mbr special edition 2016 low (1)

SPECIAL EDITION 2016 

06 

cover story 

Operational Excellence 

Interview with Felipe Navarro, 

CEO of MAPFRE Middlesea (MMS) 

10 

12 

28 

Economic Perspectives 

A Diversified Economy Requires A Healthy Mix of Economic Activities 

Article by the Hon Prime Minister of Malta Dr Joseph Muscat 

Talking Point 

Our Future Depends on the Decisions We Take Today 

The Leader of the Opposition Dr Simon Busuttil prepares today for 

the future 

FOCUS 

Malta Slammed for Cash-for-Passport Program 

Harry Cooper discusses the highly controversial sale of passports by the 

Maltese Government 

Newspaper Post

corporate interview 

corporate interview 

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Malta Business Review| SPECIAL EDITION 

Malta Business Review Malta | SPECIAL Business EDITION Review 

06 

COVER STORY 

OPERATIONAL EXCELLENCE 

Interview with Felipe Navarro, 

CEO of MAPFRE Middlesea (MMS) 

SPECIAL EDITION 2016 

10 ECONOMIC PERSPECTIVES 

A Diversified Economy Requires A Healthy Mix of Economic Activities 

Article by the Hon Prime Minister of Malta Dr Joseph Muscat 

12 TALKING POINT 

Our Future Depends on the Decisions We Take Today 

The Leader of the Opposition Dr Simon Busuttil prepares today for 

the future 

28 FOCUS 

Malta Slammed for Cash-for-Passport Program 

Harry Cooper discusses the highly controversial sale of passports by the 

Maltese Government 

Newspaper Post 

PuBLisher 

MBR Publications Limited 

editor 

Martin Vella 

teChniCaL advisor 

Marcelle D’Argy Smith 

saLes direCtor 

Margaret Brincat 

design 

Jaqueline Muscat, Gyorgy Vertes 

advertising 

Call: 9940 6743 or 9926 0163/4/6; 

Email: margaret@mbrpublications.net 

or admin@mbrpublications.net 

ContriButors 

Andre’ Azzopardi, JP Abela; Bernice Buttigieg; 

Thomas Mahony, Josef Busuttil; Simon Busuttil; 

George Carol; Harry Cooper; Bill Gates; Joseph 

Muscat; Rachel Saliba; Rachel Vella 

Baldacchino; James Vella Clark 

sPeCiaL thanks 

Bridgewest; Bill & Melinda Gates Foundation; 

Camilleri Preziosi Advocates; Central Bank of 

Malta; DOI; EC Europe; Eurostat; European 

Commission Representation in Malta; ec.europa. 

eu; eie Educational Group; FinanceMalta; HSBC; 

MAPFRE Middlesea plc; Ministry of Finance; The 

Ministry For Competitiveness, Digital, Maritime 

And Services Economy; Ministry for European 

Affairs and the Implementation of the Electoral 

Manifesto/DOI; LinkedIn; Malta Enterprise; NSO; 

OPM; POLITICO-PRO; The Malta Independent; 

Times of Malta; PN Media; MACM; World 

Economic Forum 

Print ProduCtion 

Printit 

offiCes 

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quote of the month 

“The complexity of our present trouble suggests as never 

before that we need to change our present concept of 

education. Education is not properly an industry, and its 

proper use is not to serve industries, either by job-training 

or by industry-subsidized research. It’s proper use is to 

enable citizens to live lives that are economically, politically, 

socially, and culturally responsible. This cannot be done by 

gathering or “accessing” what we now call “information” 

- which is to say facts without context and therefore without 

priority. A proper education enables young people to put 

their lives in order, which means knowing what things are 

more important than other things; it means putting first 

things first.” 

Wendell Berry 

Disclaimer 

All rights reserved. No part of this work covered by copyright may 

be reproduced or copied and reproduction in whole or part is strictly 

prohibited without written permission of the publisher. All content 

material available on this publication is duly protected by Maltese 

and International Law. No person, organisation, other publisher or 

online web content manager should rely, or on any way act upon 

any part of the contents of this publication, whether that information 

is sourced from the website, magazine or related product without 

first obtaining the publisher’s consent. The opinions expressed in the 

Malta Business Review are those of the authors or contributors, and 

are not necessarily those of the editor or publisher. 

COVER STORY 

6 Operational Excellence 

6 

16 

Interview with Felipe Navarro, CEO of MAPFRE Middlesea (MMS) 


10 A Diversified Economy Requires A Healthy Mix of 

Economic Activities 

The Hon Prime Minister of Malta Dr Joseph Muscat talks about economic growth 

and financial wellbeing 

12 Our Future Depends on the Decisions We Take 

Today 

The Leader of the Opposition Dr Simon Busuttil highlights the issues we should 

be tackling in order to allow us prepare today for the future 

Budget 2016/17 

16 “A strong Economy, A Social Budget” 

Exclusive interview with the Hon Minister for Finance Prof Edward Scicluna 

SPECIAL FEATURE 

20 Malta Climbs Global Competitiveness Index 

Ranks 

The Global Competitiveness Index 2016-2017 released by the World 

Economic Forum (WEF) ranking Malta 40th out of 138 countries 

22 Malta Budget 2016 

Infographic and Summary review of Budget 2016/17 

OUR GOLD PARTNERS 

your perfect atmosphere 

Continental Cars Ltd. 

10 

12 

26 

CONTENTS 

SPECIAL FEATURE 

26 Accelerating Innovation with 

Leadership 

28 

44 

An exclusive by Bill Gates, Microsoft Chairman on the importance 

of leading through innovation 

28 Malta Slammed for Cash-for-Passport 

Program 

Through a deal with Politico-Pro, MBR brings you an exclusive 

by Harry Cooper regarding the highly controversial sale of 

passports by the Maltese Government 

30 Malta Economic Overview 2016-2017 

A unique double page spread with the entire Maltese economy 

presented in info graphs 

Debate 

34 Malta’s Money Laundering Headache 

Harry Cooper reviews and investigates the Panama Papers and 

why its has cast doubt on Malta’s ability to push through EU antigraft 

laws and Government’s lack of transparency 

36 EC Country Report Malta 2016 

This country report assesses Malta’s economy in light of the 

Commission’s Annual Growth Survey 

40 Island Treasure 

A rare interview by Josef Busuttil, Director General of the Malta 

Association of Credit Management with Sean Feast is the Editor 

of ‘Credit Management’, the Magazine of the CICM (UK) 

44 A Digital Single Market for Europe 

MBR News Division provides the latest European Commission 

update following its unveiling of its detailed plans to create a 

Digital Single Market 

40 

50 

EDITORIAL 

Malta is certainly rotten! Malta 

remains the most difficult place to do 

business in the whole of the European 

Union, according to the World Bank’s 

Ease of Doing Business rankings that 

were released recently. It came as 

no surprise that Maltese roads were 

voted as Europe’s second worse in 

the EU. And, it is not comfortable to 

see Italian national television channel 

RAI’s news production, Governatori 

Del Paradiso, mentioning our country 

and its leaders in most adverse 

manner associated with corruption. 

This comes in the wake of Moody’s 

Investors Service affirming Malta’s 

A3 government bond rating and 

changed the outlook from negative 

to stable. The report confirms 

the government fiscal and economic policy is taking Malta in the 

right direction and budget measures introduced last year resulted in 

Malta ranking among the UE’s top-performers on economic growth, 

employment, and unemployment. 

However, the Panama papers and sale of passports affair are evidence 

of how much the country is not doing to tackle corruption, which apart 

from overshadowing Moody’s positive endorsement of Malta, provides 

a common paradox: the world often becomes aware of corruption 

when someone is doing something about it! That leads people to 

conclude that things are getting worse when they may be, in fact, 

getting better. The incentive for Malta can thus be perverse. A case in 

point is the graft that permeated Brazil’s political system, when, in 2014, 

crusading prosecutors revealed that the state-owned oil company, 

Petrobras, had funnelled hundreds of millions of dollars to officials and 

parties in exchange for contracts. The next year Brazil’s score on the 

Corruption Perceptions Index compiled by Transparency International, 

a global watchdog, fell by five points. 

David Cameron, Britain’s ex-prime minister, who styled himself as a 

champion of transparency and attempted to stamp out the financial 

secrecy that allows public wealth to be looted and hidden using murky 

offshore arrangements, had called corruption “the cancer at the heart 

of so many of the world’s problems” and “one of the greatest enemies 

of progress in our time”. He referred to a web of jurisdictions, closely 

bound in with the City of London and dubbed “Britain’s second empire”, 

accounting for between a quarter and a third of global offshore activity. 

In Malta, such are things, that half of the voting public seems immune 

to “expose corruption wherever it is found, to pursue and punish 

those who perpetrate, facilitate or are complicit in it, to support the 

communities who have suffered from it, and to ensure it does not fester 

in our government institutions, businesses and communities”. It’s as 

though the misuse of anonymous companies on behalf of high profile 

government officials to hide the proceeds of corruption” is something 

acceptable, rather than denying the corrupt the use of legitimate 

business channels. And so blinded by political allegiance, turn a blind 

eye, as our corruption-fighting priorities seem to pass by. 

Public procurement is a matter of public concern as it accounts for 25% 

of government spending—and when contracts or sales agreements 

are not submitted to the public, or have a good chunk missing, this can 

only point to one thing- that this is lost to corruption. An estimated 60% 

of the world’s bribes come from public contracts, points out Martin 

Tisné, a transparency expert with the Omidyar Network, a foundation. 

Governments that keep the details hidden must to explain why. 

In light of the above events, we are proud to present our readers with 

“Sate of the Economy”, a special edition of Malta Business Review, 

while evoking last June, when all government departments signed an 

agreement pledging to make it easier for investors to start a business 

in Malta- It would be in everyone’s interest to practice what we preach, 

before it’s too late. 

Martin Vella 

Malta Business Review’s editorial opinions are decided by its Editor, 

and besides reflecting the Editor’s opinion, are written to represent a 

fair and impartial representation of facts, events and provide a correct 

analysis of local and international news. 

Agents for: 

04 www.maltabusinessreview.net 05

Malta Business Review | SPECIAL EDITION 

cover story 

cover story 


Operational 

Excellence 

By Martin Vella 

FELIPE NAVARRO was appointed CEO of MAPFRE Middlesea (MMS) in 

September of 2015. One year after, The Malta Business Review talks 

with the man at the helm of Malta’s leading insurance company. 

MBR: You were appointed CEO of 

MAPFRE Middlesea almost a year ago. 

What were the main challenges you 

encountered? 

FN: In the past year, the company 

experienced major growth, mainly 

through the acquisition of new portfolios 

and inevitably, this has increased internal 

work. The number of employees has 

also increased significantly and therefore, 

organisational restructuring was required. 

My main focus has been making the 

company more profitable and stable, 

while producing better results for our 

shareholders and keeping a good level of 

service to our clients. Importance has also 

been given to the development of new 

products in both the life and non-life sector. 

We are the benchmark 

insurer in the Spanish 

market and the leading 

multinational insurance 

group in Latin America being 

number 1 in the Non-Life 

ranking for the region 

MBR: MAPFRE is present in many 

countries and a global player in 

international markets. Can you please 

give us an idea of MAPFRE’s activities 

overseas? 

FN: MAPFRE is a global insurance 

company present on the five continents 

and doing business in over one hundred 

countries. We are the benchmark insurer 

in the Spanish market and the leading 

multinational insurance group in Latin 

America being number 1 in the Non-Life 

ranking for the region. We are one of the 

10 largest insurers in Europe, and among 

the 20 largest automobile insurance 

companies in the United States. MAPFRE 

Asistencia is the third largest assistance 

provider worldwide and MAPFRE RE 

stands as one of the 15 biggest reinsurers 

in the world. 

We have more than 38,400 employees 

around the world, more than 5,500 

offices and almost 80,000 intermediaries. 

Fundación MAPFRE is the majority 

shareholder in the company, which 

strengthens our independence and 

shareholder stability. MAPFRE has a 

diversified business with 36 percent of 

premiums coming from general insurance, 

34 percent from automobile insurance and 

30 percent from life and health insurance. 

In 2015, our revenue exceeded 26.7 billion 

euros and our net profit amounted to 709 

million euros. The combined ratio stood at 

98.6 percent. 

We are working toward becoming the 

most trusted global insurance company. 

MBR: What is the main competitive 

advantage of MAPFRE Middlesea? 

FN: The company is fighting to be always 

one step ahead than its competitors, 

especially when it comes to innovation. 

We were the first to introduce a motor 

policy using telematics technology, 

allowing young people to be rewarded for 

driving cautiously. 

Customers of MAPFRE Middlesea also 

benefit from a 24/7 assistance for home, 

health and roadside emergencies, which 

can prove indispensible in times of need. 

Middlesea Assist is now also making use of 

a scooter to get to the client faster when 

on-the-spot assistance is required. 

MAPFRE Middlesea is the only insurance 

company on the island which rewards 

customers through a loyalty programme, 

which offers customers discounts from 

several outlets. The Insure and Save 

scheme is very popular among our clients 

and we are now working on further 

improving it. 

Being part of a successful international 

group has several advantages. First, we 

have a very steady based capital in the 

world. Second, we can offer products 

which have already been tested in 47 

other markets. We also benefit from 

economies of scale and we do actuarial, 

risk and compliance as a Group and go way 

beyond what is required by the law. 

MBR: What values are at the core of 

MAPFRE Middlesea’s operations? 

FN: We are a multinational team striving 

constantly to provide ever better 

service, and to develop the best possible 

relationships with our stakeholders: 

clients, employees, distributors, providers, 

shareholders and society. 

The values that define us as a company 

are: solvency, integrity, service vocation, 

innovation for leadership and committed 

team. 

Our values are in line with those of 

MAPFRE. We believe in having financial 

strength with sustainable results and 

we are well in line with Solvency II 

requirements. 

We also operate ethically and with a sense 

of social responsibility. The company 

holds several CSR activities across the year, 

in which we give back to the community in 

which we operate in. 

Having a committed team is crucial. 

The company is continually investing in 

the development and training of team 

capabilities and skills. 

Last, but most important, is the service 

vocation. We believe in caring for 

customer relation and strive in excellence 

in each service we give. 

MAPFRE Middlesea is the 

only insurance company on 

the island which rewards 

customers through a loyalty 

programme, which offers 

customers discounts from 

several outlets 

MBR: What are your future plans for the 

company? 

FN: We continue to work toward a new 

MAPFRE, with a structure consistent with 

the challenges specific to our size and 

presence. 

We need to make the company more 

profitable in the lines in which it already 

operates and deliver more value to our 

shareholders. 

We need to adhere to MAPFRE’s strategic 

plans for 2016 -2018. First – digital 

transformation, keeping up with the 

technological changes in our environment. 

Second – client orientation, giving the 

best service possible to our clients. 

Third, excellent technical management, 

improving efficiency in the processes and 

services to client. Fourth, culture and 

talent – allowing for the development of 

our human resources. 

In a nutshell, we want to be more focused 

on the client, who we place in the center 

of everything, to grow in a profitable 

way, through operational excellence and 

appropriate management of risks, and 

committed human talent with the skills 

and tools necessary to do their work in the 

best way possible. MBR 

All Rights Reserved / Copyright 2016 

06 07 

www.maltabusinessreview.net


key economic indicators 

2.1: Country/Economy Profiles 

MALTA ECONOMIC PROFILE 

th 

Malta 40 / 138 

Global Competitiveness Index 

2016-2017 edition 

Key Indicators, 2015 2016 

Population (millions) 

GDP (US$ billions) 

Performance overview 

Global Competitiveness Index 40 4.5 

Subindex A: Basic requirements 29 5.4 

1st pillar: Institutions 

2nd pillar: Infrastructure 

3rd pillar: Macroeconomic environment 

4th pillar: Health and primary education 

Rank / 138 Score (1-7) Trend Distance from best 

38 4.5 

40 4.7 

21 5.8 

18 6.4 

Subindex B: Efficiency enhancers 41 4.5 

5th pillar: Higher education and training 

6th pillar: Goods market efficiency 

7th pillar: Labor market efficiency 

8th pillar: Financial market development 

9th pillar: Technological readiness 

10th pillar: Market size 

38 5.0 

30 4.7 

41 4.5 

41 4.4 

20 5.8 

126 2.5 

Subindex C: Innovation and sophistication factors 41 4.0 

11th pillar: Business sophistication 

12th pillar: Innovation 

Source: International Monetary Fund; World Economic Outlook Database (April 2016) 

40 4.3 

41 3.7 

0.4 

9.8 

GDP per capita (US$) 

GDP (PPP) % world GDP 

Edition 2012-13 2013-14 2014-15 2015-16 2016-17 

Rank 47 / 144 41 / 148 47 / 144 48 / 140 40 / 138 

Score 4.4 4.5 4.4 4.4 4.5 

11th pillar: 

Business 

sophistication 

10th pillar: 

Market size 

9th pillar: 

Technological 

readiness 

12th pillar: 

Innovation 

8th pillar: 

Financial market 

development 

Malta 

1st pillar: 

Institutions 

7 

6 

5 

4 

3 

2 

1 

7th pillar: 

Labor market 

efficiency 

2nd pillar: 

Infrastructure 

6th pillar: 

Goods market 

efficiency 

Middle East and North Africa 

3rd pillar: 

Macroeconomic 

environment 

4th pillar: 

Health and primary 

education 

5th pillar: 

Higher education 

and training 

22734.2 

0.01 

what 

a great combination 

your firm benefiting from membership to FinanceMalta 

Membership advantages include: 

Company listing on our website • 

Participate in webinars & podcasts • 

Opportunities to showcase your firm • 

Business networking & educational events • 

Complimentary passes to some of Europe’s most important events • 

Opportunity to take part in road shows, press briefings & workshops • 

Access to market intelligence reports & branded marketing materials • 

Most problematic factors for doing business 

Inadequately educated workforce 

Inefficient government bureaucracy 

Access to financing 

Poor work ethic in national labor force 

Insufficient capacity to innovate 

Restrictive labor regulations 

Inadequate supply of infrastructure 

Tax rates 

Corruption 

Tax regulations 

Policy instability 

Inflation 

Foreign currency regulations 

Government instability 

Crime and theft 

Poor public health 

15.4 

14.6 

11.5 

9.7 

9.4 

7.4 

6.8 

6.7 

4.8 

3.9 

2.9 

2.8 

1.8 

1.2 

0.9 

0.0 

Source: World Economic Forum, Executive Opinion Survey 2016 

Scan QR Code 

with your smartphone 

more information on: 

www.financemalta.org 

Effective | Secure | Skilled 

0 4 8 12 16 

Note: From the list of factors, respondents to the World Economic Forum's Executive Opinion Survey were asked to select the five most problematic factors for doing business in their country 

and to rank them between 1 (most problematic) and 5. The score corresponds to the responses weighted according to their rankings. 

