reduce cost and improve blade construction. Hence even if the energy conversion of a VAWT is lower than a HAWT, improving its efficiency and reducing its manufacturing cost will make it a close match.

TEU: With the achievement of having won the 2012 Malta Innovation Awards, can you tell us whether generating costs estimated to be competitive with the best horizontal wind turbine designs, yielding a higher return on investment than horizontal turbines at higher wind speeds?

Solar is good in certain regions of the globe and wind is better in others. We need both markets to truly remove the shackles of fossil fuel dependency

efficient. Hence it has been the obvious choice on an economic basis. However having run wind farms for some time it has been shown that in various occasions, maintenance and running costs might be an issue. In HAWT this has been mainly due to problems with the mechanical components, putting the gearbox as one of the major contributors to downtime. Obviously if the turbine is not turning it is not producing anything even if it is more efficient. What we are trying to do is to improve two aspects: 1)

Reducing the gap between efficiencies of VAWTs and HAWTs by making the VAWT change its shape to be efficient in all wind speeds. Also, having the blades fixed to the hub at both ends (rather than

On top of this, due to lower parts count (not having a gearbox) and also being more robust in construction, will reduce down time of a wind farm installation. Itâ&#x20AC;&#x2122;s the classic tortoise and hare, slowly but surely, less conversion but over a longer period of time.

TEU: Why does Econetique consider that itâ&#x20AC;&#x2122;s time to examine the challenges of wind power by looking at financials and efficiency in a different way with the selfadjusting vertical axis wind turbines? RX: Wind is the wild horse of the renewable energy business. Most industry and business have shied away from attacking wind properly and offer a well-studied and engineered solution which mitigates the drawbacks of conventional wind turbines. It is this niche market that we are trying to capitalise on. Also, most people see wind and solar as competitive industries. We see them as complimentary. Solar is good in certain regions of the globe and wind is better in others. We need both markets to truly remove the shackles of fossil fuel dependency. While the Solar industry is pretty much covered, we saw the opportunity with

APRIL 2013 | THE ECONOMIC UPDATE ENVIRONMENT

presenting ourselves with a new concept in the wind market. Of course this does not happen overnight. After two years of research, design, simulations and testing we have gone through the product energy conversion capabilities and the economic feasibilities to build confidence in our product. We are now set to forge a name in this niche market. TEU: How do you deem to overcome the hurdles of conventional wind turbines and what does urban and peri-urban mean in this context? RX: It is always an advantage to have electricity generation nearest to the point of where it is needed. Hence installation in urban and periurban environment is quite beneficial. This reduces electricity transmission losses and inefficiencies. Being able to install a wind farm close to where it is needed gives you an economic advantage. Of course this can only happen if you have a turbine which does not present itself as a nuisance to the citizens of that community. As already mentioned previously, our concept offers a number of advantages when it comes to installing the turbines in places where conventional wind turbines cannot be installed. With more strict legislations imposing new lower noise and visual pollution in Urban and Peri-Urban areas, our concept will be a strong contender. We have met a company in Austria whose main raison dâ&#x20AC;&#x2122;etre is the setting-up of wind farms. When we discussed our concept with them, they mentioned a problem they had with a plot of land close to a community which initially could be installed with turbines. However, after VAWTs in urban area

a change in legislation, impairing height and imposing lower noise levels, made the project a non-starter. When we studied these restrictions, our turbine could make the project feasible. Effectively we are not seeing our product as a direct competition to conventional HAWT, more so a solution where the conventional HAWT cannot be installed. Of course there will be situations where we will go head to head with conventional HAWT. As always there will be situations where either solution will be the optimal one. With more strict legislations imposing new lower noise and visual pollution in Urban and PeriUrban areas, our concept will be a strong contender

TEU: How close can the turbines be spaced? Where can they be built? How much does land or easements cost? RX: We have been studying this aspect and it is still being investigated. An aspect we are looking into is having adjacent turbines counter rotating making it possible to placing the turbines closer. This has also an added effect of accelerating the flow for a turbine which is placed downstream in the spacing of the two front turbines. Hence one cannot immediately say how close they can be placed since this is also affected by other parameters such as land topography and prevailing wind directions. However when compared to conventional

turbines, our concept can be placed a lot closer together maximising land utilisation. Essentially turbines can be installed anywhere where there is good wind resource. They can be installed on a mast, same as a conventional turbine. We have also conducted studies where and how these turbines can be installed and integrated in buildings (ex. between skyscrapers, on highways, in bridges). This is still an ongoing study. Another aspect we are investigating is installation at sea. However I will stop there since there is more potential for innovation there and we will discuss that later on. TEU: What does one find when studying the problem of trying to profit from a wind-power product? RX: A wind resource study is always critical in making sure that you will get the benefit, and effectively if it is feasible to install a wind turbine. Hence one needs to install a wind monitor for at least a year to understand better which product best suits the wind patterns in the region. Of course with larger products and installations one needs to be even more cautious also considering wind patterns over a lengthier period of time and also simulating wind currents according to the land topography. Another aspect that needs to be considered is the mechanical loads that the turbine imparts on its installation site. Hence if installed on land, what foundations are needed and their respective cost. If the turbine is installed on a building one also needs to consider the vibrations and whether there is resonance with any aspect of the building. As you can see it is not a straightforward installation. However considering its small footprint and conversion factor sometimes wind can be the only renewable energy solution for a given situation. TEU

Corporate Brief Econetique Ltd is a company within the FXB Group of companies, which operates in the renewable energy business. Itsâ&#x20AC;&#x2122; group of specifically trained engineers can design a solution to meet todayâ&#x20AC;&#x2122;s every growing demand on energy conservation and renewable energy generation. Econetique offers products such as insulation for construction, LED lighting, highly efficient heating and cooling solutions using heat pumps, as well as photovoltaic systems, for both domestic and commercial applications.

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SHIELD CONSULTANTS

YOUR OPERATIONAL RISK MANAGEMENT PARTNERS

INDEPENDENT QUALITY DRIVEN ETHICAL COST EFFECTIVE www.shield.com.mt

APRIL 2013 | THE ECONOMIC UPDATE RISK MANAGEMENT

SHIELD's Business Crisis Management Centre by Major John Schembri

saving lives, protecting businesses. Second, by integrating technology into our operational practices in order to render the risk management processes more operational, with special emphasis on:

Major John Scembrri

We at SHIELD attach very high importance to effective operational risk management. SHIELD more or less pioneered the practice in Malta and championed (operational) risk management to the point where it is now an accepted part of mainstream management in the better run organisations. We feel that our overall contribution has been valid in generating resilience in a number of Maltese and international businesses.

Having said that, time does not stand still and recent trends in risk management have inspired us towards innovation and refreshed aspirations in terms of what services we shall shortly bring to our business clients and associates. The collective skills, expertise, competencies and insights of my team, which encompass business, IT, military, policing, occupational health and safety, business continuity and security compliance have now placed SHIELD at a very interesting juncture from when the company was founded in 1999. Basically, we at SHIELD have come to a point where we desire to go beyond offering risk management services, solutions and support simply as consultancy and training. We feel that it is now within our capability to render our (risk management) services even more cogent and relevant in the following manner. First, by our way of approaching operational risk management issues within the various fields of activity specifically from a Business Continuity perspective, placing special focus on protecting people,

Online tools as opposed to paper based documentation;

People and asset tracking;

Cloud services;

Corporate security;

Crisis Management support to businesses.

Risk management has come a long way and is still emerging as a dominant motive force upon mainstream management. Malta resides at an extremely valuable geo-political juncture and we at SHIELD are fully equipped to service businesses within a highly dynamic and effervescent part of the world. On the basis of the analytical criteria just outlined, our company has geared up a unique service for businesses. Designed and equipped with the operational risk management needs of the modern businesses in mind, SHIELDâ&#x20AC;&#x2122;s Business Crisis Management Centre [CRIS ] is Maltaâ&#x20AC;&#x2122;s first bespoke capability of its kind. Run by fully qualified, purposely trained and highly skilled risk management professionals, CRIS is intended to support your business during a crisis. In order to give you some idea of what capabilities we have built, CRIS now allows us to manage operational risk in direct collaboration with our clients, in real time, in areas as diverse as security, fire, health and safety, business continuity, maritime security, resilience testing, emergency response and crisis management. We also have other highly interesting plans and ideas coming online shortly, which we intend to discuss specifically on a business to business basis. TEU

Corporate Brief John Schembri is Managing Director and founding partner at SHIELD Consultants Ltd. He holds a MSc degree in Security and Risk Management from the University of Leicester, a Post Graduate Diploma in Occupational Health and Safety from the University of Portsmouth and is a Specialist member of the Institute of Risk Management, London. John is also founding President of the Malta Association of Risk Management (MARM).

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APRIL 2013 | THE ECONOMIC UPDATE EVENTS

The Malta International Fireworks Festival This centuries-old tradition is still very much alive in the crowded calendar of village festas that take place all over Malta and Gozo. Flying to Malta any time between June and September, you will be surprised to find that firework displays will be taking place practically every weekend starting on a Friday. There are some 32 fireworks factories and double that number of towns and villages, where these displays are part of the traditional celebrations of patron saints. Still, fireworks production in Malta is an all year round occupation for enthusiasts which will surely fascinate thousands of people both Maltese as well as foreigners alike. TEU

PROGRAM The Ministry for Tourism and the Malta Tourism Authority will be organizing the 12th edition of the Malta International Fireworks Festival. The Festival has become a landmark event in the Islands’ calendar of events, with the Grand Finale taking place in the unique settings of the Grand Harbour in Valletta. The festival will also serve as part of the commemorative events that recall Malta’s accession to the European Union which took place on the 01st May 2004. The colourful spectacle annually attracts thousands of locals and visitors alike. The events will take place on Friday 26th April in the picturesque fishing village of Marsaxlokk, on Sunday 28th April in the stunning landscape views of Golden Bay (Ghajn Tuffieha) and the Grand Finale in Valletta’s Grand Harbour on Tuesday 30th April. Barriera Wharf on the Valletta seafront just inside the Grand Harbour will be the best place to view all the action. The festival has rightfully earned the title “International” as over the years it has attracted foreign pyrotechnic companies from as far afield as Australia, Canada and Venezuela and closer to home like, Italy, Austria and Poland. Several Maltese and foreign fireworks factories will be taking part in this year’s Malta International Fireworks Festival, who will together put on a spectacular pyrotechnic show with fantastic fireworks displays synchronized to music. The participants will be Focs d’ Artifici Europla from Spain, Mount Carmel Fireworks Factory (Malta), Lieto Fireworks (Italy), Tal- Gilju Fireworks Factory ( Malta), 1-2-3 Feuerwerk (Germany), Pirotecnia Minhota (Portugal) and PyroEmotions Fireworks from Italy. Winners will be conferred with a special trophy according to their ranking, whilst the other participants will receive commemorative trophies

Our Islands are renowned for the love of fireworks, which form a core part of almost any celebration or event organised, be it secular or religious. This year’s event will prove to be an added reason to visit some of Malta’s most scenic and historic spots during the month of April. For more details and recent updates please visit www.maltafireworksfestival.com

TRADITION OF FIREWORKS IN MALTA Fireworks in Malta have a long tradition which is centuries old. Indeed the craft of pyrotechnics in Malta goes back to the time of the Order of the Knights of St John. The Order which was conventual, aristocratic and military used to celebrate the most important feasts by special pyrotechnic displays. Such firework displays were an expression of rejoicing on special occasions, such as the election of a Grand Master or a Pope, as well as on the birth of a prince. Pyrotechnics must have been inspired by cannon shots and musket fire. The feu de joie which was a salute by the musketeers produced a celebratory welcome to any dignitary. From this developed the musketterija which today is a series of hundreds of explosions of crackers firing in rapid succession. These are attached to a string placed on the roof top of a church or other large building. The solfarelli d’aria were a series of colourful weak shots fired in quick succession into the sky, the Jigjifogooh (Italian: gioco di fuoco) is better known as St Catherine’s wheels (irdieden). This is a mechanized and rotating set of wheels attached to a pole on the ground which provide a rotating movement for the burning gas tubes.

Friday 26th April 2013 - MARSAXLOKK 9.00pm Pyro-musical competition – Focs d’Artifici Europla (Spain) 9.30pm Pyro-musical competition – Mount Carmel Fireworks Factory (Malta) 10.00pm Pyro-musical competition – Lieto Fireworks (Italy) Firing Point: Delimara Fields Vantage point: Xatt is-Sajjied Sunday 28th April 2013 GOLDEN BAY ( GHAJN TUFFIEHA) 9.00pm Pyro-musical competition – TalGilju Fireworks Factory (Malta) 9.30pm Pyro-musical competition – 1-2-3 Feuerwerk (Germany) 10.00pm Pyro-musical competition – Pirotecnia Minhota (Portugal) Firing Point: Car Park above the Bay known as Riviera Martinque Vantage Point: Car Park at top of Golden Bay (Apple’s Eye area) – Radisson Hotel NB: Though the beach is open to the public no audio system will be set up to relay the music accompanying the displays. Tuesday 30th April 2013 – VALLETTA Grand Harbour 9.00pm Traditional Maltese Fireworks 9.15pm Announcement and Presentation ceremony of the winners of the Malta International Fireworks Festival 2013 9.45pm Grand Finale Pyromusical display by PyroEmotions Fireworks (Italy) Firing Point: Barges in the Grand Harbour Vantage point: Barriera wharf

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EXECUTIVE INTERVIEW OF THE MONTH

APRIL 2013 | THE ECONOMIC UPDATE

A Vision for More by Martin Vella

part of a social fabric that spawned Prime Ministers to rogues. I believe that these elements partly made who I am. Surrounded by the sea on three sides, Valletta looks like a warship surging unto the Mediterranean Sea. So it is not unnatural for a City Boy to become obsessed with anything maritime. In this respect, I was no exception. I was always a hands-on person. At age seventeen or thereabouts, I decided to seek fresh pastures, to do something different, to be innovative, and to move on from the family comfort zone. Motivated by my deep love for the sea I actively harboured [pun intended] dreams of absconding on a merchant ship but something held me back. Therefore, I decided that if I really wanted to leave I had to do so legitimately. In those days, we are talking of the early eighties, I was aware of Maltese workers earning astonishing wages working in the oil industry, usually in Libya. Naturally the high wages intrigued me and when I scratched the surface I realised there was a bagful of opportunities in what was called “the oil and gas industry”. Preparing for running down casing in an oil well

Background Investment decisions within the oil and gas sector have always been made based on a longterm outlook. Today, despite the challenging times facing one of the industries hit hardest by the global economic downturn and a cost structure that is high by historical standards, the major players are in fact taking advantage of the current storm to improve effectiveness and efficiency, to increase productivity and manage costs. In this interview I will explore the many opportunities that exist in our region at present and talk with Jonathan Borg to find out his outlook and the role Bluhull Marine intends to play in developing Malta’s potential in the oil and gas industry.

One can resist the invasion of an army but one cannot resist the invasion of ideas. Victor Hugo

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In our Executive Interview of the Month, we go head-to-head with the founder and Director of Bluhull Marine Jonathan Borg. We discuss the company’s presence in Malta and the groundwork being laid*- for the future.

TEU: Tell me a bit about your current projects, your dreams – where are you heading, and your partnerships? Our readers want to know who is Jonathan Borg, what moulds him, his vision and ambitions? JB: Motivational forces are born with you and develop according to experiences some of which are voluntary [decisions] others [circumstantial [family,friends, education] . Looking back I guess I was born with an entrepreneurial spirit. My father has a long and successful business tradition with an inspiring history, which is totally different than the business I specialise in. It dates back to 1901 when my ancestors saw an opportunity in the clothing industry then dominated by tailors and cloth merchants – the ready tailored suit! They were successful in developing the first leading menswear outlet in Malta’s capital city – Valletta. I spent most of my childhood here, rambling around the city, exposed to its history on a daily basis, and forming

I was lucky enough to start from the lower rungs of the industry thus giving m evaluable insights into the workings of the basic common element namely manpower

TEU: How does a person like you step into the oil and gasindustry, start up a company and be successful? JB: Firstly, I do not think success is a fixed goal one achieves, rather I see it as the motivating aim of any entrepreneurial venture. I do not consider myself successful but I do strive to be successful. Whether I am successful or not is a perception usually based on material possessions. I do not subscribe to that view. I would rather emphasise on a happy workforce and a project in the pipeline. In this business I have met financiers, investors coming up to you and saying, “listen we are going to give you the money and we want you to spearhead a company for us related with the oil and gas industry.” Well it does not work that way! What really helped me move forward is that I was lucky enough to start from the lower rungs of the industry thus giving m evaluable insights into the workings of the basic common element namely manpower. I started working as a roustabout, getting wacked in all circumstances from a raging storm on

EXECUTIVE INTERVIEW OF THE MONTH

APRIL 2013 | THE ECONOMIC UPDATE

an offshore rig far out in the Shetlands, to surviving a close call following a fire in Rotterdam harbour. It all boils down to experience. This was my offshore university, crude, direct and intense. Over the years I moved up and got into the logistical side of things, which as the proverbial saying goes led from one thing to another. Presently, my main area of operation is the supply of provisions for the development, extraction and delivery of energy, safely, profitably and in a socially and environmentally responsible way. I consider myself a link in a larger movement aiming to secure a responsible energy future through sustainable development. A key comparative differentiator for us is technology, both in terms of equipment, research and implementation which Bluhull Marine brings into its operations. I might change strategy but never give up my goal

TEU: How you have been transforming companies with all this experience and arrive where you are despite encountering negative forces undermining your goals? JB: I am indifferent to reactionary forces that oppose me and I will never abandon my objective. I might change strategy but never give up my goal. I believe in business ethical values, professionalism, productivity and efficiency, which in the long term have always helped me survive in a cutthroat environment. Obviously, you will always come across negative forces but then these are the situations you ultimately learn from. TEU: What makes you a leader in your field? JB: My experience and determination, my knowledge of the industry, together with my networking and my international reputation. Through Bluhull I want to secure Maltaâ&#x20AC;&#x2122;s longterm presence in the development and growth of the oil and gas sector in terms of creating a regional hub for oil and gas investors, in various fields such as research and production, development of other capabilities in the industry such as rig stops, project support services and engineering provisions of design, human resources management and other specialist services. TEU: How are you using these qualities to benefit your business? JB: My contacts and networking trace their origins to friendships I cultivated in the field. We grew up together. Today my colleagues have their roles and certain positions within certain companies. Some of us went to the service provision companies, which is an important service to the oil and gas industry. Some of us are working in the oil production industry, some of us are contractors, some of us went to the drilling contractors, some of us went to the sales and procurement industry and some ventured to the marketing and management side. But in the end of the day we all do business with Jonathan Borg, Director

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EXECUTIVE INTERVIEW OF THE MONTH

APRIL 2013 | THE ECONOMIC UPDATE

Jonathan Borg being interviewed by the Economic Update’s Editor, Martin Vella

each other, we all recommend each other’s services. Over the years I have been lucky enough to form part of a group of people in the oil and gas industry that exists because of solid trustworthiness. This does not just happen but develops over time. One slip up and you are out! There were times where I lost money on a contract but carried on with it solely because I did not want to let my business colleague down. He had recommended me and my failure would have been his. We use our qualities through an exposure to a diversity of cultures, working with the best minds in the world both within and outside the organisation. TEU: What do you enjoy most to do in this job? JB: I think it is the fact that I look at it as a form of business socialising. I am available 24/7 to my clients, to my colleagues, to my workers, to my associates and to my partners. My door is always open, my phone is always on. I can get a call from an executive and answer within two seconds and then answer a call from my gatekeeper. There is nothing in the world like a complicated project being completed on time and within budget, with a satisfied client recommending you to other clients. It is also heartening to receive the occasional message from an employee thanking you for the training and opportunities given to him. 30 |

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These experiences led me to create the Bluhull Group of Companies which though still in its infancy is earning a solid reputation in the various disciplines of the oil and gas industry. I want to secure Malta’s long-term presence in the development and growth of the oil and gas sector in terms of creating a regional hub for oil and gas investors

TEU: What was the main driving force behind you to make such a huge transition? And what were your winning strategies? JB: The winning strategy ultimately boiled down to working with experts and experienced professionals, corporations and partners who provide the safest and smoothest operation to the oil and gas industry. Working with professionals is the key. What do I mean by professionals? I mean by putting experts in the various fields on board – financial, logistics, legal, consultancy, advertising, marketing and R&D. I believe that before adapting and forming a strategy you have to select the right professionals who are compatible with your goals. You have to seek advice and you have to ask and you have to listen, and then you will

come to a conclusion. But before you come to a conclusion, you must go through the thinking/ discussion process. That is what keeps you going. That is what gives a company a cutting-edge, that is what drives a company and that is what makes a company healthy. I tend to make a distinction between inspiration and advice. Everything inspires me, a chance conversation with my housekeeper, a remark made by a taxi driver driving me from some far flung destination or a work of art hanging in museum. Only recently I was playing with my daughter when a client rang up asking me what colour had to be applied to an oil rig being built for a client in Asia. I asked my daughter what colour she would fit in between the sea and the sky and she instinctively came up which the colour silver because it shines up when it’s getting dark! Naturally, we got more out of this then a mere “shine” - the reflective coating reduced metal fatigue and deflected UV rays looked good. Advice on the other hand requires a more structured thought process. My idea of what constitutes advice originates from the person offering it. If I have engaged a top professional I expect the best advice. However the best advice always needs objective analysis and ultimately it is up to you to decide the way forward.

