The Labour Party acknowledges that the tourism industry is one of the main pillars of the Maltese economy and realizes the overall commitment of all the stakeholders to make this industry prosper.

Economic success for Malta cannot be properly weighed unless we secure continuous growth in this industry with a concomitant greater generation of wealth.

Needless to say that growth in good times and contraction in bad times do not only affect those directly involved in the industry but also those indirectly involved.

In this vein we must handle our industry with care as both the stakeholders as well as the authorities have a hand too on its destiny. We are of course all pleased that visitor numbers increased this year, and in 2010 too, and it is hoped that this trend will continue in the months ahead despite signs that growth may be slowing down. Congratulations are due to all those who helped make that happen.

Beyond all the platitudes though, we all recognize that tourism requires the best of all our combined efforts and skills to reach its full potential.

But are we reaching our full potential?

Indeed while growth in visitor numbers increased by 6.6% in Malta up to end September 2011 over the same period in the previous year, growth registered in other Mediterranean destinations, competitors for our source markets, increased by 14% in Greece, despite the financial and social upheaval unravelling before our eyes, by 11% in Cyprus, by 11% in Portugal, by 9% in Italy and by 8% in Spain.

Although demand improved after 2009 and as a result it was expected that tourism would naturally improve and that Malta would, as indeed it did, benefit, it would be foolhardy to deny that the MTA and Government worked hard to divert as many tourists as possible to Malta through marketing initiatives and the opening of new routes. Simply because demand grew does not mean that automatically more tourists visit Malta.

The Labour Party believes that Malta deserves to be the leading destination for holidaymakers in the Mediterranean in summer and in winter. The Labour Party has an excellent record of contribution, of achievement and of planning for the future of our industry.

The Labour Party believes that Malta has the ability to do better. True, Malta is not immune to international pressures, but then our financial institutions are sound and although we have a high level of national debt we are not bankrupt like Greece. Yet the social upheaval in Greece has left unscathed both its tourist brand and product so much so that growth in tourism is this year double that obtained in Malta.

True that in 2010 Malta emerged quicker from the recession than most of our rivals, but no one can deny that they have suddenly leapfrogged us into better position this year.

I have noted that in that part of the budget speech relating to tourism the Finance Minister expressed concern for next year because of what he terms as the ‘uncertainty in international markets’. However despite continuing economic turbulence European tourism industry figures are up by more than 4% this year. These are the findings by reputable IPK International for the ITB World Travel Trends Report.

But more importantly the forecast for next year is positive too. Two months ago travellers from 13 European countries were asked whether and how often they intended to travel next year. Overall a 2-3% growth is expected for next year. This is very good news and would represent solid growth and mean a new all-time high number of trips.

In view of this, one would expect the authorities to strive to be ahead of our competitors in drawing more tourists to Malta next year.

The travel trends survey for 2012 seems to share the same sentiment as ITB with Britons set to choose short haul instead of long haul travel, with euro zone countries set to benefit. But why is it that British holidaymakers, our major and most important source market, will prefer to travel to Spain, Portugal and Greece according to the same survey? Will these destinations prove again to be more popular than Malta next year?

This is not to say that, despite these positive forecasts, we might not experience a slowdown after all, but in any case the right signals should be flickered for both scenarios.

The €1 million increase in MTA’s budget for 2012 is only a timid attempt to further strengthen the country's tourism focal point.

Strangely this increase is not reflected in the marketing initiatives and route development line items of the budgetary estimates where next year the government will be spending the same amount of funds as this year.

Moreover the full budget allocated for ‘tourism and culture’ for 2012 must be reduced by €1 million as the €1 million ‘eco contribution’ item showing under tourism is alien to the tourism industry and will be spent in other areas of the Prime Minister’s portfolio.

There can be no doubt that government induced costs have been on the increase year after year. I suspect that the industry has grown so accustomed to carrying the burden of ever-increasing operating costs and dented profitability that, following the truce announced by the government in the last budget, the industry should be grateful for small mercies.

So we should be grateful that no more increases have been imposed on the highest electricity rates in Europe that the industry is currently paying. We should also be pleased that no further hikes have been announced for gas and fuel which tripled in price in two years. We ought to be thankful that that there shall be no added costs to those that have already fuelled increases by operators providing services or products to tourism operators.

And although there are of course the COLA increases, it is remarkable that the VAT increase of 2% of last year on collective accommodation has remained stable for next year, so that it will not cost the industry more than the €6 million it had to pay this year.

The Labour party believes that the Ministry responsible for tourism should measure the industry’s performance less superficially and beyond just tourist figures. Above everything else it should positively influence fiscal decisions at the Finance Ministry to defend the tourism industry against bureaucracy and burdens that pose a threat to its long term sustainability.

You will agree that if 2009 was the year of the recession then 2012 will be the year of Air Malta. Nothing displeases more the Labour Party than to see the national airline it founded in the state that it has been reduced to after years of incompetence, interference and a surplus of empty promises while the airline was sinking in deficits of untold proportions.

When the Prime Minister promised, on the eve of the election, that Air Malta employees would retain their jobs, he was also reassuring this industry of Air Malta’s role in maintaining its 50% seat capacity that is so vital to your hotels and to your restaurants.

The Opposition takes note of the agreements reached with the unions this week but believes that this is only one aspect of the restructuring process and that the impact of changes to the workforce can only be gauged when and if they will impact on other aspects of the process, particularly routes and seat capacity.

But above all Air Malta must restructure in the direction of the tourism industry. It is pointless to have a smaller, trimmer, leaner airline that will not be able to serve the exigencies of the industry with consequent impacts on occupancy.

It is already rich that the opposition sits with the Government on a steering committee but is not consulted and not informed at all on the premise that information is commercially sensitive and cannot be divulged.

Worse still that industry operators are kept in the dark on developments at the airline when it is in their interest that Air Malta maintains its 50% seat capacity that will guarantee a level playing field with low cost carriers. It is futile for anyone to deny that this is true. I have been around enough time in the industry to know of the frustration being vented.

It also pays MTA that Air Malta maintains more or less the same levels of seat capacity because it will be more expensive to have to adopt policies of substitution and replacement. MTA knows that Air Malta needs tourism to survive.

Also there is a need for the formulation of a comprehensive Air Transport policy. MTA must be allowed to take a proactive role in the restructuring of the national carrier and this can only take place in its fullest expression if both MTA and Air Malta fall under the same roof.

The Leader of the Opposition has vouched that if the Labour Party is returned to government the minister for tourism will also be the minister for Air Malta.

This is an except of a speech given by Dr Gavin Gulia, Labour Party spokesman for tourism and Air Malta, at last Friday’s annual general meeting of the Malta Hotels and Restaurants Association.