I was surprised recently by a gesture from European Commission Vice President Valdis Dombrovskis. He wrote to thank me for an intervention I had made in his presence some time ago. It was about changes he wanted to introduce in procedures governing the issue and management of insurance policies.
As I had emphasized, the changes being proposed were on the right track and acceptable. Still, more time needed to be allowed for smaller enterprises to put them into effect. These were in agreement with the need to introduce the changes but were facing huge problems to launch them in the timeframe that had been adopted.
When I made the point, Mr Dombrovskis remained unconvinced. He put it in the same bracket as other remarks that had been made in the past which sought to derail proposals meant to promote a European capital markets union. In fact, the problems being faced by the smaller enterprises in theinsurance sector were real and had arisen in different countries, not just Malta. With others, I continued to press the point. Eventually, a reasonable solution was found that provided sufficient time for the implementation of the new procedures.
I admit that I appreciated the courtesy shown in Mr Dombrovskis’ letter.
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Rental markets
It is obvious that for all the denials which are issued, one still needs to take into proper account the claims about how economic growth is triggering overheating. The latter happens when components of the country’s infrastructural system fail to accomodate satisfactorily the momentum that is generated. This is being demonstrated by how the rental market has been buckling under the stress of growth.
Negative social effects have been registered, about which to be sure, there seems to be an awareness coupled to the intention to compensate for them. However the parallel economic effects also need to be dealt with.
Such as regarding: inflation; wage levels; the price of land and housing; the plans made by families and enteprrises about the future; the presence of foreign workers, now claimed to have become crucial to the Maltese economy.
As far as I know, we have few if any models to help us understand how pressures in such areas could develop. I hope I am badly informed about this.
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Micros
In the digital sectors, new ways are being created of setting up very small (called “micro”) enterprises and of promoting them. Now, here in Malta we have a longstanding experience in the establishment and support of “micros”. The enormous majority of our concerns belong to the category and always has. However in their majority they have mostly been focussed on the local market.
No matter how small it is, a digital company would have problems if it tried to limit its business to the internal market. Conceivably it would find it impossible to do so.
What is encouraging in current developments is that new companies are being established which in a creative way, strive to supply services designed for the global digital market. Some will go under, others will keep afloat with difficulty, others will prosper. While Europe is proceeding with measures to regulate the multi-faceted digital market, these initatives merit attention and continual support by public authorities.