EXECUTIVE INTERVIEW OF THE MONTH

APRIL 2013 | THE ECONOMIC UPDATE

TEU: How did the name Bluhull Marine come to life? JB: My wife always wanted a blue hull boat. Endless arguments on the pros and cons of having a blue hulled boat ensued. I would argue that blue, apart from attracting heat will fade over time, whereas she would answer that a blue hull is inspirational. But one day, when I was really thinking to start my own new company, I started mulling about a name. Sharon said it is going to be very easy, “You never bought the blue hull boat, so we will call it Bluhull Marine and we will sail the world with this company,” she said. And that is exactly what we are doing. Let’s shred any misgivings and believe in ourselves and our capabilities in developing an efficient hub for investors and players in this competitive industry

TEU: What is the main inspiration for you in the oil and gas industry? JB: An ever changing scenario based on supply and demand. The energy business is after all the blood supply to the social and industrial fabric. It is fascinating to form part of a project whereby a seemingly dead landscape such as a desert or a troubled sea could supply energy to build, develop and sustain whole cities. Travelling to far-flung places discussing projects, evaluating proposals and advising on feasibilities have always challenged me. Only recently I was asked to form part of a team to advise a foreign enterprise with governmental interests on the setting up of shore based facilities to assist an embryonic oil and gas project. The enthusiasm shown by the promoters was inspirational.

we think about Malta’s oil and gas industry. Let’s shred any misgivings and believe in ourselves and our capabilities in developing an efficient hub for investors and players in this competitive industry. TEU: What is Bluhull’s competitive advantage over the rest? What is your message to investors to work with you and perhaps in the future also set up a hub for drilling in the Mediterranean, and what would you say if the government wants to be your partner and to incentivate you? JB: Bluhull draws from a wealth of expertise in the oil and gas industry. We have a database of human resources and contacts worldwide offering prime workmanship, excellent skills, and proven track records. Our position in the centre of the Mediterranean is certainly beneficial but this is not enough. Gone are the days when Governments invested directly in business. That is old hat and possibly illegal. State aid rules are quite rigid in this industry. A successful government has to create and maintain an infrastructure and atmosphere which is business friendly without interfering into the day-to-day competitive process. In this regard any government faces a number of challenges, however the foremost would be the following: · Excessive bureaucracy; · Lack of incentives directly related to the oil and gas industry; · Lack of a specialized hands on division addressing

· ·

the oil and gas industry’s needs; Balancing environmental concerns with the industry’s needs. Promoting Malta’s potential in the oil and gas industry abroad;

I see the oil and gas industry continuing to grow with the advancement of new drilling techniques and new innovations in exploiting existing pools to increase recoverability. We have a stable political system in place which ensures peace of mind to the investor. I would venture to say that a prime missing link in past has been the lack of experience and the lack of qualified people specifically dedicated to the energy industry. We have to think hard, think big and adjust our attitude. We should believe in ourselves and our capabilities not just change things for changes sake. We must motivate ourselves by asking whether we want to participate in an evolving industry that faces challenges but has overwhelming potential. Are we ready to invest in an infrastructure to support the oil and gas industry just as the government did in the cruise liner industry? The potential is there and Bluhull is adequately poised to form part of this growth and is proud that through sheer perseverance it has played in a global oil and gas industry. TEU

Supplying materials to the offshore rig

To Inevitably, when I am in these situations I always spare a thought, which rapidly becoming an obsession, and fantasise of bringing all the expertise to my beloved country Malta. When you look at the Mediterranean today and see the drilling activities going on in our neighbouring countries, I cannot but think that Malta can be the centre of excellence in developing into a platform in exporting services to the oil and gas industry. We do not need to strike oil to participate in the oil and gas industry. If we strike oil it is bingo, depending on the size of the well, the drilling contract and other factors, but we can still participate in the oil and gas industry by offering services to oil operators and drilling contractors operating around our area. TEU: What would you say to investors willing to invest in this industry? JB: It is a cutthroat industry that shows no quarter. Investors should identify the reliable partner and the efficient location. Welcome to business friendly Malta. Welcome to the centre of Mediterranean. Join Bluhull Marine which is working to change the way www.maltaeconomicupdate.com

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FEBRUARY 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

Defining Entrepreneurship Sara Grech

Company: Engel & Völkers Job title/Description: Chairman Professional Expertise: MBA General and Strategic Management, Diploma Hospitality and Management Quote: “Excellent companies are above all brilliant on the basics. Tools are no substitute for thinking, intellect does not overpower wisdom and analysis does not impede action. I work hard to keep things simple in a complex world. I insist on top quality and achieve this through three simple beliefs: my respect for the individual, a hands on approach and quick action. You cannot get any of these without commitment.” Women in power have a double meaning when it comes to Sara Grech’s domain. Her story becomes increasingly relevant through initiatives such as with the Malta Guide Dog Foundation – a powerful initiative dedicated to assisting visually impaired persons, the Consul office for the Philippines – assisting the local Philippine community. Sara Grech brings to light the incredible story of a successful women entrepreneur who has confronted challenges and triumphs and offered inspiring solutions to many women’s issues.

BACKGROUND By her own admission, Sara was “just a girl” when she decided to create a power company that has become one of Malta’s formidable and world-renowned real-estate companies, an iconic real estate agency, and the largest that is in the premium property business. What’s interesting is that besides working with people to force change from the bottom up, Sara is now working in the Yachting business, Events and destination management business and in the catering business. I wonder what Sara will plan next? Here’s to this powerful woman who is creating an important change, whilst also making the time to be a contributor to society. 34 |

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TEU: Was it easy to be optimistic about real estate over the past year with the type of growth we have seen, when you look at how real estate everywhere, and more specifically in Malta, has been affected? SG: Malta always feels the crunch of any economic crisis; however, we are able to recover because of the depth of the demand for properties. There are so many different countries we tap into for revenue to buy here; we are truly an international market. We joined forces with a formidable and world-renowned real-estate leader - ENGEL & VÖLKERS – to become in Malta and Gozo ENGEL & VÖLKERS SARA GRECH. This co-branding is a first in the history of the Engel & Völkers family. Openness and honesty is at the heart of everything we do and we want to attract like-minded individuals

It has long been a vision of mine to partner with an internationally-acclaimed and like-minded real-estate brand, and that ambition is now a reality. Engel & Völkers is one of the most respected names in this business worldwide, and I believe it is an important achievement for us to have gained their trust as we move forward together with the co-brand. The move will put our beloved islands further afield on the global map, as we seek to continue to attract buyers from around the world. We all know what a great place the Maltese Islands are to live in, and we want to take that message ever further afar.

by Martin Vella The change in the business model is unique on the islands. We are the agents pioneering a new business concept whereby our agents all work under one roof and are free to work from anywhere on the islands. Our IT systems have helped us achieve our aims. TEU: For you personally, did you know that you had what some refer to as an entrepreneurial gene and that desire to create and grow your own business? SG: I never imagined it, no. I think you really discover this when you take the plunge. From an early age I wanted to help others and I was always focused on guiding others. My inner thoughts and feelings always wanted to reach out to people who felt they “could not” rather than “they could”. My outlook is positive, open and real with no pretentions. I had courage from an early age. My vision was and still is “you can if you want to” rather than “you can’t or shall I try”. I am never afraid to say what I believe in and I go with my gut feeling. I am still the same person I was 30 years ago. Success comes to those that keep their feet on the ground. I believe that today I am where I am not only because I had the will to do it but also because of my family support. I had and have the desire to stay connected with my family. My three children today are 25, 21, and 18 years of age and I am very happy to have formed a special relationship with each one of them. Success most importantly is the relationships you build along the way and family is my number one priority. My attribute towards leadership comes from change. Change is the law of life and those who only look at the past or the present are certainly going to miss the future. One has to have the capabilities of leadership change to fit in the changing world. I learn from my mistakes and turn my mistakes into a positive thing. I believe that your only limits are self-imposed. Vision without action is simply daydreaming and action without vision is a nightmare. I live by my conviction that vision and desire for achievement are what distinguish outstanding people.

TESTIMONIALS Sara I wish to extend my wishes to you. You are blessed and lucky to have won the respect of your children as well as the business community through your hard work and your persistence. Well done and I wish you all the very best in your career Ray Demicoli, DeMicoli & Associates “The cliché ‘size doesn’t matter’ immediately comes to mind when one thinks of Sara. A small woman who made it big in the male dominated Real Estate world. Always a pleasure to do business with.” Michael De Maria, Sales & Marketing Manager, Pender Ville Ltd.

FEBRUARY 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

As a leader, I need to be an attentive listener and an inspiring motivator and I am focused on seeking the best in people whilst praising the work that they do. Praise makes people flourish. There is a very fine dividing line between success and failure – and you need to stay on the right side of that line. Being aware of this helps you stay in tune. TEU: With the recent co-branding Engel Völkers Sara Grech, which characteristics do you look for in the senior management?

Mr Joseph Stafrace and Sara Grech

TEU: For Sara Grech, which grew significantly in size and scale, was it challenging to maintain an entrepreneurial culture, and can you do it at a certain size? SG: A key element for a leader to expose is to be a visionary evangelist. As a visionary evangelist the leader is able to communicate regularly with the staff, therefore acting as a figure head and demonstrating the confidence within the company’s potential for success. The leader must collaborate with all members or staff to articulate a vision and get them on board in support for future prospects. A leader does this by creating a driving force and taking charge in areas on strategies, with a vision of captivating new and challenging future prospects and the desire to ensure that whatever is done continues. Culture is a major concern in the visionary aspect and to maintain the culture you build helps to foster and encourage all existing and new employees to be responsive, creative and to work in harmony, this way you can grow to any size.

ENTREPRENEUR DETAILS Past Achievements: Founder of Services Dogs Malta Foundation: a charitable project to enable the disabled live life with the helping hand of a guide dog Awards: MBA Inspiration: A humble entrepreneur

SG: Ability is what you are capable of doing, motivation determines what you choose to do, and attitude determines how well you do it. Motivation is like food for the brain, you can’t get enough of it in one sitting. It needs continual and regular top-ups. So motivation in a senior management position is imperative. What motivates me most is my strong desire to help people. I like to give all my energy, time and support and encourage people not to lose determination and focus. I work hard to lift their attitude and become a driving force for them to ensure they achieve their goals. Integrity is top of my list. There is nothing nicer than the truth. I have created a culture through our corporate values and have in built these into my people. Keeping things simple in a complex world helps you achieve multiple tasks well and as importantly on time. My belief for working on people’s life skills as well as their well-being has proven to be an important ingredient for our corporate success. With a good attitude towards quality of life, you create an atmosphere of happiness and through happiness you have a strong motivated performer. TEU: Is the industry broadly embracing innovation and how has the delivery of services changed? SG: The industry has become populated by welleducated and smart people as opposed to how it was 25 years ago, which is a breath of fresh air. Two out of three of my children (my youngest is still in university) have joined me in the family business and we have the same vision on where we want to be in the years to come. It is absolutely satisfying to be able to enjoy them in a work environment. Sara Grech is in the business of making dreams come true, for so many people looking for their home or commercial property, the move we embarked on marks a milestone achievement as we joined forces in Malta and Gozo with Engel & Volkers – a world-renowned Hamburg-based organisation. There is something very special about Engel & Volkers – it is a globally recognised brand, with a reputation for representing the very best properties and working for top clients. Moreover they share so many of our core brand values: expertise, dedicated customer care, the highest

standards and total discretion. We see ourselves as a solutions company, not a property company. We want to make a difference to all our clients seeking to settle into a new home or business. TEU: What approach do you take to achieve the results you desire from your philanthropic efforts with Dogs Foundation? SG: Philanthropy and Corporate Social Responsibility have always been high on my agenda. You arrive to a stage when you feel your plate is full and want to be able to get involved with helping others, not by simply filling out a cheque but by helping and getting involved with other people to help raise funds for those in need. To cut a long story short, I met a visually impaired person who was being guided by another person and that got me thinking. I did my research and go on with it and ended up talking to the late Ron Colombo. Today I have founded my own Foundation with Joseph Stafrace who is visually impaired, The Service Dogs Malta Foundation and as a founder I am able to contribute my experience with the hope of one day being able to help not a few people but plenty of the visually impaired persons living on the islands as well as the disabled persons. A high priority on my list is autistic children. TEU

Editor’s Note Sara Grech Ltd. has 6 strategically located outlets in Malta and has 60 people between employees and property agents. The brand has established itself as a leader in Malta. The company operates in the sale and letting of residential and commercial properties. Today Sara Grech has co branded with a premium real estate brand Engel & Völkers which has 530 shops in 38 countries. A destination management company La Krosse was formed in 2010. A premiere professional services company specialising in the design and implementation of events and programme logistics. Ms Grech attended college at Mount Carmel Academy in New Orleans, LA, USA, has a diploma in hospitality management from the University of San Francisco and has an MBA in general and strategic management from the Maastricht School of Management. She obtained ISO 9001 and ISO 14001 in internal auditing in 2010. Ms Grech is the Honorary Consul General for the Philippines in Malta and the Treasurer on the board of the Honorary Consul Council board. She is on the Board of the Malta Federation of Estate Agents, a member of the Malta Chamber of Commerce and a previous Board member of the Dogs Foundation. Now a founder in the new foundation Service Dogs Malta Foundation. A foundation set up to help the visually impaired gain independence, locally.

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APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

An Entrepreneurial Spirit Jonathan Borg

Company: Blu Hull Job title/Description: Director Professional Expertise: Strategic planning and business development in the oil and gas industry. Quote: If a man writes a better book, preaches a better sermon or makes a better mouse trap than his neighbour, though he builds his house in the woods the world will make a beaten path to his door. Ralph Waldo Emerson Increasing your ability to communicate effectively is a critical element for us to inspire others. For entrepreneur Jonathan Borg, being inspiring is not about climbing mountains or corporate ladders; it’s not about being the fastest, strongest, smartest, or richest.

TEU: Can you offer a few key lessons that any business owner can, and perhaps should, take to heart? JB: As a businessman, what I have close to my heart is to see my business grow and to ensure that my team also grows with the business. Offering incentive packages such as performance bonuses, wage appraisals and increases, including profit sharing schemes automatically motivate and empower employees to work harder. A happy employee is a happy customer. Failure can teach not only what one is doing wrong, but also how to do it right the next time

TEU: How do you focus on helping fellow entrepreneurs and what are your views on creating new business opportunities through change? JB: A politician and ex-Prime Minister who comes to mind and who may teach us a thing or two about lessons of change through a culture of helping business start-ups is Dr Alfred Sant. He is a model of change, since in my opinion, he was a catalyst of changing the Malta Labour Party, he started changing the transparency of our country, he was the person who preached zero 36 |

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tolerance on corruption and to me he is one of the most open-minded politicians when you sit down to discuss topical issues, business, strategy, alliance and discussing what’s good for Malta.

TEU: Failure is inevitable, but there is a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? JB: An open mindset and a willingness to learn from mistakes can be all that stand between glorious comeback and utter collapse. For all our successes, we must always embrace our role as champions of failure. Failure is essential to the process of innovation. Failure can teach not only what one is doing wrong, but also how to do it right the next time. It can be a useful, even transformational, force for better business practices. Stanford psychologist Carol Dweck famously said, “Fail often, and you’ll succeed sooner.” TEU: How do you inspire others with your achievements and success? JB: Inspiring others isn’t easy. If, you do love something dearly, you will not care how successful you are at inspiring others and you will continue to persevere on many levels, no matter how many times you fail. When people doubt you, and when people laugh at your failures, you will continue to do what you love because you love it. So having that depth, that love and passion for something, will protect you from all potential failures. Ultimately, if you really want to inspire others to do something then this ‘something’ should be a big part of your life TEU: Support and tolerance lead to growth and success. Do you agree? JB: The right kind of leadership should be capable of building trust, willing to take risks, and establish a culture tolerant of failure. This

TESTIMONIALS Discovery Drilling Equipment Ltd, a subsidiary of Discovery Industrial Services Ltd, a Company registered in the UK is one of the leading onshore rig builders and hereby confirm that Bluhull Marine Limited is our main contractor for mobilisation and demobilisation logistical projects, for all rigs in Africa, the Middle East and Asia. We highly recommend the services of Bluhull Marine Limited, when it comes for the co-ordination of heavy transportation by sea and by land and for the most suitable managed, cost effective oilfield storage facilities. Ralph John, VP Global Business development, Discovery Industrial Services Ltd., UK I have known Mr. Jonathan Borg, Director of Bluhull Marine Company Ltd for the last ten years or so. I have throughout been impressed with his energy, his appetite for hard work, vision and sense of initiative. Mr. Borg’s experience in the industries and services which are ancillary to oil drilling and recovery is wide ranging and longstanding. It covers operational, executive and strategic functions. I have found his expertise and views in these areas most valuable when assessing how Malta could be affected by charging trends. Dr Alfred Sant, Ex-Prime Minister of Malta

is the most important ingredient in supporting innovation and entrepreneurship to grow. So, yes I agree that helping and encouraging one another through a culture of sustenance, mutual support, loyalty and tolerance leads to growth and unparalleled success. TEU

ENTREPRENEUR DETAILS Past Achievements: I have conducted various workshops, seminars on the application of creative thinking and innovation in the oil and gas sector Inspiration: Steve Jobs- Through his passion and commitment for creative thinking and innovation he developed on of the largest and successful companies in the world. Dr. Edward Debono- Around frothy years ago (19691970) did not only relay the importance of creative thinking, but developed various tools to empower business executives, youths and children to use these tools for there personal development

APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

Changing the Current TESTIMONIALS Was achieving to the undertaking of a number of activities such as – miss maltese beauty, miss italia nel mondo, miss world malta, mr world malta.