Credit © 2016 World Economic Forum 

Find us on: FinanceMalta 

@FinanceMalta FinanceMaltaYT FinanceMalta 

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FinanceMalta is the public-private initiative set up to promote Malta’s International Financial Centre 

08





My Government took important decisions 

on the economy; subsequently the economy 

grew as we ensured financial wellbeing, thus 

continuing to put the country’s finances on 

a sound footing and which people are now 

enjoying the benefits and wealth of these 

reforms. In my opinion, the most important 

measure that took effect at the beginning 

of the year was the increase in pensions, 

because it is the first time in 25 years that 

there was any increase in pensions. There are 

actually over 12,000 pensioners who have 

seen and also will see an increase, while the 

national minimum pension rose to € 140 per 

week. We have worked also to implement an 

increase also of € 8.29 per week for those 

pensioners aged over 75 years, and an 

additional increase to people who benefit 

from other pensions. This was the first step 

wherein we commenced increasing pension 

to a bracket of people who were not earning 

sufficiently, or did not earn enough to get by. 

This is possible because there is a strong 

emerging consensus in this country, a 

consensus that is socially and in my view 

also politically transversal, that we can 

share the fundamentals of a common 

vision for Malta, a vision that includes the 

economic sphere but goes well beyond it. 

A common vision that does not imply the 

suppression of different legitimate interests 

but one that, on the contrary, protects 

diversity and resists monopolies of all sorts: 

political, cultural, social and economic. 

We certainly share the vision that 

maximises prosperity for our people, 

focused on a diversified successful 

economy underpinned by a high quality, 

dynamic, productive and innovative private 

sector that positions Malta as a global hub 

for business and investment”. 

My Government gives due critical 

importance of focusing resources on sectors 

that optimally leverage opportunities 

without, however, sacrificing the diversified 

structure of our economy. In fact, permit 

me to state and not without pride, that 

after having for so long resisted the shortsighted 

and delusional mantra that industry 

is an obsolete economic activity and how 

Malta should focus exclusively on more 

glamorous activities, thereby objectively 

making our economy less diversified, 

we now feel vindicated by the European 

Commission’s call on member states at the 

beginning of this year to recognise “the 

central importance of industry for creating 

jobs and growth and to mainstream 

industry-related competitiveness concerns 

across all policy areas”. 

Therefore Malta supports and will continue 

to support measures to build a more 

business friendly Europe through actions 

to promote industrial modernisation, 

to simplify the legislative framework 

and improve the efficiency of public 

administration at levels. 

When necessary and appropriate, public 

and private may become partners. What 

more appropriate example of public 

private partnership could I mention today 

than the resolution adopted by Malta 

Enterprise’s Board only a couple of months 

ago to delegate its Trade Promotion 

functions to Trade Malta, a joint venture 

between Government and the Chamber 

of Commerce, Enterprise and Industry. 

It will be basically fulfilling the core role 

that METCO used to fulfil. Details of the 

agreement will be announced in the coming 

weeks. Malta Enterprise will be able to 

focus on Investment Promotion and its SME 

promotion arm, Business First will focus 

on what was originally the specific remit 

of IPSE, the Institute for the Promotion 

of Small Enterprise, a joint venture with 

private sector constituted bodies. 

Economic productivity growth must be 

driven by investment in the development 

of persons and in new technologies. In this 

regard, we will leave no stone unturned to 

facilitate access to finance, life-long learning 

and multi-skilling. We must promote by 

whatever means are required a culture of 

quality and excellence across both the public 

and private sectors. We will not compete 

in today’s world only on the basis of cost 

competitiveness. Without the competitive 

edge provided by quality, we will sink. 

Research, technological development and 

innovation should not be mere buzz words 

but need to become, to use your own words, 

“a fundamental cornerstone of Malta’s 

economy”. That the Chamber is represented 

on the Research & Innovation Steering Group 

together with the Malta Council for Economic 

and Social Development, Malta Enterprise, 

the University of Malta, the Malta College for 

Arts, Science and Technology, the National 

Commission for Higher Education and the 

Malta Council for Science and Technology, goes 

a long way to emphasise our sharing of visions. 

Economic activity in Malta 

continued to outperform the 

weak growth in the EU 

But the journey is tough and the result is not 

guaranteed. We are, however, realistically 

optimistic, and with good reason. The 

European Commission’s 2014 Autumn 

Economic Forecast, published only recently, 

has this to say about Malta: “Economic 

activity in Malta continued to outperform 

the weak growth in the EU in the first half of 

2014.” The report confirms that the Maltese 

economy “continued expanding at a robust 

rate in the first half of 2014”. “Annual real 

GDP”, it states, “surprised positively and 

reached 3.2%, up from 2.5% for 2013 as a 

whole”. Moody’s, in its latest credit rating 

release, awarded Malta an A3 status with 

a stable outlook. The agency also predicts 

that this sustained growth will continue to 

manifest itself throughout 2015. 

Set this against the background of the 

Commission’s forecast of “weak economic 

growth for the rest of this year in both the 

EU and the Euro area.” The same document 

states that “real GDP growth is expected to 

reach 1.3% in the EU and to 0.8% in the Euro 

area” compared to Malta’s projected 3%. This 

strengthens our determination that whilst 

redoubling our efforts to attract European FDI 

and to target European markets, we must also 

look elsewhere for a stimulus to growth. Our 

efforts to attract Foreign Direct Investment 

from the United States, China, India, Singapore 

and South Korea offer very exciting prospects 

and are beginning to bear fruit. 

The result of navigating smartly in an 

uncertain international environment has 

led us to identify situations created by 

uncertainty itself. This is precisely how we 

are optimising our location advantages in a 

broad range of engineering-based niches, in 

the life sciences (where we successfully reinvented 

an expensive project that was set on 

a deadly collision course with the real world), 

in the more creative niches of information 

and communications technology (including 

synergies between ICT and the life sciences), 

in internet based services, in financial 

services, in higher education and training 

for the regional and European markets, in 

innovative niches within aviation services, 

in the creative industries generally and the 

long neglected field of international logistics 

where we cannot simply satisfy ourselves 

with having a vibrant marine Freeport. 

Ensuring its competitiveness is a daily 

challenge. Whatever the source of the 

investment, foreign or local, we must also 

bear in mind that there is a significant time 

lag between investment decision, start up 

and mature operations. Moreover, we need 

to constantly ensure that it is not enough to 

convince a foreign direct investor to set up an 

operation in Malta, we need to ensure that 

the investor is serviced and made to feel at 

home, always. What we promise the investor 

must be given to the investor and fast. It is not 

always easy. The provision of industrial and 

logistics space is a case in point. We have not 

solved this particular problem yet and it has 

caused delays in start-ups and expansions. We 

are confident, however, that the strenuous 

efforts by Malta Industrial Parks will begin to 

bear fruit in the course of next year. 

During 2015/16 we worked on the reduction 

to the reduction in income tax and in-work 

benefits which were all intended to continue 

to help families, reduced the rebate in fuel 

prices, granted double allowance for members 

of the Armed Forces, gave tax breaks for extra 

duties to make the police performed, and also 

provided tax breaks for sports activities, but 

A DIVERSIFIED ECONOMY REQUIRES 

a healthy mix of economic activities 

then you feel sorry to find out that a number 

of gyms increased their prices, with the result 

that consumers did not sufficiently feel such 

discount benefits. 

Regarding the health sector and healthcare 

in general, this field is one in which significant 

progress was made, as the people who are 

using health services may attest. During the 

last year there was a situation where for six 

consecutive months not one drug was out 

of stock, while for rest of the half there were 

minimal drugs out of stock. 

On the waiting lists for operations, today there 

is a waiting list for certain heart operations, 

which have been reduced such as for cataract 

operations, a number of other operations 

where the waiting list has decreasing 

drastically, even in cases such as MRI’s being 

made both during the day and night, as well as 

situations of farming out in-private hospitals. 

Nevertheless, a lot still remains to be done, but 

certainly we made great progress. It remains 

now, to complete the second phase of our 

project, through private investment, which the 

Opposition is against, such as Gozo hospital 

and St. Luke’s hospital. 

By Joseph Muscat, Prime Minister of Malta 

This year we shall bear the fruit of the 

decisions we took in the first few months 

of government including the Maritime 

Hub project, where we are going to see it 

operate, we will adjudicate the White Rocks 

tender, and the award of part of Fort St 

Elmo. These are some of the examples that 

will continue to create more jobs 

Today families and businesses are receiving 

electricity bills which they can cope with and 

invest, and through this stimulus the economy 

continued growing. The same effect was the 

measure introduced of free childcare. 

Again, we will keep working to help those 

who cannot find a job, or are made 

redundant. I welcome the idea of GWU 

certification for workers in the hotel sector 

and i am will continue to discuss this in the 

interest s of workers. Today our country 

has an unemployment rate of 5.1%, the 

lowest unemployment rate in history as the 

information h collected indicates, and the 

third lowest unemployment rate in the whole 

European Union. The last time this figure was 

registered, that was 35 years ago! MBR 

10 11 




Corporate Interview of the Month 

Our future depends 

on the decisions we 

take today 

The Nationalist Party Leader Simon Busuttil sums up the 

EY Malta Attractiveness Survey National Conference 2016 

The theme you have chosen for your 

conference - The future is today - is very 

appropriate because you are right that our 

future depends on the decisions we take 

today. And of course, by the same token, 

today is also the result of the decisions we 

have taken yesterday and there have been 

some momentous decisions that have 

helped us shape our future. 

Chief amongst these is our membership 

of the European Union which has given us 

free access to a vast European and global 

market as well as access to €2.5 billion 

worth of EU development funds. Along with 

our adoption of the euro, this has enabled 

us to attract new investment and build 

new economic sectors, such as the gaming 

sector, the aviation sector and the pharma 

sector. But crucially, it has helped us spur 

on our economic growth and given us the 

resilience to endure and emerge unscathed 

from the worst economic recession of the 

past century. So yes, indeed, our future 

depends on the decisions, good or bad, 

we take today. And in this vein, allow me to 

share with you some reflections on how we 

should prepare today, for the future: 

• Public finance: Our economic 

performance has certainly enabled us 

to steer our public finances in the right 

direction. But there are some worrying 

signs that could complicate things in the 

future. For example: 

• Public debt has increased in absolute 

terms by €748 million over three 

years since the end of 2012. Was this 

necessary if the economy has been 

performing so well? 

• Public sector employment: the 25-yearlong 

trend of decreasing public sector 

employment has been reversed. 

• The quality of public spending is a matter 

of concern because Government has 

been consuming more but investing less. 

For instance: salaries have increased by 

€26 million in the first eight months of 

this year; and subsidies to Government 

entities has increased by a further €42 

million in the first eight months, but 

capital expenditure has dropped by €83 

million in the first eight months. 

• Infrastructure: We are witnessing an 

increasing infrastructural deficit - the state 

of our infrastructure. Traffic congestion 

has become a problem for our economy. 

We need an alternative public transport 

system, such as a tramway or light railway 

that connect Malta and Gozo. 

• The environment: we must change once 

and for all our idea that economic growth 

can only come at the expense of the 

environment - this is not a zero-sum game 

because the environment can be a driver 

and not an obstacle to further economic 

growth. The sooner we integrate this into 

our economic planning, the better. 

• Energy tariffs: the reduction of the past 

two years has not been sufficient to 

reflect the huge savings that we have 

made on the cost of our electricity 

generation, thanks to the interconnector, 

thanks to the new BWSC powerstation 

and thanks to considerably lower 

international price of fuel. As a result, 

our industry is having to compete with 

others in the European Union that have 

benefitted from bigger savings. 

• New economic niches: the creation 

of new economic niches such as the 

logistics and distribution, fintech, and 

digital media services. 

• Air Malta: our national airline is not 

just about tourism; it is about our 

connectivity to the world and therefore 

it is about our economy. We say yes to 

a strategic partnership, but let’s retain 

control at national level. The decisions on 

our connectivity to the world cannot be 

taken in Rome, Milan or Abu Dhabi. This 

is why we favour a model that retains 

national control over our national airline. 

• Corruption: This is the big elephant in 

the room. Earlier this year, Transparency 

International made an unprecedented 

statement calling on our Government 

Dr Simon Busuttil, Leader of the Nationalist Party 

“to clean up its corruption mess”. Now 

you know as well as I do that corruption 

is not pro-business; that conflict of 

interest of people in high public office 

undermines the level playing-field that 

investors need and expect; and that 

well, the PanamaPapers scandal may 

well have been swept under the carpet, 

but it is is still there for all to see. All this 

creates a reputational risk today that 

damages our future tomorrow. It makes 

us less attractive for investment; it makes 

our negotiating position weaker on tax 

harmonisation and it complicates our 

life at a crucial juncture where we are 

about to take on the Presidency of the 

European Union in January. So my strong 

appeal to the Prime Minister is to sort this 

out before going into the EU Presidency. 

• The Opposition’s contribution: Prebudget 

document: we have prepared 

91 proposals to transform ensure that 

our economy is truly an economy for 

the people where we can all succeed 

together. Our proposal are presented in 

five packages: 

»» 

Economic development 

»» 

Public spending 

»» 

Social Justice 

»» 

The environment and Infrastructure 

»» 

Health and Education. MBR 

Source: communications@pn.org.mt 

Individual or 

Joint Account 

Option 

Access to funds 

Whenever, 

Wherever 

Euro Savings Account 

1.00 % 

Minimum 

Deposit €50 

USD Savings Account 

0.75 % 

Minimum 

Deposit $50 

Rates of interest are on a gross per annum basis 

Euro Fixed Term Deposit 

Minimum Deposit €1,000 

3 year: 2.30% 

2 year: 1.95% 

1 year: 1.85% 

Visit our website, open your online bank account and start benefiting 

from your savings and fixed term deposit accounts 

Easy, 

Flexible & 

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Safe, 

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USD Fixed Term Deposit 

Minimum Deposit $1,000 

3 year: 2.75% 

2 year: 2.50% 

1 year: 2.00% 

2132 2102 helpdesk@easisave.com www.easisave.com 

FIMBank p.l.c. is a licensed credit institution regulated by the Malta Financial Services Authority, and is listed on the Malta Stock Exchange. 

The Bank is a participant in the Depositor Compensation Scheme in Malta. Terms and conditions apply. 

12


Market Indicators 

Global Competitiveness Index 2015/2016 

Malta 

KEy Indicators 

Population (millions) 0.4 

GDP (US$ billions) 9.8 

Performance Overview 

11 th pillar: 

Business 

sophistication 

10 th pillar: 

Market sizet 

9 th pillar: 

Technological 

readiness 

12 th pillar: 

Innovationt 

8 th pillar: 

Financial market 

development 

1 st pillar: 

Institutions 

7 th pillar: 

Labor market 

efficiency 

2 nd pillar: 


6 th pillar: 

Goods market 

efficiency 

3 rd pillar: 

Macroeconomic 

environment 

4 th pillar: 

Healt and 

primary 

education 

5 th pillar: 

Higher 

education 

and training 

1934 saw the introduction of the 

innovative 135 daylight-loading singleuse 

cassette, forever changing the way 

photographers worked. 

GDP per capita (US$) 22,734.23 

GDP (PPP) per capita (US$) 36,004.96 

GDP (PPP) as share (%) of world total 0.01 

INNOVATE NOW 

GDP (PPP) per capita, 

current international dollars, 1980-2015 

$36,004.96 

The InnovFin SME Guarantee is a scheme run by the EIF, through which SMEs 

from eligible business sectors can benefit from lower cost finance, on the basis of 

a 50% loan guarantee. Facilties range between €25,000 and €2.4 million. 

The scheme is locally managed by APS Bank. 

2122 6644 

apsbank.com.mt 

Credit: World Economic Forum 

14 

The Banking Arrangement is supported by the InnovFin SME Guarantee Facility, with the financial backing of the European Union under Horizon 2020 

Financial Instruments and the European Fund for Strategic Investments (EFSI) set up under the Investment Plan for Europe. The purpose of EFSI is to help 

support financing and implementing productive investments in the European Union and to ensure increased access to financing. 

