Malta Enterprise ‘way below radar for international companies seeking to invest in Malta’
A survey carried out by the Malta Institute of Management shows that the existence of Malta Enterprise is not wellknown among international companies seeking to invest in Malta.
“It is alarming to note for example, that the Malta Enterprise is way below radar for international companies seeking to invest in Malta.
“This is a waste of valuable resources, especially given that the agency offers a sterling service to overseas investors who are willing to set up business in Malta. Our shipbuilding facilities are another case in point; the right message regarding the level of facilities needs to be transmitted far and wide and needs to be promoted as such,” the institute noted.
“It quite defies the purpose of promoting Malta as a maritime hub, when the promotion of all the benefits this represents is not reaching the relevant and appropriate sources, especially when the most common unappealing factors cited by this particular set of participants seem to be high costs, following bureaucracy, compliance costs, bad environmental management, political instability, superior competition and ageing workforce, respectively.
“All these negative factors need to be counteracted by promoting well the number of benefits the country has to offer, for the industry to truly grow and flourish.”
The Maritime Industry in Malta has long been hailed as one of the main pillars of Malta’s economy.
To this aim the Malta Institute of Management has conducted intensive research and a survey was built to gather a clearer picture of how the sector is viewed at international level; whether Malta really does feature on the global map and to what extent.
With participating countries in Europe, specifically Italy, France, Spain, Greece, Germany and Turkey forming part of the survey data, 95% were in the shipping sector, while the remaining 5% were brokerage firms.
A little over half (52.4%) of the participating companies have invested cross border, citing profitability (46%), costs (27%), investor demands (18%) and tax regulation (9%) as their primary reasons for investment.
While it has transpired that 90% of respondents know about Malta, the majority declined to cite a reason as to why they did not invest in the country, since they either did not know what Malta could offer or had other places in mind.
However, 33% of the companies would invest if Malta had cheap costs, 19% answered tax regulation and another 19% convenience, 10% said employment and another 10% did not answer.
The remaining 9% answered market exposure/ competition.
The respondents were asked what part of the Maritime sector they were attracted to with Maritime Transport procuring 52.4% of the results.
The transhipment of petroleum which plays a vital role in attracting international traders and can be a link to North Africa and the Middle East is cited as reason for investing in Malta by only 14% – a huge contrast to 52.4% who quoted Malta’s Bunkering Zones as an attraction for investing in the country.
Malta’s shipping flag – the largest in Europe, offering services such as reducing VAT from 18% to 5.4% on registered superyachts is also cited by 62% of the participants as a reason for setting up business.
Malta’s Shipbuilding facilities do not seem to feature all too high as incentive for investment with only 43% of the participants answering positively. 72% would consider Malta if the oil and gas sector were developed further.
Malta Enterprise is a government agency that provides services to foreign investors as well as acts as a trading hub for companies in Europe, North Africa and the Middle East.
Unfortunately, a staggering 71.4% of the participants said that they were not aware of its existence.
However, upon information of its operations, 81% of respondents said they would use such an association to invest in Malta.
From the above findings, it is clear that with regard to the maritime sector, the competitive fiscal/ legal and corporate support offered by Malta ranks high as an incentive to attract foreign investment in the industry, as well as Malta being a shipping hub and the benefits of the Malta flag, the institute said.
However, the lack of visibility of Malta Enterprise as mentioned earlier is working against Malta’s interests.
There has never been a better time for the newly launched Malta Maritime Forum, which aims to identify and resolve the various challenges faced by the industry’s various sectors, to take on a more active role and properly highlight the advantages that Malta has to offer on the relevant and appropriate international platforms, the institute said.
Conducting in-depth research as to how the industry can facilitate foreign investment and make Malta even more attractive to the world’s major shipping players should at this point in time, be on top of the Malta Maritime Forum’s agenda.