Malta's focus on "headline economic indicators" such as GDP growth, per capita income, and unemployment rate often overlooks the broader societal costs that come with pursuing growth at any cost, said the President of the Malta Chamber of Commerce, Chris Vassallo Cesareo, at the 2024 EY Conference on Wednesday.

The Chamber President remarked that Malta's infrastructure is under tremendous strain. "Skyrocketing housing prices, overburdened public services, and the daily stresses on our roads and utilities are signs that the current economic model, which depends heavily on increasing the number of foreign workers and tourists, is unsustainable."

Vassallo Cesareo said that he is confident everyone shares the same common goal of improving the quality of life of all those living and working in Malta. He continued that moving forward, there must be a shift from "superficial assessments of economic success" to a deeper and more holistic analysis of the well-being of the country's population, both in the present and the future.

He commented that if the demand continues to grow unchecked, "we will eventually reach a point of no return" no matter how much investment is put into infrastructure. He remarked that there is a simple truth, which is that there is a need to rein in the numbers and focus on value and quality. "Otherwise, we risk seeing a total collapse of our infrastructure and essential services."

Vassallo Cesareo said that the Chamber of Commerce believes the solution is clear, and that continuing with the status quo is not a viable option. He continued that what is needed is a well-structured economic transformation strategy which enables sustainable economic growth while preserving a high quality of life. He added that economic policies must prioritise sustainable development and ensure a good quality of life for all citizens.

He said that challenges faced in Malta which hinder business productivity and efficiency as well as impact the broader quality of life in the country include businesses struggling to find skilled workers, delays caused by traffic congestion, weakened infrastructure, rampant overpopulation, and the strain on resources and the environment caused by over-tourism.

Speaking about an economic transformation strategy, he said that such a strategy would allow Malta to achieve several key milestones, including a reduction of reliance on Malta's attractiveness being tied to corporate taxation, instead shifting towards unique competencies and greater efficiency. He continued that such a strategy would help strike the right balance between economic growth and sustainability, which he remarked are two objectives which have "long been seen as conflicting, but should instead reinforce each other". He added that this strategy would also direct investment towards value-added sectors.

Vassallo Cesareo said that in the Chamber of Commerce's response to Malta's Sustainable Development Strategy for 2050, the Chamber had emphasised that economic growth must go hand in hand with increased quality of life, well-being, and sustainability. "Among our proposals were ideas like a smart energy grid, better use of organic waste, an e-mobility wallet, and new success measures like a well-being index. Achieving these goals requires a comprehensive economic transformation, one in which Malta must lead or risk falling behind."

He continued that sustainability cannot be discussed without addressing urban planning. He said that proper planning ensures a sustainable level of economic development while safeguarding our cultural and natural heritage. He added that urban planning also promotes efficient infrastructure and a high quality of life. "Planning must be forward-thinking, taking into consideration the long-term impact on our environment and communities."

The Chamber President concluded that in order to accomplish all of this, "We must drive for political consensus on an economic transformation strategy that values quality over quantity, productivity over volume, and compliance with transparent communication between the government and social partners."

He continued that this means raising social dialogue to a higher level by giving stakeholders, including political players and social partners, a meaningful role in shaping Malta's economic future. He remarked that this cannot be limited by electoral timelines but must instead transcend short-term political gains for the sake of long-term national progress. He said as a nation, Malta has always proved to be resilient and risen to the occasion when change was required. He commented that the decisions made today will shape Malta's future for generations to come.