Approved and issued by APS Bank Ltd, APS Centre, Tower Street, B’Kara BKR 4012. APS Bank Ltd is authorised by the Malta Financial Services Authority 

to act as a licensed Credit Institution under the Banking Act 1994. Terms and Conditions apply.


Exclusive: Budget 2017 Budget 2017 


Budget 2017 presentation 

‘a strong economy, a social budget’ - Minister Scicluna 

The 2017 Budget speech was delivered after the timely press release 

issued by Standard & Poor’s, wherein Malta’s credit rating improved from 

BBB+ to A-. This is certainly positive news. It is also very encouraging that 

Malta is expected to continue to experience an average of 3% real GDP 

growth between 2016 and 2019. 

This is the fourth Budget for this 

legislature. In the Budget speech for 

2016, presented to the Parliament of 

Malta on 12 October 2015, the Finance 

Minister Professor Edward Scicluna 

announced a number of fiscal measures 

and amendments to the fiscal legislation. 

Notable income tax measures include the 

widening of the income tax brackets for 

individuals, a reduction in income tax for 

sportsmen, the possible introduction of 

a fiscal consolidation regime as well as 

other incentives in the form of tax credits 

or deductions intended to encourage 

employment and industry. 

Giving his first comments to MBR, Minister 

Scicluna said, “The key priorities of the 

Budget are: continuing to strengthen 

government finances; reducing the 

fiscal burdens to increase the standard 

of living; attracting foreign investment; 

strengthening social services, the 

environment and regional development; 

increasing infrastructure investment and 

improving overall Government efficiency.” 

Minister Scicluna, addressing one 

question on fiscal consolidation 

responded that, “The introduction of a 

fiscal consolidation concept in income 

tax legislation will allow 

companies forming part of a 

group to be treated as a single 

taxpayer, thus, computing 

their taxable income on a 

consolidated basis. 

With regards to SMEs and 

micro-enterprise, Minister 

Scicluna explained that, 

“Micro-invest funding is to be 

extended with a maximum 

€50,000 tax credit to be 

made available for female 

entrepreneurs. A maximum 

tax credit of €10,000 in 

respect of research and 

development for companies 

employing individuals with 

a doctorate/ reading for 

a doctorate in science, IT 

or engineering is being 

introduced and tax credits 

to be made available for 

knowledge transfer activities 

between employees. 

Asked about property specific measures, 

Prof Scicluna added, “The first time 

property buyer programme will also be 

extended. The exemption from duty 

on the first €150,000 of the value of 

immovable property will be extended for 

contracts executed up to 31 December 

2016. We have introduced Stamp duty 

refund for first time buyers that concluded 

a promise of sale after 1st July 2015, while 

a 15% withholding tax on rental income 

option is to be extended to the renting 

of commercial property. The opt-in may 

also be availed of by companies. However, 

intra-group rentals between entities shall 

be excluded from this measure. 

The waiting time before a sale of inherited 

immovable property by heirs can take 

place, where some heirs object, is 

reduced to three years from the current 

maximum of ten. Also, stamp duty on 

transfers of regenerated property in urban 

conservation areas is being reduced to 

2.5% from 5%. Another incentive is the 

introduction of property transfers tax 

reduction from 8% to 5% on transfer 

of regenerated property in urban 

conservation areas.” 

Among notable increase is the minimum 

contributory pension to €7,280 per year, 

which has been increased after a hiatus 

of 25 years. “This is a social measure 

which we have been long considering 

to implement,” commented Minister 

Scicluna, adding on, “Other key measures 

include reforms expected to insolvency 

legislation and incentivising Malta Stock 

Exchange to continue working on place to 

develop a capital market in Malta.” MBR 

Credits: DOI/Ministry of Finance 

Photo: DOI - Kevin Abela 

By Martin Vella 

Budget 2017 

Highlights 

By George Carol 

Social welfare 

• Increases in the 

allowances to people 

who care for their 

parents or infirm 

relatives at home and 

those who receive the 

in-work allowance. 

• €1m fund for 

schoolchildren with a 

difficult upbringing or 

a deprived background 

Low-income people will actually 

be getting a raise of €4 per 

week through improvements 

to the in-work benefit and 

the supplementary 

allowance 

A €1.75 wage increase as 

part of the cost of living 

adjustment 

Transport 

• Free tallinja bus card 

for a year for everyone 

turning 18 in 2017 

• Incentives for private 

companies which 

organise transport for 

their workers 

• Plans for widening 

of part of the 

Hamrun bypass and 

improvements to the 

Mosta junction near 

Kinds 

New duties on non-alcoholic 

drinks (excluding water) and 

building materials including 

steel rods, glass and tile 

Income tax on government 

pensions and private pensions 

up to €13,000 will be removed 

next year. 

Property 

• 5,000 tax concession 

for first-time property 

buyers will stay in 

place. 

• Incentives for those 

who buy property 

which needs renovation 

in urban conservation 

areas 

• Tax on Gozo property 

purchases is going 

down to two per cent 

instead of five per cent 

• Low-income tenants 

will have their rent 

subsidy doubled. Rents 

on social housing will 

be reversed to what 

they were in 2013 

Income tax on dividends paid 

to investors on the Malta Stock 

Exchange will be waived, and 

the government will introduce 

savings bonds a special 

rate targeted at 

pensioners 

The price of cigarettes will 

go up by some 30 cents - 

the same as last year 


• Private sector to invest in a 

new school for foreigners at 

the former Mtarfa Hospital 

• Plans for a new breakwater 

in Marsamxett, a motherand-child 

hospital, and 

schools in Victoria, 

Marsascala and St Paul’s Bay 

• New primary schools 

planned for St Paul’s Bay, 

Marsascala and Victoria 

• Call for proposals for 

the design, building and 

operation of the Gozo tunnel 

will be issued next year. A 

contract will be awarded for 

a fast ferry service between 

Valletta and Mgarr 

• A new fibre-optic link will 

be laid between Malta and 

Marseille, France, to reduce 

dependence on a hub in 

Italy 

• A new national oil company 

will be set up to handle oil 

exploration efforts. 

• Pinto Wharf to be extended 

by 12 metres to cater for 

bigger cruise liners in Grand 

Harbour. Deep Water Quay 

will also be extended 

• A Food Manufacturing 

Centre will be set up at the 

former Dowty site in Mriehel 

Tax credits for employers 

who set up occupational 

pension schemes 

Sources/References: The Malta Independent; 

Times of Malta; Camilleri Preziosi Advocates; Nexia BT. 

16 

www.maltabusinessreview.net 

17


Corporate Focus 

Baker Tilly Sant is the Malta independent 

member of Baker Tilly International, 

one of the world’s premiere and fastest 

growing accounting, audit, tax and 

business advisory networks. 

Baker Tilly Sant was founded on the 

ideology of creative forward thinking and 

planning, while offering innovative and 

independent services in support of clients’ 

requirements. The Firm aims to create 

a balance between outstanding client 

service, the financial success of its clients, 

the firm and its staff. The Firm prides itself 

on maintaining excellent services which 

meet and surpass client’s expectations. 

To further these delivered services, Baker 

Tilly Sant is currently in the process of 

implementing Global Focus, the new 

Global Audit Methodology launched by 

Baker Tilly International this year, which 

system focuses the audit approach on 

risks relevant to each individual client. 

This new technology further enhances 

the Firm’s capabilities of delivering highquality 

multi-jurisdictional audits. 

Very recently, Baker Tilly International has 

been named winner of the prestigious 

Network of the Year Award at the 

International Accounting Bulletin (IAB) 

Awards for 2016. 

The annual Accountant & International 

Accounting Bulletin (IAB) awards celebrate 

excellence in the accounting profession 

and bring together some of the most 

prominent people in the industry. 

The IAB Network of the Year is awarded 

to networks that have demonstrated the 

execution of profitable growth strategies 

during the past 12 months and have 

excelled in a number of key strategic 

and operational areas. They are also 

recognised by the industry as a reputable 

18 

Donald Sant 

Great Firm, 

Outstanding Network 

brand that consistently delivers high 

quality professional services. 

Commenting on the award, Ted Verkade, 

CEO and President of Baker Tilly 

International, said: “I am exceptionally 

proud that the network has been 

recognised by IAB for our outstanding 

growth, our innovation and commitment 

to delivering excellent client service, and 

for being the first network to obtain the 

ACCA Approved Employer status award in 

professional development”. 

In today’s competitive and ever-changing 

environment, businesses need to be able 

to use all the resources that they are able 

to attract, highlighting the importance of 

acquired skills and knowledge. The Firm 

places major emphasis on the constant 

need for its own resources to embark 

on career development objectives, and 

as a result, Baker Tilly Sant manages to 

provide an impeccable service to its ever 

growing client base. 

During 2015, Baker Tilly Sant was officially 

approved as an ICAEW Training Employer, 

authorised by the Institute of Chartered 

Accountants in England and Wales 

(ICAEW) to train Chartered Accountants. 

Furthermore, students following their 

professional examinations with the 

Association of Chartered Certified 

Accountants (ACCA) are also able to train 

with the Firm. It may be pertinent to state 

that with such credentials, Baker Tilly Sant 

has been attracting new professionals 

amongst its fold. 

Indeed, Baker Tilly Sant is a true positive 

reflection of the overall quality and values 

of Baker Tilly International, of which it is a 

very valued independent member. MBR 

An Independent member of Bakery Tilly International 

Ted Verkade (left) CEO/President, 

Paul Ginman (right) COO 

Fly high with us 

Baker Tilly Sant is an independent member of Baker Tilly International, one of the 

premiere and fastest growing professional networks of independent accountancy and 

business advisory firms in the world. The network is united in its commitment to 

provide exceptional client service. During 2016, Baker Tilly International was awarded 

the prestigious IAB Network of the Year Award. 

Our people are our greatest asset and Baker Tilly Sant is always looking for ambitious 

forward thinking people with a passion for business and client service, whilst at the 

same time developing their skills and flourishing their career. 

www.bakertillymalta.com 

An independent member of Baker Tilly International


World Economic Forum Survey 

EDUCATION 

Malta climbs Global Competitiveness Index ranks 

The Global Competitiveness Index 

2016-2017 released by the World 

Economic Forum (WEF) shows that Malta 

has improved its overall competitiveness 

performance. In the latest edition Malta 

ranked 40th out of 138 countries included 

in this publication. This represents an 

improvement on the 48th place attained 

by Malta in the previous release. 

This publication assesses each country 

on twelve (12) main pillars. Malta ranked 

at least 41st under each pillar, bar for the 

10th pillar (market size). Under this pillar 

Malta ranked 126th. Unfortunately, little 

improvement can ever be attained in this 

area as the score is dictated by the size of 

our country. 

Malta excelled particularly well in the 

areas of health and primary education 

(18th), technological readiness (20th) and 

macroeconomic environment (21st). 

With respect to health and primary 

education Malta ranked very strongly 

in the areas of life expectancy (16th) 

and quality of primary education (19th). 

Under the area of technological readiness 

significant results were attained for 

internet bandwidth (3rd), fixed broadband 

internet subscriptions (7th) and FDI and 

technology transfer (21st). Under the 

macroeconomic pillar Malta ranked as 

being the best country in terms of annual 

percentage change in inflation (1st). Malta 

also ranked 20th for gross national savings 

as a percentage of GDP. 

Under the macroeconomic pillar 

Malta ranked as being the best 

country in terms of annual 

percentage change in inflation (1st) 

The report overall indicates that over the 

last years Malta has gradually improved its 

rankings in a number of indicators that are 

included under this index. However, the 

same report clearly indicates that this result 

is not guaranteed and there are a number 

of areas which still need to be addressed 

concretely in order to enable Malta to 

retain and improve its ranking further. 

The index shows that improvements have 

been recorded with respect to the number 

of procedures to set-up a business as well 

as the time required to do so. However, 

the measures adopted so far have only 

enabled Malta to rank 116th (procedures) 

and 114th (time) in these areas. Given that 

these indicators are sourced by the WEF 

from the World Bank, the important work 

carried out in this area is not yet reflected 

fully in this publication. 

The Global Competitiveness Report also 

highlighted that for the first time, when 

respondents came to identify the main 

problematic factors for doing business, a 

workforce which is relatively lacking in the 

required education levels topped the list. 

This is a reflection of the shift in Malta’s 

economy to operations requiring far 

higher levels of training and expertise than 

was the case in the past. The situation is 

being studied by the Ministry of Education 

and the various stakeholders such as Malta 

Enterprise and plans have been developed 

to implement more targeted and effective 

strategies in order to ensure long-term 

sustainability. MBR 

Source: Malta Enterprise 

20

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budget 2016 infographic review 

global economic index 


MALTA BUDGET 2016 

The Global Competitiveness Index 2015–2016 Rankings 

On 17 October 2016 the fourth Budget for this legislature was presented to the Parliament of Malta. The key priorities of the Budget are: continuing to strengthen government 

finances; reducing the fiscal burdens to increase the standard of living; attracting foreign investment; strengthening social services, the environment and regional development; 

increasing infrastructure investment and improving overall Government efficiency. 

0 

0 

The Budget seeks to amend the tax bands by widening the tax 

exempt brackets for individuals in the following manner: 

% 

0 

15 

25 

35 

Separate 

Computation 

Income tax brackets for individuals 

0-9100 

0-12,700 0-10,500 

9,101-14,500 

14,501-60,000 

60,000< 

INCOME TAX 

Joint 

Computation 

12,701-21,200 

21,201-60,000 

60,000< 

Parents 

rates 

10,501-15,800 

15,801-60,000 

60,000< 

• Individuals applying the single tax rates and earning up to €19,500 

will save up to €90 tax per annum. 

• Couples applying the married tax rates and earning up to €28,700 


• Parents applying the parent tax rates and earning up to €21,200 


Deductions 

• Introduction of capital allowances for office buildings. 

• Wear and tear allowances amounting to 50% of the purchase 

price in the year of acquisition for businesses that purchase hybrid 

or electric vehicles. 

• Donations to the arts will be deductible at 150% of the amount 

donated. 

• A company that donates over €2000 to the Community Chest 

Fund can deduct the donation amount. 

% 

Tax credits 

• Micro-invest to be extended with a maximum €50,000 tax credit to 

be made available for female entrepreneurs. 

• Maximum tax credit of €10,000 in respect of research and 

development for companies employing individuals with a 

doctorate/ reading for a doctorate in science, IT or engineering. 

• Tax credits to be made available for knowledge transfer activities 

between employees. 

Reduced rate of tax on sportsman income 

• The reduced rate of tax on the income of footballers and 

waterpolo players to a flat rate of 7.5% is going to be extended to 

all players and coaches of all types of sport. 

€ 

0 

0 

Fiscal Consolidation 

• The introduction of a fiscal consolidation concept in income tax 

legislation will allow companies forming part of a group to be 

treated as a single taxpayer, thus, computing their taxable 

income on a consolidated basis. 

Other income tax measures 

• A new 15% tax on police who carry out ‘extra duties’ for 

organizations, individuals or companies. 

TAX 

VAT 

Other tax measures 

• Removal of registration tax on electric 

motorcycles. 

• The license for small motorcycles with an 

engine of 125cc has been reduced to a 

flatnominal rate of €10 per annum. 

• Owners of hybrid vehicle or electric vehicle 

will be exempt from paying CVA tariffs when 

entering Valletta. 

125cc €10 

VAT 

• VAT rate of 18% on sports 

activities will fall to 7%. 

• VAT refund on registration of 

cars registered between 2005- 

2008 will continue to be 

refunded. 

18% 

7% 

OTHER MEASURES 

Property specific measures 

• The first time property buyer programme will also be extended. The exemption 

from duty on the first €150,000 of the value of immovable property will be 

extended for contracts executed up to 31 December 2016. 

• Stamp duty refund for first time buyers that concluded a promise of sale after 1st 

July 2015. 

• 15% withholding tax on rental income option is to be extended to the renting of 

commercial property. The opt-in may also be availed of by companies. However, 

intragroup rentals between entities shall be excluded from this measure. 

• The waiting time before a sale of inherited immovable property by heirs can take 

place,where some heirs object, is reduced to 3 years from the current maximum 

of 10. 

• Stamp duty on transfers of regenerated property in urban conservation areas is 

being reduced to 2.5% from 5%. 

• Property transfers tax reduction from 8% to 5% on transfer of regenerated 

property inurban conservation areas. 

Social measures 

• Increase in the minimum contributory pension to €7,280 per year. 

• Companies employing 20 employees and failing to employ a minimum number of 

persons with disability will be liable to pay a contribution of €1,600 per person 

that should have been employed. 

• Extension of in-work benefit refunded. 

REG 

Company registration fees 

TAX 

INDIRECT TAX 

Eco-Contribution and Excise Duty 

• Continuation of process of removing eco-tax. 

• Excise duty will be imposed on products seen as harmful to the 

environment. Ex:chewing gum and plastic bags. 

• Price of petrol and diesel to be reduced by €0.03 and €0.04 

respectively. 

• As from 1st April 2016, an environmental contribution tax will be 

levied on all incoming tourists aged 18 and over at €0.50 for every 

night spent in Malta capped at a maximum of €5 per visit. 

• Excise duty on cement, cigarettes/tobacco products and alcohol 

to be increased. 

petrol 

€0.03/L 

Stamp duty on 

transfers 

5% to 2.5% 

Property 

transfers tax 

8% to 5% 

• The initial registration fee for companies registered in electronic format and 

whose authorised share capital does not exceed €1,500 shall be reduced to €100. 

Minimum 

contributory pension 

per year 

Other key measures 

• Reforms expected to insolvency legislation. 

