Business Agenda Issue 06 by Malta Business Bureau

ISSUE 06 I MAR - MAY 2011

THIS ISSUE

INTERVIEW MBB’s President speaks about the organisation’s past achievements and plans for the future.

page 5

business agenda

NEWSPAPER POST

ALTERNATIVE DISPUTE RESOLUTION It’s an easier way of resolving a commercial dispute – but why is it still underused?

page 19

THE Official Business publication of the Malta business Bureau

FUTURE OF NORTH AFRICA DEPENDS ON LIBYAN OUTCOME – Dr Joe Borg ENVIRONMENT Energy efficiency is key to business sustainability, but a lot more needs to be done to reach the EU’s 2020 targets.

page 11

Former EU Commissioner Joe Borg has stated that the situation across the North African region greatly depends on what happens in Libya, explaining that “the ousting of Gaddafi, if this were to come about, may give courage to others in the region to resort to popular protests and revolts in order to seek to achieve the same result.” Dr Borg, who is currently the Chairman of the Mediterranean Academy of Diplomatic Studies, believes that if Gaddafi does manage to retain power, it would be dif-

CASE STUDY Vassallo Group’s CEO discusses the secrets to the Group’s success. page 18

There is a strong business case for having a social conscience.

page 38

The political crisis that has hit a number of North African and Middle Eastern countries has had thousands of Maltese and European businesses on edge, speculating to what extent the unrest will impact on their business investments and on the economy as a whole. See page 7 for full interview.

REDUCING DEFICIT WITHOUT REDUCING EXPENDITURE In comments given to Business Agenda, Minister for Finance and the Economy, Tonio Fenech, has stated that reducing the deficit to bring it in line with the Maastricht criteria is essential and that work is continuing to ensure that this objective is achieved by 2011.

CORPORATE SOCIAL RESPONSIBILITY

ficult to foresee whether this would dampen the will of others to do as the Tunisians and the Egyptians did, or whether they would seek to succeed where the Libyans failed.

Minister Fenech stated that reducing the deficit was essential in order to satisfy the EU’s demands in this regard but also to retain Malta’s attractiveness as an investment

option and to safeguard jobs and competitiveness. Unfolding political and economic developments in the region are making governments objectives in this respect an increasingly challenging task, but despite this, Minister Fenech has categorically ruled out the option of reducing government spending in actual terms.

See page 9 for the full story.

“EUROPE’S RECOVERY IS UNEVEN” BUSINESSEUROPE President, Jurgen R Thumann, has declared that Europe’s economic recovery has been uneven and that the EU needs a renewed drive to safeguard its competitiveness whilst stressing that fiscal consolidation and economic reform is needed across the board. Mr Thumann also expressed the opinion that rebuilding solid foundations of economic growth throughout the continent is “the highest priority in order to deliver a lasting response to the financial and sovereign debt crisis.” He called for

the new governance framework to create much greater incentives to prevent macroeconomic and fiscal imbalances from ever arising again. He also stated rising commodity prices, the health of public finances and the financial sector continue to present challenges to Europe’s economic recovery and must be addressed without any further delay.

See page 14 for the full story.

BUSINESS AGENDA | mar – MAY 2011

editorial

EUROPE’S NEXT MOVE By Joe Tanti, Chief Executive Officer, MBB

These are difficult times for Europe. In the midst of political turmoil surrounding the Mediterranean region, this is the first test for the Lisbon Treaty, challenging Europe’s intent to make a real difference in foreign policy as a political union on a global scale. This time, Europe is not dealing with a crisis in a distant land, but on the contrary, we are dealing with popular uprisings on our doorstep, on the gateway to the European continent. It is very difficult to predict how the situation will evolve, particularly in Libya. Europe’s top priority should be achieving stability; this is crucial from an economic aspect as, notwithstanding the economic impact already incurred by several companies across Europe, the longterm persistence of this crisis risks a much larger negative impact on the Southern-European region. Ironically this comes at a time when Europe is working to regener-

ate its own economies, while major competitors seem to be developing at an ever faster pace. In this respect, an important debate that is taking place at a European level is how to address our competitiveness and boost innovation in order to retain the sustainability and growth of businesses. The Malta Business Bureau recognises the crucial importance of these aspects to the European economy and to the Maltese economy. Recently, the MBB published a position paper on the Commission’s plans to relaunch the single market. Without a shadow of doubt, the Single Market Act includes measures which are key to innovation in Europe and to ensuring that European economies remain competitive. Furthermore, the MBB organised a very productive business breakfast with the participation of Commissioner John Dalli, who exchanged views with Council members and

representatives of business sections of the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association, on business competitiveness and EU legislation. Commissioner Dalli rightly claimed that the member states have the responsibility to foster their economies while the EU brings them together to look for European solutions in response to problems and challenges faced by all. He agreed that the key to competitiveness is innovation and for this reason the EU set this as a core aspect of its EU2020 Strategy. On the other hand, the business community appreciates the fact that the EU has identified the ‘disease’ that is hindering European competitiveness, but does not always agree with the EU-suggested means to cure it. The business community has often shown concern with the Commission’s drive for harmonisation.

In many cases, such as in the questions of taxation and standardisation, flexibility should remain at the core of the EU approach. For instance, when it comes to standardisation in the hospitality industry, there is a need to accommodate the inevitable structural and cultural differences that underpin the distinctiveness of this specific economic sector. Whilst health and safety standards can never be compromised, the uniqueness of a destination can constitute a competitive advantage. A key concern for businesses remains the lack of impact assessments of proposed directives on the affected sectors; not just in terms of the financial impact, but the impracticality and adverse conditions directives sometimes create even for consumers, the very target group that directives often aim to protect. Also, a balance needs to be struck between consumer protection and the financial burden imposed on the service providers.

The business community suggests that the EU should concern itself with higher priorities to safeguard Europe’s competitiveness by ensuring consistency and push for competitive and expansionary policies without increasing burdens on economies without endangering economic growth due to Europe’s social model. We believe that this is possible. As Commissioner John Dalli stated in the MBB’s Breakfast Debate – “Europe does have strengths, and it is on these strengths that we should build. We have to take action in a number of areas that sharpen Europe’s competitive edge.”

The Malta Business Bureau is a non-profit making organisation acting as the European Advisory and Support Office of the Malta Chamber of Commerce, Enterprise and Industry and the Malta Hotels and Restaurants Association. The MBB has two offices, the Head Office in Malta and the Representation Office in Brussels.

Publisher Content House Ltd Mallia Buildings 3, Level 2 Triq in-Negozju Mriehel QRM3000

Malta Business Bureau Casa Leone Pjazza Robert Samut Floriana

Tel: 00356 2132 0712/3 Email: info@contenthouse.com.mt www.contenthouse.com.mt

Tel: 00356 2125 1719 (Malta Office) Tel: 0032 4859 81124 (Brussels Office) Email: info@mbb.org.mt infobrussels@mbb.org.mt www.mbb.org.mt

Editor: Joe Tanti Deputy Editor: Claire Azzopardi

Editorial Team: Omar Cutajar, Daniel Debono, Mariella Scicluna

Business Agenda is the quarterly publication of the Malta Business Bureau. It is distributed to all members of the Malta Chamber of Commerce, Enterprise & Industry, all the members of the Malta Hotels & Restaurants Association, and to all other leading businesses by Mailbox Distribution Services, part of Mailbox Group. Business Agenda is also distributed by the Malta Business Bureau to leading European and business institutions in Brussels.

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BUSINESS AGENDA | mar – MAY 2011

interview

THE MAN AT THE FOREFRONT OF THE BUREAU

A year has already gone by since John A. Huber’s tenure at the Malta Business Bureau. He speaks to Krista Micallef Trigona about his major highlights as well as the role of the MBB and current EU issues. This past year has been quite an exciting time for MBB President, John A. Huber. He took over the Presidency of the Bureau in March 2010, at a time when the organisation was going through a positive period of strong momentum and presence – a time when the Bureau had invested in its development and service to its members. Throughout his tenure, his main objective for the Bureau entailed injecting his own ideas and experiences into the objectives and achievements of the year that lay ahead. He is pleased with what the Malta Business Bureau has managed to accomplish so far. “The MBB has surpassed a number of milestones related to providing a more valueadded service and to communicate better with our members,” Mr. Huber says. “And throughout the year of my presidency I have sought to consolidate this aspect by voicing EU related concerns for our parent organisations — the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association.”

Naturally, in this past year, Mr. Huber has witnessed many highlights, but one in particular stands out – the focus on EU-funded projects. He elaborates further. “For the first project called ‘AMIE’, the MBB is collaborating with a number of other organisations to promote female entrepreneurship in Malta. The other two applications relate to a Life+ project proposal, that aims to achieve reduction in water consumption, and an ESF project proposal to establish a Maltese Network for Tourism through a social and civil dialogue targeting tourism marketing, accessibility and competitiveness, innovation and entrepreneurship.” Mr. Huber adds that an important feat for the MBB was the initiation of conducting impact assessments on sensitive issues developing at an EU level, which the Bureau plans to consolidate and build on in the coming years. He exemplifies that “last year, the MBB published an impact assessment on the much controversial ‘Pregnant Workers Directive’ explaining how this would impact the Maltese economy should it be implemented.”

The Malta Business Bureau sees to a number of other issues that concern the local business community. In fact, Mr. Huber identifies that one of its main roles is to ensure that businesses have an adequate level of awareness on a number of EU affairs that affect them. “When it comes to EU affairs, the amount of information there is to access is vast and unfortunately, many times SMEs do not have the adequate resources to keep up with all the developments taking place in the EU,” he says. Naturally, this makes it difficult for the ordinary business man to follow up and keep up to date with the matters concerned, so in light of this, the MBB is trying to bridge the gap by picking up on issues that affect the local business community and the Maltese economy, by translating the information into less technical jargon. Mr. Huber reports that though the MBB does see a willingness in the business community to participate in collecting feedback and influence policy, the Bureau would still like to see the industry take more of an

initiative in seeking EU related information. He explains that the main problem with this is that the EU has set an image for itself of being too bureaucratic and distant from ordinary citizens – and this can result in a lack of interest from individuals who feel too small to contribute. Overall, the MBB’s main interest is to be aware of all policy developments taking place at EU level. “In this respect, through our Brussels office, we actively participate in European fora, such as BUSINESSEUROPE, EUROCHAMBRES and HOTREC,” Mr. Huber says. “This participation gives us access to three of the biggest lobby groups within the EU,” he explains. Another step forward that the MBB has recently taken was an extensive rebranding exercise, revealing a new brand identity that captures the Bureau’s dynamic approach to its service provision to the local business community. “The identity retains a corporate look, yet simultaneously embraces change and development,” Mr. Huber adds. “The brand was devel-

oped bearing in mind that it is the spirit of the enterprise that drives Maltese business, and as such, the MBB decided to adopt a corporate concept whereby the new logo embodies a sense of motion, of progressive advancement towards one’s goals in order to obtain the best possible out of EU membership.” On a final note, Mr. Huber was pleased to add that this year, the MBB celebrated its 15th anniversary of service, stating that the Bureau has indeed come a long way since its inception in 1996. But what do the next 15 years have in store for the MBB? Mr. Huber replies that “we intend to foster this organisation to become even more active in civil society and to be a firm point of contact for the local business community with respect to EU affairs.”

