Malta's tourism sector continues to be a key economic contributor both in terms of value-added and employment. Recent economic indicators confirm this. However, complacency is not an option. For Malta to continue achieving sustained positive results in this sector, a continuous and sustained investment and policy appraisal strategy is a must.

Statistics issued by the National Statistics Office confirm Malta's positive trend in this sector. Year-on-year nominal GDP growth for quarter one 2018 stood at 6.5% of which 1.1 percentage points being accounted for primarily by tourism related services. On annual basis, in 2017, close to 16% of the 9.1% GDP growth was generated by tourism related activities. Tourism specific statistics further confirm the positive results.

The number of tourists that visited Malta during the first four months of the year when compared to the previous year increased by 18.1%. This increase also resulted in a 17.9% growth in nights spent in Malta coupled with a 10.3% increase in expenditure by tourists in Malta. These results are truly impressive and are having an overall positive impact on the Maltese economy. These results did not happen by pure coincidence or sheer luck but are the results of a carefully executed strategy and vision over the past decade. Malta's brand has successfully steered away from just sea and sun to one that showcases culture, gastronomy, sports, culture and much more. The increased accessibility and opening up of low cost airlines has been instrumental together with various cultural events which continue to lure visitors during the shoulder periods. Conference and incentive travel continues to be an important contributor together with a more targeted marketing campaign that is clearly making its mark. In addition, events such as Valletta 2018 and others continue to put Malta on the traveller's map.

This notwithstanding, there is a need to continuously assess and invest in Malta's tourism sector and carrying capacity. Investments in general infrastructure become crucial. Roads, waste management, sewage and other utilities are the backbone of Malta's carrying capacity. It is therefore always welcome to see investments in these areas. Urban and community regeneration and renewal projects are also important and here local councils should play a key role. Better management of Malta's current building boom is also warranted. However, tourism is not just about infrastructure. Upkeep of cultural sites and general cleanliness can be improved and the upcoming inaugurations of various cultural projects such as Muza should continue adding to Malta's value-add as a cultural hot spot. Investments in human capital, together with the availability of skilled resources for the industry is a challenge that the sector will continue to face just like all other sectors. With Malta attracting so many foreign human talent, care must be given to ensure that we remain attractive in terms of cost and standard of living. Our future success depends on our ability as a country to continue attracting such talent to Malta whilst increasing our own skill development and career progression. It is here that industry stakeholders, including operators, need to take the lead to ensure that skill shortages are highlighted, and solutions are developed. Access to financing and EU funds for investments by the operators also remain fundamental. In addition, the development of other niche areas of tourism and a sustained programme of events that continue to attract new visitors to Malta is highly recommended.

There is no doubt that the tourism sector remains a key pillar of our economy. Over the years it has matured, diversified and regenerated itself. The current economic results are a testimony to this. However, we must remain complacent and expect the sector to continue developing automatically. We need to continuously reassess our strategy and invest in making Malta a more sustainable destination which will continue contributing economic value-add in the foreseeable future.

 

JP Fabri is the Managing Director of ARQ Economic & Business Intelligence, a specialised advisory practice within ARQ Group (www.arqgroup.com).