Modelling and beauty pageants are Sue Rossi’s love and passion, so she is blessed that so many of her personal activities are business related! Women need flexibility, not only for themselves but for their families and Sue Rossi has certainly created an opportunity for a lot of women to showcase their talent.

TEU: Can you offer a few key lessons that any business owner can -- and perhaps should -- take to heart?

Suzanne Rossi

Company: Modelle International Job title/Description: Director Professional Expertise: Fashion Industry Quote: never leave things for tomorrow what you can do today

ENTREPRENEUR DETAILS Past Achievements: Worked for international magazine pic, obtained licence for miss and mr world prestigous events.

Awards: Outstanding contribution award 2006.

Inspiration: To assist others in exploring their inner beauty.

SR: Any success related to a business concern stems from passion. A burning inner feeling which is then transformed into venture terms. In fact a glance at my diary uncovers the hours spent on planning, organising and budgeting for any event. A key note to the harmonious tone is however dedication and motivation. Needless to say both staff members and participants are encouraged to perform assiduously throughout their temporary or permanent contact with Modelle International.

TEU: The founders of some sociallyoriented start-ups have begun focusing on helping fellow entrepreneurs, while creating new business opportunities for themselves. What are your views on this? SR: In a cultural aspect reaching out to others enhances society. Charitable acts reinforce human relations and provide the necessary ingredient for a peaceful coexistence. The business world runs on the same notion except for the very fact that any form of assistance is normally guaranteed and may carry a high price. Struggling alone is a mean thing to do yet from experience I am a firm believer of providing cushion to others wisely and sensibly.

TEU: Failure is inevitable, but is there a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? SR: There is success with failure and the inevitability of going through a particular path is quite fatalistic. In my view an absolute crush to one’s carrier can be avoided through the learning process and the virtue of humility. Taking advise and absorbing past shortcomings are quintessential factors underlying the onward direction. But of course there might be the occasional ops that may prove terminal such as a financial crisis with a disproportionate effect. But then this goes beyond one’s power to control just as global transformation resulting from an alien invasion or a meteoric fall out. TEU: How do you inspire others with your achievements and success? SR: Lead by example is a sure maxim. Any business leader and initiator would be at the wrong end of history if all the experience gained is not shared with participants and those interested in the world of fashion. Our knowledge has been passed on to us by our forefathers and we are not inventing the wheel by letting others into our secretive rooms to roam freely and discretely. Respect and a desire to rejoice at the success of others are essential traits. TEU: What is your leadership style? SR: I am decisive and realistic. Moreover I am a firm believer in getting others on board to share views and opinions. Thinking outside of the box and realising that life is a precious gift empowers my spirit with a determination to reach for the stars in a realistic manner TEU

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APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

Making Experience Your Wise Counsellor ENTREPRENEUR DETAILS

Ian Zammit

Company: Malta Sotheby’s International Realty Job title/Description: General Manager Professional Expertise: Ian’s experience extends across a number of markets in Europe, Middle East and Africa with unique insight and network in both financial and property industries, and an enviable track record for sustained growth of the operations under his management. In addition to successful organic and M&A growth in the insurance sector, Ian has developed a number of residential and commercial property projects building and managed a portfolio of over € 75 million in property investments and renovations. Quote: Anyone who has never made a mistake has never tried anything new – Albert Einstein When it comes to luxury real estate, it’s all about the Malta Sotheby’s International Realty, where... behind this luxurious real estate is Ian Zammit, General Manager.

TEU: Can you offer a few key lessons that any business owner can -- and perhaps should -take to heart? IZ: Do not be afraid to innovate – Today the changes that social media has brought in the way people purchase products and services are so closely linked that staying out of these is no longer a viable option.. Cater to a specific market - Find and identify with your niche market and make sure that the service or product offered is the best. They will become your repeat clients and they will become your best prospects for growing your business. Foster connections - Today, business owners can create those connections online, by developing compelling content, sharing that content on social networks and with influencers and encouraging audience conversations and idea sharing. Anyone who has never made a mistake has never tried anything new

TEU: The founders of some sociallyoriented start-ups have begun focusing on helping fellow entrepreneurs, while creating new business opportunities for themselves. What are your views on this? IZ: Look at what Bill Gates has done with Microsoft and then look at what what he’s done with the Bill Gates Foundation! Doing great but good things can help improve your prospects, your proﬁts and your business – and can change the world. The primary purpose of businesses has always been to 38 |

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maximize value for shareholders. This has led to a variety of social ills where businesses polluted, discarded employees at the drop of a hat or created unsustainable short-term gains. This way of conducting business is totally wrong and is another reason why the world all over is in such a mess.

TEU: Failure is inevitable, but is there a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? IZ: Failure is experienced by everyone at some point in his or her life. This can take many forms but it’s always important to bear in mind that what goes round comes round just like the world we live in. Many times what we perceive as an error or failure is actually a gift. And eventually we find that lessons learned from that discouraging experience prove to be of great worth. We should regret our mistakes and learn from them, but never carry them forward into the future with us. Albert Einstein once said “Anyone who has never made a mistake has never tried anything new.” TEU: How do you inspire others with your achievements and success?

IZ: Achievements and successes only come with hard work, although I think there is sometimes an element of luck as well. If this opportunity does come your way, make sure you identify it quickly and then make it happen. Being ambitious is not a bad thing either, but do what you have to do without hurting anybody on the way to achieving that goal. If you wish success in life, make perseverance your bosom friend, experience your wise counsellor, caution your elder brother, and hope and trust in your Eternal Maker. TEU: What is your leadership style? IZ: Never tell people how to do things. Tell them what to do and they will surprise you with their ingenuity. TEU

Personal Profile: Ian Zammit is an established business leader and Chartered Insurer with over 35 years’ experience as a senior executive in property and financial services sectors. Former CEO of British American (Mtius) Insurance in Malta, Ian has until recently held the positions of the President of the Insurance and Property Division of GlobalCapital plc. He recently joined Malta Sotheby’s International Realty as General Manager. Ian, is also well established as a non-executive director and has held several board directorship positions both in Malta and overseas, including past directorships on the boards of Metropolis (Malta), GlobalCapital Life, BUPA agencies, and GlobalCapital Insurance Brokers Ltd, and Iframac Ltd (a leading car and yacht franchise in Mauritius). His unique insight in both executive and non-executive leadership and ability to successfully operate in different cultural and business environments were and are essential and invaluable as a director of the companies such as British American Life Insurance (Mauritius), GlobalCapital Insurance Brokers Ltd (Malta), Brammer Ltd (Bulgaria and Croatia), Quadrant Italia srl, and a number of Sicavs recently set up in Malta. Ian is passionate about yachts and challenges that comes with owning a yacht, and has brokered and been involved in yacht charters for the last 3 years. He is also well known amongst the boating fraternity in the Maltese islands, and is a member of the Royal Malta Yacht Club. Energetic, always on the move and very insightful, Ian has a passion for property development but also for yachting and vintage cars. Married to Jacqueline , with three children, Francesca, Jean-Marc and Zac. Career Highlights: Malta Sotheby’s International Realty General Manager; 2013 – present GlobalCapital plc CEO / President and Director; 19912011 Guardian Royal Exchange Supervisor/Manager; 1980 - 1991 Edrichton Holdings Ltd – Intasun Ltd Area Manager Malta; 1975 - 1980 Key Achievements: - Identification & implementation of new life software for the whole company Successfully negotiated and took over the local agency of BUPA International in Malta - Lead & managed the conversion of the local branch operation of Britsh-American Insurance (Mtius) Ltd into a fully fledged stand alone Maltese Life Insurance Principal - Was instrumental in the merger of British-American with Globe Organisation to form GlobalCapital plc - P&L responsibility for the life fund growing from 9 million Euros to 65 million Euros - Set-up and expanded the property portfolio to over €75 million - Responsible for the purchased & renovation of a 12th century castle in Rome - Responsible for the development & project managed numerous properties, in Malta, Argentina, Croatia, and Dubai, most of which were sold at substantial profits - Responsible for the building, completion and hand over of new state-of-the-art Head Offices for GlobalCapital plc.

APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

A Hands-on Entrepreneur Geoffrey Farrugia

Company: HandsOn Systems Job title/Description: Founder and CTO Professional Expertise: Computer Scientist and Physicist Quote: “If opportunity doesn’t knock, build a door.”

Geoffrey Farrugia leads by example and believes that leadership is a science in itself. Geoffrey main that humans are not machines they have a mind but they also have a heart of their own too. He states that, “You have to be inclusive and try and build bridges first instead of burning them. It is very important to be honest and transparent. This will motivate the team further.”

TEU: Can you offer a few key lessons that any business owner can -- and perhaps should -- take to heart? GF: There are a number of imperatives in running a business in the 21st century, some of them cannot be found on textbooks and need to be discovered through experience. Sometimes, success can blind you to the oncoming possibility of failure. And fear of failure can keep you from success. Every business owner needs to encourage, enable and protect innovation whatever the business in which he is operating. In reality we all know that the financial crisis has been tough on every one. What most of us do not know is that the crisis might be also an opportunity for others. Companies need to

TESTIMONIALS Geoffrey is not only a visionary but also a strong executor of ideas. I have worked directly with him on a number of Microsoft projects. He is a strong leader and a great people motivator. We need more him around the world. Amir Serhan Microsoft Regional Manager Energetic and super creative are two words that fully describe Geoffrey. I have never seen such a multi talented and multi skilled person in my life. Anthony Debono, Ex-Chairman Maltacom

simplify and cut down cost whilst keeping at the edge of innovation. This is a fine balance which is most often than not very difficult to achieve

TEU: The founders of some sociallyoriented start-ups have begun focusing on helping fellow entrepreneurs, while creating new business opportunities for themselves. What are your views on this? GF: It has been always been like this in the past and it will always be like this in the future. If you ask yourself who are the top entrepreneurs in the world you will probably find out that the majority of these are young and vibrant start-ups which see things differently. Success stories such as Facebook, Amazon, Google just to mention a few, all began from a couple of university students getting together to formulate an idea and making it a reality. The internet as we know it will definitely keep on changing. This will not only change how business is done in the future but also create yet more opportunities. Before eBay, entrepreneurs did not think about opening online shops but rather thought about opening a physical shop. These founders are usually trend setters and they shape the future for young and fellow entrepreneurs alike. TEU: Failure is inevitable, but is there a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? GF: We are dealing with a very complex business world where the global village has become more of a reality and less of a dream. No business is too big to fail, or too small to succeed. Most of the time businesses fail because of cash flow and not because they have a bad product or service. You can learn from your own mistakes but I prefer to learn from other people’s mistakes. Sometimes,

there is simply no room for error and just having an open mindset is not enough. Nowadays you need to have multiple plans in place - an ejector seat and a parachute too! Business has to remain always in beta stage. What worked last year might not work this year. No one know really knows the future. Those who invested in Libya before the war broke out never expected that their business would stop because of a war. The world turns so fast and you need to turn with it. Every business owner needs to encourage, enable and protect innovation

TEU: How do you inspire others with your achievements and success? GF: Facts not words! Many people are very good in talking about something but if you ask them if they know how to do it or not they would simply tell you that they have employees who do it for them. My inspiration has always been those types of business owners who have been there and have done it themselves and if it is necessary they can do it again. You cannot sell something if you do not really understand it. I think this has played an important role to my success. Simply put I am truly hands-on. TEU

ENTREPRENEUR DETAILS Profit 2012: 350K Past Achievements: Creator of the first Maltese game for Amiga console Awards: Microsoft Valued Professional, UNESCO MAB Young Scientists Award, Young Enterprise Award Winner, Datastream Web Award Winner, Carlsberg Web Award Winner Inspiration: Nature itself

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APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

Future and Youth Michelle Gialanze

Company: International Vocational College Malta Job title/Description: CEO Professional Expertise: Education Quote: Try and plan your career to do what you enjoy, and you will be successful at it.

Michelle Gialanze stands for a totally different learning experience designed from the ground up with the student in mind. With Michelle, students have a chance to taste the different options before having to make one of the most important decisions of their life.

TEU: Can you offer a few key lessons that any business owner can -- and perhaps should -- take to heart? MG: A key lesson which I have learnt is that of really listening to and networking with others. You are not alone in any venture that you are setting up and being part of a network that believes in you, giving you positive criticism when needed and is a sounding board, is essential when starting up a business. A business is not only about financial viability and market needs but it is also about you as a person and what you believe in and what you are about. To do this you really need to have an open mindset and also to listen to what others are telling you

TEU: The founders of some sociallyoriented start-ups have begun focusing on helping fellow entrepreneurs, while creating new business opportunities for themselves. What are your views on this? MG: Sometimes you reach stages where you question whether what you have done is right, but the deep belief in your venture and what it brings to others keeps you going. At IVC College – business 40 |

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school, we are about intrapreneurship as well as for entrepreneurship. Intrapreneurship is about setting up a business opportunity within a company you are employed in, as well as setting up your own venture to achieve successful employability. In fact, this year one of our students has set up his business whilst still completing his course, this was a great way for him to receive feedback and support throughout the initial stages of his start-up from the expert lecturers that he had surrounding him.

TEU: Failure is inevitable, but is there a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? MG: When you believe in your idea and take the risk to set up your own venture and failure strikes, it is very painful. It is just like your baby getting hurt. The hardest part is the acceptance of failure as a learning process, to do this you really need to have an open mindset and also to listen to what others are telling you. It might be that it is not working out in the way you had planned, but it could possibly work out with modification, the real failure is not to learn because you don’t listen. TEU: How do you inspire others with your achievements and success? MG: I believe rather strongly that we have to look at our educational paradigm and how we are preparing our students for the future. In the 1920’s it was important that some of our youth learnt how to fire a gun… there were wars going on which required those skills. What skills are we preparing our students for in the future? Are they the real skills that will be needed? My inspiration is drawn from great thinkers within our society, and all I do is

TESTIMONIALS Michelle is a passionate and focused entrepreneur whose caring nature reflects in her work at the college. Stefan Morrow. Director and founder of Wild grass ltd. Michelle’s energetic personality and family oriented values make her an asset to work with and provide a great role model for her students. Mr Nazzareno Vassallo, Chairman, Vassallo Group

share the thoughts which strike me as relevant and necessary to others.

TEU: What is your leadership style? MG: I always wondered if you got to choose your leadership style. I am honest with my team and they are likewise, even if sometimes that is painful for me to hear. TEU

ENTREPRENEUR DETAILS Past Achievements: ·

2011. The setting up of the college within Vassallo Group and the recognition internationally.

Followed by the first graduation of our students in 2012.

The award of the Jamie Oliver cooking course, in 2012, and the opening of the IVC – Healthy lifestyle school.

2013, we held our first International conference on Intrapreneurship. This started a very healthy discussion on how we have to prepare our students for the future.

Awards: Ph.d from Nottingham University. Inspiration: My children and what awaits them in their future.

APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

Creating a Win-Win Mindset Ray Attard

Company: Teatru Manoel Job title/Description: CEO Professional Expertise: Business Management, Certified Public Accountant and a Fellow of the Institute of Accountants Quote: “If everyone consistently moves forward together, success takes care of itself”

Whatever the numbers, it is clear that failure has lessons to impart. Not least among them-- as many of us were taught at a young age – is that you don’t know whether you will succeed if you don’t try. Ray Attard, CEO of Manoel Theatre says that a good person explains, a superior person demonstrates and a great person inspires others to see for themselves.

TEU: Can you offer a few key lessons that any business owner can -- and perhaps should -take to heart? RA: The most important issue for any successful business owner is that one must understand his customers’ both present and future needs, design a competitive product which possibly exceeds their expectations through the careful organisation of competent Human resources, who together strive with dedication and passion to achieve continuously-improving results. Employees must always be listened to and included in the affairs of the organisation as it is only through strong teamwork and a clear sense of vision and direction can the demanding objectives of a successful business venture be reached.

TEU: The founders of some sociallyoriented start-ups have begun focusing on helping fellow entrepreneurs, while creating new business opportunities for themselves. What are your views on this? RA:Networking-through-benchmarking meetings, even between competitor companies, can create a lot of win-win situations, especially for those who are passing through their initial business phase. I have personally learnt a lot from young and budding business-oriented persons during such meetings.

TEU: Failure is inevitable, but is there a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? RA: There is no business without risk, but if one manages to have the right ingredients and mechanisms in place to calculate risk, then one can even manage to grow from turbulent experiences which happen on a regular basis in any bubbling business activity.

TESTIMONIALS Ray is a perfect example of how business expertise can, and should, be applied to Malta’s ever growing cultural industry. If we (as a country) are to develop this sector we need to successfully ally the creative talents we have with the diligence, foresight and entrepreneurial skills of people such as Ray. Dr. Michael Grech, Chairman, Teatru Manoel

ENTREPRENEUR DETAILS

TEU: How do you inspire others with your achievements and success?

Achievements:

RA: Success depends on the concerted effort of a team of people and it is therefore of paramount importance that everyone is made to feel an integral part of such an achievement. It is also important to celebrate success, but then off we go, together, to the next challenge trying to achieve even better results. The more the successes, the more humble and feet on the ground one must remain, albeit always convinced of your potential and talents.

• Developed the company from an assembly operation to a fully-fledged, internationally-reputed manufacturing company, taking it from 60 to 350 employees, with sales increasing from €5million to €22million

Success depends on the concerted effort of a team of people and it is therefore of paramount importance that everyone is made to feel an integral part of such an achievement

TEU: What is your leadership style? RA: As one can see I listen a lot and give space to my people to participate actively, even though I normally know exactly where I want to go, but I continue to learn from all my colleagues and therefore I discuss a lot. After this participative process is completed, it is normally obvious which kind of decision needs to be taken. However, when there is a difference in opinion around the table, then I do not have a problem to evaluate all that has been said and decide accordingly.

AS MANAGING DIRECTOR OF CARLO GAVAZZI:

• Managed to set up in Malta a 30-strong Research and Development team, since 1997, to design products that the customers were expecting to see in the medium to long term. • For 10 years, I formed part of the Business Unit Board of Directors that met regularly in Switzerland and Milan to discuss key strategic issues. AS CEO OF TEATRU MANOEL: • Identified new revenue streams which permitted Teatru Manoel to embark and complete important infrastructural projects • Expanded the theatre’s cultural reach by both expanding the performance calendar with an eclectic mix of high quality music, dance and drama productions as well as successfully implementing the Children’s Education Programme which is introducing hundreds of very young children to the joys of live theatre • Successfully managed the first Valletta International Baroque Festival

Awards: Award for achievement in Industry to Carlo Gavazzi Ltd. Malta in 1998 presented by the President of Malta.