BUSINESS AGENDA | mar – MAY 2011

CORPORATE AFFAIRS

MBB PUBLISHES ANNUAL REPORT The MBB's annual report includes snippets of information on Maestro Robert Samut, his lifetime achievements and also a historical review of the beautiful building that was once his home. The 2010 Malta Business Bureau Annual Report has been published, this time with an cultural twist that will certainly be of interest to its readers. A section is dedicated to the life and achievements of Maestro Robert Samut, the namesake of the square in which the MBB offices are located. Maestro Robert Samut is the composer of the Maltese national anthem and also lived in Casa Leone, where the MBB offices are now located. The report includes snippets of information on Maestro Samut himself and provides a historical review of the beautiful building that was once his home. The Report also strongly embraces the new brand identity and displays the rejuvenated image that the organisation has adopted. It also outlines the various activities undertaken, and events attended, by the Malta Business Bureau both in Malta and in Brussels. Throughout the year, the MBB has striven to increase its efforts to offer a more value added service to its members and the business community at large. The Malta Business Bureau was on the forefront in a series of national debates in which it participated with the publication of Position Papers and Impact Assessments, including on the Pregnant Workers’ Directive and the Relaunch of the Single Market Act. A number of high profile events were also organised by the MBB to duly inform its members on current EU developments that impact Maltese business. Two from a series of Business Meets MEPs sessions have been held so far. Furthermore, business seminars on ICT-related topics and tourism sustainability were also organised. Throughout the last year, the MBB has been very active in identifying and submitting EU funded project proposals that eventually will benefit the members of the parent organisations, the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association.

The Annual Report can be downloaded from the MBB website portal www.mbb.org.mt or requested by email from info@mbb.org.mt

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BUSINESS AGENDA | mar – MAY 2011

political economy

CRISIS IN NORTH AFRICA:

ECONOMIC RECOVERY WILL BE THREATENED IF INSTABILITY LASTS FOR LONG Business Agenda speaks to former EU Commissioner and current Chairman of the Mediterranean Academy of Diplomatic Studies, DR. JOE BORG, to find out what impact the unrest that prevails across North Africa could have on local and European economies.

IMG? The increasingly escalating crisis that has hit a number of North African and Middle Eastern countries has had thousands of Maltese and European businesses on edge, speculating to what extent the unrest will impact on their daily bread and butter. It goes without saying that the human casualties are, by far, of the highest concern, yet the ripple effect on other economies within the region cannot be ignored. Speaking to Business Agenda, Dr. Joe Borg, former European Commissioner and current Chairman of the Mediterranean Academy of Diplomatic Studies, expresses the

belief that apart from the acute reduction in trade and the evacuation of thousands of workers from the stricken countries, “the steep increase in the price of oil can have an impact on the local economy if the instability in certain oil producing countries, and in Libya in particular, is long lasting.” Nevertheless, he outlines the fact that “if the political situation stabilises in a matter of weeks, the impact on the economy should be minimal.” Essentially, Dr. Borg believes that the ultimate impact on the local, and European economies, will depend on how long the instability lasts and what decisions are

taken at European level to absorb the economic shocks caused by the reduction in trade with affected countries. “One would expect that when the situation stabilises, trade activities will pick up again,” Dr. Borg states. “I therefore believe that Europe’s economic recovery will only be negatively impacted if the instability continues for long, that is, for a number of further months.” Yet it is unmistakably difficult to tell how long the instability will continue. While the imposition of a nofly zone over Libya and the launch of a military campaign against the

Gaddafi regime aim to bring an end to the civil strife in the country, sooner rather than later, the hugely negative impact of the current situation is of grave concern on a social, political and economic level. Dr. Borg explains that the situation across the wider North African region also depends on what happens in Libya, explaining that “the ousting of Gaddafi, if this were to come about, may give courage to others in the region to resort to popular protests and revolts in order to seek to achieve the same result.” He continues to say that if this possible scenario does become reality

and Gaddafi is driven out, it would be a warning to other leaders of regimes in the region. “When your own people are determined to throw you out virtually nothing will deter them from achieving their aim and you had better do like Ben Ali or Mubarak did, rather than seek to emulate Gaddafi.” Yet he states that if Gaddafi does manage to keep hold to the reins of power, “it would be difficult to foresee whether this would dampen the will of others to do as the Tunisians and the Egyptians did, or whether they would seek to succeed where the Libyans failed.”

BUSINESS AGENDA | mar – MAY 2011

Finances

DEFICIT REDUCTION ESSENTIAL, BUT GOVERNMENT NOT PLANNING TO REDUCE EXPENDITURE IN ACTUAL TERMS One of Government's main aims is the reduction of the deficit to below 3 per cent of GDP, as required by the Maastricht criteria. But with the conflict in Libya, rising oil prices and the massive challenge of Air Malta, is this aim still on track? CLAIRE AZZOPARDI finds out. One of the main objectives outlined in the 2011 budget was the reduction of the country’s deficit to ensure that it was brought in line with the requirements imposed by the Maastricht Criteria. At the end of 2010, Malta’s deficit was slightly over the allowed threshold and while measures have been introduced by government that aim to reduce it below 3 per cent of GDP, the various economic challenges that continue to arise will certainly make it a difficult task. The unrest in North Africa, the impact of the Libyan conflict in Malta’s economy and the massive restructuring process within Air Malta, are some of the challenges that may derail this objective. At the best of times, reducing a deficit is a delicate balancing act – while government must continue to invest in its own economy in order to ensure development and growth, it must seek to bring about a situation where income outstrips expenditure, without stifling the delicate economy’s journey towards full recovery. But coupled with the severe challenges that have unfolded in recent weeks, achieving the objective becomes all the more challenging. As Minister of Finance, Tonio Fenech, acknowledges, reducing Malta’s deficit is crucial, not only because of EU requirements, but also because “budget consolidation is needed to protect jobs and competitiveness.” Government has announced that it aims to achieve a budget deficit of 2.8 per cent by the end of 2011, but while this is a requirement imposed by the EU, unfolding political and economic developments in the region will certainly make it a challenging task.

“Fiscal stability is essential if we want to keep attracting investment to our shores. Having said that, we are being very cautious as challenges abound,” he explains. “Just a quick glance around us, we can see the Libyan unrest creating difficulties to our businesses which have significant interest there; while the increase in the price of oil brings about inevitable negative consequences.”

While the right strategy seems to be in place, whether or not the ultimate aim is achieved remains to be seen. And more importantly, it is not good enough to reduce the deficit to below 3 per cent of GDP unless it is done in a sustainable way. Shadow Minister for Finance, Dr. Charles Mangion, believes that bringing the deficit to within the accepted limit by the end of 2011 will be very challenging.

Even though regional and international issues cannot always be accurately forecast or controlled, certain internal inefficiencies can – and should – be tackled in a bid to cut unnecessary and excessive government spending. The notoriously over-staffed and many a-time financially inefficient public sector is one of the first areas that will hopefully be overhauled.

“The improvements in deficit reduction in the last years were partly achieved by one off measures, like tax amnesties,” Dr. Mangion observes. He points out that even the elimination of the subsidies to the shipyards did not have

“The budget for this year included a number of initiatives to improve departmental efficiency by 2 per cent, a reduction of government arrears and, where possible, to employ less people, without affecting critical professions in sectors such as health and education,” Minister Fenech states. Despite the fact that the ‘traditional’ formula for reducing a deficit usually entails reducing expenditure, Minister Fenech claims that government is “not planning to reduce spending in actual terms.” “This year we have committed €2.9 billion in our budget, which in itself is an increase on last year’s budget. Our expenditure towards health, education and other areas of social responsibility has been sustained,” Minister Fenech points out. “At the same time we are striving to curtail public expenditure while being more efficient with regards to public sector administration.”

the full desired effect on the reduction of the deficit. “This means that the structural weaknesses in the government income and expenditure have still not been addressed sufficiently,” he states. “This year’s public finances are also expected to be impacted by any financial measures taken to address the restructuring of Air Malta. The geo-political crisis in Libya will also affect world economies and will have an impact on the Maltese economy as well. I believe the situation has to be monitored with extreme caution as no one can predict how it will eventually evolve.”

Dr. Mangion also makes reference to government’s plans to increase productive capital expenditure in 2011, after cuts in this expenditure in previous years. “One hopes that this expenditure does in fact materialise as public productive expenditure is important for the growth of our economy,” he says. “In the past, promises on productive capital expenditure often failed to be kept. It is also important that this expenditure goes on projects in those areas of the economy that really need support and not on some prestige projects that add little stimulus to our export oriented industries,” he concludes.

BUSINESS AGENDA | mar – MAY 2011

BUSINESS AGENDA | mar â&#x20AC;&#x201C; MAY 2011

Environment

EU NEEDS TO ACT FAST TO REACH ENERGY EFFICIENCY TARGETS Energy efficiency is high on the list of priorities of both the European Union as well as the business community. MARIELLA SCICLUNA explores the current state of affairs in this area and highlights ways in which increased efficiency can be achieved. Although energy efficiency is at the core of the EU 2020 Strategy, recent European Commission publications estimate that the EU is on its course to achieve only half of its 20 per cent objective. This estimate is cause for concern and it is essential that action is taken sooner rather than later to get back on track to achieve its original target. In this respect, the Commission has developed and launched a comprehensive New Energy Efficiency Plan. The binding measures put forward in this plan will be implemented through appropriate legislative instruments, including a legislative proposal encompassing revision of the existing Energy Services and Combined Heat and Power Directives. The next steps during 2011 will be the adoption of that proposal, the adoption of new eco-design and energy labelling measures, the launching of the Smart Cities and Smart Communities initiative and proposals on financing tools which will be brought forward during the budgetary discussions of 2011. The Need to Invest In Energy Efficiency Energy efficiency is one of the most cost effective ways to enhance security of energy supply and to reduce emissions of greenhouse gases and other pollutants. This is why the EU has set for itself a target for 2020 to save 20 per cent of its primary energy consumption projections. This objective was also identified in the Commissionâ&#x20AC;&#x2122;s Communication on Energy 2020 as a fundamental stepping stone towards achieving our long-term energy and climate goals. Energy efficiency makes sense to business in a wide range of sectors for compelling reasons. It reduces costs, emissions and other environmental impacts, while it also extends the availability of large, non-renewable resources. Such initiatives and technology make energy more affordable to users, not only by reducing use, but also by reducing the overall need for investments in energy supply, while they

BUSINESS AGENDA | mar – MAY 2011

Environment Yet, energy prices fluctuate constantly and poor energy procurement decisions can be expensive for consumers and businesses alike. Therefore with a proactive approach towards energy, one can control costs and perform better. Energy efficiency makes good economics and does not need major incentives and investments. also improve competitiveness and improve overall productivity. According to Ing. George Cassar, Senior Analyst at the Malta Resources Authority, there are

numerous studies that show that there is still scope for cost-effective energy efficiency in business. “Business must also bear in mind that in a world with volatile energy prices, do they wish to risk increasingly

fluctuating energy prices? Does business believe that governments can subsidise energy prices so that they can avoid having to invest in energy efficiency? Is it a sound business strategy today to project an image of energy wastage?” From a local perspective, the Maltese national electricity grid is an isolated one and is not connected to any other electrical network. Therefore, all the electrical energy that is required is generated in Malta. According to Enemalta data, the total non-residential consumption is about 1,200GWh of which about 550GWh is industrial and the rest commercial. Malta has no indigenous primary energy resources and therefore relies entirely on imported fuels, mainly heavy fuel oil and light distillate. Yet, energy prices fluctuate constantly and poor energy procurement decisions can be expensive for consumers and businesses alike. Therefore with a proactive approach towards energy, one can control costs and perform better. Energy efficiency makes good economics and does not need major incentives and investments. Companies that introduced innovative and energy efficient projects have immediately benefitted from lower energy consumption. For instance in the summer of 2007, Eni, one of Italy’s largest power companies, asked its workers to embrace the notion of casual Fridays and it raised the thermostats by one degree Celsius. The overall savings during that summer was of 217,000 kilowatts and CO2 emissions, equivalent to 140 employees taking public transport for a year. Another example of a proactive approach is the CHANGE project, which a good number of Chambers of Commerce in EU countries (including the Malta Chamber of Commerce Enterprise and Industry), came up with in order to help SMEs optimise their energy use by developing a European network of intelligent energy advisors at Chambers of Commerce and Industry (CCIs) and by kick-starting/ enhancing concrete assistance to SMEs. This demonstrates that energy efficiency is not just related to the direct reduction of electricity usage but incorporates a variety of other indirect actions which will automatically result in the cutting down of bills, such as building materials, thermal and sound insulation, better and smarter grids, and it can also boil down to just better information flow and communication. Innovation and adaptation are essential if we are to ensure improved levels of energy efficiency.

