Malta’s membership of the European Union, a market of over 450 million consumers, has provided the country with a new experience which we intend to live through with the utmost determination and we will forcefully exploit the new opportunities at our country’s threshold and utilise them to the very best benefit of our people.
Malta maintains that through EU membership it has secured its European and Mediterranean identities, at the same time ensuring that it will participate in the decision-making process which directly affects its economic, social and cultural aspects. Since 1 May, Malta has contributed at all EU levels, while reaping the benefits of economic stability, standards, access to a wider market, EU funds for several programmes and stability.
In this context, the government intends to seriously address and assist with all possible means every project aimed at further strengthening our relevance within such initiatives, in order to ensure that our competitiveness and productivity levels are enhanced even further.
European competitiveness
Competitiveness is crucial for sound economic growth and a sustainable development. We are experiencing an ever-increasingly competitive market and Europe does not exist in isolation, therefore providing us with the drive to conform and update.
Today’s world is a fierce battleground, ensuring that the products and services offered maintain a competitive edge when compared to others, in turn complimenting the respective countries’ economies. “Competitiveness” is the ability to provide a product or a service at high quality standards but at the same time at low costs.
The gradual de-industrialisation of Europe is due to the Far East scenario, whereby industry is gradually pulling out of Europe and relocating elsewhere – attracted mainly by cheaper labour costs coupled by the liberalisation of trade, particularly in the textile industry.
However, it is not only industry that has adopted such a strategy but, most importantly, the problem is now affecting services as well – particularly such labour-intensive services as call centres and office backup services. Many of these involve small and medium-sized enterprises, which constitute a substantial part of our working force and economy.
Therefore, within an environment offering strong political stability, excellent financial, banking and maritime services, a sound telecommunications platform, a modern infrastructure as well as the ability to adapt quickly as necessitated by demand on the part of trained personnel, the potential for foreign investment, economic growth and commercial opportunities is great.
Our aim must be to promote “excellent”, not “average” performance, with a balance between fundamental and market-driven research.
The Lisbon Agenda
The focus on strengthening our efforts on growth and competitiveness in order to make the EU “the most dynamic and competitive knowledge-based economy in the world by 2010” in accordance with the Lisbon Agenda is a top priority.
European growth in the coming years must be driven by structural reforms and through the improvement of the framework conditions for European citizens and businesses.
In some important industry sectors, European companies are world-leaders.
If the internal market is to contribute more to raising productivity and growth, it is necessary that all legislation is fully transposed and implemented. Compliance with internal market rules also needs to be considerably improved.
I believe that the proposed directive on services in the internal market needs to be revised in order to provide the right framework for the provision of services in certain sectors while excluding those where consensus is not realistically attainable.
The role of SMEs within the European economy
There is no doubt that Maltese industrial enterprises, ranging from SMEs to multinationals, are continuously under pressure to maintain and improve their competitiveness.
Different industrial sectors are expected to collectively achieve “faster delivery”, “higher-quality”, “eco-friendly’”and yet “cheaper” products. The various ways and means of achieving such goals in industry are changing day after day. Economic generation is no longer linked to a stable business environment but to one which undergoes constant fluctuations, both positive and negative. This affects the way in which entities operate and deliver. In today’s industrial world, competitiveness is necessary for the attainment of respective growth, when acting within the same playing field of others.
Europe needs to stimulate SMEs to invest more in research and development and innovation. EU funding programmes should be made more suitable for innovative and research-intensive entrepreneurship.
Therefore, member states and the Commission should further enhance a more coherent approach towards SMEs throughout the various national, regional and European funding programmes, through creating an optimal policy mix and effective collaboration between national initiatives and the many initiatives at European level. In facilitating access to European funding programmes for SMEs, their different characteristics and needs should be taken into account.
Regional innovation and networking among knowledge-clusters should be fostered in order to create “breeding and feeding” grounds for innovative and research-intensive SMEs.
Europe should increase the number of start-ups and spin-offs and alleviate obstacles that prevent them from growing. The availability of venture capital is especially important for the high-tech sector, as well as ample opportunities to network with other research groups, such as universities.
The drive for better regulations is to be sustained in order to reduce bureaucracy and over-regulation which inhibits the development of SMEs more than any other factor.
EU measures for the
development of R&D, telecommunications and IT
There is a direct link between R&D, telecommunications and IT, as all are “knowledge-based” and in themselves provide a sound platform for sustained economic growth and a further attraction for investment.
European enterprises thus need to “innovate” in the way products are produced and also in the way products function. In this competitive environment, research is of paramount importance as it provides a means for upgrading existing products and creating new market ones that meet extensive customer requirements. We sometimes underestimate the fact that the simplest of innovative designs could lead to excellent production and sales opportunities, resulting in internal growth and economic sustainability.
Research and innovation are not only vital to the survival of industry, but also a means of generating rights that return financial benefits for their respective creation. Both are economic generators.
For the European Union, this has been listed as a major priority, with several initiatives being taken in this regard. However, I believe we have not as yet embarked on an aggressive awareness strategy alerting industry to both the benefit of doing research and also to the existence of this research programme.
The market is becoming increasingly aware of such needs, and the need to engage researchers such as specialised industrial pharmacists is increasing. The attraction to research as a career has to commence at a tender age, when students are still forging their intellectual education. We need to move away from a culture in which science subjects are simply the main elements required to practice, say, medicine, dentistry or pharmacy but rather, that also lead to other professional and important careers within the industrial sector, such as engineering. Again, this indicates that we need to embark on an aggressive campaign to popularise science.
For creating and maintaining this excellent knowledge base, world-class human resources, a state-of-the-art research infrastructure and a mechanism to encourage scientific excellence are required, thus improving conditions for more private investment in research and innovation with a better rate of return.
The importance of greater exchanges and interaction between industry and academia in respect of research staff cannot be over-emphasised.
It is therefore crucial that EU funding programmes should address the whole research chain, from basic research to the valorisation of research results, in order to enhance industry participation and stimulate innovation.
Censu Galea is Competitiveness and Communications Minister