The Malta Independent 2 March 2021, Tuesday

An economic vision beyond the pandemic

Silvio Schembri Sunday, 17 January 2021, 08:53 Last update: about 3 months ago

That nothing will ever be the same again is by now a given. However, with the appropriate actions and decisions, the current situation can only improve. Undoubtedly, the pandemic has changed the landscape for economies and industries worldwide. While the seismic changes we have witnessed with regard to the way we conduct and perceive business have been inevitable, they have also been a game changer. From industry’s adaptation of capacity production as per demand, to our workforce’s rapid adoption of new practices, as well as taking into stride the imposed restrictions, all the while putting the clientele and customers’ interest first have resulted in an eye-opening phenomenon.

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This has been a crucial year. As a government we have ensured that our fingers remained firmly on the pulse of our businesses and industries and the livelihood of our families remained always at the heart of our modus operandi; a stance which we have adopted since the beginning and one which we shall continue to adopt throughout.

Since the very beginning of the pandemic, when its actual repercussions were simply a mere glitch on the horizon, our goal was to achieve a valuable, however much elusive, balance between the economic aspect and the health aspect.

By allowing businesses to pursue with their own operations and their flexibility in adopting introduced measures, we have managed to provide a sense of stability at times of devastating uncertainty. It is interesting to note that this stance has captured the attention of some of the most renowned companies worldwide, which have presence in our country, consequently paving the way for future investments which shall take flight during this year.

Inevitably, economies around the world are at a juncture. The enforcing of lockdowns, in some countries more than once, has inflicted great damage on the respective country’s economy and consequently the road to recovery may be a long way away. In fact, eminent economists are insisting that austerity measures may not be the solution in the long-term. In view of this, The Organization of Economic Cooperation and Development has encouraged countries to reconsider their approach in their means of aiding businesses in getting back on their feet. It has been emphasised that efforts must be doubled to improve the business environment and policies which allow new labour skills to adapt to a post-Covid economic environment must continue to be implemented. Against this scenario, we must think not only in the moment but continue to buttress the foundations we have built thus far for our future generations.  It is vital, now more than ever to support the recovery of the economy and continue fostering its resilience.

The latest DBRS report hailed the Plan for the Regeneration of the Economy launched by Prime Minister Robert Abela, a plan which presented a strong holistic approach to provide a strong impetus in not only keeping business afloat but also a way forward. At the same time, it opened the doors wide open for the exploration of new opportunities and diversification of services, particularly in the digital and environmental sphere. Particularly, DBRS hailed the Covid-Wage Supplement, the latest version of which shall strongly cushion those businesses hard hit by the pandemic, as well as cover new employees employed from May of last year. DBRS hails the government’s measures as sustainable since they follow ‘a prolonged period of strong economic and fiscal performance.’  The report conveys the trust in the Maltese Government in its running of its public financing by reassuring ‘the fiscal prudence exhibited by Malta in the past’ and ‘the prudent management of the revenue.’

From an economic perspective, DBRS report notes the growth experienced by services’ sectors throughout a challenging year; the information and communication sectors, entertainment and financial and insurance activities complemented by the diversification of our economy. This translates into confidence in our ability to create jobs, which according to a report by the EU Commission has exceeded that of the EU average. 

Even our industrial sector has seen improvements in sentiment. Industrial operators saw an increase in demand and whereas in other countries operators stated they would be shedding jobs, in Malta employers want to recruit more. Among families, optimism is strong, boosted by the budget measures. Whereas around the EU families stated that they expect their financial situation to worsen, in Malta the majority are foreseeing an improvement. Based on these solid foundations, we have an excellent opportunity to simultaneously future proof our economy and industry. Hence, in the coming weeks we shall be launching an economic document up for consultation which will present our vision for the economy for the upcoming 10 years as well as a strategy with clear goals to be achieved spread across various sectors. This document will look into at what is needed for our economy in terms of skills and upskilling of our workforce and where we’re going.

Looking to the future, the vaccination roll out is a crucial step in paving the way for economic recovery. And whilst we must ensure that we sustain a much-needed balance between the economy and health, responsibility demands that first we ensure that the current situation improves, and that the number of cases decline to a more acceptable level. Hence, we are consulting with the Health Authorities together with the relevant stakeholders to ensure that the much-anticipated government vouchers are issued at a more opportune moment, in the best interest of all our people.

The purpose of the vouchers’ initiative is to re-stimulate the economy through an injection of more than 45 million, aimed at regenerating activity for impacted businesses and self-employed, whilst serving as an incentive for the public to enjoy a better quality of life. However, this must not be conducted in such a way that it will be detrimental to the health of our people. Therefore, the initiative will be implemented at the appropriate time, when it will also be possible for bars and clubs to re-open again, so even these can benefit from this fiscal initiative which shall generate economic activity for all.

The past months have been burdensome in several ways for the majority of our population. We understand and fully empathise that after the exhausting situation we have all experienced, most are simply rearing to go; industries are anticipating the implementation of their investment plans, businesses look forward to a return to their pre-Covid activity and families long for a modicum of normality, when life can once again resume. Together we have overcome the worst of these unprecedented circumstances, and together we shall once again look to a brighter, bolder and more prosperous future. Throughout all this, we shall, as always, remain vigilant guardians of our country regardless of the challenges looming ahead. I believe that we have proved our mettle several times over in the past months, by solidly standing shoulder to shoulder with our people, our businesses and our families, when it actually mattered most. 

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