TEU

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APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

A commitment to Forward Eco-Thinking Ryan Xuereb

Company: Econetique Ltd. Job title/Description: Managing Director Professional Expertise: Engineeing Renewable Energy Quote: : Once we accept our limits we go beyond them - Albert Einstein

Ing. Ryan Xuereb believes in Forward Eco Thinking, providing Eco-Conscious Solutions and replenishing the wellbeing of our Environment. Today, as Managing Director of Econetique, Ryan is acknowledged as the driving force behind one of the premier renewable energy providers in the Maltese Islands.

TEU: Can you offer a few key lessons that any business owner can -- and perhaps should -take to heart? RX: There is never enough time spent in planning. Planning means that you can forecast market trends before they happen, problems before they develop and manage successfully. At the end of the day it is the value adding. The satisfaction that has awarded you new customers in a niche market. The thought that has saved you costs solving a problem. TEU: The founders of some sociallyoriented start-ups have begun focusing on helping fellow entrepreneurs, while creating new business opportunities for themselves. What are your views on this? RX: Experience and knowledge is money. It is reasonable that entrepreneurs charge for the knowledge they have built up during their years in the business. As I already mentioned, there is never enough time spent in planning. Hence if you can get the help of someone who has experience and helps you plan better it is money well spent. This has double significance when one is involved in contributing to harness our 42 |

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energy resources, render them user-friendly and at the same preserving our environment. Losing a battle does not mean you lost the war

TEU: Failure is inevitable, but is there a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? RX: Einstein once said ‘a person who never made a mistake never tried anything’. However he continues telling us that ‘we cannot solve our problems with the same thinking we used when we created them’. Losing a battle does not mean you lost the war. You just need to stop analyse the problem, or failure from another perspective and capitalise from that. Sometime it is better having encountered a problem from which, with the acquired knowledge, you can build something better. TEU: How do you inspire others with your achievements and success? RX: By never stopping to question how it can be done better. I sometimes look at other people’s ideas and think if only I had thought of that. That inspires me to think harder. Hence by never stopping myself I am pushing others into thinking harder. TEU: What is your leadership style? RX: Empowerment. I believe that you need to let everyone fight their own battle to build self confidence. Each individual within your merit

TESTIMONIALS Ryan your leading by example has helped you start-up and grow your company to admirable heights in a relatively short time. Your outlook to research and innovation has not only won you admiration from the local engineering community but will also guarantee you more success in the future. Joseph Borg - FXB Group Director

needs to be responsible for the growth of his/her sector. I do not believe in micro management. It clogs brain power and imagination. It is the value-adding in each thought that makes a company grow. That bright idea which opens new doors to new success. TEU

ENTREPRENEUR DETAILS Details: 33 years old Married & expecting first baby. Graduated in Engineering from University of Malta in 2002 Past Achievements: Designed and overlooked projects for interior controls on Premium Automotive Brands such as Jaguar, Volvo, Land Rover & Alfa Romeo Awards: Malta Scientific Innovation Award 2012 World Intellectual Property Organisation award for Innovative Enterprise 2013 Inspiration: ....and so you touch this limit, something happens and you suddenly can go a little bit further. With your mind power, your determination, your instinct, and the experience as well, you can fly very high - Ayrton Senna

APRIL 2013 | THE ECONOMIC UPDATE

TOP ENTREPRENUER AWARDS 2013

Seeing the Big Picture Eman Borg

Company: LogicPass Ltd Job title/Description: Managing Director Professional Expertise: Software Development, Networking, Cloud Computing, Virtualization Quote: Most of the important things in the world have been accomplished by people who have kept on trying when there seemed to be no hope at all. Dale Carnegie

Eman Borg always wants to see the big picture by zooming out. We zoom our lenses on Eman to find out what makes today’s business environment different from the past.

TEU: Can you offer a few key lessons that any business owner can, and perhaps should, take to heart? EB: Take any challenge as an opportunity. Do not be afraid to try something new. If you are willing to try things you haven’t done before, you will learn new expertise. What matters is that the risks you take are well studied and calculated. ZOOM Out... Always see the big picture. As good as things may look close-up, you should always have a wider view of your business.

TEU: The founders of some sociallyoriented start-ups have begun focusing on helping fellow entrepreneurs, while creating new business opportunities for themselves. What are your views on this? EB: At LogicPass such business model has been implemented for many of our projects. We focus on helping entrepreneurs, small businesses and

TESTIMONIALS “I have used tenders.com.mt several times and was always alerted instantly when a tender is out. Much better then having to sift through thousands of tenders to find the one you need.” - David Seisun Sales Manager Handson Systems

enterprises by simplifying business processes and aiding in extending their reach to larger audiences. Social networking, specifically online word-of-mouth, has become a staple of today’s business. That’s where my business comes in! Our company has created platforms aims at facilitating B2B and B2C interactions: www.tenders.com.mt - Who has the time to look at the Government Gazzette on a daily basis any longer? With this site we charge a nominal yearly fee to inform our clients by email/sms whenever a tender from a government or private institution related to their business is issued. www.ecino.com - Online word of mouth is quintessential for today’s business, be it an ice cream parlour or an insurance company - an entrepreneur simply cannot afford to stay out of the game! Ecino is a simple payment system that encourages interaction and between one’s business and his customers. This business model has been responsible for some of Malta’s leading online viral case studies. www.deal.com.mt - This novel website gives the general public a number of daily deals that wouldn’t otherwise be available offline. This successful model has been responsible for a steep rise in overall online purchasing in Malta.

TEU: Failure is inevitable, but is there a right way to go wrong, and is an open mindset and a willingness to learn from mistakes the way forward? EB: Yes, I strongly believe that failure is an integral part of success. Learning from mistakes can help solidify your future. It is, however, important to rebound back into business swiftly. What makes today’s business environment different from the past is its permeability of

change, i.e. the faster rate at which it is changing and evolving. Today’s entrepreneur must be a faster thinker in order to act swiftly and stay ahead of competition.

TEU: How do you inspire others with your achievements and success? EB: I see myself as an aspiring entrepreneur. I enjoy the entrepreneurial journey itself and not merely the success that comes with it, and hope that my energy and enthusiasm leaves a positive mark on my employees, clients as well as my competitors. TEU: What is your leadership style? EB: I believe in a flat hierarchy, where everyone is empowered to take the lead when deemed necessary. I believe in minimal red tape and bureaucracy. This environment helps brew creativity and lateral thinking within our office walls. TEU

ENTREPRENEUR DETAILS Achievements: LogicPass were Nominated by Malta Communications Authority for the eBusiness Award - Best indigenous enterprise of the year in 2011 for the website tenders.com.mt * Developed Ticket Management System for Rockestra including online portal and on-site ticket management solution with wireless barcoding systems * Donation / Call / SMS Management for l-Istrina, Caritas, Dar Tal-Providenza and other local organizations 2003-Present * Providing nComputing solutions that allow 30 users to have their own desktop on a single computer while saving 90% of electrical energy and 50% acquisition cost.

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APRIL 2013 | THE ECONOMIC UPDATE FINANCE

Access to Finance - Part 1 by Patrick Hall

BARTER Barter is a method of exchange by which goods or services are directly exchanged for other goods or services without using a medium of exchange, such as money. This tool can be useful and cost effective but has to be used wisely. This shall only be used to barter your goods and services to get raw materials or items required to finish your product and service. It is not advisable to use it as a means to sell your products and services as it will affect your cash flow negatively and can lead to serious consequences.

BANK LOANS Bank loans are one of the most common forms of finance for small and medium-sized enterprises and business start-ups. They are generally a quick and straightforward way to secure the funding needed, which is usually provided over a fixed period of time. Bank loans can be capital repayment or interest only and can be structured to meet the businesses needs. For businesses seeking to purchase premises, commercial loans are widely available and will offer flexible terms to suit each business’s needs. Loans can be short term or long term, depending on the purpose of the loan.

BUSINESS OVERDRAFTS

Patrick Hall

Enterprises and businesses lose the confidence as the real economy takes a hit. The current global economic situation does not help any business. It’s the time for every business to take a stock of the situation and see where it needs to improve and focus on areas that need to be restructured.

Restructuring is not only done in operations as it is equally important to do the restructuring of your finance. Deep analysis needs to take place to see that you are in possession of the right financial tools and see the amounts are up to the requirements of the company. One has to also look at the cost of the finance. Have you got the right instrument in place? Do you need to consolidate? Are there other ways to get your finances in place cost effectively? Finance is at the heart of every business. It gives a company the ability to firstly survive in the current scenario, then to grow expand and flourish. There are different types of financial instruments a business can make use of. 44 |

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Overdrafts (OD) represent the most common form of business borrowing. Simply put, an overdraft occurs when money is withdrawn from a bank account and the balance goes below zero. Usually the business through a cash flow analysis applies for an OD to finance its operations and a limit is usually set by the bank depending on the company’s operations. It is always recommended and is also a condition from the bank that the OD should be strictly used for the operations and not to purchase assets. In case of purchasing of bank assets bank loans apply. If a company like start ups needs to purchase initial stock sometimes it is more feasible to apply for a loan and get better interest rates with the option to pay on a longer period usually five years. A healthy OD should fluctuate up and down regularly when required. If your OD is always to the limit, then you might consider other instruments. Please visit our new website at: www.maltaeconomicupdate.com TEU

Editor’s Note: Having started his career as a Junior Accountant with Grant Thornton, Patrick Hall moved into the IT sector with Information Technology services Ltd serving as a Marketing and Sales Manager. His experience during this period involved business development and implementation of systems in different business sectors. Patrick was also involved in training of employees in leading companies including government entities. For a number of years he offered freelance advisory and consultancy services. Mr Hall was appointed General Manager with Halmann Vella Group, where he used to oversee structural organizational, implementation on new systems and business process re-engineering. He is now managing DF Business Advisory Limited which forms part of DF group of companies where he is assisting foreign companies to set up their business in Malta, Business Restructuring to local companies and assisting entities to access to Finance and Funding Opportunities.

APRIL 2013 | THE ECONOMIC UPDATE BUSINESS

Business sustainaBility by Luke Desira

Companies have problems – bureaucracy, waste, duplication, complexity, cycle time, or repetition.

ISO 9001 is a Quality Management System that gives good business practices on how to ensure three aspects:

These problems call for immediate attention because the operations of every company whatever the size, boil down to a set of processes, and the efficiency with which these processes are executed dictates how well the business is running. That is why companies looking to improve their operational efficiency, are now adopting quality management systems (QMS).

Process approach – products are delivered to clients through a series of interconnected events

Customer focus – the role of the company is to help their clients meet their needs

Continual improvement – collecting the required data that can be analysed to pinpoint the areas that need improvement.

ISO 9001 is the world’s most widely recognized standard for quality management system.

The implementation of the Quality Management System is a manageable task if you have competent people within your team. An effective quality management system is an on-going process that will lead in improvement to both business performance and quality throughout the company.

To ensure sustainability in the business, it is imperative to focus on what the client is getting. It is useless to try to focus on too many procedures because as Plato had said ‘Good people don’t need laws to tell them to act responsibly and bad people will find a way around the laws’ – Plato.

Luke Desira B.Eng M.Sc. H.Dip.is a process expert at STEP Enterprises.

Ask someone inside the company, or ask external experts for support. TEU

mobile: 79206686 | e-mail: luke@step.com.mt 1 mobile: 79206686 e-mail: luke@step.com.mt

WHAT ARE WE ABOUT? Very small incremental changes can have a huge positive impact on your business. This is our central principle at STEP. Our team’s services are tailor-made according to the needs of your company, set in a professional yet friendly environment. STEP can help you both in setting up and running your quality management system. To learn more about how STEP can help you improve your business’ efficiency, get in touch with us.

For a limited time only, Malta Enterprise is offering a tax deduction of up to 52.5% on the costs for certification of: ISO 9001 ISO 14001 CE Mark

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APRIL 2013 | THE ECONOMIC UPDATE ENVIRONMENT

Securing

Our EnvirOnmEnt by Martin Vella

Ing. Oliver Fenech, Projects & Development Manager with PTMATIC, talks with us about environmentally sound management of hazardous wastes, affirming that the companyâ&#x20AC;&#x2122;s strategies and measures to halt and reverse the effects of environmental degradation in the context of increased national and international efforts to promote sustainable and environmentally sound development in all countries

This phenomenon has now been recognised by TEU: If I understand it correctly, you made a significant career decision in joining PT Matic. Is that right? OF: Joining PT Matic Environmental Services Ltd (PTM) marked an important step in my career as I had been looking for a company where I could apply my skills while at the same time being exposed to important projects, both on a national and international level. Furthermore, I wanted to form part of a team of competent individuals who work together in a professional business setting where the common aim is to make a difference by protecting the environment. I am glad to say that over the past four years this is exactly what I found and this provides me with the extra motivation to continuously strive to improve our modus operandi. 46 |

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We identify permitted plants within the EU that can accept and properly treat the various wastes

TEU: Would you give us an overview of the comprehensive services covering all hazardous and non-hazardous waste streams? OF: PTM, which forms part of the Alberta Group, is as a specialist supplier of a comprehensive range of environmental services that range from the proper handling and disposal of hazardous and non-hazardous waste to environmental testing, consultancy and the supply of related equipment. With regards to waste, given the lack of local solutions, we identify permitted plants within the EU that can accept and properly treat the various wastes we handle for safe disposal or recovery. We carry out all the background checks necessary to ensure that the plants are fully permitted and are capable to treat the waste properly. Very often we visit the plants to check things out in person. The added difficulty is shipping the waste to these various destinations as very few shipping lines accept hazardous waste onboard. We currently handle around 6,000 tonnes of waste per year in approximately 300 exports of a wide range of hazardous and nonhazardous waste, such as asbestos, fly ashes, waste electrical and electronic equipment, solid and liquid pharmaceutical waste, oils

and sludges, cytotoxic waste, paints and chemicals of various kinds, refuse derived fuel, waste wood etc.

TEU: Which markets do you operate in and who would typical clients of yours be? OF: We have established ourselves as the main hazardous waste handler in Malta but we are also highly active in the North African markets particularly in Libya. We provide our services to a wide range of clients coming from very diverse fields such as waste generation, manufacturing, cosmetics and pharmaceuticals, power generation and oil and gas, ship building etc. TEU: What are PT Maticâ&#x20AC;&#x2122;s capabilities wherein the handling of wastes is involved and how do you execute waste management contracts in full compliance with international legislation OF: Clients come to us having a waste related problem which could vary from the odd asbestos roof that requires removal to a very serious case of ground contamination. We have developed the full capability to properly handle and dispose/recover all forms of waste. Whatever the challenge we are faced with, we make it a point to provide our clients with the best possible service while protecting human health and the environment. For instance we are the only organisation in Malta with a specific asbestos works insurance which covers both our workers as well as third

APRIL 2013 | THE ECONOMIC UPDATE ENVIRONMENT

parties. Our staff made up of engineers, scientists and qualified onsite operatives are fully trained and competent in their work, but most importantly they have the environment at heart. As part of our work, we are also in constant contact with the authorities, OHSA and MEPA in Malta, but also the relevant environmental authorities overseas to ensure that all the movements are done in full compliance to international legislation.

including the disposal of camp wastes, medical and cytotoxic wastes and plant for the treatment and disposal of municipal and related wastes, as well as water and sewerage treatment plants. We also supply geotextile materials for use in Landfills etc. In all cases, we can design, supply,

install, commission, and maintain the plants as the client requires. At PT Matic our aim is to protect our environment and to keep it safe for future generations. TEU

TEU: How do you co-ordinate export/ movement of hazardous and nonhazardous waste, from collection until final delivery? OF: The shipment of waste is controlled by what is known as the Basel Convention, which is an international treaty that adopts a very rigorous system for the control of all trans-boundary movements of waste and their disposal. We employ staff whose role is that of coordinating all the movements with all the stakeholders involved and ensuring that we have and maintain all the necessary permits for the wastes we carry. Today, we are the organisation that possesses the largest number of permits from MEPA for the export of different hazardous wastes to various plants for proper treatment. We make it a point to provide our clients with the best possible service while protecting human health and the environment

TEU: Why do you consider PT Matic as an expert in the conduct of Environmental Testing Programmes? OF: We supply testing instrumentation and develop and implement suitable testing programmes depending on the analysis required. As an independent, multidisciplinary consultancy we cover all aspects of environmental protection and sustainable development and we offer impartial advice to define the optimum technical solutions to a variety of environmental problems. We also work with clients to undertake major Environmental Baseline and Impact Assessments in a range of situations. TEU: Does PT Matic offer environmental equipment materials? OF: PTM is a major supplier of a wide range of Environmental equipment and materials. In particular Incineration and gasification equipment for a variety of applications

Profile Oliver Fenech Projects and Development Manager for PT Matic Environmental Services Ltd •

B.Eng (Hons), M.Phil, GIED

•

Bachelors degree in Mechanical Engineering;

•

Masters degree in Product Design;

•

Occupied management positions over the past seven years;

•

Participated and presented at numerous conferences worldwide;

•

Over the past years has worked actively to transform PT Matic from being just an asbestos contractor to become the local leader in the handling of hazardous waste;

Testimonial I have known Oliver from six years ago when we have met during a specific project, where he proved his competence and professionalism. Diligence, detail, management and communication skills are few of his evident abilities. Nowadays he can be defined as an expert in the field. Joseph Calleja, General Manager, Palumbo Shipyard

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APRIL 2013 | THE ECONOMIC UPDATE HEALTH

Turning the volume down in Europe’s cities

Millions of European city dwellers endure urban noise pollution every day. Apart from its nuisance value, noise in Europe has health risks with stress and cardiovascular issues being particular concerns, according to the World Health Organisation (WHO). The social costs of traffic noise in Europe have been estimated to 0.4% of total economic output, mainly from road transport.

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This phenomenon has now been recognised by the European Union (EU) as an environmental issue. The European Commission unveiled plans in December 2011 to cut vehicle noise in the coming years. And the 2002 EU Environmental Noise Directive already placed heavy obligations on city authorities to sort the problem out. To support them, the Commission has invested millions of Euros in research projects to find new ways of reducing urban noise. Until recently, research into noise reduction focused mainly on insulating buildings against urban noise. Little attention has been given to quietening the urban environment itself, but this is now changing.

