TECH.MT

Malta – A Hive of Activity for International Business

From artificial intelligence to fintech, the internet of things (IoT), and blockchain, Malta has emerged as the European technological hub of choice, leading the way forward in innovation and technology. Speaking to Showcase Dubai, DANA FARRUGIA, CEO at Tech.mt describes Malta as a shockless environment for investors, making it a very attractive option indeed.

From the very start of the interview, Dana Farrugia, Tech.mt’s dynamic CEO makes it very clear: Malta is not just a good option, it is a great option for business. Even though it is a small island, Malta facilitates and ensures the benefit of being well connected to all European hubs with regular and short flights made available. “Tech.mt, the Government and other stakeholders are already doing a lot to ensure that the ecosystem remains competitive,” said Ms Farrugia, adding that Malta also provides economic potential, with a sustained rate of approximately 6% average annual GDP growth over the previous five years, access to the EU market, and one of the most business-friendly legal frameworks in the EU.

A PERFECT ENVIRONMENT FOR GROWTH

Indeed, according to Ms Farrugia, Malta has created a perfect environment for growth. For enterprises, this implies favourable fiscal conditions and simplified licensing and cuttingedge infrastructure. Financial services, marine services, and tourism are all booming industries in Malta, but the technology industry, in particular, has found a secure and fruitful foundation. According to the digital-intensity index, 32% of companies in Malta are highly digitised (compared to 18% in the EU) and Maltese businesses outperform the EU average for the use of digital technologies. “Malta has excellent connection as well as a large bandwidth capacity. 5G connectivity has also begun, giving Malta an even more appealing area for testing new products and apps,” said Ms Farrugia. Malta ranks 5th in all the dimensions of the Digital Economy and Society Index: connectivity, human capital, use of internet services, integration of digital technology & digital public services (DESI 2020).

A SPACE TO GROW

Ms Farrugia listed several factors which render Malta the perfect choice. The corporate income tax rate for a company incorporated in Malta is 35%. However, the effective tax rate incurred by a registered foreign shareholder could be lowered significantly through several fiscal and employment schemes. “A few of the top benefits of investing in Malta include incentives and support measures by various government entities, investment and R&D tax credits, cash grants, physical space and designated areas for R&D and strong business support services,” said Ms Farrugia.

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Malta also provides economic potential, with a sustained rate of approximately 6% average annual GDP growth over the previous five years, access to the EU market, and one of the most business-friendly legal frameworks in the EU

Another big plus point is that English is lingua franca in Malta and, since English language is the language of the Internet, thousands of digital nomads and other expats have relocated and are effectively running their own businesses or working for Maltese enterprises.

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Tech.mt aims to provide a bidirectional communication channel between local and international academics, through which areas of collaboration can be found and integrated to form well-defined paths in which all academia can participate and benefit.

A TALENTED WORKFORCE

Malta is home to numerous talented people with a high level of dexterity. Around 95% of graduates remain in Malta to plough their talent and expertise back into the economy, observed Ms Farrugia. Local talent, in addition to the pool of global talent, “…may be depended on to deliver in any prospective endeavour,” noted Ms Farrugia. Malta ranks 23rd out of 132 countries in the 2020 Global Competitiveness Talent Report and the country has a strong track record of attracting and keeping talent, ranking 20th and 14th in the world, respectively. Malta, said Tech.mt CEO, has launched several initiatives to encourage the development of digital skills. In 2017, 74% of young people (16-19 years old) were reported as having higher levels of digital abilities than the EU average of 57%.

BRIDGING THE GAP BETWEEN ACADEMIA AND INDUSTRY

With pride and determination in her voice, Dana Farrugia said that “Tech.mt aims to provide a bidirectional communication channel between local and international academics, through which areas of collaboration can be found and integrated to form well-defined paths in which all academia can participate and benefit”. She added that in such a role, Tech.mt would also be helping to build a bridge between academia and the world of industry, helping both to feed into each other. “Tech.mt and the University of Malta have signed a cooperation agreement with eight Italian Universities to enhance the benefits of students extending their studies within the technological and innovation sphere,” said Ms Farrugia.

