The Future Is Today

Welcome Speech by Anton Borg, President of the Malta Chamber of Commerce, Enterprise and Industry on occasion of a National Conference marking the launch of EY’s Malta Attractiveness Survey 2016 titled “The Future Is Today”.

Today’s event, and particularly the topic of The Future is Today, presents a unique opportunity to shed light on matters of urgent concern thought only to belong to the future, whereas, in fact, they are a reality today. There is no doubt that amidst a very turbulent international climate, our economy is currently experiencing strong economic growth overall. The continued resilience of the economy has been acknowledged by the European Union and the major independent credit rating agencies.

However, as the island’s most vociferous promoter of competitiveness, the Chamber is always quick to remark that buoyant economic momentum should not be taken for granted. Coasting on present achievements is tempting - yet ill-advised - particularly when surrounded by a looming Brexit, a unique US Presidential election, terrorism and political instability in neighbouring regions.

To ensure Malta’s continued attractiveness and develop a future-proof economy, there is desperate need to invest some of the proceeds of today’s success and enhance the islands’ infrastructure, particularly in transportation and innovation, the education and healthcare systems, as well as national pensions. Without serious and rapid interventions in these particular areas and despite the economic performances of today, the possibility of sustainable growth and continued attractiveness is bleak.

Education

The future is now, yet recent findings by the National Commission for Further and Higher Education have revealed that the country’s educational system dwells in yesterday’s past. It is not supplying the labour market with the skills in highest demand while producing amongst the highest early school leaver rates in Europe and worrying pass rates in core subjects. The modern Maltese forward-looking economy is in urgent need of significant investment in the education sector coupled with an overhaul of archaic practices and teaching methods as well as outdated and ill-informed career advice.

The Chamber publicly supports Minister Bartolo’s vision to - I quote – “contaminate education with as much reality as possible” – having repeatedly advocated the need for closer collaboration between education and the business sector by encouraging education programmes with both academic and vocational paths. This way the country can link education with the skills and competencies required today and in the future.

Research Technology Development and Innovation

A concerted effort is required in the area of Research, Technology Development and Innovation, an area of vital importance for any business operation to remain competitive and for any country to remain attractive. By nurturing RTDI capabilities through the advocated overhaul of the education system and investment in the required infrastructure, Maltese business shall stand a better chance of building and retaining a more resilient and competitive position.

The country needs to assess and forecast the skills and human resources required for RTDI processes to be in place, while facilitating the permitting process to allow more third-country researchers to work in Malta.

As a Chamber we also look favourably at the concept of RTDI contributing to new areas in which Malta can be part of the future today – by serving as a test-bed for new technologies. Our

Islands have, in the past, proven ideal to carry out complex testing exercises of technologies and processes in preparation for launching in larger markets.

The economic spill overs of innovative operations lead to further capital investment in equipment and human resources. This generates new ideas, protects and enhances consumer welfare, improves business processes and unlocks opportunities, therefore generating the competitiveness and attractiveness that are crucial for our economy.

Infrastructure and transport

The future is now, yet Malta’s infrastructure is also lagging behind in this respect. Our road networks are not in a state to cope with the sheer number of private vehicles constantly on the move – the result of a lack of foresight and, as we all know, an inadequate public transportation system.

The Chamber has actively participated in and publicly commended the drafting of a long-term holistic transportation strategy launched by Transport Malta some weeks ago. We are encouraged by the proposed stronger involvement of the private sector by virtue of PPPs or other joint ventures and the reassuring consideration of alternative modes of transport such as electro mobility, sea transport links and mass-rapid transit systems.

However, concerns arise regarding the financing of the plethora of projects considered in the strategy documents. In recent years, the Chamber has suggested to Government to invest part of the proceeds generated by the Individual Investor Programme to realise such projects of an infrastructural nature to ensure that the country can cope with the effects and demands of continued economic prosperity.

Pensions

The future is today, as is the uncomfortable reality that Malta’s pension system presents a liability to the country’s future economic stability. To remedy this, the Chamber has repeatedly proposed solutions to render our pensions more sustainable. Recently we have also accepted the notion of voluntary second pillar pensions as a means to supplement and wean off the reliance on unsustainable and low state pensions. In such a scheme, employees who voluntarily join the scheme would contribute a percentage of their gross salary through a payroll deduction. The Chamber also proposes the introduction of tax-related incentives that would need to be made available in order to boost the attractiveness of such a pension scheme, as the younger generation’s propensity to save is diminishing.

Healthcare

The future is now, yet our healthcare systems continues to provide medicines from a national formulary of times gone by - to the detriment of the health and dignity of patients and citizens. The potential cost-savings from the efficiency gained through investments in newer and more effective forms and practices of remedy will foster the required sustainability in the public healthcare sector - a sector and service that is cornerstone to the country, yet a sector that can threaten the future stability of public finances.

Conclusion

Ladies and Gentlemen, the Malta Chamber of Commerce, Enterprise and Industry seeks to safeguard Malta’s existing competitiveness. We constantly endeavour to promote a concerted effort tasked with mitigating the threats to Malta’s future prosperity and attractiveness posed by the aforementioned factors. Primarily, the country must embrace RTDI as a key component of its competitiveness. Research and innovation will ensure we are a step ahead of competition in each of the sectors we have identified for examination today as well as in the rest of our economy. However, going down the RTDI path requires that a number of fundamentals be put in place not least in the areas of education and infrastructure as I mentioned.

The future is today. The future is also tomorrow. We know what must be done in order to be here tomorrow, experiencing the continued prosperity that our businesses and people so rightly deserve.