“Urban noise can be tackled in two ways. If we can do something with the source of the noise first, we will. After that, we look at the way sound is propagated and perceived,” says Jens Forssén of Chalmers University of Technology, Gothenburg, and the project coordinator of HOSANNA, an EU-funded project tasked with looking at urban noise. HOSANNA provided a toolbox to reduce road and rail noise pollution that goes beyond traditional solutions such as sound barriers and speed limits. “We looked at a range of solutions that can help with urban noise reduction. For example, sound barriers that exploit soft materials, vegetation or possibly recycled

APRIL 2013 | THE ECONOMIC UPDATE HEALTH

materials could achieve significant reduction in noise compared to the straight-sided sound barriers commonly used now,” Forssén says. “The perception of the sound scope overall is very important, which is why we applied a range of assessments, including questionnaires and even physiological measurements of stress, to assess the effectiveness of the measures we will finally recommend.” The 13 project partners involved in HOSANNA, which ran for three years until November 2012, are supported by a €3.9 million EU grant. The project’s wide-ranging proposals have already attracted interest from architects, city planners, acoustic consultants, noise control engineers, and various other decision makers. One success story supported by HOSANNA was in Lyon, where researchers showed that a natural plant sound shield could deliver significant noise reduction. The project involved setting up a barrier just 15m long, 1m high and 40cm thick in front of the Church of St George on Lyon’s busy Quai Fulchiron. The wall was made of recycled materials including coconut fibres and lava stones - and some 1,200 different plants. “Although it is low in height, it is able to muffle sounds,” says Bruno Vincent, who is a director of Acoucité, a Lyon-based urban noise observatory that worked with HOSANNA on the project. The acoustic performance of the barrier was measured before and after the barrier was erected, with pedestrians asked to assess the sound environment. “The prototype was able to stop sound waves and create a quiet acoustic zone: the noise reduction behind the wall was estimated at between four and eight decibels,” Vincent says. Vincent, who has worked on noise issues for 25 years and has a PhD in environmental psychoacoustics, says the barrier was also successful in raising interest with politicians and city engineers. “It showed how vegetation could be used to deal with noise,” he says. A key to the success is that it reduced noise and also raised the attractiveness of the location. “It addressed a real problem with a solution that is both practical and visually pleasing: it could be both acoustically efficient and aesthetically attractive,” says Vincent. “So it is good for us, and it is good for our quality of life.” Reducing noise at source is an obvious place to start when tackling noise pollution. While tyres are widely acknowledged as the biggest source of noise in the urban environment, noise from cooling systems in vehicles such as cars and trains can come close.

ECOQUEST, a research project backed by a €2.4 million EU grant addressed the issue by looking into vehicle cooling systems. The three-and-a-half year project, which runs until mid-2013, has developed innovations that could lead to cooling units with reduced noise profiles and decreased carbon dioxide emissions. Reducing noise at source is an obvious place to start when tackling noise pollution

ECOQUEST’s focus was on cooling systems in trains and cars, designing new compact layouts, innovative heat management strategies and low energy/noise components. “We developed methodology for tools to make predictions about more efficient and quieter systems. And we have been applying these tools to fans,” says Manuel Henner, one of ECOQUEST’s research leaders. Henner, who is also an expert on fan systems and airflow management at French car parts maker Valeo, says ECOQUEST has already written some patents from its research on how to use the fan system to counter downswings, and adapt to the real conditions of the engine. “This will reduce costs, weight and electrical consumption. So this improves fan system efficiency, and therefore the performance of the engine,” Henner says. A prototype of the system was due by the end of 2012 to test the research and show the various efficiency gains. “It is about reducing 1 or 2% of engine consumption. That might not seem much, but it matters when you talk about the entire European car market,” he says. Henner says that the project, which began at the end of 2009, arrived at the right time, just as the economic downturn was hitting. “Without this project, we probably would not have been able to learn what we did,” he says. “Sometimes, you are shooting in the dark, and so you need a framework of a project, with a budget and partners. ECOQUEST gave us the consistency to carry on. This project was an opportunity to invest, continue and learn.” TEU

For further information see also: CORDIS: ECOQUEST http://cordis.europa. eu/projects/233541 ; HOSANNA http:// cordis.europa.eu/projects/234306 Projects’ websites: ECOQUEST http://www. uni-siegen.de/ecoquest/ ; HOSANNA http:// www.greener-cities.eu/ Courtesy: RTD-MEDIA-REQUESTS www.maltaeconomicupdate.com

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APRIL 2013 | THE ECONOMIC UPDATE IT

Reliable, Flexible and Customer Focused by Rebecca Hansen

Christian Sammut, Chief Executive Officer and R: Jack Mizzi, Chief Marketing & BD Officer

Since its launch more than ten years ago, BMIT has grown to become one of the leading companies of its kind in Europe. We talk with CEO Christian Sammut and Jack Mizzi, Chief Marketing and BD Officer, who explain why BMIT are definitely the number one data centre in terms of size, business operation, and expertise in Malta, as well as one of the leading online gaming providers in terms of data centre services. 50 |

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APRIL 2013 | THE ECONOMIC UPDATE IT

BACKGROUND BMIT’s competence as reliable, secure, flexible service operator is backed by 24/7 service at both its two data centres. Working around the clock, they provide technical assistance, including expert hosting and colocation services, though they constantly strive to build on their facilities and proficiency across numerous emerging technologies. The company offers three main categories of services: data centre services, cloud services and managed services, all on 24/7 basis. Within its data centre services category, BMIT supplies multiple and redundant connectivity to the internet, hosting space and power, all complemented by technical support. The second category is cloud services, with BMIT being the only provider of cloud services in Malta. Having invested a substantial amount of money, well over one million Euros to build a cloud platform last year, today the company has a fully automated platform, and they provide all categories of cloud services. BMIT are also leading online Gaming providers in Europe in terms of data centre services. Jack Mizzi gives a brief introduction on BMIT and also on the type of cloud services being offered. “The first type are public cloud services, available on demand and with immediate provisioning via our website. These include cloud computing, backup as well as applications such as hosted exchange mail. Then we offer private cloud services to customers in a dedicated set-up and personalised offering. Finally, we have the “best of both worlds” offering – hybrid cloud consisting of a mix of public and private cloud environments. What we do is architect all this.

TEU: And your third pillar? JM: Our third pillar consists of managed services, meaning our specific service offering is to provide technical and expert advice and support to our customers, including systems design, implementation and support for all type of IT set ups. CS: The company grew with the development of gaming in Malta, and as gaming in Malta grew from strength to strength and capitalised on that, we made sure we were able to grow with the industry and evolve our services from a pure co-location provider to offering a full portfolio services in co-location, cloud and managed services. Additionally, we believe that another of our strengths lies in our ability to provide a one-stop technological solution to our customers, whatever their area of operation. Gaming is very much a dynamic and evolving industry in Europe. Malta is a strong and large player in this market, but it is also impacted by changes in legislation and by whatever is happening in Europe. Therefore, we have to look at how we can adapt to those changes and also look at how we can focus on providing other services.

Looking at non-gaming business, In Malta I believe you have approximately thirty five thousand businesses, 97% of them are micro SMEs. A lot of them are also family owned businesses. What we find with such companies is that many of them underestimate the cost of running an IT system. Many of them relate only to the cost of a server or application “I spent five thousand on a server, I spent another five thousand on an application to serve my business requirements.” But then they forget that at the end of the day, they put it somewhere, so it is taking up space for them, they have to keep it running in a secure environment, and so there might be some security elements. You have to cool it, you have to invest in an UPS, since it is consuming electricity all the time. So you have to pay maintenance on it and you most probably need IT personnel to support you whenever you have a problem. You have to have access to the internet so you have to pay for that as well. You maybe have to look at a backup plan. So there are many parameters which many organisations may be ignoring when maintaining an in-house IT set-up. As a result we seek to advise customers on the real costs

involved and on the advantages of hosting an IT infrastructure within a data centre, or else make use of cloud services when applicable. The latter offer the benefit of a no up-front investment and pay-per-use payment model, and hence avoid the need for substantial financial commitments on IT infrastructure. TEU: What kind of projects have you worked on? CS: Our customer base is varied. At one end, we have some of the largest gaming operators in Europe hosted within our data centres. We also provide services to some major multi-nationals as well as businesses in IT, financial services, logistics and banking. On the other end, we provide services to micro businesses, start-ups and small professionals who use our services to minimise their IT costs and get flexible and personalised services. JM: Our objective is to allow our customers to focus on their core business and leave the IT support function to us. Our portfolio of services easily allows for this and irrespective of whether it is a two employee, or a two thousand employee set-up, we can provide with solutions www.maltaeconomicupdate.com

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APRIL 2013 | THE ECONOMIC UPDATE IT

which add value and let business focus on their operation without worrying on support services such as IT set-ups. CS: One typical example is a recent new customer – a Maltese living in the Far East. He is currently hosting with a US company but serving primarily the European market. He is having issues of time zones, issues of latency, performance, etc. He contacted us, not sure if we can cater for a one-man organisation. We provided him with a solution which we believe addresses his requirements in a costeffective manner. As Jack said, we have a mix of customers in terms of size, operation and turnover, and whereas originally they were mostly gaming, we now have customers in IT, transport, legal, insurance and finance, amongst other. Business is a game and only the team with the best players will win

We are currently doing a major implementation for an international customer, a well known brand in the communications market. They trusted us to set up their services here and provide them with a range of data centre services. Any data centre has to comply with certain regulatory and technical requirements, even from a security perspective. We follow international standards and provide services within the parameters of such standards in order to ensure the highest level of service quality. TEU: Where does security come in all of this? CS: Obviously security is paramount for us. Customers trust us with their IT set-ups and their data, which is often the single-most important set of information a company possesses. We therefore ensure that any risks are minimised and preventive action taken. For example we are very strict regarding physical security and access to premises, with not only access control systems, but also with CCTV cameras all over the place. We also have very sophisticated fire detection and fire mitigation systems. Connectivity to the Internet is also critical – we are probably the only data centre in Malta which is connected to all fibre cables going out of Malta. This allows us to offer 52 |

peace of mind to our customers, in addition to any volume of bandwidth they require. Power is also an issue. We want to ensure that customers have uninterrupted service and in this regard have put in place all the necessary infrastructure, including multiple power feeds, a UPS set-up that can handle all customers and more, as well as a generator set-up that can run uninterrupted for days. JM: In addition to physical security we also ensure that we provide the best service in relation to information security. In this regard we have been recently granted the ISO27001 certification in Information Security Management by BSI – British Standards Institute. We are also PCI DSS certified, meaning that our data centres are certified to host customers requiring the handling of payment transactions. The combination of all these gives a high level of comfort to our clients, who trust us with business-critical data and applications. TEU: How do you intend to retain the competitive advantage of the brand BMIT? JM: BMIT is a very well established brand in the online gaming world and is slowly but surely building a reputation among non-gaming customers. We are very conscious on what the company means to our customers, and our prime objective is to continue nurturing our relationships and build new ones in nongaming markets. Also, business is a game and only the team with the best players will win. We are investing substantially in our team to ensure they remain on the forefront of knowledge, competence and ability, to provide customer with solutions that fit their requirements. To remain competitive, we have to remain and be distinctive. This was our most competitive advantage and the singular reason why we are still in business. TEU

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Bio Christian Sammut - Chief Executive Officer Christian is an experienced data centre and business development specialist. Throughout his career Christian has worked in the private and public sectors both locally as well as overseas, including the aerospace industry. His responsibilities have included the delivery and support of IT infrastructure services, as well as the management and operations of the Government of Malta’s data centres. In 2001 Christian joined GO, Malta’s largest telecommunications provider, to develop new business and data centre opportunities. More recently Christian held various positions at GO including that of Chief of Strategy and Business Development. Christian is a graduate in engineering from the University of Malta and holds a Masters in Business Administration from Brunel University.

Bio Jack Mizzi - Chief Marketing and Business Development Officer Jack has a long career in telecoms and broadband services, specialising in marketing and business development. He has developed and managed broadband and bandwidth initiatives for one of Malta’s leading communication companies, and was responsible for product development, marketing communications and wholesale -related functions. Subsequently he managed a new telco content function spanning web portal management, newsroom and digital TV, as well associated e-commerce and advertising sales functions. Jack is a graduate in Management from the University of Malta and holds an MSc in Marketing from the University of Leicester.

APRIL 2013 | THE ECONOMIC UPDATE

Athens And IstAnbul -

TRAVEL

Enchanting destinations a stone’s throw away with Air Malta Athens and Istanbul; two cities renowned for history, myths and legends are so close yet so different. Athens and Istanbul; two cities renowned for history, myths and legends are so close yet so different. With Air Malta’s low fares to Athens and Istanbul, clients may enjoy a few days away from Malta and explore these Mediterranean cities that have so much to offer. Fares start from as little as €69 to Athens and €89 to Istanbul. These are based on one-way trip per passenger including all applicable taxes and charges and are available on www.airmalta.com. Air Malta operates two weekly flights to Athens every Monday and Friday and two weekly flights to Istanbul every Monday and Thursday. As from 19th June, Air Malta will be operating another weekly flight to Istanbul every Wednesday. Athens, considered the cradle of western civilisation is full of possibilities that cater to all tastes and cultures. One of the greatest European

cities with its wide range of theatrical stages, most famous of which is the ancient Herodes Atticus theatre, home of the Athens Festival that takes place between May and October. Athens features many romantic, open air garden cinemas as well as a vast number of music venues. Sophisticated Athens sites include many pillars of western history, from the Acropolis to the Temple of Olympian Zeus, as well as world-heritage treasures in the National Archaeological Museum. Istanbul, a rapidly-growing metropolis enjoys a multitude of ancient and modern riches. It is primarily known for its Byzantine and Ottoman architecture but its buildings reflect the various peoples and empires that have ruled over the city. Visit some of the most iconic structures like the Hagia Sophia that stood as the world’s largest cathedral for more than a thousand years before being converted into a mosque; and see the splendour of the imperial mosque known as the Blue Mosque. The Topkapi Palace should not be missed with its diverse array of architectural styles from Baroque to Neoclassical and remarkable collection of antiquities.

Air Malta maintains its commitment in offering value for money and superior service in both its economy as well as business class cabins. The airline offers complimentary refreshments as well as free allowance of one 10Kgs hand luggage and a poolable 20Kgs free baggage allowance to its economy class passengers. Club Class passengers are given an allowance of two pieces of hand luggage for a total weight of 15Kgs plus 30Kgs baggage allowance. An additional service fee of €5 on each ticket is applicable on tickets issued from the call centre or the airline’s office. Certain conditions may apply.

TEU

More information can be obtained from the airline’s website www.airmalta.com.

Go to Athens

from just

Visit Istanbul

from just

Go for history. Go for great food. Go for breathtaking beauty.

The city where Europe and Asia meet.

€69 €89

Flights are one-way and inclusive of taxes & charges. Seats are subject to availability. Terms and conditions apply.

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APRIL 2013 | THE ECONOMIC UPDATE

MaxiMizeyour Business BUSINESS SOLUTIONS

Business solutions from Office Group Ltd increase efficiency and cut down costs.

hatever the needs at the workplace, the picture is more or less the same everywhere: Whether your office is large or small, whether it’s corporate or departmental – document creation, reproduction, distribution and sharing is based on solutions. Divisions like logistics, marketing, personnel, finance and others have two main requirements with their office equipment: 1

Devices must be affordable and offer an excellent cost/performance ratio. You rightfully expect your equipment to be available at all times - which should be ensured with perfect technical service and support, reliable but virtually unnoticeable.

Any new equipment to be considered must be perfectly simple and straightforward to integrate into the existing network setup. At the same time, administrators want an easy setup and maintenance of all devices and intelligent software support. From small offices to big enterprises, Office Group Ltd clients easily find the individual solution that perfectly fits their most specific and diverse business requirements. As the present local distributor for Konica Minolta for over 25 years, its unparalleled suite of products ranges from entry-level devices to cutting edge high-performance print systems in colour or black and white. Proud to have a vast production print client base both locally and in North Africa, covering most large organizations, government departments and corporations, OGL is renowned for reliable and efficient after sales service, backed by qualified technicians who are trained overseas. Konica Minolta Business Solutions is a leader in advanced document management technologies. For the sixth consecutive year, it has been recognized as the top brand for customer loyalty in the Office Copier Market, being named 2013 “Document Imaging Solutions Line of the Year”. The philosophy of constant innovation has produced the present generation of technologically superior devices and systems. This exclusively designed choice of highly efficient and perfectly compatible multifunctionals will help you lower your print and document management costs, enhance your productivity, improve your business and increase your profits.

All Konica Minolta products comply with local and global environmental laws and regulations, backed up by the many certificates which the company has applied for and been awarded: Blue Angel, Energy Star, ISO 14001, ROHS. For over 30 years, after-sales service has been OGL’s philosophy. Nowadays it can also provide full customer support remotely. Through Konica Minolta CS Remote Care, users benefit from outstanding levels of device monitoring in real time, which advise the service side early on routine maintenance or any other required intervention. It allows triggering automated services via the remote communication path – e.g. delivery of consumables, firmware updates and device settings. Downtime of output devices is minimised, productivity enhanced and routine maintenance planned conveniently within users’ work schedules. Konica Minolta has in its present portfolio highquality multifunctionals with an array of state-ofthe-art technology, most prominently represented by the latest Emperon™ controller for powerful print architecture, advanced biometric finger vein authentication, and its proprietary Simitri® HD polymerised toner for superior image quality.

(ballpoint pens, felt tips…). This means that Konica Minolta printouts, e.g. contracts and training materials, can be signed or marked with no difficulty. The printed output is more durable and does not peel from the paper surface: paper can be folded without degrading print quality. Konica Minolta Business Solutions GmbH has a Representative Office in Malta, from where they provide full support to the local market and to the CAMEA area (Central Asia, Middle East and Africa) and beyond. Today, their offices cover two whole floors of the Oftec Centre at 1/2 Notabile Road - Birkirkara, where Office Group Ltd holds its operations and showroom. TEU

Office Group Ltd, Oftec Business Centre 1/2, Notabile Road, Birkirkara BKR1876 Tel: (356) 2149 3483 - (356) 2149 5596 Fax: (356) 2148 4320 - (356) 2149 1795

Simitri® HD polymerised toner is one of the few toners which do not contain oil, enabling the output to be written on using various writing implements www.maltaeconomicupdate.com

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APRIL 2013 | THE ECONOMIC UPDATE TECHNOLOGY

A Brand New Way of Thinking HandsOn is a telematics company with some bold and ambitous projects and ideas. Founded in 2010 HandsOn has a very clear mission - to create cutting edge technolgy solutions that work the way customers want them to work. Geoffrey Farrugia describes how in just two years, HandsOn has established itself both locally and abroad by providing GPS tracking, fleet management, RFID and mobile solutions.

TEU: What makes the handson brand so special and how have you led within the industry? GF: HandsOn is not just any other company. HandsOn has become a new way of thinking, a clear vision, a technological culture, one which is dynamic and forward looking. We believe in this culture and we share it also with our customers. We have been fore runners in our industry not because we are nice, but because we listen and we deliver. We are far from perfect but this makes us even more interesting as we keep on learning. Many companies seem to reach a peak and they just stay there perhaps because it is more convenient for them to stay there. Our company is not in the business of reselling technology or trading hardware or software for a profit. On the other hand we create technology from the ground up. TEU: How do you focus on your brand and has brand operational improvement allowed you to focus on being much more consistent with your end-to-end customer experience? GF: Brand is everything, but it is nothing if the brand is not backed up by reliable, cost effective and powerful products and services. Customers need to belong to something. This 56 |

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sense of belonging is in every single one of us, it is part our human nature. A strong and sensible brand makes you want to be part of it. This is why there is somehow a feel good factor around buying branded stuff rather than unbranded or fake ones. A good brand however, begins at home. A strong brand helps employees to be more motivated and to feel part of something special to begin with. All this translates into creating better products and offer better services because all employees are motivated and enthusiastic about what they are doing. This then translates into a happy and satisfied customer who wants to be part of that brand. It is a cycle which we need to constantly take care of. If one of our team members is not in sync with this culture then something, somewhere is going to tarnish the brand. At HandsOn our brand is our life we live it, we wear it and we believe in it.