BUSINESS AGENDA | mar – MAY 2011

SAFEGUARDING THE NEEDS OF HOTELS AND RESTAURANTS The Malta Hotels and Restaurants Association was formed in 1958 with key objectives that are still very much alive today. The Association encourages its members to run their properties on a professional basis, to maintain their properties to the highest possible standard within their category and to deliver value for money to those that use their establishments. It also lobbies with authorities to promote, foster and encourage at a national level the formulation of legislative measures and policies designed to further develop the tourism industry, and it provides a forum for regular consultation between members and other related bodies in matters of common interest.

General Assembly is held annually to elect a Council which is representative of the various categories of the hotels and restaurants sector. Each member has a casting vote to elect a representative on the Council. Thus members benefit from having a voice on the Council which is proactive and looking after their interest. Other benefits that members of the Association enjoy are: • Exposure on the Association website; • Information about the industry’s progress through the Association’s magazine and the BOV hotel survey quarterly reports;

The Benefits of Membership

• Exposure on the Association's magazine with news items about the members’ establishment;

Membership of the Association is open to all those that operate an accommodation establishment or a catering operation and are licenced by the Malta Tourism Authority. A

• Networking at sectoral meetings, seminars and conferences held regularly to update members

with progress; trends and threats facing the sector • Staff at the MHRA office available to assist members with any queries, information and support that might be required from time to time by members; • Use of the MHRA office for meetings. Other Advantages The Association is also a member of HOTREC, which is the trade association of hotels, restaurants and cafés in Brussels and lobbies at the European Union level. MHRA is also affiliated to The World Tourism Organisation (UNWTO/OMT) which is a specialized agency of the United Nations and the leading international organisation in the field of tourism. The MHRA is a partner organisation of the Malta Business Bureau along with The Malta Chamber of Commerce, Enterprise and Indus-

try. As Malta’s accession to the European Union gained momentum the need was felt to gather more knowledge about the implications and advantages in joining the European Union. Members of MHRA benefit from this partnership since they can tap into MBB for any information related to European Union legislation, contacts, who is who, etc. The Association’s endeavours and achievements have assured it a place amongst the most important constituted bodies in Malta. Its contribution towards the improvement of the industry remains continuous

and valuable and places it amongst Malta’s top employers’ unions. MHRA also has a good number of Associate Partners whose activities are closely linked to the Tourism Sector. Their support is invaluable in sustaining MHRA as a strong lobby group to ensure the growth of the tourism activity.

For further information please either visit MHRA website on www. mhra.org.mt or contact our staff on mhra@mhra.org.mt. MHRA staff can also be reached on (+356)2131 8133 or postal address 2, Gallina Street, Kappara, San Gwann SGN4111.

BUSINESS AGENDA | mar – MAY 2011

european business

“ We need a renewed drive for growth, competitiveness and smart fiscal consolidation”

– Jürgen R. Thumann

BUSINESSEUROPE President, Jürgen R. Thumann, speaks to Business Agenda about Europe’s competitiveness, the single market and the unfolding situation in North Africa.

Q. The state of affairs

within Europe’s economies has been under scrutiny for many long months now, and rightly so. Although tentative recovery has been registered in many EU states – do you believe that we are now in safer territory and that 2011 will see the consolidation of this recovery?

The recovery in the EU has so far proved stronger than expected, despite uncertainty still running high in financial and sovereign debt markets. For 2011, BUSINESSEUROPE forecasts GDP growth to reach almost 2 per cent. Global growth remains sustained and the recovery is gradually broadening to domestic demand, with investments and employment regaining positive momentum. However, the recovery has been uneven, with those countries with strong external competitiveness and sounder public finances showing greater resilience and a more broadly based recovery at present. There is an ongoing rebalancing of the European economy, which implies particularly severe challenges for certain countries having to catch-up in difficult circumstances. But the need for reforms is not confined to the countries with the greatest difficulties. Rebuilding solid foundations of economic growth in our continent as a whole is the highest priority in order to deliver a lasting response to the financial and sovereign debt crisis. The new governance framework at EU level must create much greater incentives to prevent macroeconomic and fiscal imbalances

from arising in the first place, that is: before they become a threat to jobs and a source of instability.

Q. In your view, what could potentially derail this recovery?

A. Substantial

risks still remain for 2011 and beyond. At present, the biggest concerns are related to rising commodity prices, but the health of public finances and the financial sector remain an important threat for the European and global recovery, and must be addressed without any further delay. Most of these risks interact with each other and affect financial market stability and companies investment perspectives. The risk of disorderly correction of global imbalances and unilateral approaches is present in this post-crisis environment. We should remain alert of protectionist risks and this is why a robust policy framework is also needed at a global level. I believe that the policy environment and quality of the response to dissipate current uncertainties will play a particularly crucial role for business confidence and the strength of the upturn in 2011 and beyond.

Q. BUSINESS EUROPE

has devloped its own recommendation in the Go For Growth proposals, stating that Europe should ‘go back to the fundamentals of the market economy’. Do you think that this could pose any risks, especially considering that Europe was supposedly working within a marketeconomic framework before the crisis hit?

BUSINESS AGENDA | mar – MAY 2011

european business “The development of companies is central to that prosperity. Growth and employment will be achieved if EU decision-makers put the development of companies at the centre of their policies... ” A. I believe that in order to

strengthen the economy, we should go back to the fundamental values of the market economy. Let me recap on those values: reward work and productive investments; encourage reasonable risktaking; ensure transparency on market value; protect and develop

intellectual property rights; identify and provide sanctions for fraud; ban distortions of competition and fight protectionism; and finally, finance affordable public services and social security. Implementing these principles is essential for the prosperity of European citizens.

The development of companies is central to that prosperity. Growth and employment will be achieved if EU decision-makers put the development of companies at the centre of their policies, if the Single Market is revitalised, and if Europe’s position in the world is strengthened. When they can operate in a business-friendly environment, companies are successful in producing first-class goods and services, in creating jobs, and in developing new technologies. When companies are successful, they create the wealth that is needed to finance public services and social security.

Q. Turning to a different

to destabilise the situation. With new avenues for reform come new opportunities for investments and market opening. Just as in Europe, the Southern Mediterranean countries need more economic growth to create jobs for young people.

A. BUSINESSEUROPE is

Already in early 2000, BUSINESSEUROPE took the initiative to set up BUSINESSMED in order to reinforce the relations with the Southern region of the Mediterranean. Over the longer term, business partnerships across the Mediterranean can support much higher growth. BUSINESSEUROPE hopes that changes in the Southern Mediterranean countries will lead to more South-South integration and further improve the relationship with the EU.

topic - to what extent do you think that the severe unrest in North Africa will affect businesses across Europe, considering that trade with these countries was severly hampered?

monitoring the complex and fast-changing situation in the Southern Mediterranean closely. We welcome the opportunity for economic reform in the countries concerned and encourage all sides to work together constructively and to avoid violence that threatens

Q. Going from the regional

to the international perspective - there are other challenges that need to be tackled to ensure the sustainability of Europe’s businesses and institutes, and there seems to be agreement that R&D and innovation are one way of attaining this. But Europe lags behind some other major players in thIs area - how can this situation be improved?

A. In February 2010 EU heads of

state and government endorsed the Innovation Union flagship initiative as a central tool to achieve smart and sustained growth. They emphasised research, development and innovation (RDI) as key factors to ensure a competitive Europe able to grow and sustain employment in an increasingly competitive global market place and deliver solutions to societal challenges such as ageing and climate change. This view is very much shared by the European business community. The EU is still struggling to make significant progress towards meeting the target of 3 per cent of EU GDP spent on RDI. At the aggregate level, the 2009 figure is around 2 per cent, but these figures must be put in perspective. The EU Industrial R&D Investment Scoreboard 2010 shows that business is doing its best to maintain research and innovation investment despite a significant fall in turnover. The fall in R&D investments was some 2 per cent in 2009, compared with an over 10 per cent decrease in sales. This shows that companies continue to invest in RDI and consider this as a priority.

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Inevitably more must be done. Although European business must remain the main vehicle for RDI, the EU has important roles to play in this context. The regulatory framework must be simplified, access to capital must be improved, and public funds must be used better. If the EU is to meet, for example, the climate challenge, the public sector at various levels must commit to enhance support to RDI. The research and innovation policy is inherently linked to other EU policy areas.

BUSINESS AGENDA | mar – MAY 2011

AWARENESS

PERSONAL SAFETY IN THE CLOUD Enabling Trusted Interactions and Minimising Risks in the Online World By Louise Mifsud, Marketing Manager at Microsoft Malta

Today individuals and organisations are empowered with a wealth of choices in online applications, services and data storage. The new era of “cloud computing” offers many benefits, including lower IT costs and greater flexibility for businesses as well as new and easier ways for individuals to connect, share common interest and access information. Although this has also increased online risks, the fundamental principles, practices and tools that have evolved over the past two decades to help protect users on the Internet, remain effective in the cloud computing realm. Protecting individuals, particularly children, has been a priority for Microsoft since the company began delivering services online in 1994. Today we work to promote greater online trust and safety through a range of measures. We incorporate online safety features and tools into our products and services. Our internal business policies and practices support safer and more responsible Internet use. We work with organisations worldwide to educate consumers about online risks and how to avoid them. We support law enforcement in investigating and prosecuting cybercriminals. And we collaborate with policymakers on a range of issues associated to online safety. In light of growing public awareness about online safety and internet in cloud computing, Microsoft examined the issues involved and also offered an overview of the company’s online safety efforts. Furthermore Microsoft also identified a number of ways that policymakers can help protect individuals online, including enacting stronger laws against cybercrime and child exploitation, supporting industry self-regulatory principles, promoting Internet safety education in schools and funding research on online risks. The Cloud: New Opportunities, New Challenges Microsoft has invested significantly in addressing online safety

issues as part of our internal business practices. These measures include enforcing a code of conduct for users of Microsoft online services and moderating content and interactions in those services to quickly address issues such as abuse, illegal activity and inappropriate material. Microsoft cloud services have built-in tools for users to report abuses; such reports are promptly investigated by our experienced online safety agents. In a nutshell our efforts are focused in the following areas: • Enabling people to interact more safely and share information online • Helping adults manage the use of technology by children and protect them from inappropriate content and contact • Partnering with law enforcement, industry and civic organisations to end the spread of child abuse images and related forms of computer-facilitated child exploitation • Combating online crimes such as identity theft, phishing and fraud Promoting Safer User Interaction and Content Today, parents face new challenges in monitoring the content their children encounter online, the people they meet there, and what they share in the cloud. With more to explore in the cloud and with kids spending more time online, the odds that young people will see unsuitable material, encounter someone who might try to harm them or inappropriately expose personal details, are greater. Growth in the use of mobile phones and other Internet-connected devices is also creating the potential for more personal information to be exposed online. This includes data about people’s location, which can be transmitted through global positioning systems and Wi-Fi network mapping tech-

nologies built into many devices and application. While geolocation software and location-based services can provide valuable benefits such as enabling parents to know their children’s whereabouts, the potential abuse of this data for stalking and harassment is a cause for concern. The Microsoft Online Safety website (www.microsot.com/protect) provides age-based guidance for Internet use, including tips of how to teach children what is or isn’t appropriate. The site addresses issues such as “sexting” (sending sexually explicit text messages) and cyberbullying, safer social networking, rules for safety using mobile devices, tips for responsible online gaming behaviour and how to avoid, block, and report online predators. It also offers links to information about Microsoft technologies such as Windows Live Family Safety 2011 and Microsoft Smart Screen Filter that are designed to help protect families from online threats. Protecting Children from Online Exploitation Microsoft has worked with law enforcement agencies in Canada and elsewhere to develop Child Exploitation Tracking System (CETS), a software tool that allows investigators to share and analyse information related to criminal acts such as possessing or distributing child pornography, kidnapping, and physical or sexual abuse. CETS is used by hundreds of law enforcement officers in countries around the world and additional deployments are planned. In addition Microsoft has partnered with Interpol, the International Centre or Missing & Exploited Children, and other organizations to help train more than 3,200 law enforcement personnel in more than 110 countries in methods of identifying online child predators, investigating offenses, and assisting victims. To supplement this inperson training we have also developed a centralised law enforcement portal that provides training, tips,

and tools for investigators on cybercrime. We released a new and updated version of the portal in December 2010; it currently has more than 1400 active users and processes more than 400 requests for assistance each year. Combating Online Fraud and Scams The Microsoft Online Safety website (www.microsoft.com/protect) also provides information to help people avoid online fraud and scams. Microsoft Security Essentials (www.microsoft.com/securityessentials) is a free download that provides real-time protection against viruses, spyware, and other malicious software. We have also built new features into Hotmail that help hijacking victims regain control of their accounts and make it harder for hijackers to compromise them. Furthermore, Hotmail also proactively detects and locks down compromised accounts when the service identifies significant changes in account’s email volume or finds that spam is being sent from that account. It also checks for suspicious activity such as logins made from two continents on the same day. Another Microsoft technology developed for law enforcement agencies is the Computer Online Forensic Evidence Extractor (COFEE). This uses digital forensic tools to help investigators, including those with limited technical expertise, to gather evidence of live computer activity at the scene of a crime. As part of our efforts to thwart cybercriminals and help legitimate users to better determine whom to trust online, Microsoft is also developing stronger digital identity verification technologies and protocols and collaborating with others to generate ideas for advancing trust. For more details please visit www. microsoft.com/mscorp/twc/endtoendtrust/default.aspx