• Malta Stock Exchange to continue working on place to develop a capital market in Malta. 

diesel 

€0.04/L 

€7,280 

Source: EC Europa 

Economy Score 1 Prev. 2 Trend 3 

Switzerland 5.76 1 

Singapore 5.68 2 

United States 5.61 3 

Germany 5.53 5 

Netherlands 5.50 8 

Japan 5.47 6 

Hong Kong SAR 5.46 7 

Finland 5.45 4 

Sweden 5.43 10 

United Kingdom 5.43 9 

Norway 5.41 11 

Denmark 5.33 13 

Canada 5.31 15 

Qatar 5.30 16 

Taiwan, China 5.28 14 

New Zealand 5.25 17 

United Arab Emirates 5.24 12 

Malaysia 5.23 20 

Belgium 5.20 18 

Luxembourg 5.20 19 

Australia 5.15 22 

France 5.13 23 

Austria 5.12 21 

Ireland 5.11 25 

Saudi Arabia 5.07 24 

Korea, Rep. 4.99 26 

Israel 4.98 27 

China 4.89 28 

Iceland 4.83 30 

Estonia 4.74 29 

Czech Republic 4.69 37 

Thailand 4.64 31 

Spain 4.59 35 

Kuwait 4.59 40 

Chile 4.58 33 

Lithuania 4.55 41 

Indonesia 4.52 34 

Portugal 4.52 36 

Bahrain 4.52 44 

Azerbaijan 4.50 38 

Poland 4.49 43 

Kazakhstan 4.49 50 

Italy 4.46 49 

Latvia 4.45 42 

Russian Federation 4.44 53 

Mauritius 4.43 39 

Philippines 4.39 52 


Malta 4.39 47 

South Africa 4.39 56 

Panama 4.38 48 

Turkey 4.37 45 

Costa Rica 4.33 51 

Romania 4.32 59 

Bulgaria 4.32 54 

India 4.31 71 

Vietnam 4.30 68 

Mexico 4.29 61 

Rwanda 4.29 62 

Slovenia 4.28 70 

Macedonia, FYR 4.28 63 

Colombia 4.28 66 

Oman 4.25 46 

Hungary 4.25 60 

Jordan 4.23 64 

Cyprus 4.23 58 

Georgia 4.22 69 

Slovak Republic 4.22 75 

Sri Lanka 4.21 73 

Peru 4.21 65 

Montenegro 4.20 67 

Botswana 4.19 74 

Morocco 4.17 72 

Uruguay 4.09 80 

Iran, Islamic Rep. 4.09 83 

Brazil 4.08 57 

Ecuador 4.07 n/a 

Croatia 4.07 77 

Guatemala 4.05 78 

Ukraine 4.03 76 

Tajikistan 4.03 91 

Greece 4.02 81 

Armenia 4.01 85 

Lao PDR 4.00 93 

Moldova 4.00 82 

Namibia 3.99 88 

Jamaica 3.97 86 

Algeria 3.97 79 

Honduras 3.95 100 

Trinidad and Tobago 3.94 89 

Cambodia 3.94 95 

Côte d’Ivoire 3.93 115 

Tunisia 3.93 87 

Albania 3.93 97 

Serbia 3.89 94 


El Salvador 3.87 84 

Zambia 3.87 96 

Seychelles 3.86 92 

Dominican Republic 3.86 101 

Kenya 3.85 90 

Nepal 3.85 102 

Lebanon 3.84 113 

Kyrgyz Republic 3.83 108 

Gabon 3.83 106 

Mongolia 3.81 98 

Bhutan 3.80 103 

Argentina 3.79 104 

Bangladesh 3.76 109 

Nicaragua 3.75 99 

Ethiopia 3.75 118 

Senegal 3.73 112 

Bosnia & Herzegovina 3.71 n/a 

Cape Verde 3.70 114 

Lesotho 3.70 107 

Cameroon 3.69 116 

Uganda 3.66 122 

Egypt 3.66 119 

Bolivia 3.60 105 

Paraguay 3.60 120 

Ghana 3.58 111 

Tanzania 3.57 121 

Guyana 3.56 117 

Benin 3.55 n/a 

Gambia, The 3.48 125 

Nigeria 3.46 127 

Zimbabwe 3.45 124 

Pakistan 3.45 129 

Mali 3.44 128 

Swaziland 3.40 123 

Liberia 3.37 n/a 

Madagascar 3.32 130 

Myanmar 3.32 134 

Venezuela 3.30 131 

Mozambique 3.20 133 

Haiti 3.18 137 

Malawi 3.15 132 

Burundi 3.11 139 

Sierra Leone 3.06 138 

Mauritania 3.03 141 

Chad 2.96 143 

Guinea 2.84 144 

Note: The Global Competitiveness Index captures the fundamentals of an economy. Recent developments, including currency (e.g., Switzerland) and commodity price fluctuations (e.g., Azerbaijan, 

Qatar, Saudi Arabia), geopolitical uncertainties (e.g., Ukraine), and security issues (e.g., Turkey) must be kept in mind when interpreting the results. 

1 Scale ranges from 1 to 7. 

2 This shows the rank out of the 144 economies in the GCI 2014–2015. 

3 The trend line shows the evolution in percentile rank since 2007; breaks in the trend line reflect years when the economy was not included in the GCI. 

The Global Competitiveness Report 2015–2016 | xv 

22 © 2015 World Economic Forum 

www.maltabusinessreview.net 23 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

29 

30 

31 

32 

33 

34 

35 

36 

37 

38 

39 

40 

41 

42 

43 

44 

45 

46 

47 

Advanced 

Economies 

Middle East, 

North Africa, and Pakistan 

48 

49 

50 

51 

52 

53 

54 

55 

56 

57 

58 

59 

60 

61 

62 

63 

64 

65 

66 

67 

68 

69 

70 

71 

72 

73 

74 

75 

76 

77 

78 

79 

80 

81 

82 

83 

84 

85 

86 

87 

88 

89 

90 

91 

92 

93 

94 

Emerging and 

Developing Asia 

Latin America 

and the Caribbean 

95 

96 

97 

98 

99 

100 

101 

102 

103 

104 

105 

106 

107 

108 

109 

110 

111 

112 

113 

114 

115 

116 

117 

118 

119 

120 

121 

122 

123 

124 

125 

126 

127 

128 

129 

130 

131 

132 

133 

134 

135 

136 

137 

138 

139 

140 

Commonwealth of 

Independent States 

Emerging and 

Developing Europe 

Sub-Saharan 

Africa 

Credit: © 2016 World Economic Forum


banking 

IIG Bank (Malta) Ltd 

grows stronger in international trade finance 

IIG Bank continued to grow its presence 

in the international markets despite the 

slowdown in output and traded volumes 

that continue to persist. The IMF has 

concluded that the weak growth in 

trade volumes is largely a result of the 

synchronised economic slowdown in 

advanced and emerging economies. The 

post-crisis slowdown in investment was 

particularly significant. The IMF analysis 

however suggests that there is hope and 

that world trade will recover, provided the 

world economy and investment do so. The 

shift in the composition of global output 

explains the slowdown in world trade. 

It also adds that “among goods, trade 

growth fell for 85 per cent of product lines, 

with the sharpest slowdown observed in 

trade of capital and intermediate goods. 

IIG Bank continues to focus on the 

financing of essential commodities, 

primarily agro-products and other 

primary consumables. These are products 

that are always the least effected and 

the most resilient in maintaining traded 

volumes during persistent economic 

slowdown and depressed markets. 

In the first half of this year, the Bank 

continued to maintain growth and 

profitability trends which generated the 

extraordinary results of 2015, whereby 

it registered a profit for the year before 

tax of $6,543,793, up from $2,838,714 

in 2014. The interim financial statements 

for the 6 months to June 2016 show 

13% increase in operating profit when 

compared to the same period in 2015. 

As was declared at the beginning of the 

year, all the previous year’s revenues 

attributable to the shareholder were 

reinvested in the Bank, resulting in an 

increase of $6,200,000 in Tier I capital to 

$22,500,000. 

The Bank continues to build its 

operational capability and its business 

network internationally, venturing into 

new areas while expanding its banking 

relationships to support its fast growing 

business. This also means additional 

investment into specialist skills at all levels 

of its organisational structure. The bank 

continues to grow its customers, both 

its depositor base and its loan portfolio 

clients. The Bank remains focused on 

establishing long lasting relationships 

with clients, ensuring that the service 

expectations of its discerning customers 

are met with efficiency. 

Reporting on the performance of the Bank, 

Raymond Busuttil, Managing Director and 

Chief Executive Officer of IIG Bank (Malta) 

Ltd, said: “The Bank has succeeded 

in reaching goals and exceptional 

profitability during difficult times where 

the crises that hit the global markets has 

continued to persist to this day, creating 

unprecedented challenges for businesses 

and certainly for banks. The board and 

executive management are encouraged 

by the fact that the Bank is successfully 

establishing a highly respected name for 

itself in the world of international trade 

and commodity finance.” MBR 

moneypluscard.com 

M+C Account 

Corporate & Private 

Multi Currency 

€ - £ - $- CHF 

Access via Browser 

moneypluscard.com 

ePayzz mobile App* 

e-money mobile payment 

*ePayzz App is an e-money solution, e-money licence pending (MFSA) 

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Regulated and licensed by the Malta Financial Services Authority (MFSA) 

© Money+Card 2016 All Rights Reserved 

24


exclusive: Future Leadership 

exclusive: Future leadership 


Accelerating Innovation with Leadership 

By Bill Gates, Co-chair, Bill and Melinda Gates Foundation 

As the U.S. presidential candidates lay 

out competing visions for the country, 

I have been thinking about a topic they 

have not yet discussed in detail: what 

political leadership can do to accelerate 

innovation. Innovation is the reason our 

lives have improved over the last century. 

From electricity and cars to medicine and 

planes, innovation has made the world 

better. Today, we are far more productive 

because of the IT revolution. The most 

successful economies are driven by 

innovative industries that evolve to meet 

the needs of a changing world. From the 

advances that put a computer on every 

desk to the discoveries that led to lifesaving 

vaccines, major innovations are the result 

of both government investments in basic 

research and the private-sector creativity 

and investments that turn them into 

transformative products. 

I have heard some people argue that lifechanging 

innovations come exclusively 

from the private sector. But innovation 

starts with government support for the 

research labs and universities working on 

new insights that entrepreneurs can turn 

into companies that change the world. 

The public sector’s investments unlock the 

private sector’s ingenuity. 

I was lucky enough to be a student when 

computers came along in the 1960s. At 

first they were very expensive, so it was 

hard to get access to them. But the twin 

miracles of the microchip revolution and 

the internet—both made possible by 

U.S. government research—completely 

changed that. It’s no wonder that today 

most of the leading hardware and software 

companies are based in the U.S. 

Accelerating innovation requires both 

political leadership and private sector 

leadership. As U.S. voters decide which 

candidates they want to elect to fill 

national, state, and local offices, and as 

many countries around the world undergo 

similar political transitions, I think we 

should consider what kind of leaders can 

drive the innovations we need. 

The key to prioritising 

progress is support for 

innovation 

The best leaders have the ability to do 

both the urgent things that demand 

attention today and at the same time lay 

the groundwork for innovation that will 

pay dividends for decades. 

As a country and around the world, we 

confront a wide array of urgent issues 

that our leaders must address—from 

terrorism to job creation to migration. 

Our next president will be part of a new 

group of global leaders who will wrestle 

with these urgent problems. Those 

leaders can either prioritise alleviating 

poverty, making everyone healthier, and 

accelerating economic growth—or they 

can let progress stall. The key to prioritising 

progress is support for innovation. 

When we innovate, we create millions of 

jobs, we build the companies that lead 

the world, we are healthier, and we make 

our lives more productive. And these 

benefits transcend borders, powering 

improvements in lives around the world. 

Our global culture of innovation has been 

most successful at those moments when 

science, technology, and great leadership 

come together to create miracles that 

improve modern life. I believe we are in 

one of those moments. 

One of the most indelible examples of a 

world leader unleashing innovation from 

both public and private sectors came in 

1961 when President John F. Kennedy 

spoke to the U.S. Congress and challenged 

the country to put a man on the moon 

within the decade. That speech came at a 

time of cultural and political turmoil, when 

national and economic security dominated 

the headlines. President Kennedy believed 

looking to the skies would inspire the 

country to dream big and accomplish huge 

things. 

That speech didn’t just launch humankind 

on a successful journey to the moon. 

It also inspired America to build a 

satellite network that changed the way 

we communicate across the globe and 

produced new forms of weather mapping 

which made farmers far more productive. 

In the face of fear, President Kennedy 

successfully summoned our country to 

harness American ingenuity and advance 

human progress. 

It’s important to remember what made the 

moonshot the moonshot—that is, what 

transforms political rhetoric into gamechanging 

breakthroughs. A moonshot 

challenge requires a clear, measurable 

objective that captures the imagination of 

the nation and fundamentally changes how 

we view what’s possible. And it requires 

marshaling the resources and intellect of 

both the public and private sectors. When 

we do that, we chart a course for a future 

that is safer, healthier, and stronger. 

Because we are at a pivotal moment when 

the conditions are ripe for transformative 

innovations, there are many important 

things this new group of national leaders— 

including whoever is elected in the U.S. in 

November—can accomplish over the next 

decade. There are four objectives I think 

we should prioritise: 

1. Provide everyone on earth 

with affordable energy without 

contributing to climate change. 

2. Develop a vaccine for HIV and a cure 

for neurodegenerative diseases. 

3. Protect the world from future health 

epidemics, which might be more 

infectious than Ebola and more 

deadly than Zika. 

4. Give every student and teacher new 

tools so all students get a world-class 

education. 

Provide everyone on earth 

with affordable energy without 

contributing to climate change 

There is enormous potential to develop 

technologies that will make energy 

cheaper and reduce our energy imports 

without contributing to climate change or 

air pollution. In the next eight years, we 

could start the transition to a new type 

of clean fuel that doesn’t emit carbon, 

deploy batteries that let electric cars 

run far longer on a single charge, and 

produce dramatic drops in the total cost of 

renewables. 

Last year, the U.S. and twenty other 

countries committed to doubling their 

energy R&D budgets, and 28 investors 

pledged to invest in the output of 

that research. This is only the start. By 

increasing government support for cleanenergy 

research, presidents and prime 

ministers could attract more private 

investors to the field. As early-stage ideas 

progress, private capital will pour in to 

build the companies that will deliver those 

ideas to market. 

Develop a vaccine for HIV and a cure 

for neurodegenerative diseases 

With the right leadership and investments 

over the next decade, we can discover 

and deliver a vaccine for HIV. Many have 

forgotten about the scourge of AIDS, 

treating it like a disease that can be 

managed instead of the deadly virus that 

kills more than 1 million people worldwide 

every year. Based on recent progress, I 

believe world leaders could help make an 

effective AIDS vaccine a reality within the 

next decade. And with a vaccine, we would 

be on the path to ending the disease 

altogether. 

We can also make tremendous progress 

on ending neurodegenerative diseases 

like Alzheimer’s. These diseases are 

devastating for the people and families 

that they affect. They are also huge drivers 

of out-of-control health care costs, which 

deplete government budgets that could 

be used for other critical functions. New 

digital tools and the rapid advancement of 

science are providing new momentum and 

hope in the search for cures. 

In the face of fear, President 

Kennedy successfully 

summoned our country to 

harness American ingenuity 

and advance human progress 

Protect the world from future 

health epidemics 

Global leaders should be proud of their 

role in bringing the Ebola crisis to an end 

and helping the affected countries recover. 

Many agencies, including the Centers for 

Disease Control and Prevention (CDC) and 

the U.S. military, did exemplary work in the 

face of significant risks to their own safety. 

Other leaders around the world mobilized 

their infrastructures as well. But the Ebola 

epidemic and the rise of the Zika virus also 

highlight the need for new advances. There 

is a significant chance that a substantially 

more infectious epidemic will come along 

during the next decade. If one does, we 

will need to be able to detect it, develop a 

test for it, and produce cures very quickly. 

Using advances in biology, scientists are 

developing these capabilities. With vision 

and support, we will be able to identify and 

prevent epidemics before they devastate 

families, communities, and economies. 

Give every student and teacher 

new tools so all students get a 

world-class education 

Education is one of the areas in R&D 

that is often overlooked and can have 

immediate payoff. The world can develop 

technologies that can help students learn 

in ways that are more tailored to their 

needs. But that is just o ne part of the 

equation for educational success. Highquality 

online courses are still in their 

infancy. So is personalized learning, which 

combines classroom time with digital tools 

to let students move at their own pace. 

Technology can make teachers’ jobs easier 

and their work more effective by letting 

them upload videos of themselves in the 

classroom, connect with other teachers, 

watch the best educators at work, and get 

real-time feedback from their students. 

The private sector has started work on 

these ideas, but funding for government 

research budgets would boost the market 

and help identify the most effective 

approaches, giving teachers and students 

new tools that empower them to do their 

best work. 

I hope our leaders seize these worldchanging 

opportunities by investing in 

great research institutions, which translate 

into big opportunities for innovators. 

When these ideas help shape a future 

that is healthier, more productive, and 

more powerful, it will be because world 

leaders stepped up to do the urgent and 

the important at the same time. MBR 

Creditline: LinkedIn/Bill Gates 

EDITOR’S NOTE 

William Henry “Bill” 

Gates III (born October 

28, 1955) is an American 

business magnate, 

investor, author and 

philanthropist. In 1975, 

Gates and Paul Allen 

co-founded Microsoft, 

which became the 

world’s largest PC software company. 