We constantly work on keeping our brand moving with a strong momentum. There is much more to strengthening a brand than advertising the brand on billboards or

magazines. That is just part of the cycle. At HandsOn our brand is our life - we live it, we wear it and we believe in it. To have most if not all our employees looking forward to come to work every single morning says something. The brand is strong and itâ&#x20AC;&#x2122;s there!

TEU: How do you continue to leverage the legacy while focusing on the brandâ&#x20AC;&#x2122;s evolution and what it needs to be today? GF: A brand such as ours is bold. Many brands do not mean anything. Take Apple for example, which we all agree is one of the strong brands around. The word apple does not invoke any strong message yet is quite a powerful brand. In contrast, HandsOn is saying something. Have you ever thought how much the word hands-on is used in our daily lives? Even the Prime Minister himself in his recent budget speech has advised more than once that the government needs to be hands-on. HandsOn means being there on the field and be able to touch and feel subject matter. Being hands-on is being practical and being able to drill down, observe and take care of every little detail. Operating in the technology sector, the brand needs to be fast moving. Our customers have to always ask us whatâ&#x20AC;&#x2122;s next? With a vast range of products and features in place but also in the pipeline HandsOn is not just about evolution but revolution!

APRIL 2013 | THE ECONOMIC UPDATE TECHNOLOGY

TEU: How do you associate hansdon brand’s original no-frills theme with the associated moves to grow business traffic and ancillary revenue initiatives? GF: A number of sub brands are already in place. A brand needs to be flexible. Take Google for example. You have Google Maps, Google Drive, Google Translate which are all powerful sub brands for products and services that Google has created. HandsOn is preparing to launch a number of other services that will increase both existing business but also create new revenue. Diversity in one’s own sector is beautiful. Have you ever asked yourself how Google went from a search engine provider to a mobile phone manufacturer? Many companies are afraid to explore parallel avenues when in today’s world we have so much convergence of different technologies into one platform. Take the smartphone as an example. It is a diary, a camera, a phone, a Sat Nav and a million other things you want it to be. HandsOn has some great ideas in the pipeline some of them will remain on paper for the moment but some of them will be launched this year. Stay tuned. HandsOn range of products and services are built around cloud technology. The cloud is flexible and grows with our business.

TEU: So how does businesses, large or small, take advantage of the new apps medium, which is a cloud-based model? GF: Today technology is changing the way we create technology. The cloud is the future - no doubt about it. We deliver cloud based solutions because we think that there is no other better alternative. Many legacy companies who have been building desktop applications are realising that this is the way forward and are following suite. HandsOn range of products and services are built around cloud technology. The cloud is flexible and grows with our business. It is also benefiting from the economies of scale that we always talk about. A start-up can never afford the data centre infrastructure that a cloud service provider has so the only way is to rent part of that cloud. Cloud technology has helped to create a strong and robust telematics platform which is like a fire and forget missile.

has focused on consolidating the services that it offered for the last two years. Are we there yet? This is a question that we constantly ask ourselves day in, day out. This keeps us on tabs while making sure that we deliver what we promise. On the other hand, however, you cannot plan not to offer new services in our sector as you would end up missing the boat. It is a challenge that we constantly face and we are not afraid to admit that at times it is hard to keep up with. We like to think as if HandsOn is a ship (hopefully not a Titanic). As some people take care of the engines, others are planning the journey and ensuring that the ship is on course. Some of us at HandsOn are busy thinking about what is next, while others are refining what we already have. Finally, we are all hands-on deck when the need arises!

TEU: What are your thoughts on the different mobile platforms when it comes to app development? GF: This is one big headache but it is ought to be. Although many frameworks are around that permit us to cross compile and cross develop you still need to be hands-on and make sure that what works on one platform is working on the other. Testing is ultimately the most important thing because there are so many variants in today’s mobile phone market.

TEU: How have the service offerings evolved and are you bringing on new offerings today?

TEU: Does the reliance on technology simplify what needs to be done or make it more complex? GF: Good technology should simplify what needs to be done. It is all about design and testing really, two stages which are frequently overseen by many companies out there.

GF: It is all about adopting a divide and conquer approach. You cannot wage a technological war on many fronts as you run the risk to loose it before you actually start. Technology changes so quickly and if you cannot beat it you have to join it! HandsOn

TEU: How have you maintained a seamless experience for customers across all stores? GF: Customers are so different. Providing a consistent and seamless experience for customers has never been so critical. Retail

customers are increasingly well informed, leveraging a vast amount of information applied to product research and comparison shopping. Beyond the information available to customers today, the avenues available for sales execution, traditionally viewed as point-of-sale, extend well beyond the traditional cash register. TEU

Overview HandsOn Systems Ltd. is a telematics company located in Malta made up of the right people with the right skills. HandsOn is made up of creative innovators with a passion is to research and develop high tech solutions. HandsOn currently employ a team of 15 technology consultants, developers and engineers and delivers innovative IT telematic solutions to a broad range of clients worldwide.

Bio: Geoffrey Farrugia, aged 29, is the founder and CTO of HandsOn Systems. He is an IT graduate with over 10 years experience in the technology field and brings a lot of creative and innovative ideas and skills to the company. His vision is to create advanced and sustainable technological systems that offer true and immediate benefits to the end customer. He is also an active academic and lectures and supervises IT students in various Universities. He is also a consultant on various IT fields for a number of government institutions and has some bold projects and ideas for the future.

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APRIL 2013 | THE ECONOMIC UPDATE CHARITY EVENT

TRAVEL

Kinder Swimathon - Challenge yourself for Charity The Kinder Swimathon is a nationwide swimming challenge which encourages swimmers across Malta to team up and swim a number of laps at their favourite pool to raise money for Inspire, the Foundation for Inclusion which works with over a thousand children and adults with a disability across its centres in Malta and Gozo.

Efforts will be rewarded! Inspire will be giving trophies to the individual who swims the most laps; individual raising the most funds; team swimming the most laps and team raising most funds;

The Kinder Swimathon is an excellent team building, endorphin releasing, fun activity but more importantly it will make a difference in the lives of our beneficiaries, who come to Inspire to develop their potential, focusing on their abilities rather than their disabilities! How will it work? Taking part and donating is simple! • Form a team of six to eight people; • Book your lane at Inspire M’Scala, Ta’Qali or Tal-Qroqq National Pool ; • Commit to a minimum €50 donation; • Sign up!

For more information, call the Fundraising Team at Inspire on 20928105 or email us on events@inspire.org.mt.

So, whether you do the breaststroke, backstroke, butterfly stroke , improvise in freestyle or simply float, it’s bound to be a load of fun and refreshing break in routine. So go on, don that swimwear, pop on your goggles and take the plunge!

Inspire is a non-profit organisation that leads the way in providing therapeutic, education and leisure services to persons with disabilities in Malta and Gozo. Our services are provided free of charge or are heavily subsidized, which means that we depend on your generosity to keep on offering the services we provide. Through close relations with parents, government and the business community we reach out to our beneficiaries giving them the opportunity to develop their potential enabling them to integrate into their communities.

presents

SWIM ATHON

MAKE A SPLASH FOR CHARITY M O N 1 3 T H - S U N 1 9 T H M AY 2 0 1 3 VENUES

INSPIRE INDOOR POOL, M’SCALA K M S N AT I O N A L S W I M M I N G P O O L , TA L- Q R O Q Q M FA P O O L , TA’ Q A L I TEL - 20928105 OR EMAIL - EVENTS@INSPIRE.ORG.MT

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TEU

APRIL 2013 | THE ECONOMIC UPDATE ICT

Privacy, Transparency and Data Protection Key To Trust in Cloud Computing Our commitment is that the cloud users in Malta should put their mind at rest that their cloud suppliers protect their personal data efficiently, in a transparent manner, and in line with local and European data protection standards,” said Minister Dalli in her opening address.

Hon Helena Dalli, Minister for Social Dialogue, Consumer Affairs and Civil Liberties addressing the opening of the seminar together with Adrianna Zammit, Country Manager, Microsoft Malta.

By 2016, there will be over 1 billion smartphones, 350 million of which will be used at work. 82% of the world’s online population engages in social networking and 50% of enterprise customers are ‘on the road’ to the cloud.

Yet a lot of questions arise when dealing with cloud computing and people, especially business organizations, need to be more informed to find out how secure cloud computing, how this field has developed and what the benefits of this technology are. “Microsoft has been a leading active player in the development of cloud computing, especially through its flagship product Office 365 which already satisfies the key concerns of those wanting to adopt cloud computing namely the issues of privacy, transparency, compliance and security.” This was stated by Dr Jochen Engelhardt, Legal Director for Microsoft CEE during a half day seminar on the legal implications and privacy issues surrounding cloud computing. “Questions such as where is my data going? Who is using my data? Who can access it? are the most common questions and concerns encountered by Microsoft with clients who plan to migrate to the cloud platform. Our Data Processing Agreement specifies how Microsoft uses data only to offer customers the service unlike other providers who use data for marketing services, to run analytics and for advertising. Privacy is at the top of Microsoft’s agenda. Office 365 is the first major business productivity public cloud service provider willing to sign EU model clauses with all customers, clauses that set stringent EUwide data protection requirements. Data in the EU, stays in the EU. Microsoft was also the first

certified under the Safe Harbor programm in 2001 and Microsoft rectifies compliance with the Safe Harbor principles every twelve months,” explained Dr Engelhardt. He also referred to Third Party Validation and how Microsoft provides transparency through adoption of industry standards to ensure that a comprehensive set of practices and controls are in place. “Microsoft is certified ISO27001 – one of the best security benchmarks available across the world and Office 365 is the first major business productivity public cloud service to impliment rigorous ISO security controls on physical logical process and management,” concluded Dr Engelhardt. Office 365 is the first major business productivity public cloud service provider willing to sign EU model clauses with all customers

The seminar was also addressed by Hon Helena Dalli, Minister for Social Dialogue, Consumer Affairs and Civil Liberties who commended Microsoft for the initiative to discuss the security and data protection challenges posed by cloud computing and said that Government acknowledges Microsoft as a major global driver of cloud computing technology and is committed to promoting the safety in the use of such technology. “We recognise that cloud computing offers a flexible and an easily accessible alternative to conventional IT outsourcing and has the potential to offer vast cost savings in the provision of IT infrastructures. However, keeping in mind that the right to the protection of personal data is a fundamental right, we must address the difficult data protection issues raised by cloud computing.

Minister Dalli referred to the legal frameworks that are in place in order to guarantee adequate data protection and privacy specifically to how the Maltese Information and Data Protection Commissioner has participated in the drawing up of an ‘Opinion’ on cloud computing vis-à-vis data protection, a document which was adopted last year and which reflects the collective view on cloud computing of the Data Protection Authorities in all the EU Member States. “It is of the essence that clients are guided to adhere to the legal provisions of the EU Directive and to consult the afore-mentioned ‘Opinion’ published by Article 29 Data Protection Working Party. This ‘Opinion’ on cloud computing should serve as a set of guidelines to all local legal professionals when giving advice to their clients on the subject,” added Minister Dalli. Karl Davies Barrett, Windows Azure Solutions Professional at Microsoft spoke on how today’s world needs cloud computing to be able to manage the huge amount of data especially in a society where everyone is bringing in his devices to work, into the organisation, merging one’s professional life with his personal and social life. “Productivity is key to the way Microsoft is developing its platforms – where one’s personal experience on his pc is available anywhere he goes, without compromising on security and privacy.” In his presentation on cloud computing and Maltese data protection legislation, Dr. Claude Micallef-Grimaud discussed the risks of lack of control and transparency ‘in the cloud’, overlapping jurisdictions, transfers of data to third countries not having ‘an adequate level of protection’, various security implications as well as the data controllers’ legal obligations (including obligations relating to cloud service providers). “In Malta, just like many other countries around the world, data protection legislation has fallen behind the great technological advances that have taken place in the realm of IT. However, one should note that major reform (on an EU level) is planned for the near future and this will, in all probability, also address issues such as cloud computing. Despite the natural concerns that exist, the enormous benefits of cloud computing are clearly the reason why this technology has gone mainstream, even in Malta,” concluded Dr. Micallef-Grimaud. TEU

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APRIL 2013 | THE ECONOMIC UPDATE AVIATION HEALTH INTERVIEW

MAKING AN IMPACT by George Carol

DF Group have recently secured some of the world’s best luxury aviation companies including Vista Jets, currently operating over 35 aircraft around the globe, and Hub Air. We ask Anthony Galea, DF Group’s Partner why these prestigious companies have selected DF Group as the operating partners, and why the selection of DF Group is a continuation of the company’s growth strategy.

BACKGROUND Malta´s ambition and commitment to develop its aviation sector, including one of the biggest aircraft registers in Europe and related areas such as aircraft engineering and maintenance, sector-specific education and training, the country is already an encouraging place to be for an aviation organisation such as DF Group and certainly has substantial potential in the future, as the Maltese government continues with its sector-related strategy. 60 |

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TEU: Despite the uncertain global economic environment affected the aviation industry’s strategy how did DF Group manage to acquire, register and manage prestigious clients such as Vista Jets, and Hub Air? AG: Undeniably, the economic environment in the last years impacted the aviation industry, as well as the business aviation industry. We also know that difficulties create opportunities if tackled correctly. Many companies have restructured or are re-structuring, and in so doing are looking for opportunities. Our strategy has been to make our presence felt in the international fora by marketing Malta as a jurisdiction and provide solid, clear and reasonable opportunities and solutions to clients. TEU: Can you give us an overview of the aviation portfolio and services you are offering, and does this include the management and servicing of private jets in Malta, and what have been the most significant developments? AG: The spectrum of our services reflects the opportunities in Malta and vision to create a hub, therefore our clients are not only those seeking

legal, fiscal or corporate advice and setting up structures accordingly, but also those looking to relocate business or start a new activity in Malta in sectors such as aircraft maintenance, and pilot training. We are particularly proud to have contributed to the set-up of Hub Air, a pilot training academy, who will train the pilots of the future and who will surely remember Malta as a thriving hub for the aviation industry during their careers and hopefully contribute to the further growth of the local industry. We are particularly proud to have contributed to the set-up of Hub Air, a pilot training academy, who will train the pilots of the future

This new operating base will continue to increase in presence has already created new job posts in the areas of crew, operations, engineering, travel and administration. We had to think ahead about expanding our operational bases. After extensive research we found that no other European jurisdiction combines an excellent geo-strategic location between our Service Regions, with a very focused, service-oriented Government, a

APRIL 2013 | THE ECONOMIC UPDATE AVIATION HEALTH INTERVIEW

well-educated English speaking workforce and with efficient structures as well as Malta TEU: What other challenges do you face in your planned expansion of business aviation services? AG: Business aviation is a niche market and Malta as a jurisdiction is in its infancy. Few international operators think of Malta as a jurisdiction so the challenge is to convince about Malta’s offering. Travelling is also a challenge as links to a number of important centres such as Nice are missing. Challenges also arise when dealing with authorities who are being asked to address and decide upon matters new to them, as well as create links with other authorities when previously these didn’t exist. Sometimes difficult and interesting situations are created and it takes the co-operation of various stakeholders to find workable solutions. Few international operators think of Malta as a jurisdiction so the challenge is to convince about Malta’s offering

TEU: Can the Maltese market sustain a number of private airlines/jets as a hub? AG: We certainly believe that Malta can sustain many other start-ups in the various sectors of the aviation industry. So far the growth has been sustainable and, even though there has been a period of difficulty, the Government authorities have had the time to grow their resources and are continuing to do to be able to provide for the growth. I mention the Government authorities as the aviation industry is possibly the most regulated industry and the efficiency and know-how of authorities are therefore crucial to sustain growth of the industry. TEU: Is the coming of Vista Jets a vote of confidence in Malta as an international investment hub. AG: Definitely, its testimony to what we have discussed, Malta is a jurisdiction of opportunities and can provide the solutions. TEU: The Business aviation concept is a new product that has for long been missing on the Maltese air travel industry. What differentiates you to provide the time and schedule around the business leaders and the customer needs?

AG: Clients in the business aviation industry are very demanding and have specialized needs and wants. We have invested in the last years, networked and learnt about the business aviation industry. We are able to address the clients’ needs and wants. TEU: Many who think of private aviation imagine a top tier niche traveller. Is it broader today? AG: No the costs relating to travelling in a business jet are accessible to High Net-worthy Individuals and large corporations. There has been talk ‘of low cost operators’ also in the business aviation industry but we are not aware of any viable operation at present. TEU: Is it challenging to find growth? AG: We believe the aviation industry presents opportunities for anyone having the necessary know how and who is prepared to invest resources. We are certainly optimistic about the industry in Malta. TEU: What response have you received from the industry since you established? Have government, travel agents, airports, business and other partners been supportive? AG: The Government has been supportive, as have been other service providers. Nonetheless,

the Government does need to invest in human resources and assist in marketing Malta as a jurisdiction. Representatives of authorities of many other jurisdictions attend industry events and some have set-up specialised agencies. TEU: What are your key strategies and how do you take advantage of market opportunities? AG: as mentioned earlier the first step is to create an international reputation for the jurisdiction. We work with other service providers towards this goal. Attending the various industry events is crucial. We work hard on this and have created an important network to date. TEU: Malta has become a hub for international aviation despite the crisis. Is this so? AG: Indeed we believe that the effort of all the stakeholders, and in particular the policy and director given by the Government, and also now the current administration, has been successful. The vision was to create an industry and we believe that the seeds have been sown correctly to create an industry in Malta. Surely, more has to be done so that the international aviation community comes to look at Malta as its jurisdiction of choice. TEU

Editor’s Note

Anthony Galea is the Partner of DF Advocates. Dr. Galea is responsible for the Transport Law Department at DF Advocates and is also a director of DF Advocates, which is a company related to the firm and a specialist in the yachting industry. He acts as legal advisor to various foreign banks and international companies in relation to yacht finance and registration, sale and purchase, as well as related matters such as mortgages, fiscal advice, management, charter activities and insurance. He also advises a number of aviationcompanies and has assisted their set-up and licensing in Malta. Anthony advices a leading Maltese Bank in relation to financing operations, particularly in relation to loans, home loans and overdraft facilities and acts as consultancy for bank subsidiaries in relation to their trade operations. He also acted as legal advisor to international companies in the financial services industry in setting up of funds.

anthony.galea@dfadvocates.com

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APRIL 2013 | THE ECONOMIC UPDATE

ICT EDUCATION

ICE Malta ICE Malta, keeping you one step ahead

ICE Malta’s Young EntrEprEnEurs 2013 MIlEstonEs to datE! We are great believers that entrepreneurs must occasionally stop for a minute and look back at what they’ve accomplished and dedicate some time to celebrate these milestones with family, friends and the work team – it’s the best way to inspire oneself and ensures that one is driven for the months ahead.So here’s some of our favourite 2013 moments to date leading us to our newly launched project – a first for the Maltese islands.

