There was some good news last week for Malta, and for the manufacturing industry.

After weeks of heated debate, following the announcement that Denim Services is to close at the end of January, with the result that 800 workers will lose their jobs, last week the government said there is a good chance that a new textile company will set up shop in Malta at around the same time.

In a statement released last Wednesday, the Industry, Investment and IT Ministry said the Gama Textile Group of Austria is having negotiations with Malta Enterprise to set up a jeans centre of quality production in Malta.

“This new project is expected to employ around 400 workers and Gama has said it will give preference to employees of the former Denim Services Group of Companies,” the ministry said.

Talks are hopefully expected to be concluded by the end of the year and the new company will begin operations in January. Gama is also negotiating terms with the directors of Denim Services Group to take over its assets, which means that it would start operating from the complex currently occupied by Denim.

Some people will point out that Gama will only be employing half the workers employed by Denim. But, on the other hand, it is also true that the

opening of a new factory is a sign that the future for this type of industry in Malta is not as bleak as might have been thought.

Gama’s plans are in line with what Minister Austin Gatt has been saying all along – that the future of the manufacturing industry lies in its ability to diversify and move towards top quality products.

In an article in The Malta Independent last September, Dr Gatt wrote: “Europe, but also countries like the United States, Hong Kong and Singapore, have long resigned themselves to the fact that they can no longer attract investment in low to medium end, high-volume manufacturing industries.”

He added that certain industrial sectors were also moving to low cost countries “and it is pointless to hope to keep them where they are”.

In Malta, the working conditions, including wages, may not be as high as those in other parts of Europe and the United States, but they are certainly better than those found in developing countries. Therefore it was inevitable that Malta would suffer as a result of globalisation.

That is why it is so important for Malta to be able to move forward and not be afraid of change. Otherwise the country will find it extremely hard to compete.

In this context, the Gama Group’s plans to set up a high quality centre here are in line with these “guidelines”.

The ministry made it clear that Gama do not intend to set up a high-volume, low-tech production line for the mass production of jeans, but a centre of excellence in jeans finishing, according to customers’ needs and the retailing of the same at the high end of the market chain.

Gama believes this is the only way that a textile operation can be commercially viable in Malta.

The General Workers’ Union has welcomed Gama’s plans for Malta, especially the fact that it intends to give priority to former Denim workers when it starts recruiting people.

Of course, the experience these workers have in the textile industry will come in handy, but they will also need some re-training to learn new skills in this sector.

Keeping our fingers crossed that a deal between Malta Enterprise and the Gama group will be concluded soon, we hope that Gama will be the first of many high-end companies that will use Malta as a production base.

Malta’s manufacturing industry needs similar companies in order to be transformed into a highly successful sector once again.