Policy Considerations for Online Safety In addition to passing stronger laws and increasing resources to help stop criminals who use the internet to harm children and others, government leaders are uniquely positioned to focus greater attention on online safety as a societal imperative. General recommendations to policymakers include • Strengthen Online Safety Laws • Support Industry self-regulation as well as legislative frameworks in emerging technology areas • Promote integration of Internet Safety education into school curricula and teacher training • Commission studies and fund research to advance Internet Safety • Support community events that promote Internet Safety As advances in device and cloud computing deliver more powerful capabilities for interacting and sharing information on the web, technology providers, governments, law enforcement, community organizations, and Internet users have a shared responsibility to promote a safer online environment. Microsoft takes a comprehensive approach to online safety that includes the development of family safety technologies, strong governance policies, responsible monitoring of our online services, guidance and education for families and children, and partnerships to help combat online crime. These efforts align directly with Microsoft’s overall commitment to promoting greater trust online and to building products and services to enhance consumer safety.

For further information on Microsoft Cloud Services please contact Microsoft Malta on +356 21381202.

BUSINESS AGENDA | mar – MAY 2011

CASE STUDY

VASSALLO GROUP:

The Path to Success The Vassallo Group is one of the most well-established and diverse companies in Malta. KRISTA MICALLEF TRIGONA speaks to Chief Executive Officer, Pio Vassallo, about the Group’s secret to success and what it has in store for the future.

The Vassallo Group’s story is one that is intrinsically tied to Malta’s recent history. The story begins over 60 years ago, with the establishment of a modern, post-war construction company that literally set about picking up the pieces and rebuilding the island. Fast forward six decades and the Group has become one of the largest, strongest and most diverse to be found in the country.

and to be aware of the opportunities out there well in advance of other competitors,” Mr. Pio Vassallo divulges. “For example, when we first invested in private elderly health care 20 years ago, this idea was completely unheard of on our islands, and nobody thought that it would work. But we realised that there was a lot of potential in this field, and we were willing to take the risk.”

While construction still remains at the core of its operations, the Group's entrepreneurial spirit has seen it diversify into many other sectors including elderly care, manufacturing, hospitality, catering, education, alternative energy and even landscaping.

However, one of their biggest secrets to success is that is that they do not reinvent the wheel. “We are not looking to create something new. What we do is analyse the market trends unfolding abroad and, in cases where we see potential, adapt them to how we think they will work best in Malta.”

According to the Group’s Chief Executive Officer, Pio Vassallo, the entity has taken advantage of the country’s size and its market, and has realised that in order to be successful, it could not have just relied on one sector alone. “Our success relies on our ability to be diverse

Furthermore, despite the economic recession that hit Malta’s shores about two years ago, the group still continued to invest and diversify. “Our investment in the tourism sector posed the biggest risk, as we opened our two hotels –

The Bugibba Hotel and The Geroge, at a time when a number of others were closing down. We chose to invest further in this market because we saw that tourism plays a major role in our economy, and we feel that with the right product and strategy you can operate and do well. “Unfortunately, the current situation in Libya is causing quite an impact on the tourism sector despite the gain that we enjoyed in the short term due to the emergency travellers; however, if the situation continues to persist, it may have a stronger effect on business in the future,” he says. Whatever the future may hold, one thing is certain – the Group shows no sign of slowing down. “Current works in progress include the completion of The Landmark, which will include a number of shopping outlets, a cafeteria, two wedding venues designed by the renowned architecture firm Architecture Project, one of the island’s

largest kitchens, a large supermarket and a number of offices,” explains Mr. Vassallo. “Another major project in the pipeline is the development of a block of luxurious apartments in Sliema, which is a joint investment with Forestals. We also have plans for growth in the tourism sector where we are looking to invest in another two hotels on our islands, as well as one abroad,” he discloses. “We are also seeking out further investment in the waste and alternative energy sectors where we are looking to invest in solar panels overseas. Generally, we have plans to expand in our already existing sectors”. However, Mr. Vassallo stresses that the Group's success is all down to one major factor – its people. “The Vassallo Group is first and foremost a company built on people,” he says, adding that, “throughout the years we have associated ourselves with the best people in the industry

and with the most knowledgeable consultants and partners. “We also have a number of people who started out at the low end of management sections and made it to the top as directors – some of them have even been with us for twenty years,” Mr. Vassallo proudly says. “And this is a strong part of our mission statement – to provide many opportunities to our employees.” Another factor that is of importance to the Group, is family. “You spend more time with your employees then you do with your family, so we have established an organisation which is friendly and welcoming, and this entices our employees to perform well. We also live by the motto 'work hard and play hard', so our work ethic is formal when it needs to be, but the rest of the time, we have a very down to earth atmosphere and this we feel, has paid off extremely well,” he concludes.

BUSINESS AGENDA | mar – MAY 2011

EU affairs

ALTERNATIVE DISPUTE RESOLUTION:

AN EFFECTIVE SOLUTION? By Omar Cutajar, MBB's Permanent Delegate in Brussels The promotion of alternative dispute resolution schemes (ADRs) is a priority objective driving the revision and updating of the EU’s consumer acquis and a bid to increase consumer confidence in the Single Market. Essentially, these are non-judicial schemes available to help consumers resolve disputes with traders whenever they have demonstrable issues with goods or services obtained via a commercial transaction. ADR systems carry a self-evident advantage for businesses; they offer a cost-effective alternative to judicial redress and are becoming increasingly popular for businessto-consumer dispute resolution in sectors such as telecoms, financial services and the travel business. Consultation on the use of ADR in commercial disputes The European Commission has launched a public consultation on ADR schemes for consumers, aiming to consult with stakeholders and public authorities on the difficulties identified in relation to ADR and the ways to improve the use of ADR in the EU. The Commission has also produced short briefs reporting on country-specific situations with regard to existing ADR courts noting in the case of Malta specific gaps in the transport, tourism and energy sectors. Despite the growing importance of ADR in Europe, the resort to ADR-based solutions in Malta is

rather limited, and this despite the fact that there are several public ADR schemes in operation, including the Malta Arbitration Centre and the Malta Mediation Centre.

situation of business-to-consumer disputes.

From a Maltese business perspective, ADR-modelled solutions for cross-border consumer disputes are clearly much more attractive propositions than the ongoing discussions at EU-level to unveil mandatory legislation on compensatory collective redress. In fact, the consultation on alternative dispute resolution schemes is an exercise running in parallel to another consultation on collective redress.

Reinforcing ADR systems through greater awareness and the proactive engagement of traders would deliver better results for consumers and traders alike. The Commission consultation acknowledges that the major drawback preventing a large-scale take-up of ADR-based schemes is the effective lack of both consumer and business awareness of ADR systems.

On a related note, Maltese business is concerned about the rapid pace of development of the discussions on the separate but related EU legislative proposals concerning the Consumer Rights Directive and the optional European Contract Law. This remarkable surge in the political focus on consumer empowerment mechanisms is creating confusion as it is not based on a single, coherent and effective solution for all the stakeholders – the business, the aggrieved customer, sometimes also the legal aid that would typically be involved in a

Addressing the shortcomings of current ADR schemes

According to studies cited in the Commission consultation paper, the level of consumer awareness on ADR is extremely limited whilst up to “40 per cent of retailers declare that they do not know any ADR mechanisms.” Beyond the awareness deficit, the effectiveness of ADRs depends considerably on the existence of an effective court system as well as the prompt availability of efficient and equitable public enforcement by regulators. Current ADR practices amongst the more established jurisdictions demonstrate the

need for a strong incentive-driven approach in order to make ADRbased litigation more popular and indeed a viable alternative to the traditional and costly court litigation.

to provide fast and cost-effective solutions for business-to-consumer disputes on goods and services purchased online as long as ADR procedures can be tailored for a rapid delivery of a ruling.

Enhancing the cost-effectiveness of ADR in evolving business-to-consumer commercial relationships

It is vital that any prospective EU legislative proposal furthering the institutional development of ADR schemes should seek to translate the principle that ADRs provide quick, effective and affordable redress while avoiding excessive litigation into tangible reality. The expedite delivery of justice in business-to-consumer disputes in a cost-effective manner can indeed constitute a very concrete helping hand for abetting small businesses in handling redress procedures whilst incentivising them to improve their customer-handling procedures.

In order to attain this objective, it is critically important that the voluntary nature of ADRs is preserved as much as possible. The Commission consultation queries whether resort to ADR should be made a mandatory first step prior to court litigation. There are several arguments dismissing the logic of mandatory out-of-court ADR proceedings, chief of which is the legal consideration that from the consumer point of view, any contractual clause obliging compulsory out-of-court proceedings could be considered as an unfair contractual term. Another important aspect in redress mechanisms is the coverage of business-to-consumer disputes in relation to e-commerce. ADRs are the best poised systems

“This remarkable surge in the political focus on consumer empowerment mechanisms is creating confusion as it is not based on a single, coherent and effective solution for all the stakeholders...”

In turn, in the specific case of online commerce, ADRs can significantly boost consumer confidence in electronic purchasing therefore contributing to the growth of crossborder electronic markets for goods and services as foreseen by the EU’s Digital Agenda. Maltese business is supportive of measures enhancing cross-border e-commerce as long as EU consumer redress policies do not prescribe collective redress procedures, which are by nature costly for both defendant and claimant, exposed to abuse and cumbersome to implement.

BUSINESS AGENDA | mar – MAY 2011

EIE CONFERENCES GUIDE 2011

Organised by:

THE 2011 MALTA 6 May 2011 – Malta Bean Counter to Business Leader: The Changing Role of the CFO CFO CONFERENCE ......................................................................................................................................................................... The conference should be of interest to: . Chief Executive Officers; . Chief Financial Officers; . Finance Managers; . Accountants , Internal and External Auditors; . Professionals interested in a career in Finance;

THE 2011 MALTA

10 June 2011 – Malta

Organised by eie Management Centre and David Spiteri Gingell Consulting

ICT for Executives Conference ........................................................................................................................................................................... The conference should be of interest to: .Chief Executive Officers; .Chief Information Officers; .Chief Financial Officers; .Senior Executives;Management; .Academics and University members; .Senior Public Officers; .Students considering a career in Business, ICT;

THE 2011 MALTA

24 June 2011 – Malta Weighing out the Financial and Economic Post Crisis Developments

EU UPDATE CONFERENCE ................................................................................................................................................................................ The conference should be of particular interest to: . Members of Boards of Directors of private organisations; . Professionals from the financial services industry; . Directors, Chief Officers and Managers of Government Authorities . Professionals involved in Public-Private Partnerships; . Corporate Investors; . Business Owners, Directors and Managers of SMEs; . Practitioners, Consultants and Advisors in Finance, Accounting, Auditing, Law, Economics and EU Affairs;

THE 2011 MALTA 5 October 2011 – Malta Organised by: eie Management Centre Environment and Energy and David Spiteri Gingell Consulting Management Conference .......................................................................................................................................................... . . . The conference should be of interest to: Chief Executive Officers; Chief Financial Officers; Senior Executives; .Management; .Officials of constituted bodies; .Officials of Non Government Organisations; .Officials of political parties; .Academics and University members; .Senior Public Officers; .Students considering a career in the environment and energy business sector

13 &14 October 2011 – Malta Affordable, high quality training for everyTHE 2011 MALTA one in the voluntary sector CHARITY CONFERENCE ................................................................................................................................................................................ The conference should be of interest to: . CEOs, .fund raisers, .fund raising consultants, .financial controllers, .trustees, .volunteers, .senior employees, .administrators, .donors, .public officers

17 & 18 November 2011 – Malta THE 2011 MALTA Building relations, networking and MANAGEMENT EXPO .......................................................................................................................................................................... The conference should be of interest to: .all level managers in private, voluntary and public sector and future leaders

BUSINESS AGENDA | mar – MAY 2011

Other Events 2011 THE 2011 MALTA ICT for Executives Seminar

Responding to Increasing Economic Uncertainty: The Case for Business Intelligence?