CrEatIvE studEnt showCasE 2013 With the support of Malta Enterprise, our creative design students were being given the opportunity to meet industry leaders and showcase their portfolios. While two students were chosen as winners a number of students were given internship opportunities! A great way to kick start creative careers in the digital gaming industry and attract more foreign investment to employ our local talent.

sponsorshIp of thE Malta rugbY world Cup qualIfIEr agaInst swItzErland and thE hIgh IMpaCt tablE tEnnIs aCadEMY We started off by sharing our philosophy ‘STUDY. UNWIND. REPEAT’ encouraging our students to dedicate time to their passions – be it sports, arts or whatever would inspire creativity and lead to a balanced lifestyle. Our financial contribution to these sports organizations led to a number of marketing opportunities which reaped many benefits for our brand. More CSR ahead!

noMInatEd for Malta’s Young EntrEprEnEur awards 2013 and thE ICE ICt blog This made us blush but we accepted gladly and are proud to be nominated with other successful entrepreneurs who make us proud to be Maltese and inspire us to continue to strive to position ourselves as leaders in the ICT Arena. Truly, one opportunity leads to so many others, and this nomination led us to the launch of another iconic moment for the ICE Malta team. The launch of our very own blog dedicated to ICT opportunities, challenges, ICT business and the true value and relevance of ICT education. We’ll be sharing our thoughts, experiences and stories of the many hardworking ICT institutions on our island the first ever ICE ICT blog on www.economicupdate.com.

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aMbassador safEr IntErnEt daY 2013 and gIrls In ICt daY 2013 It irked us that these two world celebrations were never given much importance locally. We made sure to include both events on our calendar and made it our mission to organize competitions and events so Malta will be given the international exposure our islands deserve. We are pleased to have received the support of some of the island’s leading ICT players included TRC, Connexo, Malta Enterprise, MITA, MCA, 6pm, University of Malta amongst others, who made sure that both events were successful.

host InstItutE for thE CIsCo nEtworkIng aCadEMY nEtrIdErs 2013 While we had embarked on a number of competitions for our creative design students we had big plans for our CISCO students too! With the support of Malta Enterprise and the Get Qualified Scheme, ICE Malta’s accepted nomination to be the host school for this year’s NetRiders 2013 means that between 3 and 4 CISCO students have the chance to represent Malta in the international competition and win a study trip to California and the UK CISCO Headquarters!

Tel: 21467787 email: info@icemalta.com website: www.icemalta.com

APRIL 2013 | THE ECONOMIC UPDATE

DIGITAL SIGNAGE - The Insights by Duncan Dimech & Ana-Marija Zafirovska Digital signage is the new advertising medium that is replacing traditional medium at a very accelerate pace like wildfire. The new medium offers a more compelling content that printed media and it engages users more.

This engagement is what drives this accelerated growth. On the islands of Malta, lately, we have seen a number of digital billboards being set up in different locations but they lack the ultimate engagement that todaysâ&#x20AC;&#x2122; technology is promising to people. Some of these digital billboards are also placed in locations that are high above the ground in way that look like gods overlooking us humans. Digital signage has the power to communicate a message at the right audience at the right time. The only problem is to find the right methodologies that enable us to determine the audience and the time they are willing to listen to our message. Technology also lends a hand in this through data acquisition devices. Digital signage without data acquisition devices has the same effectiveness as old traditional advertising media. It is also the reason behind the ineffectiveness of digital signage that many complain about. To demonstrate the benefit of data acquisition devices with digital signage, let us consider a digital billboard located in a cross road. This digital billboard has traffic coming from the left and right hand side as well as from the front and back. The traffic coming from the back is not of any use to us for obvious reasons. A digital billboard in this location would typically be expensive but acts no more than a media player displaying images and/or videos for a particular duration of time and the loops over. Now consider adding a data

acquisition device to this digital billboard. The impact will be totally different as based on the traffic conditions we can display a particular advert instead of another. Now consider this can be done using also the time factor therefore my impact on the potential audience is increased. Not clear so let us explain a bit more. If we have knowledge that on the left of the digital billboard there is a primary school and office block of 300 employees. Using data acquisition devices, the digital billboard can determine if there is heavy traffic from the left hand side and the time. If the time is around 2:30pm and there is heavy traffic on the left hand side, it is more likely that it is being caused by parents going home with kids rather, than people leaving the office thus a company producing school bags would be more interested in promoting the product on that digital billboard having the knowledge that the advert will be displayed to potential buyers at the right time. The best part of interactive content is that such content is considered to be non-invasive by the audience and it is the audience requesting the information

The latest trend in digital signage is to replace the adverts on digital billboards with ones on information kiosks. This move is driven by the fact that information kiosks have a 10% higher potential to attract business than digital billboard according to a research done in the United States by Nielsen Research. The increase is the result of the interactive content information kiosks can present to the audience. The best part of interactive content is that such content is considered to be non-invasive by the

Mr. Duncan Dimech, the Managing Director of EXOR Group Ltd, earned his Masters Degree with the University of Liverpool, home of 9 noble prize winners, and specialised in Information Security. Over the past 15 years, Mr. Dimech has been involved on a number of projects for local and international business entities and is leading a number of IT research projects funded by the European Union. Mr. Dimech is a Member of the British Computer Society and a visiting lecturer at the University of Malta.

audience and it is the audience requesting the information rather than we are trying to push a message across which makes the audience less receptive to our message. Information kiosks as opposed to digital billboards also reside at the same level of humans and allow humans to touch them thus the godly figure is not present anymore. This psychological factor plays at our advantage as products displayed on information kiosks are perceived to be more reachable. Whereas digital billboards need to be adopted with data acquisition devices, information kiosks are equipped with data acquisition devices from their inception. Typically an information kiosk will have a keyboard or a touch screen for user interaction and adding additional devices is like attaching a device to a regular computer. What is then needed is a good set of applications built to run on information kiosks that while giving the right message at the right time are also able to collect the necessary data for an entity to take business related decisions. Although it is commonly agreeable that a good marketing mix will provide you with the necessary tools to disseminate your message to the intended audience, we are now acknowledging the fact that businesses need to know the impact their campaigns are having through each channel. Using technology will give you the necessary information at the right time to take business decisions and digital signage with data acquisition devices like information kiosks is a way of obtaining this information. TEU

Ms. Ana-Marija Zafirovska, the Business Solutions Advisor at EXOR Group Ltd, earned her Bachelorâ&#x20AC;&#x2122;s Degree in Sociology with the Ss. Cyril and Methodius University of Skopje, as well as a Postgraduate Certificate in Marketing with The Chartered Institute of Marketing. Ms. Zafirovska was actively involved in the journalism sector at International levels for the past 3 years and is a researcher on a number of European Union funded projects.

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APRIL 2013 | THE ECONOMIC UPDATE BANKING INITIATIVES

HSBC Malta launches Malta Trade for Growth managers, HSBC is well positioned to connect customers to international opportunities. Customers in Malta will be able to benefit from relationship managers with a deep understanding of international business. “HSBC is best placed to connect Maltese businesses to other counterparts across the world. So if a company is looking to trade across borders by expanding overseas or wishes to engage with emerging markets to reach its global aspirations, they should talk to us first as we have the expertise and resources to help,” said Michel Cordina, Head of HSBC Malta’s Commercial Banking.

Minister for the Economy, Investment and Small Business, Dr Chris Cardona, speaking at the launch of HSBC’s ‘Malta Trade for Growth’, together with (from left) HSBC Malta’s CEO Mark Watkinson and Head of Commercial Banking Michel Cordina.

HSBC will provide a wide range of incentives and resources to make it easier for Maltese companies to do business overseas

HSBC Malta has become the first bank in Malta to launch a strategic initiative specifically designed to help local companies bolster their international trade, particularly with emerging markets. HSBC’s ‘Malta Trade for Growth’ encompasses all initiatives related to international connectivity and is aimed at local customers with global aspirations as well as international companies wishing to take advantage of Malta’s strategic location. HSBC will be offering a wide range of incentives, discounts and resources that will make it easier and more cost effective for companies to do more business overseas. HSBC’s ‘Malta Trade for Growth’ was launched today at the Malta Maritime Museum by the Bank’s CEO Mark Watkinson and Michel Cordina, Head of Commercial Banking, in the presence of Dr Chris Cardona, Minister for the Economy, Investment and Small Business. One of HSBC’s objectives is to open new trade corridors for Maltese companies via its global connectivity. HSBC Malta can provide access to an extensive list of solutions to assist international trade, such as Structured Trade Finance, Internet Trade Services, Receivables Finance, Renminbi direct trade settlements, Payments and Cash Management Solutions, and Foreign Exchange.

The pace of economic expansion in regions like Asia and Latin America is changing the world and Maltese businesses need to be part of this new economic land scape. This initiative is designed to drive international trade, which will be vital to Malta’s future economic growth,” said Mr Watkinson. “‘Malta Trade for Growth’ brings together the full range of global benefits that HSBC is able to deliver to its customers. It highlights HSBC’s continued commitment to supporting growing businesses, and also forms part of the bank’s strategy to be the world’s leading international bank,” he said. Through ‘Malta Trade for Growth’, HSBC is offering a number of incentives such as the waiving of the fee related to the first documentary letter of credit for those customers that are new to HSBC Malta’s Trade Finance. In addition, a 20% discount will be provided on the opening and advising fees on documentary letters of credit to or from emerging markets. Other incentives relate to the waiving of the administration fee for finance against trade export or import facilities for trade with emerging markets, as well as discounts on Receivables Finance and preferential rates on Foreign Exchange, including currencies such as the Chinese Renminbi. ‘Malta Trade for Growth’ will also allow customers to access HSBC’s unrivalled global reach and expertise in international trade. With trade teams on the ground in 60 countries and 7,000 commercial banking relationship

“The basis for this growth in the coming years shall be that of improving the competitiveness of the Maltese economy by encouraging local businesses to think global and to internationalise their business through the development of joint ventures and strategic alliances with international partners. On behalf of the Maltese Government I would like to thank HSBC for introducing the ‘Malta Trade for Growth’ initiative and for bringing forward its international network to facilitate and assist Maltese companies to tap international markets,” said Minister for the Economy, Investment and Small Business, Dr Chris Cardona. HSBC is well positioned to connect customers to international opportunities

‘Malta Trade for Growth’ will be supported by an extensive advertising campaign featuring the stories of Maltese companies that have successfully expanded overseas. Businesses can find out more about ‘Malta Trade for Growth’ by visiting the Bank’s website at www.hsbc.com.mt/commercialbanking. They can also access HSBC’s ‘Global Connections’ site, which provides customers with all the information they need to grow their business internationally. Business customers can also access trade forecasts reports issued on a regular basis by HSBC to help them explore the future of world trade and identify key opportunities across markets and sectors. In addition, customers can access more than 20 Country Guides that provide relevant information on doing business with the most important developed and emerging markets around the world. TEU

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APRIL 2013 | THE ECONOMIC UPDATE BUSINESS BANKING

BOV launches Business Month by Ms Vanessa Macdonald

Officials often refer to the fact that 99 per cent of Maltese businesses are SMEs but it would be a mistake to assume that these thousands of SMEs are a homogenous group, facing the same challenges and opportunities.

The Maltese economy has seen a number of emerging sectors replacing others now in decline, while companies in stable sectors have to face the normal problems associated with business cycles, competition and access to finance. Many of these issues are going to be tackled between the end of April and the end of May by a series of events being sponsored or organised by Bank of Valletta, which will hone in on specific areas to ensure that those attending get valid and invaluable information.

Entrepreneurship will be highlighted during The Economic Update Entrepreneur of the Year Award, being presented by Circle Events at the Westin on May 10. During this gala dinner, nominees will be learn who the public and a team of judges have selected for the various categories, culminating in the coveted Entrepreneur of the Year award. This annual event will include the World Airnews Aviation Awards as well as speeches by experts giving their insight into this rapidly evolving field

Another event which is bound to prove of great interest is being organised during May in

conjunction with the Malta Business Bureau at BOV Centre. During this event, the results of a survey on Access to Finance will be made public. The BOV Business Month will end with an event being organised with PWC which is slated to become an annual event: The BOV-PWC Family Business Forum. This year’s event will be entitled “Planning for Continuity” and the two organisations will be drawing on their joint expertise to ensure that the speakers shed light on the complex issues arising from succession and growth. This afternoon event, being held on May 31, will be closed by Minister Cardona. TEU

Other events are also being planned, details of which will be made available over the coming weeks. For the full programme, check www.bov.com.

“We have teamed up with a number of strategic partners to ensure that we tap into their expertise and their insight into their members or clients,” the Executive Head of the Research and Business Generation Unit Noel Scerri said. The events kick off with a day of events on April 30 organised by Circle Events at Le Meridien in Balluta. The Bank’s Head of Media and Community Relations, former journalist Vanessa Macdonald, will interview the Minister for the Economy, Investment and Small Businesses, Chris Cardona, about the new government’s plans during a business breakfast for the constituted bodies and other organisations, who will undoubtedly be most interested to hear his views. In the afternoon, at the same venue, a series of seminars is being held aimed at the various stages of SMEs – from entrepreneurs just embarking on new ventures to those in the mature stages aiming for diversification or growth – with top speakers for each. The aviation sector, which has seen phenomenal growth over the past decade, will be showcased during the BOV Aviation Outlook event being hosted at BOV Centre on May 6. This annual event will include the World Airnews Aviation Awards as well as speeches by experts giving their insight into this rapidly evolving field. www.maltaeconomicupdate.com

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APRIL 2013 | THE ECONOMIC UPDATE COMMERCIAL TRADE

Why Maltese CoMpanies need a passport for GroWth By Michel Cordina, Head of Commercial Banking, HSBC Bank Malta

Maltese enterprises face what initially appears to be a dilemma. They can maintain the status quo, striving to build their business in home markets that they know and trust, or they can venture overseas, tackling the host of logistical, financial and cultural challenges that international trade entails.

regional demand. Then again, those growth rates still dramatically outstrip those of the U.S. and Europe. As economic malaise cuts spending in the developed world, manufacturers are rethinking supply chains that were designed to meet demand from Northern consumers.

Stop to think for a moment and you will quickly realise that thereâ&#x20AC;&#x2122;s no dilemma here at all. The time to be brave, the time to take the plunge is now.

In the future we expect to see a collective reorientation towards emerging markets from companies in developed and developing economies alike. Indeed, this is already happening. The Asia-Pacific region accounted for 7% of Appleâ&#x20AC;&#x2122;s net sales in 2009, for example, but in 2011 this share climbed to 21%.

To explain why we think it is vital for Maltese companies to explore foreign markets, let us start with the economic outlook. In China, India and Brazil GDP growth rates have slowed in recent months, giving emerging market SMEs reason to review their expectations for 68 |

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Here is another example. Between 2000 and 2012 almost 17 million Brazilians started using

APRIL 2013 | THE ECONOMIC UPDATE COMMERCIAL TRADE

private healthcare. That’s the equivalent to adding the population of the Netherlands to the world’s private healthcare and pharmaceuticals market.

To ensure operational effectiveness, it will put effort into communications and into ensuring that high standards are met in all its markets.

By 2050, HSBC research forecasts that the collective size of the economies we today call ‘emerging’ will have increased five-fold to eclipse those we now call ‘developed’1. What this means for the emerging world is real wage increases and an expanding middle class with rising consumer power. For Maltese organisations, it means a host of new challenges and – more importantly – new opportunities.

Thinking about venturing overseas for the first time, a Maltese Company may be concerned about differences in legal systems, trade documentation, foreign exchange volatility and even simply whether it will get paid. Such concerns often intensify with distance.

For Maltese organisations, it means a host of new challenges and – more importantly – new opportunities

THE POWER OF PARTNERS Already many SMEs are finding themselves doing business overseas because they’ve built strong relationships with multinational customers who take established partners with them into new markets. A Korean carmaker, for example, may encourage key suppliers to co-locate with it in a new production facility because it needs ready access to customdesigned parts.

A Maltese exporter trading with the E.U. may face some modest challenges around law and logistics, but in the Middle East it may be obliged to find a local partner that will hold majority ownership of the venture. For a company without the internal resources of a multinational it can be a daunting task to research new markets, assess counterparty risk and source affordable advice on legal and tax matters. It should be remembered that this is a twoway street. Emerging world suppliers know perfectly well that developed world companies are seeking low-cost goods and services, but they face equally intense challenges. Lack of cross-

border trading experience can be a barrier even in countries like China, where the majority of SMEs – representing about 60% of GDP3 – have been in business for less than a decade. Many SMEs across the developing world are striving to innovate, boost efficiency and learn how to thrive in newly liberalised markets. The United Nations Conference on Trade and Development is studying the processes of clustering and networking that emerging SMEs attempt in order to compete in today’s globalised world4. Some grow, UNCTAD says, and others wither away. The winning formula is still being worked out. HSBC believes international commerce is already proven as a winning formula, which is why we’re the biggest trade finance bank in the world. The companies we are talking to share this view, and they’re increasingly thinking about ways they can benefit from emerging ‘South-South’ trade corridors linking South America, Africa and Asia. They see no dilemma, just a commercial imperative to think as globally as they can. TEU

This isn’t an isolated phenomenon. New corporate champions from the emerging world have similar power to reshape supply chains for SMEs, seeking quality imports at the best price from businesses that are ready and able to meet their needs. Evidence for the benefits international SMEs enjoy is mounting. A report by the European Commission’s Enterprise and Industry division2 found that being active across borders correlates with higher turnover growth. Between 2007 and 2009, more than half of European SMEs that invested or took on subcontracting work abroad reported increased turnover, compared to 35% for all SMEs. Those that are internationally active also reported higher employment growth, while the study found a close link between internationalisation and innovation.

FEAR OF THE UNKNOWN A successful international company will be open-minded and culturally aware, and it will maintain a rigorous financial discipline to cope with multi-currency trading across time zones.

Michel Cordina, Head of Commercial Banking, HSBC Bank Malta

The World in 2050, HSBC Global research, January 2011 Internationalisation of European SMEs, Directorate-General for Enterprise and Industry, European Commission, section B2 3 The International Expansion of China’s Small and Medium Enterprises, Guillermo Cardoza, University of Bristol 4 Report of the expert meeting on clustering and networking for SME development, UNCTAD, August 2012 1 2

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APRIL 2013 | THE ECONOMIC UPDATE GOZO FEATURES

Gozo Business Review by George Carol

Gozitan women returned to work and benefitted from the scheme that exempted them from paying income tax for a year. Unemployment in Gozo has fallen by 13 per cent since 2009.

