The Malta Chamber noted with utmost concern the European Commission’s decision to demand that Cyprus Airways refund €65 million in state aid, after it failed to achieve financial viability – as a result of which the Cypriot national airline has now ceased operations. In the light of this, the Malta Chamber of Commerce, Enterprise and Industry calls for a renewed resolve from all parties to ensure credibility in Air Malta’s restructuring process and the utilization of state aid funds granted by the Commission on a ‘one time, last time’ basis.
In a statement, the Malta Chamber called for a concerted effort from all quarters to support the long-term restructuring plan in full consideration of the bigger picture and the country’s economic development. The Malta Chamber commended the decisions taken by the airline’s management to slash operating costs and ensure viability. Futile quibbles about insignificant matters along the way must be avoided at all costs because these can cost the economy, the airline and all its employees dearly. The Malta Chamber called on the stakeholders to abandon outdated policies and rigidities and to think strategically towards rendering the company financially sustainable in the long term.
As the Cypriot experience shows, the European Commission means business and will not have mercy on any state aided company which does not comply with state aid rules, the Chamber said.
As far as the Malta Chamber is concerned, the airline is extremely important and is a prime strategic asset for Malta. Indeed, its importance to the Islands’ economy extends beyond the tourism sector.
In this context, Air Malta has played a pivotal role in Malta’s economic and social development. The airline’s international route network, built by sustained investment over the years, is vital for the country’s economic development, it added.
Beyond tourism, the airline offers a lifeline to the vibrant manufacturing industry which accounts for a significant contribution to GDP, exports, investment and private sector employment. Specifically for the manufacturing industry, reliable and timely supply of components and raw materials is essential to modern just-in-time manufacturing and integrated supply-chains. Equally important to the manufacturing industry are the down-stream oriented activities where the closing and opening of routes based purely on passenger numbers can make or break a manufacturing company in Malta, by shutting off timely and cost-effective access to markets. It is pertinent to note that the following sectors of industry are totally reliant on inward/outward air-freight - pharmaceuticals, microelectronics, electrical components and printed security documentation. For these areas in manufacturing, air freight is the most viable, efficient and secure mode of connectivity to the market. There exists no feasible alternative and these sectors therefore thrive on guaranteed air-transport.
Besides, the airline provides an equally pivotal role to emerging sectors of the economy such as real-estate, yachting, education, logistics and remote gaming. The airline’s route network renders possible the constant attraction of foreign direct investment, particularly in those areas where the investor needs to repatriate workers and/or family, the Chamber said.
The Malta Chamber reiterated its call for a concerted effort from all quarters to ensure the survival of our national airline. Malta’s long-term strategic interest and future economic development cannot be allowed to depend exclusively on the short-term profit motives of internationally-owned carriers.