19 October 2011 – Malta

Registration: at 16:45, Duration: 17:00 – 20:15 with a 15 min coffee break Organised by EIE Management Centre and David Spiteri Gingell Consulting

THE 2011 MALTA Environment & Energy Management Seminar Plasma Gasification – An Alternative to Gas for the Powering of the Electricity Generators?

24th November 2011 – Malta

Registration: at 16:45, Duration: 17:00 – 20:15 with a 15 min coffee break Organised by EIE Management Centre and David Spiteri Gingell Consulting

THE 2011 MALTA Social Policy Seminar Long Term Health Care: What Implications for Malta?

15th December 2011 – Malta Registration: at 16:45, Duration: 17:00 – 20:15 with a 15 min coffee break Organised by EIE Management Centre and David Spiteri Gingell Consulting POST CRISIS CAPITAL AND RISK MANAGEMENT WITHIN FINANCIAL INSTITUTIONS Course Type: Advanced Evening Course (3 modules of 3 hours each) Dates: 12 May 2011; 19 MAY 2011; 26 MAY 2011 Time: duration 17:00 – 20:15 with a 15 min coffee break

ADVANCED VAT WORKSHOPS Course Type: Advanced level practical workshops Dates: 16 & 17 June Time: 09:00 – 14:30 including networking lunch

Ensuring Organisational Capacity for planning and executing large capital projects Course Type: Advanced Evening Course (3 modules of 3 hours each) Dates: 4 October 2011 Time: Seminar starts at 17:00 – 20:15 with a 15 min coffee break

ADVANCED TAXATION WORKSHOP Course Type: Advanced level practical workshops Dates: 2 & 3 June 2011 Time: 09:00 – 14:30 including networking lunch afterwards

INTERNAL AUDITING WORKSHOPS Course Type: Advanced Evening Course (3 modules of 3 hours each) Dates: 15, 29 September and 6 October Time: duration 17:00 – 20:15 with a 15 min coffee break

THE FUTURE OF THE EURO EXPLOSION, IMPLOSION OR A TRUE RESERVE CURRENCY TO CHALLENGE THE DOLLAR? Course Type: Advanced level workshop Dates: 1 December Time: duration 17:00 – 20:15 with a 15 min coffee break

All events will be accredited with CPE hours by the Malta Institute of Accountants and other relevant professional bodies.

Will you join us for these specialised events? Further information on the events or on sponsorship opportunities may be obtained from the European Institute of Education. | a: eie group, Tal-Balal Road, San Gwann SGN 9014, Malta, EU. | t: (+356) 21 332 804/ 5 | e: info@eie-group.com | w: www.eie-group.com | www.eieonline.com

BUSINESS AGENDA | mar – MAY 2011

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BUSINESS AGENDA | mar – MAY 2011

tourism

SUSTAINABILITY: WHAT DOES IT MEAN FOR THE MALTESE TOURISM INDUSTRY?

In the wake of the ever-increasing limelight gained by environmental issues, the concept of ‘sustainability’ has become more than a political catchphrase. OMAR CUTAJAR discusses what connotations the term carries for the Maltese tourism industry.

The hospitality industry is not immune to this general widespread debate on sustainability which goes well beyond its original limited scope to ecological sustainability. In fact, the recently set-up ‘Task Force on Sustainability’ within HOTREC – the pan-European hospitality industry association – aims to define and proactively communicate a long-term strategy and position on the issue of sustainability. The HOTREC ‘Task Force on Sustainability’ has been conceived to formulate the action standpoints on behalf of the European hospitality industry in such a manner as to take into account all the competitiveness-related aspects of the sustainability debate. This is a fundamental consideration for the Maltese tourism industry. The focus in the current political debate on sustainability is very much tilted onto the environmental aspect with limited attention devoted to the economic and competitiveness dimension of environmental sustainability. MHRA President, George Micallef drew the attention of the HOTREC Task Force’s participants to this vital lacuna in the general EU policy discussions on sustainability. “The very first focus of the sustainability debate should emanate and focus on the economic viability of the tourism industry. This is the only way to guarantee the longterm sustainability of the European hospitality sector,” remarked Mr. Micallef at the launch meeting of the HOTREC Task Force. “A balance needs to be struck between consumer protection and the costs covered by service providers, as whilst consumers expect higher environmental standards, surveys show that they are not necessarily prepared to pay for them.”

EU policy considerations

Mr. George Micallef - President, MHRA

The economic perspective of the sustainability debate is a paramount consideration in the context of the recent Commission Communication on Tourism entitled “Europe, the world’s No 1 tourist destination – a new political framework for tourism in Europe”. In practice, the Communication focuses on support actions for the improvement of ‘Destination Europe’. However, the constitutive fibres of any tourism destination are the tourism businesses delivering the services to the holidaymakers and travellers. Therefore, the core trajectory of the Action Plans steering the proposed initiatives announced in the Commission Communication should allot critical centrality to the hospitality enterprises. Two priority actions are the development of sustainable management of tourism destinations and the adoption of a Charter for responsible and sustainable tourism. These initiatives were already the subject of initial discussion at the EU’s Tourism Sustainability Group. The role of the private sector is critical for the delivery of these initiatives and in this regard, it is vital that any policy discussions should be framed within a proper understanding of the post-recession context in which the European hospitality industry is operating. Putting the sustainability debate into context The Maltese tourism industry is amongst the best-placed in Europe to discern the contours of the postrecession hospitality business environment. “The winding up of the economic crisis is taking place at a protracted pace with the pick-up in volume not necessarily reflected in the business returns for opera-

tors”, explains Mr. Micallef. Surely this is not an exceptional scenario pertaining exclusively to the Maltese hospitality scene but is rather the general market reality across Europe irrespective of the diverse destinations’ business models. “The post-recession business context is one determined by a price-driven market where operators are being confronted with increasing costs which are in turn being met by lower margins,” elaborates Mr. Micallef. “Such a scenario leads on to one unassailable conclusion: that with no profitability, there is no sustainability,” warns the MHRA President. Gleaning on the practical issues: the case of ecolabelling This economic reality advocates a paradigm shift in the current prevailing EU policy-thinking on sustainability. No more is this need evident, than in the veritable minefield of highly-fragmented eco-labelling regulations in existence at both EUlevel and across the EU-27 Member States. The participation by hospitality businesses in eco-labels should not be enforced via backdoor legislation, standardisation

processes or through mandatory certification schemes. HOTREC CEO Anna Torres explains that the organisation has “welcomed the development of eco-design requirements related to energy from an environmental point of view, provided that they do not cause extra costs for enterprises and do not reduce the quality of the services provided to the guests”. Avoiding the creation of additional cost-burdens for the European hospitality industry is a critical red-line within the post-recession scenario. However, the concern of the tourism operators in relation to the eco-labelling is not limited to costs but it extends to the conceptual underpinnings of the available schemes to-date. It is difficult to establish a common European label, to package a minimum standard on a set of criteria that would fit all the segments of a very disparate and multi-tiered business model as the one around which the hospitality industry is structured. “Whilst issues concerning health and safety can never be compromised and specific definitions are

useful to inform prospective customers, standards have to provide for the specific cultural and geographical features of a destination which can differentiate itself from other tourist destinations, thereby gaining a competitive advantage,” explains Mr. Micallef. “The hospitality industry cautions that competition should be safeguarded in the labelling system, as the demand for different eco-labelling criteria varies on the basis of the geographical location and the climatic environment as well as on the operational market reach of a given hotel,” he continues. The Maltese tourism industry cites the example of eco-labelling as one practical example illustrating the shortcomings of the current EU policy approach towards the implementation of sustainability principles in the hospitality sector. Urgent re-focused thinking on the matter is therefore required in order to sustain and preserve the competitiveness of the European tourism industry – to-date the leading global player in the everexpanding hospitality and travel market.

BUSINESS AGENDA | mar – MAY 2011

EU AFFAIRS

Subsidiarity, Proximity, Partnership:

Bringing Europe Closer to its Citizens The Committee of the Regions is the political assembly that provides local and regional authorities with a voice within the European Union. DANIEL DEBONO reviews the purpose of this organisation and discusses its relevance to Malta and local businesses.

Mr. Michael Cohen (PES) Party of European Socialists

Malta, being that the Maltese representatives within the CoR can voice local priorities and concerns in policy developments affecting Malta at an early stage, such as in education, youth, culture, health and socialeconomic cohesion. When the discussions on such matters then move to other European fora, Dr Mifsud expressed the opinon that “the Maltese government, as an EU member, has to take a position on the same subjects.” Mr. Cohen said that “the Maltese delegation represents Malta’s Local Council Association and presents its position in Brussels. We participate in meetings, conferences and seminars, to gather information on current and future policies, legislation and programmes from EU institutions with direct implications for local authorities.”

Set up by the Maastricht Treaty in 1992, the Committee of the Regions (CoR) acts as a consultative assembly to the EU decision-making process and bridges the gap between Brussels and Member States’ citizens. Through a number of specialised commissions, including on Economic and Social Policy (ECOS), Cohesion Policy (COTER) and Institutional and External Affairs (CIVEX), the CoR’s plenary session approves political positions that officially represent local and regional authorities throughout the EU. The so-called institutional triangle, composed of the European Commission, Parliament and Council, are bound to take this position into consideration. Otherwise, the CoR, which is also referred to as the ‘guardian of the principle of subsidiarity’, has the right to refer the matter to the European Courts of Justice to intervene against any EU laws that evade this principle.

The CoR’s ruling body is the Bureau, which comprises 60 members that include the President, a First Vice-President, 27 Vice-Presidents (one per Member State), the four Presidents of the CoR political groups and 27 other members. The plenary assembly is composed of 344 members who reunite five times a year to discuss and adopt opinions, reports and resolutions that are officially presented by CoR Commissions. The Committee’s Relevance for Malta The Maltese delegation in the CoR is made up of five representatives, three from the Party of European Socialists (PES) and two from the European People's Party (EPP). When asked about the relevance of the CoR to Malta, both Mr. Michael Cohen (PES) and Dr. Malcolm Mifsud (EPP) agreed that this institution may be extremely relevant to

Councils. Same as in the European Parliament, the members form part of political groups. Dr. Mifsud claimed that despite the difference in political groupings, the Maltese representatives coordinate much of the work that is carried out, and a common stand is taken when the national interest is at stake.

ought to be scrapped. The Committees’ current administration has defended the CoR rigorously in the face of such claims. In a statement issued to EurActiv in recent weeks, President Mercedes Bresso emphasized that the CoR’s powers are granted by the EU’s strongest legal documents, i.e. the Treaties.

Some of the areas that Maltese representatives are mostly active in include the Commission for natural resources, social issues such as gender equality, youths and employment, the Mediterranean forum, cinema in the digital era, and the development of an integrated maritime policy.