During his career at Microsoft, Gates 

held the positions of chairman, CEO 

and chief software architect, and was 

the largest individual shareholder until 

May 2014. Gates has authored and coauthored 

several books. 

26 27 



Analysis 

Analysis 


Malta slammed for 

cash-for-passport program 

The super-rich are using the option to buy 

access to the EU and beyond. 

Malta has issued hundreds of passports to 

non-EU nationals in exchange for huge sums 

of cash over the last two years, resurrecting 

concern that the country is effectively selling 

access to the European Union. The passports 

were granted to wealthy individuals who 

made large donations to the government 

and dropped cash to buy property on 

the Mediterranean islands without being 

required to live there. 

Prime Minister Joseph Muscat’s spokesman 

Kurt Farrugia said almost 700 passports have 

been issued to non-EU nationals since the 

program’s launch in 2014. Those passports 

have so far generated at least €200 million for 

Malta. Farrugia was responding to questions 

from POLITICO after the government released 

a list of more than 900 people granted 

Maltese citizenship last year. 

Critics charge that the program undermines 

the concept of European citizenship, 

potentially poses security risks and provides 

a possible backdoor for Russians seeking 

to escape sanctions against their own 

country. The program requires a €650,000 

contribution to a national development fund 

and investing €150,000 in government stocks 

or bonds. A spouse or a child costs up to 

€50,000. “If I didn’t have a great deal of love 

and sympathy as well as respect for Malta as 

a country, I would say what I was inclined to 

say two years ago: These are the practices of 

a banana republic which must be rigorously 

counteracted within the EU,” said Frank 

Engel, a center-right MEP from Luxembourg. 

Ana Gomes, a senior Socialist MEP on the 

Justice and Home Affairs Committee, said 

such schemes “put at risk the integrity of 

the Schengen system” and should be looked 

at closer. “I am absolutely disgusted,” she 

said, adding that she has demanded “an 

investigation by the EU Commission to look 

into member state investor schemes, not just 

Malta’s.” 

The price of a passport 

The program requires applicants to give 

a €650,000 contribution to a national 

development fund and provide a €150,000 

investment in government stocks or bonds. 

That leads to a Maltese passport that 

provides visa-free travel to at least 166 

countries. Applicants must also own property 

worth at least €350,000 in Malta for at least a 

year to establish a so-called residency link to 

the country. 

Those passports have so 

far generated at least €200 

million for Malta 

A spouse or a child costs an extra €25,000, 

or €50,000, if the dependent is older than 

18. The figures indicate many families 

are taking advantage of the scheme: 202 

applicants secured citizenship for 503 

spouses or children. Each donation provides 

more money for the government than 

“your average Maltese will pay in a lifetime 

of income tax,” says the CEO of a company 

spezialising in “citizenship planning.” 

“Citizenship is something that has to be 

earned, not simply handed out to people 

with deep pockets,” said Latvian MEP Robert 

Zīle, a former finance minister. He added that 

the scheme “may also be helping to defy the 

sanctions imposed on Russia by Europe as a 

large chunk, if not a majority, of those who 

get Maltese citizenship through investment in 

the country are of Russian origin.” 

By Harry Cooper 

Pedestrians in Valletta. Malta has issued hundreds of passports to wealthy non-EU individuals who made large donations to the government 

| Credit: Horacio Villalobos/Corbis via Getty Images 

Many Russians originally expressed interest 

in the scheme, according to a company 

involved in the program, but it is unclear how 

many have actually been granted Maltese 

passports. 

Getting ‘quality persons’ 

When the government published the list 

earlier this month of those who obtained 

citizenship in Malta last year, including those 

who used the Individual Investor Programme, 

it was accused of making it virtually 

unintelligible by listing individuals by their 

first names and not including their country of 

origin. “We have no idea about the names or 

who the hell they are,” said Jason Azzopardi, 

the country’s shadow justice minister. 

“There’s no way of knowing.” Maltese 

officials, however, defended the program and 

said applicants are thoroughly scrutinised. 

“The people going through the program have 

to go through a very strong and thorough due 

diligence process,” Farrugia said, noting that 

25 percent of applicants are rejected. “We’ve 

always looked to get the quality persons.” 

Applicants must have no criminal record as 

well as undergo checks against records at 

the International Criminal Court and Interpol. 

Andrew Rosindell, a Conservative politician in 

the U.K. who sits on his parliament’s Foreign 

Affairs Committee, said there are still security 

concerns, and the program highlighted the 

need for the U.K. to “urgently” end automatic 

free movement for EU citizens. “Malta is 

effectively deciding U.K. immigration policy,” 

Rosindell said. “Clearly, there are going to be 

security concerns in terms of criminality, in 

terms of people coming in who perhaps are 

not desirable in our own country.” 

The Maltese government spokesman 

dismissed such concerns by saying other 

European countries have similar routes to 

citizenship and are less rigorous in their 

vetting. When asked, he declined to specify 

which countries he meant. Although other 

countries offer various visa or residence 

options in return for investment, Cyprus and 

Austria are the only other European countries 

besides Malta to offer a direct route to EU 

citizenship through investment. 

Building connections to the 1 

percent 

“Today, a person of talent and means need 

not limit his or her life and citizenship to 

only one country,” reads the website of 

Henley & Partners, a company based in the 

Channel Islands that handles “residence and 

citizenship planning.” The company, which 

was awarded the contract to design the 

program in 2013, now promotes the Maltese 

passport option globally and recommends 

applicants to the government, receiving 

a commission for every person who gets 

citizenship. 

European Union flag flies with a Maltese flag 

in front of the Auberge de Castille, office 

of the Prime Minister in Flordiana, Malta | 

Credit: Karl Azzopardi/EPA 

Eric Major, the CEO of Henley & Partners, 

confirmed that Russia, former Soviet 

republics and the Middle East are the main 

markets for the passports. 

“This is a very privileged offering for the 

world elite,” Major said, adding that the 

program builds “a connection with the top 1 

percent of the world population.” 

Major pointed out that the passport income 

benefits the national development fund and 

that each donation provides more money 

for the government than “your average 

Maltese will pay in a lifetime of income tax.” 

In addition to Henley & Partners, individuals 

can apply through one of 137 registered 

agents, including the accounting firms E&Y, 

KPMG, Deloitte and PwC. 

A rocky start 

When the program was first announced two 

years ago, the European Parliament objected, 

saying: “EU citizenship should not be for sale 

at any price.” In particular, MEPs expressed 

concern that a lack of residency requirements 

for applicants would violate international law. 

Even though the European Commission has 

no say in an EU country’s citizenship and 

does not formally endorse or approve cashfor-passport 

programs, it encouraged the 

Maltese government to introduce a residency 

link, which it subsequently did. 

“The Commission continues monitoring 

investors’ schemes … to ensure that there is 

a genuine link between these investors and 

the EU country that awards them citizenship 

Corrugated Packaging Solutions 

From Original Design To Finished Carton 

and thus also citizenship of the Union,” 

said Christian Wigand, a spokesman for the 

Commission. Major, whose company also 

offers help with citizen programs in Austria 

and Cyprus, said that business is booming but 

that Malta is “the most successful investment 

program in the marketplace” on account of 

the amounts raised. 

“It’s a very powerful passport in terms of 

mobility.” MBR 

Creditline: PoliticoPro 


Harry worked for five 

years in the European 

Parliament as assistant 

to ECR chairman 

Syed Kamall MEP and 

latterly Chairman of 

the Internal Market 

Committee, Vicky 

Ford MEP. He advised 

them both on a wide range of policy 

areas, in particular financial services 

and technology. Prior to that, he was a 

lobbyist for the Confederation of British 

Industry, with a focus on environmental 

regulation and infrastructure policy. He 

is a history graduate of Oxford University 

and received his Master’s in global politics 

from the London School of Economics. 

Packaging Designers 

Sample Making 

Corrugated Sheets and Conversion 

Plain and Printed Cartons 

Point of Sale Display Cartons 

28 29 



economic rundown 

economic rundown 


MALTA ECONOMIC OVERVIEW 2016-2017 

INFLATION RATE 

Industrial Production 

August 2015 

-3.80% 

August 2016 

2006.......................................2016 

average 

+16.50% 

June 2007 

0.27% 

Manufacturing 

Production 

August 2015 

-3.40% 


-20.50% 

September 2009 

2001.......................................2016 

average 

+22.60% 

January 2011 

-0.31% 

New Passenger 

Cars Registration 

-283 

from 1 st to 2 nd quarter 

2016 

-23.70% 

February 2009 

2010.......................................2016 

average car registration 

75% 

SERVICES SECTOR SHARE 

IN MALTA’S ECONOMY 

3.3% 

GDP GROW 

IN 2014 

2184 

1st Quarter 


Quick Facts 

1547.08 

POPULATION: 

421,000 

increase (0.8% per year) of which: 

• Maltese: 95% 

• Foreign: 5% 

POPULATION DENSITY: 

1,322 (persons per km2) 

Cars 

1066 

1st Quarter 

2010 

Malta 

Exports 

November 

2011 

669616 

€ Thousand 

Exports 

H USE 

PRICE INDEX 

2nd Quarter 


+2.32 

Index Points 

Gasoline 

Prices 

2.02 $/Ltr 

March 2014 

0.77 $/Ltr 

December 1995 

average 

1.55 $/Ltr 

2005-2016 

average 

96.07 

1995.......................................2016 

Index Points 

2nd Quarter 

2nd Quarter 


110.95 2005 

Index Points 

Revenue and Expenditure 

2017 

€4.02 Billion 

€3.97 Billion 

Revenue 

Expenditure 

January 

1996...............2016 

average 

216312.93 

Exports in Malta 

August 2015 

-7% 


1996 

103400 

€ Thousand 

Exports 

62.04 

Index Points 

EMPL YED 

PERSONS 

177751 

Employed persons 

in April 2016 

= 1,383 

176368 

Employed persons 

in March 2016 

Increase in 

Employed Persons 

1997...............2016 

average 

April 

2016 177751 

Employed 

Persons 

Real GDP Growth 

4.1% 


Estimate 

80% of 

growth 

resulted from 

domestic 

demand 

144795.76 

0.7% 0.5% 


Estimate 

2017 

Projected 

3.5% 

2017 

Projected 

Employed Persons 

December 

1999 

General Government Deficit as a 

percentage of GDP 

Economic activity 

is still considered 

relatively robust, 

although recent 

developments are 

characterised by 

declining growth 

rates. 

Domestic demand 

continued to be 

the main driver, 

contributing to circa 

80% of growth. Net 

exports are expected to 

contribute moderately 

to growth in 2016, 

explained by a recovery 

in foreign demand. 

128206 

Employed 

Persons 

Fiscal consolidation is 

reported to progress in 

line with Government’s 

projections to extent that 

original targets were 

exceeded. 

The general Government Deficit is expected to fall to 0.7% 

of GDP in 2016, and projected at 0.5% for 2017, primarily 

on the back of strong nominal GDP growth. 

General Government Debt 

63.3% 61.9% 


Estimate 

2017 

Projected 

Under a no policy change 

assumption, General 

Government Debt is 

expected to decline to 

63.3% of GDP in 2016, and 

projections for 2017 place 

debt at 61.9% of GDP. 

Capital Infrastructure: Policy measures to support a more productive economy 

Gozo’s digital 

infrastracture 

Fibre optic link between 

Malta and Gozo with 

an investment of €3.2 

million over the next two 

years. 

Ta’ Qali 

Development of Crafts Village with a total 

expenditure of €14 million to start in 2017. 

Ex-Marsa shipbuilding 

Development into a maritime hub to start in 

2017. Ablecare Oilfield Services Holding Ltd will 

invest €55 million over 10 years. 

Tourist Arrivals 

in Malta 

AUGUST 2016 

256781.83 

2711.72 

JULY 2016 

229671.11 

2001.......................................2016 

average 

256781.83 


Target Sectors 

FINANCIAL 

SERVICES 

Financial services 

already constitute one 

of the most significant 

economic drivers, 

offering investors a 

stringent yet flexible 

operating environment 

within the eurozone 

in banking, financial 

planning, fund 

administration and 

management, as well as 

insurance and pensions. 

112274.82 

Tourists arrivals 

40412 

December 2005 

New Primary Schools 

St. Paul’s Bay, Marsascala and Victoria Gozo. 

Social Housing 

€50 million 

investment over 

the next three 

years. 

Malta Budget 2017 

Marsamxett 

Plans for a new breakwater. 

Telecommunications 

network 

An extension 

of the present 

telecommunications 

network, via a new 

submarine cable between 

Malta and Marseille, to be 

financed by EU funds. 

Pinto Wharf, Grand Harbour 

To be extended by 15m to 

cater for large cruise liners. 

Deep water quay also being 

considered for expansion. 

Smart City 

Work on €56 million new 

ITS campus to start in the 

first months of 2017. 

Hal Far 

40, 000 sq m site is to be transformed 

in free trade and logistics centre with 

an investment of €80 million. 

Loans to Private Sector 

100 

Malta offers specific incentives aimed at encouraging activities in niche 

industries, particularly in the following growth-targeted sectors. 

MARITIME 

Malta boasts the largest 

fleet in the EU, and 

merchant shipping, 

ship management and 

registration, yachting/ 

superyachting services, 

yachting crew training 

and ship repair services 

support this industry. 

The island is also keen 

to attract more service 

providers and is seeking 

to develop a multifaceted 

maritime park. 

AVIATION 

Already a major player 

in the maintenance, 

repair and overhaul 

sector, new legislation 

has enhanced Malta’s 

international reputation 

as a centre for aircraft 

registration, finance and 

leasing business. 

5 

10 

CREATIVE 

INDUSTRIES 

Malta offers one of 

the most progressive 

IT environments. 

Investment in 

information and 

communications 

technology, digital 

media, design, arts and 

crafts, gaming and online 

gaming, as well as film 

editing and production 

have been identified as 

growth sectors. 

JULY TO AUGUST 


7.85 

EUR Million 

2003.......................................2016 

average 

3490.10 

4174.01 

EUR Million 

February 2012 

TOURISM 

Investment is channelled 

into special-interest 

areas such as cultural 

and eco-tourism, 

educational tourism, 

and short-duration 

conference 

services – as well as 

increasing Malta’s 

role as a cruise ship 

destination. 

EUR Million 

2548.42 

EUR Million 

November 2003 

ADVANCED 

MANUFACTURING 

Malta’s manufacturing 

sector has shifted from a 

low-value industry to one 

that is technology-based, 

with high-value-added 

activities, encompassing 

aircraft modification and 

engineering services, 

amongst others. 

0.4% 

SEPTEMBER 2016 

GDP VOLUME 

GROWTH 

0.3% 

Q2 2016 

EURO EFFECTIVE 

EXCHANGE RATE 

95.3% 

20 OCTOBER 2016 

HOUSEHOLD 

DEBT RATIO 

94.7% 

Q2 2016 

MONETARY 

AGGREGATE M3 

5.1% 


CURRENT 

ACCOUNT 

BALANCE 

€29.7 bln 


10-YEAR AAA 

GOVERNMENT 

BOND YIELD 

0.00% 

19 OCTOBER 2016 

COST OF 

BORROWING 

FOR HOUSE 

PURCHASE 

1.90% 


National Statistics Office, Malta; Central Bank of Malta; Eurostat; Deloitte Malta; Finance Malta; Country Report Malta; World Economic Forum; Camilleri Preziosi Advocates; Nexia BT 

30 31 



Economic Analysis 

Malta’s Economic Growth Ranks Second in the EU 

Written by: Bridgewest 

This year the European Commission states that Malta’s economy will increase with a 4.3% rate, which makes it the second highest from the 

EU member states. Ireland is the first in the top three, with 6%, but Malta rejoices from the best economic growth in the last ten years. At 

the end of 2015, the Maltese economy continued to register significant growth, thus it is expected to further increase throughout 2016 as 

well. Our company formation experts in Malta can offer you complete information about Malta’s current economic situation. 

32 

Sectors with robust 

economic growth in Malta 

During the first three quarters of 2015 

strong increases were seen in sectors such 

as: 

• scientific and technical; 

• professional; 

• administration and support activities 

(with 17.5%); 

• insurance and financial sector (11.7%); 

• real estate activities and retail trade; 

• food and accommodation service 

activities. 

The strongest growth was seen in the 

service sectors and therefore it managed 

to compensate for the rather slow growth 

of the manufacturing sector. 

A considerable increase in investment 

(by 21.5%) underpinned the increase 

in real GDP. This outstanding growth in 

investment made the Government try 

to find ways to reform central sectors of 

the Maltese economy and to encourage 

a further development in the new growth 

sectors. Exports of services and goods is 

yet another sector that increased by 2.5% 

throughout 2015. 

Results of the 

Maltese economic growth 

The benefits of Malta’s economic growth 

are many and are not limited to exports 

and investment, where, indeed, the results 

are remarkable, but were passed on to 

employees and companies. Profits during 

the year of 2015 (especially during the 

first three quarters), increased by 11.5%. 

Salaries were also increased by 4.7 % in 

the form of compensation. 

The European Commission’s analysis 

focuses on the increase in infrastructural 

projects that can have a positive effect 

from an economic point of view; what is 

more, the setting up of the development 

bank has the goal of facilitating loans 

given to medium and small-sized 

enterprises that wish to continue their 

investment. 