Addressing the challenges facing Gozo businesses means confronting the recurrent problems associated with the island’s importunate double insularity. In the last Budget, ex-Finance Minister Tonio Fenech had provided some interesting statistics that confirms the economic situation in Gozo is not much different to Malta. Gozo businesses taking part in the employment aid programme generated 400 jobs. Some 150 Gozitan workers were transferred from Malta to Gozo to perform back office jobs. Seven hundred

However, following the change in government, many of their unrelenting complaints have not been dealt with. While the government promised to upgrade Gozo’s industrial estates, industrialists still complain that the service charges of Malta Industrial Park have increased. The services of Gozo Channel, as usual, remain ambiguous. Gozo businesses are in favour of the building of a tunnel connecting Malta to Gozo – a controversial topic, especially when elections loom, and this is another white phantom. Meanwhile, Gozo business want to have direct links with neighbouring, yet this may have negative environmental implications. These issues relating to the economic infrastructure of the Gozitan economy, are all significant and also may disclose an innermost looking attitude of some operators. One needs to apply a feasible business model based on the turism industry and ecology of this Island gem. In turn, this

would generate employment for Gozo residents in Gozo which are economically unaffordable. Gozo needs a sustainable and specific economic development plan that exploits the island’s competitive advantages. Such a plan must promote the ecologically friendly island and its natural wonders and must also appeal to more wealthy European tourists, and should not simply promote local mass tourism, which is detrimental on the island’s infrastructure. Perhaps the introduction of a longer air strip that would enable affluent tourists aiming to get away from the stressful big city lifestyles to travel to Gozo could well seem like a good strategy in the long run. As a frequent visitor at times I find the island congested with heavy traffic and masses of day trippers roaming aimlessly around Gozo’s prime areas, and I am not impressed with what I see. The Gozo business community should come around to connect together to solve these issues and seek ways of optimising their island’s distinctive economic potential and preserve its eco system. TEU

Sources: Gozo Chamber of Commerce; Times of Malta; Malta Independent

Gozo’s niGhts of CultuRe This year will herald the 7th edition of Notte Gozitana – an all night festival which will be held in Victoria, Gozo. This extremely popular night of fun is organised by the Ministry for Gozo and will be on Friday 10th – Saturday 11th May (with a soft ending on the Sunday). Gozo businesses taking part in the employment When Notte Gozitana started seven years ago it was held in various districts around the island. However the Ministry realised that festivalgoers prefer to have a more localised event – this enhances the festival experience as crowds don’t spread too thin - so it has now been based in Victoria for a few years. The organisers try to identify new main areas for the activities. Two years ago the main events took place up in the Citadel, and last years’ events were concentrated in the narrow streets. This year, it’s back to the town centre as the main base with several events also happening in the Citadel. Although there is also a fair share of Maltese talent, this year the organisers also want to showcase Gozitan talent as much as possible, and participants have been chosen after expressing interest and applying to take part. 70 |

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As they recognise that many festival-goers come over from Malta and spend the weekend in Gozo, the organisers decided to have an opening on Friday so that visitors from Malta will have more days of fun to enjoy. Programme highlights include period costume historical parades and re-enactments along the main streets of Victoria; a concert by popular band ‘Airport Impressions’; the staging of the concert version of the rock-opera ‘Gensna’; a children’s area in Savina Square; various indoor classical music concerts; folklore music & dance; chillout stages with live bands; a grand car car show; musical drama in maltese and a variety of art exhibitions.

A couple of years ago, a very successful event was added to the festival – Saturday tours that include transport to various cultural heritage sites like towers, chapels and monasteries; tours to EcoGozo sites and Gozitan flora and fauna; and also walking tours around Victoria incorporating chapels, shelters and the narrow streets. As usual Lejlet Lapsi - Notte Gozitana will provide added attractions besides those which Gozo normally offers visitors to the island at this time of year. This year’s event will offer interesting grand shows on Friday and Saturday besides many other attractions under the stardust capital city Victoria. TEU

APRIL 2013 | THE ECONOMIC UPDATE NEWSMAKERS

HISTORIC JEWELLERY OPENS IN VALLETTA The exhibition Vanity, Profanity & Worship: Jewellery from the Maltese Islands opens in the sumptuous historic building of the Casino Maltese, Valletta on the 31st March, 2013. For the first time in Malta, this exhibition will bring together spectacular pieces of jewellery loaned from Maltese private and church collections which rarely, if ever, are seen in public. It will be a unique opportunity to view such a collection of artistic and historic jewellery under the same roof. Over 550 jewellery items will be exhibited, and this will provide a thorough survey of what jewellery in Malta looked like from ancient times to the present. Jewellery sheds light on the beliefs, customs and fashions of a people and this exhibition will highlight all these aspects. A full programme of activities, including lectures and workshops will run throughout the exhibition. A fully illustrated catalogue with studies on aspects of Maltese jewellery history has been published to coincide with the exhibition. The exhibition is an event by Fondazzjoni Patrimonju Malti, a Maltese not-for-profit organisation which has organised landmark exhibitions in the decorative and fine arts in Malta for more than two decades TEU

Vanity, Profanity & Worship: Jewellery from the Maltese Islands Casino Maltese, Valletta from 31st March until 26th May 2013 Open every day from 10am till 6pm and until late on Friday For further info: info@patrimonju.org; www.patrimonju.org Follow Fondazzjoni Patrimonju Malti on facebook for regular updates.

SKYCARGO strengthens its Cool Chain Premium Service

Plan Your Autumn Holiday For Autumn with Air Malta

SkyCargo, the freight division of Emirates, one of the fastest growing airlines in the world, has strengthened its Cool Chain Premium Service with the appointment of an additional cool chain solutions provider. SkyCargo has contracted CSafe, a global provider of cool chain solutions, for the supply and service of mobile refrigeration units used for its Cool Chain Premium Service, which specialises in the transport of temperature-sensitive products, including pharmaceuticals. SkyCargo offers three Cool Chain solutions, namely Cool Chain Basic, Cool Chain Advanced and Cool Chain Premium, each of which is designed to meet the requirements and specific needs of customers for the shipment of temperature sensitive products from fruit and vegetables to healthcare products and pharmaceuticals. Emirates flies on a daily schedule from Malta to Dubai via Larnaka, Cyprus. Emirates SkyCargo is located on the First Floor at MIA Departures and can be contacted on tel. no 2166 0102, or at skycargomla@emirates.com. For more information on SkyCargo visit: www.skycargo.com.

Air Malta has launched a special Easter Promotion. Through this offer, the airline is giving a 10% discount on its published fares on all scheduled flights from 01st October to 30 November 2013. Commenting on this Easter Promotion, Philip Saunders, Chief Commercial Officer said, “Once again, Air Malta is delivering a special Easter surprise ith an opportunity to book now and benefit from a 10% discount on over 320,000 seats cross our scheduled network later in the year. Whilst you may have to hunt for Easter ggs over the holiday period, there’s no need to hunt at Air Malta as the discount applies to every fare on every flight. This is the perfect opportunity to cash in on a saving and fly o the destination of your choice this coming autumn.” This offer will be open for sale from today until Easter Sunday 31st March at 11.59 pm Malta time. Tickets purchased through this offer are valid for travel across Air Malta’s network between 01st October and 30th November 2013. This offer is available for tickets booked through the airline’s website www. airmalta.com and through travel agents in Malta. Certain conditions may apply. Air Malta maintains its commitment in offering value for money and superior service in both ts economy as well as business class cabins. The airline offers free allowance of of 10Kg hand luggage and a poolable 20Kgs free baggage allowance to its economy class assengers. Club Class passengers may carry up to two pieces of hand luggage for a total weight of 15Kgs plus 30Kgs baggage allowance. More information can be obtained by isiting Air Malta’s website §www.airmalta.com. TEU

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APRIL 2013 | THE ECONOMIC UPDATE

LIBYA INSURANCE

SOLVENCY II – The Gold Standard? by Matthew Taylor

Majority of European insurers are ill prepared for the looming deadline for the implementation of Solvency II.

Although the shift from Solvency I to II – the new ‘gold standard’ in insurance regulation - is beset by significant short term challenges, it presents a number of opportunities to those insurers capable of carefully designed and implemented application. However, continuous delays and uncertainties over the final framework have created doubts over the credibility of the new regulation, with some market experts labelling the project as overambitious. This is a claim bolstered by the fact that most European countries are not prepared to fully adopt it, suggesting the current deadline of January 1st 2014 will slip again.

The Main Features Of Solvency Ii The Solvency II Directive, which is being viewed as a global benchmark in insurance regulation thanks to its comprehensive scope and structure, requires insurers to address all foreseeable risks that might affect their business structure. The predominant objectives of this regime are to safeguard the interests of policyholders by enshrining risk management at the heart of business practices, harmonise insurance regulations, and consolidate the European insurance market. 72 |

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Implementation Marred by Uncertainty Despite the rapidly approaching deadline of 1st January 2014 for implementation, quantitative surveys conducted by the European Insurance and Occupational Pensions Authority suggest that most insurance firms are not prepared for full adoption of Solvency II regulations. Whilst Western Europe, led by the UK and Spain, has made progress towards readiness, the generally poor state of preparedness across Europe has led some market experts to label the project as overambitious in nature. This assertion is lent credence by the high likelihood that the current deadline for implementation is likely to be breached once again.

Impact on Key Insurance Sections The short-term impact on life and general insurance business is likely to be negative. Significant capital charges for risky and volatile assets with high yields are expected to drive changes in investment policies. Sovereign bonds will gain more exposure and replace high capital charge assets, rendering some products obsolete and unviable.

Challenges of Solvency II Requirements The structural overhaul of Solvency II poses significant challenges for insurance industries and regulators, in terms of resources, time and money. The complex nature of calculating

solvency capital requirements, marketing consistent treatment of balance sheet items and integrating risk management in central business processes will exert immense pressure on the current structure, and will increase the cost of specialists required to handle business models efficiently and in compliance with the new norms. It will also require reliable data and IT infrastructure, adding further pressure on company resources and budgets. TEU

For further information: Timetric’s report, ‘Assessing Solvency II: Challenges and Opportunities for the Insurance Industry’ is available at: http://timetric.com/ research/report/IS0251MR/ Courtesy: Progressive Digital Media.

CORPORATE BRIEF Timetric is a leading provider of online data, analysis and advisory services on key financial and industry sectors. It provides integrated information services covering risk assessments, forecasts, industry analysis, market intelligence, news and comment.

APRIL 2013 | THE ECONOMIC UPDATE HEALTH & BEAUTY

ATTRACTING MEN: The Marketing Challenges of the Health & Beauty Sector Value for money is key in health-driven sectors

In sectors squarely focused on health benefits, such as oral care and personal hygiene, the top concern amongst men that influences consumption is getting the best value for money. Men of all ages may want healthy teeth, whiter smiles, and to be well scrubbed, but this focus on value means that price competition is likely to be strong in these sectors in the future. After value for money, motivations between different age groups are more diverse. Early Young Adult males (those aged between 16 and 24 years old) look for products that match their lifestyle and that appear tailored to their individual needs, whereas Older Consumers (those aged over 55) are looking for quality products that will be highly effective, so claims regarding functional ingredients are likely to stand out.

Different motivations also drive consumption in beautydriven sectors When it comes to sectors such as fragrance and skincare, and even make-up, the results between age groups differed further. Older males prefer products that are budget friendly, yet still offer quality benefits, in particular due to the ingredients they contain.

Globally, men use more grooming products than many realise, and so male health & beauty brands need to encourage switching rather than attracting new customers

The male grooming market in ten key countries* is bigger than many would think: men account for 47% of the volume of Health & Beauty products used, equivalent to over 3,000 million litres of Health & Beauty products every year. So while the use of male grooming products is increasing, results are already high. This means marketers’ primary challenge is not to attract men to their category, but to encourage them to switch from unisex and/ or female brands. For example, this was the basis of Old Spice’s “Smell like a man, man” campaign in the US in 2010, which encouraged men to swap “lady-scented” body wash for a more masculine product. After accounting for both men’s frequency of product use across these sectors, and for whether it was a man’s, women’s or unisex product that they used, Canadean’s consumer survey shows that men’s consumption of Health & Beauty products approaches that of women’s in several product markets, such as Haircare, Oral Hygiene, and Fragrances. In terms of total volumes around the world, it should be noted that the large male populations of the BRIC (Brazil, Russia, India and China) region drives the global volume: male grooming isn’t restricted to just mature economies, even if product choice can differ.

Successful products target the key motivations of their target age group In order to encourage men to switch to male products it is vital to understand the motivations driving consumption in key consumer groups. In particular, age, and the needs of specific age groups, is a key determinant of men’s Health & Beauty consumption habits; the success of a product targeted at men will often be based on its ability to meet the target age group’s most important motivations.

In contrast, young males look for products that are “on-trend” and that are designed specifically with their gender in mind; often helping them feel confident, and not self-conscious, about the product they are about to use. One brand catering to this is Bulldog Natural Cosmetics, whose range of shaving products introduces men to the benefits offered by skincare products made from natural ingredients.

Male grooming isn’t about products that are “Just For Men” The fact that the New Gender Behaviours trend, which tracks products chosen because they offer gender-specific benefits, is only relatively important among Early Young Adults in Beauty-driven sectors shows that male grooming isn’t solely about offering products “For Men”. Instead men look for Health & Beauty products designed to meet a specific range of needs, and increasingly, albeit slowly, they are less concerned about overtly masculine branding. TEU

* Data are based on Canadean’s nationally representative consumer survey, which gathered over 30,000 responses across 38 Health & Beauty product categories in Brazil, Russia, China, India, France, Germany, Italy, Spain, the UK and the US in 2011. Results from this survey were integrated with industry research to quantify total consumption by key consumer groups and determine the market value and volume influenced by 20 consumer trends.

For further information:

Contact Matthew Taylor at Progressive Digital Media. Email: matthew.taylor@ progressivemediagroup.com | Telephone: 0207 3365316 EDITOR’S NOTE Canadean has a long-held reputation for providing valuable and in-depth market research initially built up in beverages, and now operates across the FMCG market and related industries, including packaging, ingredients, soft drinks, beer, retail, foodservice, wines & spirits, health & beauty and food. It specialises in conducting online survey panels, producing in-depth market insights reports through qualitative and quantitative in-country analysis as well as offering clients a bespoke consultancy service tailored to address each client’s specific business needs.

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APRIL 2013 | THE ECONOMIC UPDATE NEWSMAKERS

COMPUNET LAUNCHES NEW ONLINE STORE phones. A new feature that is incorporated within www.compunet.com. mt is Repair Tracking, enabling anyone submittingequipment or other products for repairs to track with ease the stage the repairs have reached. “We are enthusiastic about the launch of our new flagship online store which will make life easier for students,parents and business people. The site boasts easy to order web pages and new products and technologies will be added regularly,” said Brian Zarb Adami, Chief Technical Officer at 6PM plc.

Compunet have launched their new online store www.compunet.com.mt. This is Compunet’s latest move that allows customers to discover, learn and buy a wide range of products. The site has just undergone an intensive revamp in order to provide customers with an easier, more convenient way to shop from the comfort of their home or office. Compunet’s new store features free deliveries to addresses in Malta and the EU. More than 1,000 products are online including PCs, laptops and computer components, software and games, TVs and monitors, visual and audio equipment as well as cameras mobile

AIR MALTA AIRCRAFT FLY IN FORMATION OVER THE MALTESE ISLANDS

A Eurocopter AS350 helicopter, equipped with a Cineflex gyro-stabilized film camera system was utilised to film the event. This system is used for film and television production, news and broadcast television and high-profile sporting events including the Middle Sea Race. This was the first time that Air Malta aircraft flew in formation together and air to air filming was organised by the airline. Local renowned photographer, Kurt Arrigo, was entrusted with the photography and the setting up of an international team that could film the event. A lot of planning was made to organise and coordinate this experience by various Air Malta departments that included, Flight Operations – who planned and coordinate the flights, Marketing and Branding, Corporate Communications, Cargo and Ground Handling Services. The planning also included the participation of several organisations amongst which were the Malta Air Traffic Services and the Department of Civil Aviation. Throughout the planning and execution of the flight Safety was paramount. The two Air Malta aircraft were commanded by Capt Mark Micallef Eynaud, Chief Officer Flight Operations and Capt Patrick Calleja, Head of Aircraft Operations. Capt Micallef Eynaud has previous formation flying experience in the Royal Air Force. The material shot will be used in the Marketing and Public Relations activities in Malta and abroad including the airline’s in-flight magazine – Il-Bizzilla, the new website and across the airline’s social media channels including Facebook. The event will continue to build the airline image and footage library to promote better the airline and the Maltese islands. TEU

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“We see great potential in the local and EU’s e-commerce market, to offer customers choice, value and service through our online store. Customers now have a trusted and secured shopping experience of the best possible selection of products.” Set up in 1994, Compunet Ltd started off as a vendor of assembled PCs. Today Compunet has become a leading computer and electronics company providing solutions to both home and corporate users. In 2011 Compunet Ltd became part of the 6PM Group. The Company has provided the Group with the infrastructure skills that complement the 6PM IT solution and services offering. The company’s retail presence has also contributed to diversifying the Group’s portfolio and allowed the Group to tap into the B2C market locally and abroad. Compunet are partners with Epson printers, Dell computers, Marantz home entertainment systems and Viewsonic TVs and monitors. TEU

SHIREBURN SOFTWARE SUPPORTS NEW LEAF AND THE NATIONAL LIBRARY

Shireburn Software continues to support New Leaf, a non-profit voluntary organisation whose objective is to preserve the books at The National Library and promote the use of public libraries. Shireburn Software has sponsored the purchase of a light-box that will be used by professional restorers to be able to view, assess and analyse documents and books that require restoration.This project forms part of the Shireburn Software 30th Anniversary CSR plan to continue to contribute towards our society. Amongst its list of objectives, New Leaf aims to preserve books at The National Library with specialists and equipment, convert the National Library’s hand written library cards to a database, organise book cleaning training and volunteers, convert the out-dated cassette based audio books to MP3, publicise the need for volunteers and promote the use of the national and public libraries. “Shireburn Software is all about knowing what information you have and where, digitising data and document management, so we see New Leaf as a perfect partner for our CSR efforts,” said John de Giorgio, Managing Director, Shireburn Software. “We are more than happy to play our part in giving these priceless books, some of which are pieces of world history and heritage, the attention they truly deserve.” For more information on New Leaf and how to help by donating time or money, please contact Monique Chambers on 99891722, monique@newleaf. org.mt or visit http://www.newleaf.org.mt. www.shireburn.com | +356 2131 9977

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

FATCA arrives at a time when financial institutions already face numerous significant economic and regulatory challenges, testing many organisations’ capability and capacity to manage change. The FATCA requirements introduce a series of business and systems requirements that appear simple in concept, but may be difficult and costly to operationalize. The aim for organizations affected by FATCA will be to meet the new compliance burden, while managing the associated compliance costs and risks. With an extensive, multidisciplinary team of professionals with both FATCA and industry-related experience, as well as continuous liaison with local regulatory authorities, KPMG is distinctly positioned to help you achieve compliance by the varying effective dates while maintaining business as usual. Our extensive knowledge and experience regarding FATCA and our deep understanding of our clients’ businesses allow us to simplify the impact on their businesses. For further information on how KPMG can help and assist you, kindly contact: Juanita Brockdorff Partner, Tax Services T: +356 2563 1029 Juanita Bencini Partner, Risk & Consulting Advisory Services T: +356 2563 1053 kpmg@kpmg.com.mt

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