She also added that regions and cities are bound to have a voice in European decision-making being that over 70 per cent of EU legislation is disseminated to administrations closer to the citizens. Therefore, only by listening to citizens’ concerns represented by elected practitioners on the ground, can the EU make more decisive and efficient policies.

On a number of occasions, the role of advisory institutions such as the CoR and EESC within the European legislative framework has been questioned as to how effective it is in real terms, and whether they

Business interests are very much at the heart of the Committee of the Regions. Dr. Mifsud highlighted the fact the CoR is very much aware of business interests because this sector is the core creator of jobs in Europe. This is why it actively participates in all political developments concerning business because in the end, in most regions, legislation concerning this sector would have to be implemented not only on a national level, but also on a local level. In this respect, Mr. Cohen explained that the CoR fosters an important cooperation with the European Economic and Social Committee (EESC), to develop solid consultations which are then delivered to the other institutions. The Maltese delegation to the Committee of the Regions is elected from the Association of the Local

Dr. Malcolm Mifsud (EPP) European People's Party

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BUSINESS AGENDA | mar – MAY 2011

Business News MBB Update

14th JANUARY – MBB REPRESENTED in Regional Development Forum in Portugal MBB CEO Joe Tanti was invited to participate in a Regional Development Forum in Portugal which addressed the concept of publicprivate partnerships. Minho, the locality hosting the forum is a sheer example of private firms, local development associations, regional tourism boards and municipalities, that come together to foster business, jobs and the reputation of the locality. The Consortium Minho In project was launched in 2009 by the Portuguese Government with a regional

development initiative for the upgrading of four thematic areas: environment, tourism, agro-industry and cultural heritage. Amongst others, the development included ten anchor projects featuring health and wellness, competitiveness and entrepreneurship, the Verde wine route and nature tourism. The conference was addressed by Dirk Ahner, Director-General of the European Commission’s Regional Policy DG.

3rd February – MBB CEO addresses MQC Colloquium MBB CEO Joe Tanti was invited to address a Colloquium organised by the Malta Qualifications Council, in which over 100 participants from industry and the educational sector in Malta were present.

the EU2020 Strategy and the EU’s Agenda of News Skills for New Jobs which are trying to address these issues and encouraged the MQC to further focus its policies according to this European vision.

Mr. Tanti observed that globalisation has increased the pace of change and investment was required for skill-upgrading in a number of sectors. He recalled that many EU citizens still faced challenges with the prospect of working abroad. He therefore proposed that the MQC framework should link to all these challenges. Mr. Tanti referred to

Mr. Tanti made reference to the fact that involving employers in academia is not the easiest of tasks both on a local and on a European level. He advised that a proper PR campaign was required. Whilst acknowledging that the initiative was commendable, he claimed that many businesses were not aware of what the MQC was trying to achieve.

9th February – MBB CEO Joe Tanti participates in seminar on Knowledge Alliances MBB CEO Joe Tanti participated in a seminar organised by the European Commission’s Education and Culture Directorate General on Knowledge Alliances. This forms part of the Lifelong Learning Programme. The seminar delved into themes on what knowledge alliances could, or should, cover. A discussion was held on how best to promote this concept through a pilot project on knowledge partnerships that should commence in the coming weeks. Mr. Tanti’s visit was funded by the European Commission.

The Feast of St. Paul Celebrated in Brussels Also, on the 9TH of February the Ambassador of Malta to Belgium, Pierre Clive Agius held a get together for the Maltese community in Brussels to celebrate the Feast of St. Paul. The event which was held at his residence was organised together with the Malta Business Bureau. MBB CEO Joe Tanti and Permanent Delegate Omar Cutajar were present. They were joined by MBB trainees Matthew Lowell and Pavel Jakovlev.

17th JANUARY – MBB and Malta CIP National Contact Point organiSe an information session on the future of the Competitiveness and Innovation Programme (CIP) The Malta Business Bureau (MBB) and Malta CIP National Contact Point (NCP) organised a jointinformation session following the European Commission’s launch of a public consultation on the future of the Competitiveness and Innovation Framework Programme (CIP). This public consultation formed part of an impact assessment which designed a possible successor programme.

about the developments around the future CIP as well as to push for a national debate to understand the views and needs of local entities. Furthermore, an overview of the current and upcoming calls under

the CIP was provided. The event was well attended, with over 80 participants from different sectors both from private and public entities respectively.

This European-wide consultation was undertaken in order to provide the Commission with public views on what the future priority areas for a future CIP programme, structure, priorities and funding instruments ought to be. The MBB/NCP event served as an information event to provide the stakeholders with information

23rd February – MBB presents a position paper on the Single Market Act to ParliamentARY Secretary Hon. Jason Azzopardi MBB President, John A. Huber, together with Chief Executive Joe Tanti and Permanent Delegate in Brussels, Omar Cutajar, officially presented a position paper in response to the public consultation by the European Commission on the 50 proposals for the Relaunch of the Single Market to Hon. Dr. Jason Azzopardi, who accepted it on behalf the Maltese government. The MBB also presented this document to the Internal Market and Services Directorate General on behalf of the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association. MBB President John A. Huber urged government to “send a strong message against any proposal that undermines Malta’s competitiveness,” and he also cautioned against “the adoption of EU proposals that have a direct bearing on business before it can be ensured that the proposal and related regulations can be effectively implemented and enforced.” He stated that, “while the Malta Business Bureau welcomes the publication of the Communication

on a Single Market Act, we expect that government takes a clear position against any proposal that could potentially have a negative impact on the local business community. He also acknowledged that the Relaunch of the Single Market is a much-needed development and indeed a timely initiative to reinvigorate cross-border business activity across the EU-27 Member States.” The Parliamentary Secretary for Small Business and Land Hon. Jason Azzopardi thanked the Malta Business Bureau for presenting him with its position paper..

Hon. Jason Azzopardi said that government welcomes a healthy exchange of ideas, with the various sectors of the economy. It is this close contact with the key representatives of the sector that allows government to better legislate, and design the ideal climate for our SMEs. The Parliamentary Secretary said officials from his secretariat would be analysing the position paper in the coming days. The Parliamentary Secretary augured that this document will strengthen the timely communication between government and stake holders.

BUSINESS AGENDA | mar – MAY 2011

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BUSINESS AGENDA | mar – MAY 2011

MBB Update

28th February – MBB CEO invited to participate in conference in Bucharest

24th February – MBB celebrates 15th Anniversary by launching new brand IDENTITY The Malta Business Bureau unveiled its new brand identity to mark the 15th anniversary since the launch of the Bureau, with a networking event between the council members of the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association. Members of Parliament, MEPs, and other distinguished guests were also present. The new logo was unveiled by MBB President John A. Huber and Minister of Finance, the

Economy and Investment Hon. Tonio Fenech. Mr. Huber stated that, “in recent years, the MBB has stepped up its services and it is entirely fitting that the organisation takes on future tasks with a rejuvenated brand that befits its dynamic and efficient approach to its duties.” Hon. Tonio Fenech congratulated the MBB for their work in recent years, stating that the organisation has helped to ensure that the local business community was well informed on EU developments and decisions.

MBB CEO Joe Tanti participated in an international conference on the Sectoral Operational Programme for Human Resources Development (SOPHRD 2007-2013) in Bucharest. The main objective of this conference was to promote the objectives and operations of ESF interventions in Romania. This was a good opportunity for the exchange of experiences, practices and information between national and transnational organisations. Mr. Tanti’s visit was funded by the European Commission.

2nd March – Participation in round table conference ON EU ICT Policy support programme 2011 Ms. Robin Counihan attended a seminar on behalf of the MBB, on the EU’s ICT Policy Support Programme 2011, hosted by CIP. This funding programme, combined with the Intelligent Energy Europe Programme and the Entrepreneur and Innovation Programme are collectively grouped under the Competitiveness and Innovation Framework Programme (CIP), a programme that strives to achieve total competitiveness of enterprise and innovative capacity in each of the targeted programmes. The ICT

Policy Support Programme aspires to achieve this by accelerating the development of a sustainable, competitive, innovative and inclusive information society. The Policy Support Programme 2011 will serve to benefit a large proportion of the business industry as it will assist the developments of markets for innovative ICT based solutions and digital content, notably in areas of public interest. This will highlight the niches in the market as it opens up a broad range of business opportunities that are in demand,

and will directly affect those SMEs that will be able to provide these services as it will create more job opportunities in this field. The Policy Support Programme will not replace but will build on the original national, regional and other EU initiatives.

Ms. Counihan is a student from the Republic of Ireland reading for a Bachelors degree in Economics and Sociology at the University of Limerick, who is currently undergoing a traineeship at the MBB and MHRA.

BUSINESS AGENDA | mar – MAY 2011

MBB Update

UPCOMING EVENT 4th APRIL

4th MARCH – Business Breakfast with EUROPEAN Commissioner John Dalli The Malta Business Bureau organised a Business Breakfast with European Commissioner John Dalli with the focus theme being “Business Competitiveness and Legislation”. The Councils/representatives of business sections of the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association were participants in this event. Among other topics, MBB President John Huber discussed the problem of lack of innovation in the EU, fearing that this has become more of a catchword. This is more worrying when it seems to be the core concept around which the EU2020 Strategy is revolving on. He argued that this seems to have become, “a veritable political slogan, all too-often repeated without properly backed by the necessary tailor-made financial support required to make it truly accessible

10th March MBB invited to participate in JCI's Political DAYS PROJECT Malta Business Bureau Executives Mariella Scicluna and Daniel Debono were invited to participate in a political “Developing an Active Youth Society” (DAYS) session organised by the Junior Chamber International (JCI), with the main theme being the European Union and the role of Malta. In this context, Ms. Scicluna and Mr. Debono explained the role that the MBB plays in civil society and the business community. They discussed the services offered by the organisation and also gave a tangible example of the MBB’s operations by referring to and discussing key points from the most recent Position Paper on the Single Market Act that was published at the end of February. During the same event a thorough interview was held with Dr. Angelo Chetcuti from the European Commission’s Representation in Malta, and along with the MBB, an additional presentation by MCESD was held about a project in partnership with the Malta-EU Steering & Action Committee (MEUSAC) under the ESF programme entitled “Closer to Europe”, which focuses on the participation of society in decision-making through cooperation, with a wider range of partners.

Launch of 'Ambassadors in malta for increasing women entrepreneurs' (AMIE) project in Malta

for the average micro-business that dots the Maltese entrepreneurial landscape.” Mr. Huber also expressed concern at the Consumer Rights Directive that will soon be voted on by the European Parliament. In respect of e-commerce, which is crucial for business in modern economies, he claimed that, “consumer trust is vital, but not to a degree that leaves the trader practically defenseless against fraud.” This is what Maltese business fears most should the current text of the Directive prevail. Mr. Dalli, while delving into the current crisis being faced in the North African region, particularly Libya, also discussed the prospects of EU competitiveness and economic growth. He expressed the view that the role of the European Union is to support and supplement action at national level. “The member states are in the driving seat

and the EU assists. But Europe can certainly play a role in bringing the member states together in order to look at European solutions to European problems and challenges,” he explained. “I believe that the key to securing increased competitiveness is innovation and it is essential that national governments allocate sufficient resources to ensure results in this area.” The seminar was also addressed by Mr. Anthony J. Tabone, member of the Board of Management of Malta Chamber, and by Mr. George Micallef President of MHRA. An open floor debate followed with Commissioner Dalli. This was moderated by PBS journalist Mr. Keith Demicoli.