Investment 

grants for start-ups 

@MaltaGov 

Analysing the country’s economy, the 

Minister for Finance stated that the results 

show a future sustainability of Malta’s 

economic growth and the updated GDP 

figures released by NSO are the ones that 

confirm the strong, broad-based rapid 

development and growth of the state. 

You can contact our Maltese company 

registration agents who can provide 

you with further details and updated 

information about Malta’s economic 

growth. MBR 

Sources: Bridgewest: Ciantar Associates 

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Debate 

Debate 


Malta’s 

moneylaundering 

headache 

By Harry Cooper 

Exclusive to MBR 

Panama Papers cast doubt on island’s ability 

to push through EU anti-graft laws. 

A money-laundering scandal that reached 

the highest levels of government in the EU’s 

smallest country has attracted the attention 

of Brussels. 

When a Maltese cabinet minister and 

the prime minister’s chief of staff were 

mentioned in the Panama Papers leaks, it 

looked like a messy domestic affair. 

No longer. The alleged burying of a report 

into the saga has set alarm bells ringing 

among EU lawmakers worried about 

Malta’s ability to steer through new EU antimoney 

laundering legislation when it holds 

the rotating presidency of the EU’s Council 

of Ministers in the first half of next year. 

A spokesman for Joseph Muscat, Malta’s 

prime minister, said: “We are taking this 

issue very seriously.” But not everyone 

is convinced. 

Malta has to get serious. 

It has to tidy up in order 

for the whole European 

financial infrastructure to 

gain credibility 

“This is all very embarrassing,” German 

Green MEP Sven Giegold said. “We will 

raise this whole mess in the [European 

Parliament’s special] Panama Papers 

committee. Malta has to get serious. It has 

to tidy up in order for the whole European 

financial infrastructure to gain credibility.” 

Recently, the man tasked with investigating 

the saga resigned. 

The Parliament’s special committee is likely 

to summon Keith Schembri, Muscat’s chief 

Prime Minister of Malta, Joseph Muscat | Dean Mouhtaropoulos/Getty Images 

of staff, and Konrad Mizzi, a member of 

the government, when it meets after the 

summer break. 

Schembri and Mizz were named in the 

Panama Papers — leaks in April of more 

than 11 million documents from the 

Panama-based law firm Mossack Fonseca. 

According to the documents, only days after 

the Labour Party won the 2013 Maltese 

elections, the two men instructed lawyers 

to set up offshore trusts in New Zealand 

and companies in Panama. They then tried 

to set up accounts with eight different 

banks in tax havens across the world. 

The revelations sparked street protests 

in Malta in April, and Mizzi (sort of) lost 

his job as energy minister — he stayed 

in the government as minister without 

portfolio but with responsibility for “the 

implementation of [the government’s] 

energy plans.” What’s even more 

troubling for Brussels is more recent 

events. Last month, the man tasked 

with investigating the saga resigned. No 

reason was given for the decision by 

Manfred Galdes, director of the Financial 

Intelligence Analysis Unit, other than that 

he was going to “take up a post in private 

practice.” He wasn’t the first casualty of 

the scandal. Galdes is reported to have 

handed over his confidential report into 

the saga to Michael Cassar, Malta’s police 

commissioner, in April. Under Maltese law, 

the police commissioner has the final say 

over whether or not to prosecute in cases 

relating to money laundering. But before 

he could take any action, Cassar resigned 

citing health reasons. 

In a letter to the prime minister, Cassar 

said: “I used to exercise and managed to 

avoid many health problems but, due to 

a lack of time, some of these problems 

have returned.” 

Lawrence Cutajar was last week confirmed 

as Cassar’s replacement, becoming the 

fifth police commissioner since the 2013 

elections. The opposition Nationalist Party 

immediately condemned the appointment, 

saying Cutajar’s only qualification for the 

job was “being Joseph Muscat’s friend” 

and pointing to a 2013 Facebook post in 

which Cutajar praised the prime minister 

for “having balls.” Galdes and Cassar have 

refused to comment on the investigation, 

but that hasn’t stopped rumours circulating 

about their abrupt departures. 

Speaking to Malta Today at the weekend, 

Simon Busuttil, leader of the Nationalist 

Party and, like Muscat, a former MEP, said: 

“Did Galdes resign while the investigation 

was ongoing, if the investigation is 

ongoing, what were its conclusions? Is 

it true that an investigation report had 

been handed to the police for further 

action, but just two days [later], the 

police commissioner resigned?” 

Transparent approach 

After the summer break, talks will begin 

on an updated EU Anti-Money Laundering 

Directive, prompted at least in part by the 

Panama Papers scandal. Slovakia, which 

holds the EU presidency until the end of 

the year, will start off the negotiations but 

the Maltese will be in charge during the 

final stages, if all goes to plan. A European 

Commission spokesperson said the idea 

behind the new rules was to improve 

transparency. “We aim for a rapid adoption 

of the revision in order to strengthen 

transparency rules further and to close any 

potential loopholes.” 

It aims to do that by giving greater powers to 

national financial intelligence units such as 

the one formerly headed by Galdes, which 

look into tax avoidance and evasion, and 

force companies and trusts to disclose who 

are their ultimate “beneficial owners.” The 

Maltese government would have to sign 

off on any new proposals made during the 

discussions with the European Parliament 

and Commission. 

There are growing concerns about the 

country’s reputation as a financial services 

hub. A spokesperson for the Maltese prime 

minister said he wasn’t concerned about 

any potential conflicts of interest, saying: 

“We’ve always been compliant with all EU 

regulation on anti-money laundering.” 

A spokesperson for Malta’s permanent 

representation to the EU added: “The Mizzi 

and Schembri case … has absolutely no 

bearing, connection or impact whatsoever on 

Malta’s EU presidency or its role in steering 

through new [anti-money laundering] 

proposals and legislation. Malta will 

continue to show commitment in combating 

illicit practices through the [anti-money 

laundering] directives and other related 

directives.” But Carl Dolan of Transparency 

International was less enthusiastic. “The 

prospect of Malta steering legislation that 

aims to eradicate corporate secrecy in the 

EU once again highlights that the Council has 

no formal procedures for dealing with any 

conflicts of interest that might arise,” he said. 

Malta’s Nationalist Party leader Simon Busuttil | Credit: EPA/Paco Campos 

Image problem? 

Malta’s problems don’t end there. There 

are growing concerns about the country’s 

reputation as a financial services hub, an 

area in which the tiny island nation has high 

hopes for the future. The chief executive 

of Deloitte in Malta, Malcolm Booker, told 

POLITICO that “any kind of disruption in 

the sector for whatever reason is always 

an issue. [The financial services sector] 

wants a quiet, peaceful day, with business 

as usual. The more transparency, the more 

regulation, the better.” 

this latest development with the 

Financial Intelligence Analysis 

Unit chief resigning, apparently 

because his recommendations 

were not followed 

Kristy Debono, a Nationalist MP, said she 

believes the scandal is causing serious 

damage to the reputation of the Maltese 

financial services sector. “The problem 

is that the prime minister has not taken 

responsibility. He needs to take certain 

actions so that [Malta’s] reputation will 

remain intact.” Speaking at an event hosted 

by Malta’s banking association weeks 

before he stepped down, Galdes made his 

position clear: “There is a link between 

economic growth and dealing with financial 

crime. The reality being faced is that the 

bar has been raised. The way we react is 

key to our success. We must avoid ending 

up on any gray list or black list. We need to 

maintain our reputation as a trustworthy 

financial sector.” 

That’s harder to do in the wake of the 

scandal. Ana Gomes, a Portuguese MEP 

and vice chair of the Parliament’s Panama 

Papers committee, said Malta was in the 

crosshairs. 

“Malta is definitely a case for particular 

attention, not just because of allegations 

against the prime minister’s chief of 

staff and the minister, and this latest 

development with the Financial Intelligence 

Analysis Unit chief resigning, apparently 

because his recommendations were not 

followed, but also because Malta is already 

on our radar.” 

“Malta is one of the jurisdictions in the EU 

that has a very lax system of incorporation 

where it is very easy for anyone who 

wants to fool the anti money-laundering 

authorities, they can set up a company 

like a Russian doll and can make ultimate 

beneficial owners hidden,” said the MEP, 

who is from the Socialist group, the same 

political family as Muscat, Mizzi and 

Schembri. 

“I am going to propose that Malta will be 

high on our agenda … even more so with 

these developments.” MBR 

Creditline: PoliticoPro 

34 35 



Country Report 

Taking comfort to a 

whole new dimension 

1 

2 

Economic performance has been 

robust over the recent years. 

The economy has demonstrated 

notable resilience in a challenging 

macroeconomic environment over 

the past several years. Real GDP 

growth recovered relatively quickly 

following the 2009 recession and 

in 2015 it exceeded the pre-crisis 

peak. Household consumption and 

net exports have been the main 

engines of growth. One-off largescale 

projects in the energy sector 

and the finalisation of EU-funded 

projects boosted investment in 

2014-2015, thus also contributing 

strongly to the expansion of the 

economy. Real GDP growth is 

projected to moderate somewhat 

after 2015, but to remain higher 

than the long-term average. As 

a result of the robust economic 

performance, Malta’s GDP per 

capita is projected to reach 97% of 

the EU average in 2017. 

The favourable macroeconomic 

conditions have contributed to an 

improvement in public finances, 

although faster correction would 

reduce risks from the inherent 

vulnerabilities. 

The general government budget 

deficit has decreased in recent 

years thanks to strong revenue 

growth. However, current 

expenditure has been growing 

faster than potential growth, 

which could create problems in 

case of shocks to tax revenues. 

Primary budgetary surpluses and 

strong economic growth helped 

the general government debtto-GDP 

ratio to fall. However, 

moderation in economic growth 

would make further debt reduction 

more challenging. Sustainability 

challenges remain in view of the 

projected increase in age-related 

budgetary costs. 

36 

EC Country Report Malta 2016 

This country report assesses Malta’s economy in light of the Commission’s Annual Growth Survey published on 26 November 2015. The survey 

recommends three priorities for the EU’s economic and social policy in 2016: re-launching investment, pursuing structural reforms to modernise 

Member States’ economies, and responsible fiscal policies. 

3 

4 

5 

Growth has been job-rich and 

broad-based. 

Economic growth has been 

underpinned by the improved 

competitiveness of some 

traditional sectors as well as 

the emergence of new labourintensive, 

export-oriented 

activities. As a result, the amount 

of new jobs generated in the 

post-crisis period is significantly 

higher than during the boom until 

2008. This has been supported 

by policies targeted in particular 

towards attracting more women 

to the labour market. The process 

of diversification of the economy 

has reduced its capital and 

import intensity, contributing to 

a significant improvement in the 

external trade balance. 

Maintaining competitiveness 

to support the current growth 

momentum is a continuous 

challenge. 

The potential of human capital to 

contribute to economic growth 

remains to be fully tapped. 

Notwithstanding significant 

progress in recent years, labour 

market activity remains low, 

in particular among women. 

Education and training outcomes 

are still below targets, affecting 

the quality of labour supply. 

Furthermore, inefficiencies in 

network industries, the public 

administration and the judicial 

system hinder the business 

environment. 

Overall, some progress has 

been made in addressing 

the 2015 country-specific 

recommendations. 

The authorities have taken steps 

to improve the professional 

development of teachers. This is 

expected to contribute to raising 

basic skills levels and to reducing 

early-school leaving in the longrun, 

but it is too early to assess 

the results. A number of initiatives 

for access to finance have been 

offered to small and mediumsized 

enterprises, but access to 

non-bank instruments generally 

remains limited. 

1 

2 

3 

4 

Regarding the progress in reaching the national targets under the Europe 2020 Strategy, Malta has 

made good progress towards its targets on employment, reducing greenhouse gases, while more effort 

is needed on R&D expenditure, increasing renewable energy, improve energy efficiency, reduce early 

school leaving, increasing the tertiary education, and reducing poverty. 

The main findings of the analysis in this report, and the related policy challenges, are as follows: 

External sustainability has improved 

benefitting from the restructuring of 

the economy. The emergence of exportoriented 

services has boosted net external 

trade, resulting in a surplus in the current 

account balance. The net international 

investment position remains positive. Cost 

competiveness developments have also 

been favourable on the back of growing 

productivity and moderate wage growth. 

The public debt ratio is lower than the euro 

area average and it is approaching the 60 

%-of-GDP threshold, but the sustainability 

of public finances remains a challenge in the 

long run. The public debt ratio has been on 

a decreasing path since 2011 on the back of 

fiscal consolidation and high nominal GDP 

growth. There appear to be no significant 

risks in the short and medium term. Yet, 

long-term sustainability remains a challenge 

reflecting the budgetary impact of ageing 

costs, in particular pensions. The efforts by 

the authorities in containing the long-term 

expenditure growth in the pension and 

healthcare systems so far do not appear 

sufficient to address this risk. 

There is still untapped potential in the 

labour market to foster economic growth. 

With one of the lowest unemployment 

rates in Europe, the Maltese labour market 

continues to perform strongly. However, 

in spite of the gains over the past years, 

activity rates continue to be among the 

lowest in the EU, particularly among 

women. The supply of skills has not fully 

adjusted to labour market requirements. 

To offset this, reliance on supply of skills 

through foreign labour has increased in 

recent years. Education, perpetuating the 

low skills levels in the population. 

Access to alternative sources of finance for 

SMEs is still limited. SMEs rely heavily on 

debt financing, with implications for the firm 

indebtedness in the economy. The availability 

of alternative sources of finance such as 

crowdfunding, venture capital, business 

angels is not developed. Since the beginning 

of 2014, the government put forward 

policies geared to the provision of equity and 

venture capital, but these measures appear 

to be relatively limited, concentrating on tax 

credits and small amounts for seed funding. 

5 

6 

7 

Competitiveness could further benefit 

from the removal of structural bottlenecks 

in network industries and the public 

administration. The authorities aim to 

diversify the energy mix and bring an end 

to oil dependency in electricity generation. 

The reform, however, has yet to be finalised. 

Import dependency will remain a challenge 

in the absence of more focused efforts on 

boosting domestic production of renewable 

energy and raising energy efficiency. 

The transport system continues to be 

characterised by high economic costs caused 

by significant road traffic congestion. The 

authorities have yet to present their strategy 

to tackle the issue. The low efficiency of 

government administration and of the 

judicial system continues to pose challenges 

to Malta’s attractiveness to investors. 

Apart from one-off projects, investment 

has been muted reflecting structural 

changes in the economy and bottlenecks. 

Ongoing large-scale projects result in a 

significant boost to investment over the 

underlying trend. The increasing importance 

of less capital-intensive services sectors, 

however, lowers the investment needs of 

the economy going forward. Nevertheless, 

bottlenecks in the public administration, 

insufficient capacity to innovate and skills 

mismatches lower Malta’s attractiveness to 

foreign investors and hamper the ability of 

businesses to investment. 

Malta is still away from its 2020 povertyreduction 

target. The risk of poverty and 

social exclusion increased from 2008 to 

2013, most notably for children and the low 

skilled. Material deprivation has been on 

the rise and has contributed to the poverty 

and exclusion risks. New measures have 

been introduced in recent years to correct 

these trends. 


This document is a 

European Commission 

staff working document. 

It does not constitute the 

official position of the 

Commission, nor does 

it prejudge any such 

position. 

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Employer Branding 

Employer Branding 

The Growing Concept 

By Thomas Mahoney 

At this point, you as a reader may be asking yourself; what is it exactly that the writer means by 

the term ‘employer branding’? 

In order to help oneself visualize the 

theoretical concept, I always prefer to 

describe employer branding as marketing 

component within a human resources 

function with particular focus on attracting 

talent, investing in people’s talent and 

well-being, career progression and talent 

retention, as a generic overview. This 

branding concept has two dimensions 

to it; an internal brand whereby relating 

to one’s employer brand converts into 

loyalty and increased engagement, and 

an external brand aiming to attract talent. 

The two have to mirror each other, which 

also serves as transparency filter between 

what happens internally vis-à-vis what is 

being promised and preached about the 

organization on the outside. Portraying 

a false picture of an organization’s office 

life and core values to win talent over 

will prove to have a short success life and 

will only damage the brand, furthermore 

creating high staff turnover and a tarnished 

brand reputation. 

An employer brand may be well aware of 

the above mentioned core pillars, however 

an organization has to make sure that such 

pillars are active, effective and positively 

38 

contributing to the department strategy 

feeding into the overall organisational 

strategy, thus increasing the added value 

of the brand. 

I always prefer to describe 

employer branding as 

marketing component 

within a human resources 

function 

Over the past 12-18 months around 12 

fully fledged online gaming employer 

brands have emerged, with all brands 

investing heavily to attract talent towards 

them and towards the industry. The 

concept has now gained ground and I 

About the Author: 

believe we are in stage I like to describe as 

the first generation of employer branding, 

whereby most organizations are dedicating 

a standalone site towards their ‘Careers 

Brand’ coupled up with attractive social 

media presence pushing three main 

components through interactive content; 

Malta, The organisation’s success story and 

the office life and prospects. This is done 

so well, that in my opinion some of the 

best video’s promoting the Maltese islands 

have stemmed out through such brands. 

From an educational perspective employer 

brands dedicate a segment of their efforts 

in promoting and raising awareness of 

the industry and educating people on the 

career opportunities it offers. 

