Merry Christmas to our businesses
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Some of our businesses depend on this time of the year to assess whether their enterprise is worthwhile.
The festive season is welcome by all of us for one reason or another. For most, it is time to think of all the presents for the children and loved ones, time for Christmas concerts and the infamous lunch with colleagues at the workplace, hoping that the director goes for an extra glass of wine.
Dr Peter Agius, PN candidate for the European elections, former Head of the European Parliament Office and cabinet member of the President of the European Parliament Antonio Tajani
Well, we deserve some rest after all the toils of the year. And yet, Christmas means overtime for many of us too. Our retail and catering sectors see Christmas with particular expectation. For them, these last few weeks of the year can mean the difference from a very good balance sheet to a mediocre one.
Some of our businesses depend on this time of the year to assess whether their enterprise is worthwhile. For while the GDP figures tell a story of a booming economy it is not so for many in the retail sectors or for many small restaurateurs. Official Eurostat figures in fact show that Maltese retail registered the largest decrease in the EU this year. This is not a one off reading. National studies by the Malta Central Bank also recorded a retail decrease in its market sentiment surveys. In the times of the promised best in Europe, Maltese retailers have to contend with a drop of 2.6% compared to increases to the tune of 7 and 8% in Poland, Lithuania and Ireland.
So how can we explain that while our population is expanding to the tune of 15,000 extra residents per year and the GDP is growing, our shops are selling less? The contrast is not logical. I think there are two readings of a possible explanation. One of these is that Malta’s economic boom is confined to sectors which are not trickling down enough to the real economy.
The second reading is to be found in the rise of the digital revolution, which is gradually transforming our behaviours from street shoppers to internet shoppers. The latest available data in fact shows that 70% of consumers have bought at least once online and that those who said they bought something off the internet every week quadrupled from 3% in 2014 to 13% in 2018.
This situation calls for reflection and consideration of public intervention in aid of our local economy. Clearly, online shopping is here to stay and has its virtues in extending further our choices as consumers, but we need also to take stock of the essential societal and economic contribution brought about by the shops in our villages, providing the rhythm and colour to our main streets and an essential service to all our families.
To my mind, the only way to face globalisation is to use globalisation. We need to equip our shops with the tools to face competition in the online world. Government had announced an initiative on this line, and yet, most shop owners I met over the last three months had not even heard about it.
One of the shops I visited recently was approaching 100 years since opening its doors in Valletta. It was manned by a fine gentleman in his 50s who I do not imagine handling software operations to sell his art products online.
However that art shop together with his colleagues selling kitchenware next door and souvenirs in front may still benefit from an online presence, even if it is not necessarily followed by a click to shopping cart button.
The online shopping statistics released this year show in fact that 70% of shoppers do actually scout for what’s available online before deciding whether to buy online or from the shop down the road. It is thus clear that while the shop down the road may not depend on a webshop, it can hardly afford not being on the internet at all with its offer.
Imagine having Mosta’s Constitution Street all at your fingertips online in a virtual tour showing off the wares, from the types of dog-food to the latest jewellery fashion, offered by the hundred plus shops in that street. Our business community can derive great benefit from such an initiative which can be triggered or at least facilitated with public money.
As a candidate for the upcoming European Election, I want to suggest a way of using Europe’s tools to achieve the objectives above. The next EU budget proposed by the European Commission will include a €9,2 billion fund to aid European businesses in their transition towards a digital economy. This fund is precisely the gold mine we need to tap into to ensure that our local businesses can keep on growing be it in the digital milieu or in the more concrete world in our streets.
In conclusion, I want to extend the best wishes for a peaceful Christmas to all readers. I hope you all managed the Christmas shopping already. If not, may I dare keep to the topic and suggest buying local!