The Foundation for Women Entrepreneurs together with the Malta Business Bureau, Reach Beyond Foundation, National Council for Women and Malta Association of Women in Business are coordinating a project entitled 'Ambassadors in Malta for Increasing Women Entrepreneurs' (AMIE) funded under the Competitiveness Innovation Programme (CIP) funded action no. ENT/CIP/09/E/N08S003. The duration of the project is of 24 months, from 1st December, 2010 until the 30th November 2012. AMIE will be officially launched in Malta on Monday, 4th April, 2011 during a half day event, ending with a networking lunch. During the event, MBB executive Mariella Scicluna will present the role of the MBB within the project. The ten Maltese Entrepreneur Ambassadors will be introduced to the stakeholders and the local media. The main objective of AMIE shall be that of promoting Female Entrepreneurship in Malta through the establishment of a Network of

Women Ambassadors. This Network, which shall be part of the European Network of Women Entrepreneurs, shall campaign amongst unemployed women, women in active professional life as well as students to set up their own businesses and become entrepreneurs. Furthermore the objective of the Ambassadors are to act as role models so as to raise women’s ability to create a vision for themselves as entrepreneurs as well as the required motivation and self-confidence in setting up and creating a successful business. The Ambassadors shall be role models to inspire other women to become entrepreneurs by ‘telling their story’. Overall AMIE aims to carry out the activities outlined above so as to increase the potential of women becoming entrepreneurs. It is the intention of all the partners of the consortium to sustain this action even beyond the project duration of AMIE.

BUSINESS AGENDA | mar – MAY 2011

AWARENESS

FIMBank launches Online Savings Account Easisave.com, an online savings account powered by FIMBank, offers one of the most competitive interest rates around, currently standing at 2.5 per cent gross per annum. This online savings product promises “access to your money whenever, wherever” through a dedicated website, www. easisave.com, which offers an extremely safe and secure environment in which clients can control and manage their savings at any time. Opening an Easisave Euro Savings Account is a simple and straightforward process and can be done within minutes by applying online, while clients are able to effect transfers between their Easisave accounts and their linked bank accounts on a 24/7 basis without notice and without incurring any fees or bank charges. Easisave funds are not tied for a fixed term while the initial deposit requirement is of just €50. Moreover, the Bank will consistently pay premium interest on savings. These characteristics make Easisave ideal for customers who want a higher return on their sav-

ings and not wishing to tie these funds for a fixed period of time. Easisave operates under the depositor compensation scheme established under the laws of Malta, which guarantees amounts up to €100,000 per depositor.

For more information, visit www.easisave.com or contact the Helpdesk on Freephone 8007 3388.

Gateway to Export assists SMEs venture in foreign markets Malta Enterprise has launched a new programme to encourage micro and small enterprises seek foreign markets and make exporting a regular part of their day-to-day operations as a means of growing their business. Gateway to Export is a structured yet flexible programme which enterprises are expected to complete in around 18 months. Businesses will first be assessed for the skills they already possess and then provided with the training and

ongoing support they need to succeed in overseas markets.

exceed 20 per cent of the company’s turnover, if any.

Upon completing this phase, companies should be familiar with the export market and have the skills, know-how and confidence to excel internationally under the professional guidance of the business specialist assisting them throughout the programme.

The programme is targeted towards a number of sectors, namely the manufacturing industry, creative services, ICT, tourism, transportation and logistics, health services and life sciences, financial services, as well as the education and training sectors.

Eligible companies need to have less than 50 employees, an annual turnover which does not exceed €10 million, and export sales which do not

For further information contact Malta Enterprise on 2542 0000 or via email on info@maltaenterprise.com.

BUSINESS AGENDA | mar – MAY 2011

AWARENESS

Microsoft Appoints New Country CE-CERTIFIED Manager for Microsoft Malta BUILDING ment’s vision for Malta as a Centre of Excellence by 2015,” explains Adrianna Zammit.

Entrusted with managing the dedicated and energetic team at Microsoft Malta, Adrianna Zammit has already a clear picture of Microsoft Malta’s vision for these coming months and years — a vision based on the values of Presence, Innovation and People.

Being a leader in software innovation is at the core of Microsoft’s agenda. “Last year Microsoft spent nearly 9 billion dollars in research and development. At the moment the majority of this R&D is being committed to developing the latest technologies such as cloud computing – an internet based computing service. Leveraging this, my goal is to ensure that we bring the latest technologies and resources to Malta, providing our customers not only with innovation but also with efficient, reliable and secure technology at a lower cost. “Also, I consider the Microsoft team as one of our most important assets. It is critical that we continue to develop the best-in-class individuals in our industry and invest in them by ensuring they have all the resources, training and support they need to be enriched in their jobs and everyday interactions within our community,” added Adrianna Zammit.

“My first goal is for Malta to truly feel Microsoft’s presence and impact locally; not only with our customers, partners and community at large but also with our government. Microsoft has unparalleled resources, technologies, and expertise globally. Coupling this with our local presence, we have all the necessary tools to propel our government’s position as an e-Government leader in addition to our govern-

Adrianna Zammit, a Maltese-American, holds a degree in Electrical and Computer Engineering. She brings with her extensive global experience in IT, engineering, sales, and executive management from Fortune 500 companies. The Microsoft Malta team today consists of nine employees with a broad range of expertise in different areas, such as sales, services, marketing and technology specialists.

Microsoft has appointed Adrianna Zammit as Country Manager for Malta.

THE NEW CITROËN C4 REVEALED generation, the new C4 has grown in dimensions with 5cm in length, 2cm in width, and 3cm in height. It also comes with a new exterior design.

The all-new Citroen C4 was launched in Malta by Muscats Motors during an event held on 11th March at the Radisson Blu Resort Hotel & Spa, Golden Sands. The new C4 cuts a distinctive profile, striking an impression of strength, stability and balanced proportions with its sculpted lines. Compared to the current

During the launch presentation marketing manager Grazielle Camilleri explained that “the New C4 is available with Citroen’s new micro-hybrid e-HDi powertrains, featuring the latest generation Stop & Start system that helps deliver CO2 emissions as low as 109g/km at launch - and 99g/km on future models.” “Alongside existing range technologies, such as EGS (Electronic Gearbox System), hill start assist, automatic electric parking brake, Lane Departure Warning System and Xenon dual-function directional headlamps, the New C4

is available with convenient and useful new technologies. These include a new blind-spot monitoring system, a cornering light function, cruise control and speedlimiter with road speed memory settings, and an innovative new service called eTouch.”

EQUIPMENT

Occupational health and safety is a key issue that requires awareness building to install a safety culture in all stake holders who provide a service. At present, there are numerous occupational health and safety risks since a number of workers and employers do not adopt the recommended safeguards. Enforcing preventative measures is, therefore, vital. Access Equipment supply CEcertified building equipment consisting of electric lifts and platforms, a wide range of work platforms and hoists, available both for sale and leasing. Most notable is the mast climbing work platform, which is both a valid alternative to traditional scaffolding and a support to the traditional scaffolding.

PRICE: The New C4 has been launched at the starting price of €16,990 for the Citroen C4 1.4 petrol model. Specifications include air conditioning, power steering, alloy wheels, 4 airbags, ESP, ABS, radio cd, remote central locking and much more.

Through both practices, the cost savings are radically improved. The assembling and disassembling times, plus the transport time for both materials and personnel, are reduced by 80 per cent. Moreover, all jobs are carried out in a safer working environment.

Send an e-mail on info@mml. mizzi.com.mt to request information or a test drive or contact the Citroen Sales Team on 2326 4585/6. www.citroen.com.mt

All equipment is supplied by Salerno Ponteggi, which established itself in the international panorama as a leader company in the field of production of mast

climbing work platforms, transport platforms, hoists, construction lifts, and suspended platforms. Ever growing, Salerno Ponteggi has increased its range of products and has always improved the quality of its production to make innovative solutions, capable of satisfying the varied market demands. The whole process of manufacturing is carried out in Salerno, where, since 2008, the three crucial phases of the activity-carpentry, finishing and assembling-have been gathered in a single site. Access Equipment may also be leased since owning your own equipment requires ongoing, dedicated maintenance and warehousing costs. Leasing has become a simple, obvious solution for many businesses, with arrangements being inclusive of fully comprehensive insurance cover, maintenance and service, replacement if necessary, plus certification on assembly, among other benefits.

Access Equipment — The Retail Office Centre, M4 Shopping Complex Old Railway Track, Attard. ATD 1234. Freephone: 8007 4199 Mobile: 9949 3628. www.francescagambina.com.mt

Sole distributors for:

your partner in hygiene www.hygienemalta.com Detergents & Systems for Dishwashing, Kitchen Hygiene, Housekeeping, Laundry & Food Processing First Aid Kits - Colour Coded Bins - Trolleys - Brushware - Recycled Paper Food Grade Containers - Personal Protection - Dispensers - Safety Signs Disposables & Much More Sikasa, Triq It- Torri, Msida MSD 1825 | Tel/Fax: 21 413 154 | Mob: 99 472 922 | email: info@jmpmalta.com

BUSINESS AGENDA | mar – MAY 2011

AWARENESS

Mobile Proximity MALTA’S PREMIER WATERFRONT HOTEL Marketing Launched in Malta

The Grand Hotel Excelsior Malta is a newly reconstructed, deluxe, 5-star resort situated within the sixteenth century fortifications of Malta’s capital city, Valletta — a UNESCO World Heritage site. The Excelsior commands the island’s premier waterfront location offering breathtaking sea views of Marsamxett Harbour and Manoel Island. As a member of Preferred Hotels & Resorts, the hotel exceeds expectations on the basis of its 5-star service excellence. All 428 deluxe rooms and suites enjoy a harmonious blend of classic and contemporary design mixed with modern 5-star convenience including multichannel flat screen TV. Spread over ten levels, three of which are executive floors, most of the rooms and suites overlook stunning harbour views. The Excelsior’s facilities include a private 30-berth marina, large outdoor and indoor swimming pools, health & beauty centre and 3 food and beverage outlets. The Excelsior offers versatile conference and banqueting facilities, 14 flexible venues of over 4000 square metres, a number of which have

natural daylight — an ideal environment for business meetings, conferences and other events. Near to the Excelsior is the Mediterranean Conference Centre. This historical building enhances the Excelsior’s conference potential with an auditorium capacity for up to 1,400 delegates. The Grand Hotel Excelsior opened its doors to its first guests on 10th September 2007. Right from the start it was very clear that the product and service offerings were to be of a superior nature. The hotel prides itself in attracting and retaining a faithful following of leisure and business guests as well as prominent international personalities. For the past three years, the hotel played host to the well known artists performing at the yearly concert, Isle of MTV — Lady Gaga, Enrique Iglesias, Black Eyed Peas, Scissor Sisters, David Guetta, Kid Rock, Kelis to name but a few. Tom Jones, Rod Stewart and Ronan Keating, who were in Malta to give a concert, also chose to stay here.

The hotel has been reviewed by previous guests as a ‘Hotel fit for Royalty’ on the popular website ‘tripadvisor’. This was due to the fact that during their stay, the King of Spain was also residing at the hotel, when in Malta on a state visit last year. The German Chancellor, Angela Merkel, also recently chose the Excelsior while on the islands to attend meetings with the Maltese authorities. The team at the Grand Hotel Excelsior is extremely honoured to have had the opportunity to contribute towards the success of these two all important visits. Huge emphasis was put on ensuring the safety of the distinguished guests as well as offering optimum levels of service and hospitality the Excelsior is known for. The hotel feels it plays an important role in ensuring it lives up to and exceeds the reputation the Maltese have as being a hospitable nation. The fact that these major events are becoming a regular occurrence is testimony that the Grand Hotel Excelsior is being talked about on an international level.

New educational events for professionals Learning is a lifetime process, but there comes a time when we must stop adding and start updating.

CONFERENCES & EVENTS 2011 The European Institute of Education – EIE Management Centre is embarking on a new project and is offering conferences, seminars, advanced workshops and other continual professional educational events for professionals hailing from different walks of life.

yearn for educational and informative events which are specific, targeted and focused on subject matters which are current and which are delivered in a professional environment allowing them to go back to their workplace and apply theory to practice.

Current educational events have become run-of-the mill and are often repeated year after year. The aim of these events leans more towards fulfilling the Continuous Professional Education (CPE) requirements of the various professions, rather than offering real and practical value for professionals in their day-to-day work.

To this end, EIE Management Centre has developed a detailed and varied programme of events, targeted at professionals with an accounting, financial, taxation, voluntary and others background.