Investing in people is the most profitable 

investment any organization can do… MBR 

Thomas Mahoney is Director with EGIM and an Employer Branding 

Specialist 

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Feature Interview 

Feature Interview 


ISLAND 

The objectives of MACM are threefold: lobbying I support Juventus – the Old 

- LECTURES to ensure a AND healthy CONFERENCES 

credit environment in Malta; 

education - to promote good credit management 

In terms of education, MACM organises a number 

practices; and information - to provide a reliable and Ireland, Spain, Romania, Lithuania, Russia, Malaysia, 

of lectures, workshops, seminars, conferences and 

up-to-date credit management information system. Mexico and South Africa, to name but a few. “The inhouse 

training and workshops that I deliver in various 

inhouse training for the Maltese business community: match on TV and also try to 

TREASURE 

“These MACM events lobbies assist with the various local firms stakeholders to turn credit risks 

addressing a number of credit related matters, keep my promise and fly to 

into credit rewards by protecting their cash flow and countries give me the opportunity to learn about the 

including: securing their dishonoured long-term profit,” cheques Josef and explains. late payment; MACM various business cultures which in turn provides me 

the has EU also Late set Payment up its Training Commercial Centre in Malta, Transactions providing with 

them necessary 

play 

enthusiasm 

on their 

to 

home 

spread the 

turf 

word 

- 

Directive; part-time The lectures EU Consumer for Maltese Credit students Directive; reading and the of good credit management practices and entice 

the CICM obligation Credit Management of registered Diploma companies in Level to 3 file & Level annual 5. the Juve Stadium. 

everyone to deploy the proper business culture for a 

accounts. “MACM is It in also fact represents the Accredited its members’ Study Centre views in Malta on 

areas of The including Chartered VAT Institute refunds of and Credit business Management better credit environment across the globe.” 

cash flow, 

(CICM) an accreditation that we are proud to have,” and securing their long-term profit,” Josef explains. 

the Data Protection Act, and the Banking Act. 

he continues. “I strongly believe that the credit REGULAR MACM CONTRIBUTOR 

has also set up its Training Centre in Malta, 

practitioners should be trained and skilled in order providing part-time lectures for Maltese students 

LECTURES to develop enthusiasm AND CONFERENCES and impetus for the credit Josef reading also the regularly CICM Credit contributes Management to the international Diploma in 

JOSEF Busuttil was born into a humble Maltese is attending the same Jesuits’ secondary school that 

In function terms of within education, their respective MACM organises firms. “Skilled a number credit of business Level 3 press & Level with 5. business and credit management 

family. His father, now retired, was a civil 

lectures, workshops, seminars, conferences inhouse 

training for the Maltese business community: 

I used to attend.” After five years at the bank, Josef 

practitioners also help to build professionalism and the articles: “MACM “I have is in recently fact the launched Accredited The Study MACM Centre Credit 

JOSEF servant Busuttil and his was mother, born into a housewife. a humble Maltese He has 

necessary expertise to manage cash flow – the lifeblood 

moved “At the on to age a financial of 17, I was services somehow firm, ‘constrained’ 

specialising in 

Management in Malta of The Reference Chartered Book Institute which is of written Credit to assist 

“These of a business, events assist raise motivation the local firms and to job turn satisfaction credit 

two family. younger His brothers father, now and can retired, remember was a civil clearly his stockbroking start my career and insurance a major broking. Maltese During bank, his where nine I 

the Management busy people (CICM) employed an in accreditation the Credit Management 

that we are 

risks and create into credit dynamic rewards and by high protecting performance their working cash flow 

early servant years living and his at his mother, grandfather’s a housewife. He together has two 

proud to have,” he continues. “I strongly believe that 

years spent as five a years. financial I strongly advisor, believe he studied that everything marketing 

environments in the field of credit management. Function,” he adds. Besides credit management, Josef 

with younger three spinster brothers aunties: and can “They remember looked after clearly and his happens for a reason! I thank God for that move as 

“Thanks to our Membership of the Federation of has the two credit other practitioners passions: his should family be and trained football. and “My skilled 

and obtained a post-graduate diploma from the 

early years living at his grandfather’s house together 

in order to develop enthusiasm and impetus for the 

played with us as if we were their most loving soft I have met my loving wife, Charmaine, who was a 

European Credit Management Associations (FECMA), family means the world to me and I love them dearly,” 

Chartered Institute of Marketing. 

with three spinster aunties: “They looked after and trainee at the same bank at the time. Charmaine 

credit function within their respective firms. 

toys, in a narrow street in Zejtun in the southern part 

MACM has built a strong relationship with CICM and I he smiles. “Although my days are hectic and always full 

played with us as if we were their most loving soft is now a keen and enthusiastic bank manager. We 

often share ideas and discuss common issues, related “Skilled credit practitioners also help to build 

of Malta,” he remembers. Josef consider himself BANKRUPTCIES AND FAILURES 

of meetings and work-related activities, I look forward 

toys, in a narrow street in Zejtun in the southern part have two children, Sara who is twenty and is reading 

to credit and cash flow, with the CICM officials, FEATURE who professionalism and the necessary expertise to 

lucky to have been educated at St INTERVIEW Aloysius’ College, 

of Malta,” he remembers. 

a University Degree in Medicine and Surgery, and 

have been always very receptive and collaborative.” SPECIAL to spend time with my wife and children. They are my 

manage cash flow – the lifeblood of a business, raise 

a Maltese 

Josef consider 

Jesuits’ 

himself 

school, 

lucky 

having 

to 

a 

have 

clear 

been 

motto for Following a number of bankruptcies and defaults in 

backbone that supports me in all I do. They give me 

Jake who is twelve and is attending the same Jesuits’ 

motivation and job satisfaction and create dynamic 

educated its students at St ‘Man Aloysius’ for others’: College, “It a is Maltese a motto Jesuits’ which payments across the Maltese business environment, 

INFORMATION SHARING 

the 

secondary school that I used to attend.” 

and 

necessary 

high performance 

strength to 

working 

carry on and 

environments 

keep me going. 

in the 

school, has been having deeply a clear inscribed motto in for my its mind students till this ‘Man very the After local five business years at community the bank, Josef encouraged moved on Josef 

I 

to a 

field strongly of credit believe management. 

that success is built with the bricks 

ISLAND 

The objectives of MACM are threefold: lobbying 

When it comes to information I support sharing, Juventus MACM – the provides Old 

- to ensure a healthy credit environment in Malta; 

for day others’: and am “It still is a continuously motto which striving has been to deeply follow and to financial set up services MACM – firm, The specialising Malta Association in stockbroking of Credit 

an effective and efficient online credit management of failure “Thanks and to I owe our Membership my career success of the to Federation my family, 

education - to promote good credit management 

Lady, as they are often referred 

practices; and information - to provide a reliable and 

inscribed practice it in whenever my mind I till can. this Helping very day others and gives am you and insurance broking. During his nine years as a 

information system to to. its I Members. try to never MACM miss Members a Juventus 

Management 2001: “It was a challenge for 

as of they European have Credit always Management been the bricks Associations which I used 

up-to-date credit management information system. 

match TV and also try to 

still inner continuously peace, serenity, striving motivation to follow and high practice level of me financial to start advisor, this association he studied but marketing with the and help obtained and 

have access to a number of online integrated databases whenever (FECMA), I MACM failed.” has Josef’s built other a strong passion relationship is football: with 

TREASURE 

MACM lobbies with various stakeholders 

addressing a number of credit related matters, keep my promise and fly to 

it satisfaction, whenever I which can. Helping keeps you others going gives morally you inner strong a post-graduate diploma from the Chartered 

by which they can analyse the credit worthiness of their 

including: dishonoured cheques and late payment; 

CICM and I often share ideas and discuss common 

encouragement of the local businesses, I took this 

Turin once every year to watch “I support Juventus – the Old Lady, as they are often 

the EU Late Payment in Commercial 

peace, serenity, motivation and high level of 

Institute of Marketing. 

prospective Transactions customers, them whilst play monitoring their their home existing turf - issues, related credit and cash flow, with the CICM 

in life.” 

referred to. I try to never miss a Juventus match on TV 

opportunity with great responsibility, enthusiasm 

Directive; The EU Consumer Credit Directive; and 

customers on a daily basis. “The MACM online credit 

satisfaction, which keeps you going morally strong 

the obligation of registered companies to file annual the Juve Stadium. 

officials, who have been always very receptive and 

information management system helps businesses to 

and also try to keep my promise and fly to Turin once 

and keenness,” he explains. “Changing the business 

accounts. It also represents its members’ views on 

in RICH life.” ARCHITECTURE 

BANKRUPTCIES AND FAILURES 

collaborative.” 

Josef Busuttil, Director General of the Malta Association of Credit of 

areas including VAT refunds and business cash flow, 

take profitable credit decisions and securing their in a long-term proactive profit,” manner,” 

Josef explains. every year to watch them play on their home turf -‘the 

culture Following was a number indeed a of hard bankruptcies nut to crack! and defaults Working 


in 

MACM has also set up its Training Centre in Malta, 

Management, speaks to Sean Feast about his three passions: credit 

Josef explains. Thus, it assists them to: identify Juve Stadium’. My only desire is that Juventus will win 

providing part-time lectures for Maltese students 

RICH Being ARCHITECTURE 

Maltese, Josef has always management; been fascinated his family; directly payments and football. with across the the business Maltese business people and environment, always 

LECTURES AND CONFERENCES 

profitable prospective customers; minimise the risk INFORMATION SHARING 

reading the CICM Credit Management Diploma in 

In terms of education, MACM organises a number of 

the European Champions League in the very near 

Level 3 & Level 5. 

Being by the Maltese, rich architecture Josef has always of the been island’s fascinated buildings, wanting the local to business assist them community in their encouraged needs, Josef Josef read 

associated with credit sales; avoid bad debts; and be When it comes to information sharing, MACM 

lectures, workshops, seminars, conferences and inhouse 

training for the Maltese business community: 

“MACM is in fact the Accredited Study Centre future. Who knows? Maybe the final in May 2017 will 

by especially the rich the architecture old houses, of farmhouses the island’s buildings, and baroque OSEF Busuttil for to was set an born up MBA into MACM a humble at Henley Maltese – The Business Malta “At the Association age College, of 17, I was completing 

somehow of Credit ‘constrained’ 

consistent in credit decisions. in Malta of The “It Chartered also Institute helps of them Credit to: provides an effective and efficient online credit 

“These events assist the local firms to turn credit 

family. His father, now retired, was a civil 

to start my career in a major Maltese bank, where I 

Management (CICM) an accreditation that we are be Juventus against Leicester City!’’ So has Josef got 

especially the old houses, farmhouses and baroque Management in 2001: “It was a challenge for me 

risks into credit rewards management information system to its Members. 

churches in the local villages and towns as well as 

manage by protecting their dissertation on credit management in Malta: 

credit cash flow management processes effectively; 

servant and his mother, a housewife. He has two spent five years. I strongly believe that everything 

proud to have,” he continues. “I strongly believe that 

J 

churches in the local villages and towns as well as to start this association but with the help and 

monitor customers on a daily basis; enhance customer any MACM advice Members for youngsters have access just starting to a number out on of their 

younger brothers and can remember clearly his happens for a reason! I thank God for that move as 

the credit practitioners should be trained and skilled 

online 

the architectural beauty of the capital city, Valletta, early years living “Credit at his grandfather’s has truly house become together I have my met passion my loving and wife, Charmaine, in my role who was a 

in order to develop enthusiasm and impetus for the 

the architectural beauty of the capital city, Valletta, encouragement of the local businesses, I took this 

relationship; wincrease careers? integrated “Make databases sure that by you which study they the can subjects analyse you the 

with three spinster aunties: “They looked after and trainee at the same bank at the time. Charmaine 

credit function within their respective firms. 

built and fortified by the knights of St John in the 

played with us as of if we Director were their most General loving soft at MACM, is now a keen I have and enthusiastic always bank strived manager. We 

built and fortified by the knights of St John in the opportunity with great responsibility, enthusiasm 

effectiveness “Skilled credit practitioners in the also collection help to build of like credit most worthiness and that of you their feel prospective comfortable customers, with,” he 

toys, in a narrow street in Zejtun in the southern part have two children, Sara who is twenty and is reading 

professionalism and the necessary expertise to 

sixteenth century: “This environmental splendour 

dues; gain and maintain sound 

sixteenth century: “This environmental splendour to and promote keenness,” the he credit explains. profession “Changing and good the business credit 

of Malta,” he remembers. 

a University Degree Medicine and Surgery, and 

manage cash flow – the lifeblood of a business, raise advises. whilst monitoring “Set realistic their goals existing and targets customers for yourselves on a daily 

that 

that 

surrounds 

surrounds 

us 

us 

Maltese, 

Maltese, 

enticed 

enticed 

me 

me 

to study 

to study Josef consider himself lucky to have been 

Jake who is twelve and is attending the same Jesuits’ 

motivation 

management 

cash flow; and job satisfaction and ultimately and create dynamic to 

culture was indeed practices a hard whenever nut to crack! and wherever 

and basis. seek assistance from those who can help you. Life 

educated at St Aloysius’ College, a Maltese Jesuits’ secondary school that I used to attend.” 

and high performance working environments in the 

Mathematics and and Physics Physics for for my my ‘A’ ‘A’ level level in in order order 

sustain long-term profit.” As 

school, having a clear 

to I am,” 

motto 

Working he 

for its 

records. 

students ‘Man 

directly The with Malta 

After five 

the business Association 

years the bank, 

people of 

Josef 

Credit 

moved on to a 

field of credit management. 

“The MACM online credit information 

the Director General of MACM, 

is indeed a roller coaster – sometimes you may feel 

for others’: “It is a motto which has been deeply financial services firm, specialising in stockbroking 

“Thanks our Membership of the Federation 

pursue to pursue a degree a degree in architecture, in architecture, a dream a dream which which inscribed was in my mind Management and till always this very day wanting and (MACM) am to assist and a insurance members-owned, them broking. their During needs, his nine notfor-profit 

Helping others organisation, gives you inner providing a post-graduate a diploma central from the national Chartered 

CICM and I often share ideas and discuss common But never give up, when you feel that you failed, get 

years as a 

of European Credit Management Associations 

Josef is responsible for ensuring at management the top and some system other helps times businesses at the very to take bottom. 

still continuously striving to follow and practice financial advisor, he studied marketing and obtained 

(FECMA), MACM has built a strong relationship with 

never was never realised realised due due to various to various difficult difficult challenges at Josef read for MBA at Henley Business College, 

that members receive the profitable credit decisions in a proactive manner,” 

it whenever I can. 

the at the time. time. “At the age of 17, I was somehow 

peace, serenity, motivation completing and high level his of dissertation Institute on of Marketing. 

issues, related to credit and cash flow, with the CICM 

credit management 

most professional and reliable Josef explains. Thus, it assists them to: identify 

organisation for the promotion and protection of all 

up, put yourself together again and keep going. “A 

satisfaction, which keeps you going morally strong 

officials, who have been always very receptive and 

‘constrained’ to start my career in a major Maltese in life.” in Malta: “Credit has truly BANKRUPTCIES become AND my FAILURES passion and 

collaborative.” credit management services profitable prospective customers; minimise the risk 

credit interests pertaining to Maltese businesses. 

career path may surely change but make sure that 

Following a number of bankruptcies and defaults in 

bank, where I spent five years. I strongly believe in my role of Director General at MACM, I have 

in order to help them protect associated with credit sales; avoid bad debts; and be 

RICH ARCHITECTURE 

payments across the Maltese business environment, 

INFORMATION SHARING 

The always objectives strived to of promote MACM the are credit threefold: profession lobbying 

you fall in love with your job or your career. If you 

Being Maltese, Josef has always been fascinated the local business community encouraged and Josef 

When their it comes cash to information flow to sharing, the MACM benefit consistent in credit decisions. 

that everything happens for a reason! I 

by 

thank 

the rich architecture of the island’s buildings, to set up MACM – The Malta Association of Credit 

provides an effective and efficient online credit 

- good to ensure credit a management healthy credit practices environment whenever in Malta; and 

of the Maltese commerce and lack motivation to go to work, you may either have a 

management information system to its Members. “It also helps them to: manage the credit 

especially the old houses, farmhouses and baroque Management in 2001: “It was a challenge for me 

God for that move as I have met my loving wife, 

MACM 

education 

economy Members at have large. access to a “I number lecture, of online problem 

wherever I - am,” to promote he records. good credit management 

management 

at work 

processes 

which you 

effectively; 

need to settle 

monitor 

promptly 

churches in the local villages and towns as well as to start this association but with the help and 

integrated databases by which they can analyse the 

Charmaine, who was a trainee at the same bank the architectural at beauty of the capital city, Valletta, encouragement of the local businesses, I took this 

coach and deliver workshops for or 

practices; The Malta and Association information of - Credit to provide Management a reliable 

customers you may on need a daily to change basis; enhance your job customer completely. 

built and fortified by the knights of St John the opportunity with great responsibility, enthusiasm 

credit worthiness of their prospective customers, 

the time. Charmaine is now a keen and enthusiastic sixteenth century: “This environmental splendour and keenness,” he explains. “Changing the business 

whilst various monitoring reputable their existing customers institutions 

a daily Whatever 

(MACM) is a members-owned, not-for-profit 

relationship; it may increase be, don’t effectiveness hesitate – life in the is too collection short 

that surrounds us 

bank manager. We have two children, Sara who 

and Maltese, up-to-date enticed me study credit culture management was indeed a hard information 

nut to crack! 

basis. 

and business training centres 

Mathematics and Physics for my ‘A’ level in order to Working directly with the business people 

“The MACM online credit information 

organisation, providing a central national 

to 

around the World,” he says. 

of be dues; unhappy! gain and “If you maintain truly do sound what cash you flow; love and doing, 

pursue a degree 

is twenty and is reading a University Degree in 

system. in architecture, MACM a dream which lobbies was and with always various wanting to assist stakeholders 

them in their needs, 

management system helps businesses to take 

never realised due organisation to various difficult challenges for the at promotion and protection of all 

profitable credit decisions in a proactive manner,” 

“I train and coach people you ultimately will only to be sustain pursuing long-term your hobby.” profit.” MBR 

Josef read for MBA Henley Business College, 

the time. 