BEYOND THE TRADITIONAL SOURCES OF FUNDING

The potential presented by the future in the technology sector is vast. Innovation funding is one area that is thought to be crucial for Malta’s continued success in the digital and innovation environment. Traditional methods of funding for a new company initiative are judged unsuitable for the great majority of new ventures. This results in wasted chances for entrepreneurs, as well as for the economy, because start-ups that scale up and become established enterprises eventually contribute favourably to the country’s economic growth.

A healthy ecosystem allows for a positive and virtuous cycle of economic development and progress, and angel investment is thought to be the foundation to accomplishing this for Malta. “As a result, we are presently reviewing the framework that governs angel investment in our local ecosystem, and we believe there is opportunity for improvement to develop this sector of our economy as a new niche market,” said Ms Farrugia.

AT THE FOREFRONT OF REGULATION

Tech.mt CEO said that local and foreign start-ups have taken root in Malta like nowhere else in the EU, drawn by competitive taxes and the country’s abundant natural attractions. Other technological expertise has also thrived in the country. “Malta became recognized for its blockchain endeavours, not by coincidence since the country was possibly the first and the most efficient in the world to establish a clear and appealing legal framework for this emerging technology,” asserted Ms Farrugia. Meanwhile, Artificial Intelligence has been very much in the government’s cross hairs with a national policy announced in October 2019, based on three strategic pillars: investment, start-ups and innovation, and adoption by both the public and private sectors.

Malta was the first jurisdiction to develop a regulatory framework for DLTs. Malta became the first country in the world to develop a comprehensive legal framework for the regulation of cryptocurrency service providers and cryptocurrency initial offerings. Three separate pieces of legislation were introduced to safeguard investors and support growth of the tech industry: the setup of The Malta Digital Innovation Authority (MDIA) as regulator, the enactment of The Innovative Technology Arrangements and Services (ITAS) Act and The Virtual Financial Assets (VFA) Act which sets out the framework for Initial Coin Offerings (ICOs) and the regulatory regime for the provision of certain services in relation to virtual assets

TECH.MT ENHANCES POTENTIAL

“The mission of Tech.mt revolves around the fundamental principle of enhancing Malta’s attractiveness for foreign direct investments as well as facilitating international business development and innovation,” said Ms Farrugia. She listed various ways in which Tech.mt helps potential investors: • Pointing the investor in the right direction to help the technology sector expand and thrive. Tech.mt is dedicated to assisting Maltabased technology firms in exporting their technologies, as well as establishing export sales channels for the technology industry. • Tech.mt is committed to providing Industry Connections to stimulate the local technology business by hosting events on key tech areas.

This will offer businesses with an excellent opportunity to network, as well as a window of opportunity to make new connections. • Tech.mt acts as an intermediary to facilitate Internationalisation of connections to ensure excellent client relationship management through our personalised advisory services. • For the past year, Tech.mt has been working hard to attract venture capital and angel investment as an alternate source of funding for start-ups.

Tech.mt will assist in applying and attaining the right funding in order to introduce new niches for possible consumer investment. In addition, it will bring together investment and the local start-up ecosystem. “Tech.mt strives to present Malta as a high-quality, creative, and tech-savvy country and promote Malta as a suitable location for foreign direct investment while also promoting local technological enterprises overseas,” concluded Ms Dana Farrugia. n

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Tech.mt strives to present Malta as a high-quality, creative, and tech-savvy country and promote Malta as a suitable location for foreign direct investment while also promoting local technological enterprises overseas.

For further assistance contact Tech.mt on: Email: techmt.contact@tech.mt Phone: +356 22262100 Facebook: @Tech.mtMalta Instagram: @tech.mtmalta LinkdIn: linkedin.com/company/tech-mt