EIE Management Centre believes that local professionals

EIE Management Centre has also endeavoured to bring onboard top-notch speakers and educators, having a practical experience and hands-on approach in most cases. Emphasis is being

placed on what the attendees will take back to their workplace, and how these events will serve to add value to attendees’ careers and professional life. These events are accredited by various professional institutes. This will ensure that in addition to all of the above-mentioned benefits, attendees will be contributing towards their annual CPE requirements. EIE Management Centre invites you to join and share in its success. EIE Management Centre forms part of the EIE Group, an established educational services provider.

Innovative Solutions Ltd, a subsidiary of Mailbox Services Group has launched Mobile Proximity Marketing on the local market a new marketing platform that allows the wireless distribution of advertising content through a localised broadcast, targeted to mobile phone devices in a particular area.

tion Malta Chapter said that “innovation and creativity are primarily driven by technology and mobile proximity marketing is a prime example of this”.

The technology of Mobile Proximity Marketing (also known as location-to-mobile) allows brands and content owners to reach mobile phone users through devices that use localised wireless connections like Bluetooth, Wi-Fi and NFC. This kind of content enables new communication channels with mobile phone users that go beyond any traditional or digital media.

the targeted location and advertising content is managed from the office using campaign management software. Content messages are sent through the system via Bluetooth or Wi-Fi to all mobiles in the area and customers receive the content on their mobile phones within seconds”.

“Mobile proximity marketing is the latest innovation in intelligent marketing,” said Keith Abela, Group Marketing Manager at Innovative Solutions. “Mobile Proximity Marketing technology enables interaction between brands and consumers, allowing brands to send advertising content to potential customers in the right place and at the right time.” Mr. Abela emphasized that the technology behind Mobile Proximity Marketing, is invaluable for marketing professionals because the system’s advanced reporting allows measurement and assessment of the success of marketing campaigns in real-time. During Innovative Solution’s recent business presentation, Mr Ray Grech, Chairperson of the International Advertising Associa-

For more information on the conferences programme call EIE Management Centre on 2133 2804/5 or send an email on info@eiemanagementcentre.com

Sales Manager Chris Briffa explained how the technology behind Mobile Proximity Marketing works. “The hardware system is installed at various points in

A wide variety of content can be transmitted through proximity marketing via a system that can be installed in a wide range of locations ranging from airports, hotels, bus stages to buses, heritage sites, supermarkets, shopping malls, bars, cinema theatres and event locations. Innovative Solutions backed by Futurlink, the Spanish IT company behind the technology, has already installed mobile proximity marketing systems at Pavi, Smart, The Point and Vodafone’s Valletta branch and mobile kiosk. The power of this medium lies in the fact that advertising reaches directly the right segment and decision maker at point of sale bridging potential distortion between traditional advertising visible elsewhere and the purchase decision at point of sale.

For more information one can visit www.innovative.com.mt

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BUSINESS AGENDA | mar â&#x20AC;&#x201C; MAY 2011

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BUSINESS AGENDA | mar – MAY 2011

THE EESC: WORKING TO STRENGTHEN THE SINGLE MARKET MATTHEW LOWELL explores what the European Economic and Social Committee (EESC) is advocating for reinvigorating the European Single Market.

“Since the general feeling of many Europeans is that the Single Market has let them down, the Single Market Act is seen as a good initiative and has long been awaited by the EESC. The Committee is now highlighting what it thinks that the main priorities should be amongst the 50 proposals put forward by the Commission.” _ Anna Maria Darmanin The European Single Market has brought about a vast array of benefits to European economies and consumers. Nonetheless, many challenges continue to hinder its progress and prevent it from reaching its full potential. The recent economic and global crisis, along with a rapid transformation of the global economic environment, has illustrated the Single Market’s weaknesses and revealed its need for further improvement.

As a result, in order to try and re-kindle the somewhat forgotten initiative, the European Commission launched a Communication on the issues of the Single Market and earmarked the main principles it considers critical to further enhance and deepen European market integration. The objective of the Communication and the public consultation on the Single Market Act launched by the European Commission was to inject new confidence in the “social market economy” by putting European

citizens at the heart of the Single Market and to foment better governance and dialogue among the Union’s member states, civil societies, social partners and critically, the business community. The opinion on the Single Market Act was scrutinised by EESC, and even though the EESC opinion is not an in-depth study of the act, the report offers a holistic approach that goes beyond the Commission’s proposed structure of a “Single Market Act”,

sub-divided into three pillars. The opinion highlights the areas the European Economic and Social Committee felt were lacking in substance such as consumerrelated initiatives, the aspect of environment protection and the spurring of R&D activities amongst businesses. Commenting on the report, EESC vice-president Anna Maria Darmanin stated, “since the general feeling of many Europeans is that the Single Market has let

them down, the SMA is seen as a good initiative and has long been awaited by the EESC. The Committee is now highlighting what it thinks that the main priorities should be amongst the 50 proposals put forward by the Commission.” However, Ms. Darmanin warned that “there are some important issues which have been omitted altogether and are therefore not covered by the 50 priorities listed in the Commission Communica-

BUSINESS AGENDA | mar – MAY 2011

agencies, electronic payments and e-procurement, consumer credit and over-indebtedness, interbank transfers and other items. Moreover, in the report, the EESC emphasises its role, as the body representing European civil societies, in the preparation and implementation of new possible measures.

capacity of SMEs, the lack of adequate financial capital needs to be urgently addressed at EU level. This has become more critical with the financial crisis. New innovative sources of financing, such as equity capital markets and access to venture capital funding, would assist Maltese companies to overcome the financing barrier.

tion such as specific measures dealing with the sustainability of micro and family businesses besides social aspects like the revision of the pregnant workers directive”.

Adding to the recommendations listed in the opinion paper, the EESC reiterated its willingness to contribute to future proposals and vowed to play a part in coming up with detailed positions on the future development of the European Single Market.

According to the EESC’s opinion, the Commission’s document fails to cover issues such as copyright levies, data protection, investor protection, the social progress protocol, European private company statute, e-procurement, European credit rating

A proposal of significant added value for Maltese small and medium-sized enterprises (SMEs) is the proposed action plan aimed to foster and better improve “access to capital markets”. Often regarded as a perpetual hindrance to the operational growth

According, to Stefano Mallia, EESC member representing Maltese employers’ organisations, it is vital that the relaunch of the European Single Market is based on furthering the interests of small business. “The internal market should be about facilitating cross-border business activities of all commercial endeavours irrespective of company size, and the concerned economic sectors,” said Mr. Mallia.

“The international market should be about facilitating cross-border business activities...” _ Stefano Mallia

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The Proposed Common Consolidated Corporate Tax Base The proposal for a “Europeanwide Common Consolidated Corporate Tax Base” (CCCTB) is a delicate issue stirring debate amongst Maltese businesses. The European Commission has tabled a proposal for a common consolidated system leading to the calculation of the appropriate tax base for businesses operating crossborder or in a number of different EU Member States. According to the Commission’s proposal, the inception of a CCCTB would allow companies to benefit from a ‘one-stop-shop’ system for filing their tax returns thereby permitting them to consolidate all the profits and losses they incur across the different business locations. The Malta Business Bureau conveys a message of caution on the potentially harmful impacts that an increasingly-coordinated EU taxation policy could have on the country’s competiveness by highlighting the adverse implications for new high-growth business sectors such as financial services and pharmaceuticals, amongst others. “The ability for a memberstate to harness a competitive tax regime to bolster its investment promotion policy is a fundamental principle for improving the general competitiveness of its economy,” commented Mr. Mallia. "This is why Maltese business is decidedly against any measures conceived to facilitate the convergence towards the harmonisation of corporate tax rates in Europe," Mr. Mallia concluded.

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“We all know that the Single Market is the biggest asset of the European Union. It is especially important for a country like Malta which has a very small market. We therefore have to continue pushing to make the EU Single Market a reality for our firms,” elaborates Mr. Mallia.

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21/03/2011 16:56:32

Mr. Lowell is currently undergoing a traineeship at the MBB's office in Brussels.

BUSINESS AGENDA | mar – MAY 2011

SECURE A COMPETITIVE EDGE THROUGH

CORPORATE SOCIAL RESPONSIBILITY Corporate social responsibility is picking up in the business world. But is investing in CSR purely altruistic, or do such actions bring about benefits for a business? Krista Micallef Trigona finds out.

Consumers are becoming increasingly aware that product-purchasing habits and low price and high quality are no longer the factors that determine a sale. As socio-environmental impacts become more essential for consumers, it is in turn becoming more crucial for businesses to engage in Corporate Social Responsibility (CSR). But how can companies benefit from CSR? Many enterprises are unfortunately unaware of the benefits that they themselves can gain. Greater social responsibility is the way forward for a company to gain a competitive edge. But how does CSR have an impact on these factors? Save More on Operating Costs From an environmental perspective, CSR can help companies save a lot more on their operating costs. At first, however, the company may have to fork out extra money when reducing its carbon footprint, by for example, investing in energy efficient vehicles and appliances, but in the long run it will lead to cost saving since less energy is being used. The same can be said for companies that seek out ways to minimize water, and maximise the use of recycled materials.

Boost your Brand Identity Companies that adopt social responsibility are more likely to see a positive impact on their brand image, which will in turn have an impact on customer loyalty as well. Consumers are no longer showing interest in ruthless corporations whose prime concern is maximising profits, and as a result, companies that adopt a responsible and ethical approach will be positioned well in a competitive market. Retain your Employees Research shows that companies that invest in CSR are more likely to attract and retain the best employees. Furthermore, they tend to be more motivated in their job, probably because of the satisfaction they get in knowing that they are working for a company that is investing in the good of society and the environment and also because such employers are more likely to treat them well. Consequently, employees who are motivated result in more productivity. Get More Access to Capital Investors are showing more interest in companies that adopt CSR initiatives, particularly in issues dealing with the environment and

human rights. Investors no longer invest in companies that do not have a good reputation for CSR, and so, companies that are socially responsible are likely to have access to a larger capital base. Build a Good Reputation Companies that are socially responsible strive to minimize their impact on the environment, deal with their stakeholders fairly, and contribute to the good of society through giving and volunteering programs. This means that to the general consumer, companies have established themselves and built a good enough reputation, which will be enough for them to make it through any potential rough patches.

CASE STUDIES: BANK OF VALLETTA Throughout the years, BOV has worked towards building awareness of corporate responsibility obligations into its roots as well as the culture of the organisation, and continues to offer responsible banking services, whilst also meeting the broader needs of all its stakeholders.

“Today we service 300,000 active clients,” explains Mr. Muscat Azzopardi, Head of Marketing and PR. “We therefore understand that this places a huge responsibility on us since we are inextricably linked with the community within which we operate,” he says, adding that over the past two years, the international financial crisis has demonstrated that being responsible and being profit-making can, and should go hand in hand. “Every year, a fixed percentage of the pervious year’s pre-tax profits are allocated to the Community Relations Programme and this framework ensures an equitable distribution of funds via the seven pillars,” he explains. With the experience in hand, BOV recommends that in order to embrace the principles of CSR, companies should start at the highest level of executive management by appointing a CSR manager. “From there on, the path is relatively straightforward,” Mr. Muscat Azzopardi says. “Best practice examples from the industry that one operates in are available and, depending on the scale of the organisation, one may adopt these exam-

ples and tailor them to their organisation,” he concludes. ISLAND HOTELS Islands Hotels is another large company which has recognised the value of CSR. The Group’s CSR initiatives are driven by its directors, who truly understand and value the benefits that can be enjoyed by both the organiser as well as the recipient of any CSR initiative. “With regards to our activities related to the environment, we believe that the tourism industry depends on our environment and it is crucial to support and take care of our surrounding environment in order to achieve sustainable tourism,” explains Ing Ray Vassallo, Chief Engineer at the Radisson Blu Resort and Spa. “Being a socially responsible company it indirectly improves our corporate image, particularly when we direct our efforts to social activities such as those organised in aid of Creche, St. Joseph Home and the Inspire Foundation where our role was to landscape their garden,” he concludes.

BUSINESS AGENDA | mar – MAY 2011

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BUSINESS AGENDA | mar – MAY 2011