Medicine and Surgery, and Jake who is twelve and addressing a number of completing credit his dissertation related on matters, 

credit management 

Josef explains. Thus, it assists them to: identify 

credit interests pertaining 

in Malta: 

to 

“Credit 

Maltese 

has truly 

businesses. 

become my passion and 

profitable working prospective in the customers; field minimise of credit the risk 

“A career path may surely change including: but dishonoured make sure cheques in my role of Director and late General payment; 

at MACM, I have 

associated 

management 

with credit sales; 

and 

avoid 

I am 

bad debts; 

always 

and be Josef Busuttil Director General MACM (Malta 

always strived to promote the credit profession and 

consistent in credit decisions. 

that you fall in love with your continues on page 38 

the job EU or Late your Payment career. in Commercial Transactions 

looking “It also helps forward them to: manage and the credit eager Association of Credit of Management) 

good credit management practices whenever and 

If you lack motivation to go to work, you may wherever I am,” he records. 

management 

Directive; The EU Consumer Credit Directive; and 

to share 

processes 

my 

effectively; 

knowledge 

monitor 

and jbusuttil@macm.org.mt 

either have a problem at work which you need The Malta Association of Credit Management 

customers on a daily basis; enhance customer 

(MACM) is a members-owned, not-for-profit 

relationship; expertise increase in this effectiveness function in the collection that 

September 2016 www.cicm.com to settle promptly or you the may obligation need to change of registered companies 

The recognised 

to file annual 

organisation, providing a central national standard 

The recognised standard 

of 

I 

dues; 

am 

gain 

truly 

and maintain 

passionate 

sound cash flow; 

about.” 

and 

your job completely. Whatever ultimately to sustain long-term profit.” 

accounts. it may It be, also don’t represents organisation its members’ for the promotion views and protection on of all 

hesitate – life is too short to be unhappy’’ credit interests pertaining to Maltese businesses. 

Outside of Malta, Josef has Sean Feast is the Editor of ‘Credit Management’, the Magazine 

of the CICM (UK). 

areas including VAT refunds and business cash flow, 

also lectured and trained credit 

continues on page 38 


managers in Belgium, France, credit:www.macm.org.mt 

36 September 2016 www.cicm.com 



www.cicm.com September 2016 37 

Josef Busuttil, Director Director General of General the Malta Association of the Malta of Credit Association of Management, of speaks Credit to Sean of Feast 

Management, about his three passions: speaks credit to management; Sean Feast his family; about and his football. three passions: credit 

management; his family; and football. 

“A career path may surely change but make sure 

that you fall in love with your job or your career. 

If you lack motivation to go to work, you may 

either have a problem at work which you need 

to settle promptly or you may need to change 

your job completely. Whatever it may be, don’t 

hesitate – life is too short to be unhappy’’ 

Lady, as they are often referred 

to. I try to never miss a Juventus 

Turin once every year to watch 

“A career path may surely change but make sure that you fall in love with 

36 

your job or your career. If you lack motivation to go to work, you may 

either have a problem at work which you need to settle promptly or you 

www.cicm.com September 2016 37 

may need to change your job completely. Whatever it may be, don’t hesitate 

– life is too short to be unhappy’’ 

40 41 



tourism 

world of fine wine 


the improvement of the overall tourism 

product and more effective promotion and 

marketing of our offer”. 

The Minister for Tourism pointed out 

that developments which are dominating 

the Tourism agenda within Europe and 

beyond include the sharing economy, 

digitalisation, connectivity, seasonality, 

sustainability and investment in human 

capital. 

All these developments and challenges will 

feature in a high-level Tourism conference 

to be held during Malta’s presidency next 

year. This event will bring together an 

extensive cross-section of stakeholders 

and will serve as a platform for discussion 

about the future of European tourism. 

This conference will mainly target the 

structure of how Europe can, and must, 

adapt to evolving tourism trends in order 

to maintain and improve its competitive 

edge. 

In concluding his intervention, the Minister 

for Tourism stated that the ultimate 

objectives can only become possible by 

immediately embarking on two points of 

action: 1) As European destinations we 

must not regard each other as competitors 

but we should collaborate together to 

achieve an even larger market share of 

international tourism and 2) It is of utmost 

importance that we create enabling 

mechanisms for the tourism sector in 

Europe to adapt to the evolving business 

environment, especially by creating 

targeted funding opportunities, in the 

current and future funding programmes, 

which are clearly directed to the tourism 

sector. MBR 

PHOTO: DOI - Jeremy Wonnacott 

HOTREC 73 

General Assembly 

As European destinations we must not regard each other as competitors but 

we should collaborate together to achieve an even larger market share of 

international tourism 

Addressing the Hotrec 73rd General 

Assembly on ‘The priorities of the Maltese 

Presidency of the EU’, Minister for 

Tourism Edward Zammit Lewis said that 

at a time when various EU member states 

are struggling on the tricky path to full 

economic recovery, tourism has remained 

a major and resilient contributor to the 

overall European economy, as it generates 

billions of euros, while guaranteeing the 

survival and creation of thousands of 

SMEs. 

Minister Zammit Lewis said that as tourism 

gathers further economic pace and 

relevance, policy-makers are also realising 

the importance of listening, and working 

hand-in-hand, not only with those who 

invest, but also with those who, on a daily 

basis work, work within this sector. This 

perspective will lead to more opportunities 

for investment and employment across 

Europe as a whole. 

The Minister for Tourism noted that during 

the recent European Tourism Forum 

organised by the Slovak EU Presidency two 

weeks ago, different methods with which 

the Tourism sector within Europe could be 

made more sustainable were discussed. 

This process will also serve to face the 

various challenges emerging from three 

distinct factors affecting our industry: 

first, the collaborative economy; second, 

taxation and competitiveness and, thirdly, 

the issue of digitisation. 

Regarding the Council of the Presidency 

of the European Union to be held in Malta 

next year, the Minister for Tourism Zammit 

Lewis highlighted that this will probably be 

the biggest administrative and diplomatic 

challenge for us as a nation since Malta’s 

accession to the Union. 

“In view of what Europe has been going 

through in recent times, together with 

the other members of our Trio, the focus 

is on what unites us. In order to achieve 

this aim, we need to emphatically put the 

citizen at the heart of our discussion”, said 

the Minister. 

“This scarcity in the citizens’ faith in the 

EU, often the result of a lack of effective 

and timely action by European institutions 

– as the case of the financial and migration 

crisis - has to become a focal point of 

Malta’s Presidency.” 

“As an EU state where tourism is clearly 

our bread and butter, we will ensure that 

Tourism features within the agenda of the 

Maltese Presidency and, in this regard, 

our priorities are fully in synch with those 

of the European Commission. We will be 

looking at ways to strengthen European 

tourism by encouraging discussions for 

common action plans on how to maintain 

and boost the EU’s market share, through 

PHOTO: DOI - Jeremy Wonnacott 

Organic grapes for 

excellent wine 

by JP Abela 

MBR talks with Mark Cassar about how he has rooted, watered and pruned his 

hobby until it turned into a rare pursuit. At a time when we are all more focused 

on how the food we eat is farmed and produced, Mark’s focus on sustainable 

winemaking practices - Methode Qvervi - and organic grape farming seems 

poised to take the wine world by storm. 

MBR: Tell me how you became involved 

with the vineyards… 

MC: Fourteen years ago I started planting, 

growing and harvesting organic grapes in 

my fields very close to the Salib tal-Gholja in 

Siggiewi. My love for wine is what sparked 

off my initial interest, and very quickly, 

what started out as a hobby became a 

professional endeavour thus dedicating all 

my time and money to this project. 

MBR: Mark’s specialty is offering this highquality 

organic wine at affordable prices. 

Do you think that farming in organic ways 

offers something special to the wines? 

MC: Knowing where your food comes 

from is important. Wine is no different. 

The wine is made from grapes that have 

been grown without the use of artificial or 

synthetic chemicals, such as herbicides and 

pesticides. To keep the weeds and bugs at 

bay, organic wine makers work with nature, 

rather than against it, by boosting their 

vineyard’s biodiversity. 

MBR: Do you have a particular consumer 

in mind when crafting this wine? 

MC: My wine has a pretty diverse audience. 

The gluten free wine is suitable for vegans 

and vegetarians and has a low sulphide 

level. There may be people who just like the 

wines for their style-vibrant wines that are 

balanced. Others are drawn to the fact that 

all my vineyard and winery are organic. 

MBR: What is Methode Qvervi ? 

MC: Qvevri wine-making takes its 

name from the distinctive egg-shaped 

earthenware vessel - the Qvevri - in which 

wine is fermented and stored in villages and 

towns throughout Georgia. 

Mark uses Qvevri because it allows the 

winemaker to express the terroir and the 

grape perfectly. This is a vessel that lets the 

winemaker create wine holistically. 

The vessel is buried in the ground, which 

guarantees an optimal temperature for 

the ageing and storage of wine and its egglike 

shape favours the processes inside. 

The inside is sealed with hot beeswax and 

the lid of the Qvevri, after fermentation 

is complete, is sealed with wet clay coiled 

around the top with a heavy stone placed 

over it. The Qvevri's torpedo shape allows 

sediment to collect at the pointed bottom 

of the vessel, while the wine naturally 

moves around the middle. 

My love for wine is what 

sparked off my initial interest 

MBR: The Mar Casar wine - what would 

you suggest people pair it with? 

MC: I would pair the Chardonnay with cold 

cuts, goat cheese, spicy food, creamy pasta 

and white meat. Red meat, meat and gravy 

and strong cheeses are a great match for 

our Merlot wines”. The Merlot is a powerful 

wine that will improve and gain complexity 

with ageing. MBR 

All Rights Reserved / Copyright 2016 

42 43 



DSM Report 

DSM Report 


A Digital Single Market for Europe: 

Commission sets out 16 initiatives to make it happen 

The Internet and digital technologies are transforming 

our world – in every walk of life and in every line of 

business. Europe must embrace the digital revolution 

and open up digital opportunities for people and 

businesses. How? By using the power of the EU’s 

Single Market. Today, the European Commission 

unveiled its detailed plans to create a Digital Single 

Market, thereby delivering on one of its top priorities. 

At present, barriers online mean citizens miss 

out on goods and services: only 15% shop online 

from another EU country; Internet companies and 

start-ups cannot take full advantage of growth 

opportunities online: only 7% of SMEs sell crossborder 

(see Factsheet for more figures). Finally, 

businesses and governments are not fully benefitting 

from digital tools. The aim of the Digital Single Market 

is to tear down regulatory walls and finally move from 

28 national markets to a single one. A fully functional 

Digital Single Market could contribute €415 billion 

per year to our economy and create hundreds of 

thousands of new jobs. 

The Digital Single Market Strategy adopted today 

includes a set of targeted actions to be delivered by 

the end of next year (see Annex). It is built on three 

pillars: (1) better access for consumers and businesses 

to digital goods and services across Europe; (2) 

creating the right conditions and a level playing 

field for digital networks and innovative services to 

flourish; (3) maximising the growth potential of the 

digital economy. 

Commission President Jean-Claude Juncker said: 

“Today, we lay the groundwork for Europe’s digital 

future. I want to see pan-continental telecoms 

networks, digital services that cross borders and a 

wave of innovative European start-ups. I want to see 

every consumer getting the best deals and every 

business accessing the widest market – wherever they 

are in Europe. Exactly a year ago, I promised to make 

a fully Digital Single Market one of my top priorities. 

Today, we are making good on that promise. The 16 

steps of our Digital Single Market Strategy will help 

make the Single Market fit for a digital age.” 

Vice-President for the Digital Single Market Andrus 

Ansip commented: “Our Strategy is an ambitious 

and necessary programme of initiatives that target 

areas where the EU can make a real difference. 

They prepare Europe to reap the benefits of a digital 

future. They will give people and companies the 

online freedoms to profit fully from Europe’s huge 

internal market. The initiatives are inter-linked and 

reinforce each other. They must be delivered quickly 

to better help to create jobs and growth. The Strategy 

is our starting point, not the finishing line.” 

Commissioner for the Digital Economy and Society 

Günther H. Oettinger said: “Our economies and 

societies are going digital. Future prosperity will 

depend largely on how well we master this transition. 

Europe has strengths to build on, but also homework 

to do, in particular to make sure its industries adapt, 

and its citizens make full use of the potential of new 

digital services and goods. We have to prepare for a 

modern society and will table proposals balancing the 

interests of consumers and industry.” 

The Digital Single Market Strategy sets out 16 key 

actions under 3 pillars which the Commission will 

deliver by the end of 2016: 

Pillar I: Better access for consumers and 

businesses to digital goods and services 

across Europe 

The Commission will propose: 

1. rules to make cross-border e-commerce 

easier. This includes harmonised EU rules on 

contracts and consumer protection when 

you buy online: whether it is physical goods 

like shoes or furniture; or digital content like 

e-books or apps. Consumers are set to benefit 

from a wider range of rights and offers, while 

businesses will more easily sell to other EU 

countries. (see Factsheet for facts & figures). 

2. to enforce consumer rules more rapidly and 

consistently,by reviewing the Regulation on 

Consumer Protection Cooperation. 

3. more efficient and affordable parcel delivery. 

Currently 62% of companies trying to sell 

online say that too-high parcel delivery 

costs are a barrier (see the newly released 

Eurobarometer on e-commerce). 

4. to end unjustified geo-blocking – a 

discriminatory practice used for commercial 

reasons, when online sellers either deny 

consumers access to a website based on 

their location, or re-route them to a local 

store with different prices. 

5. to identify potential competition concerns 

affecting European e-commerce markets. 

The Commission therefore launched today 

an antitrust competition inquiry into the 

e-commerce sector in the European Union 

(press release). 

6. a modern, more European copyright law: 

legislative proposals will follow before the 

end of 2015 to reduce the differences 

between national copyright regimes and 

allow for wider online access to works 

across the EU, including through further 

harmonisation measures. The aim is to 

improve people’s access to cultural content 

online – thereby nurturing cultural diversity – 

while opening new opportunities for creators 

and the content industry. In particular, the 

Commission wants to ensure that users who 

buy films, music or articles at home can also 

enjoy them while travelling across Europe. 

The Commission will also look at the role of 

online intermediaries in relation to copyrightprotected 

work. It will step up enforcement 

against commercial-scale infringements of 

intellectual property rights. 

7. a review of the Satellite and Cable Directive 

to assess if its scope needs to be enlarged 

to broadcasters’ online transmissions and to 

explore how to boost cross-border access to 

broadcasters’ services in Europe. 

8. to reduce the administrative burden 

businesses face from different VAT regimes: 

so that sellers of physical goods to other 

countries also benefit from single electronic 

registration and payment; and with a 

common VAT threshold to help smaller startups 

selling online. 

Pillar II: Creating the right conditions and 

a level playing field for digital networks 

and innovative services to flourish 

The Commission will: 

1. present an ambitious overhaul of EU telecoms 

rules. This includes more effective spectrum 

coordination, and common EU-wide criteria 

for spectrum assignment at national level; 

creating incentives for investment in highspeed 

broadband; ensuring a level playing 

field for all market players, 

2. review the audiovisual media framework 

to make it fit for the 21st century, focusing 

on the roles of the different market players 

in the promotion of European works (TV 

broadcasters, on-demand audiovisual service 

providers, etc.). It will as well look at how to 

adapt existing rules (the Audiovisual Media 

Services Directive) to new business models for 

content distribution. 

3. comprehensively analyse the role of online 

platforms (search engines, social media, app 

stores, etc.) in the market. This will cover 

issues such as the non-transparency of search 

results and of pricing policies, how they use 

the information they acquire, relationships 

between platforms and suppliers and the 

promotion of their own services to the 

disadvantage of competitors – to the extent 

these are not already covered by competition 

law. It will also look into how to best tackle 

illegal content on the Internet. 

4. reinforce trust and security in digital services, 

notably concerning the handling of personal 

data. Building on the new EU data protection 

rules, due to be adopted by the end of 2015, 

the Commission will review the e-Privacy 

Directive. 

5. propose a partnership with the industry on 

cybersecurity in the area of technologies and 

solutions for online network security. 

Pillar III: Maximising the growth 

potential of the digital economy 

The Commission will: 

1. propose a ‘European free flow of data initiative’ 

topromote the free movement of data in the 

European Union. Sometimes new services 

are hampered by restrictions on where data is 

located or on data access – restrictions which 

often do not have anything to do with protecting 

personal data. This new initiative will tackle those 

restrictions and so encourage innovation. The 

Commission will also launch a European Cloud 

Next steps 

The Digital Single Market project team will deliver 

on these different actions by the end of 2016. 

With the backing of the European Parliament and 

the Council, the Digital Single Market should be 

completed as soon as possible. The Digital Single 

Market was on the agenda of the European Council 

meeting on 25-26 June 2016 and the following 

subjects were on the agenda for regulatory 

framework auctioning: 

Commission presents strategy on Digital Single Market and Open Science #DigitiseEU 

Annex I : Roadmap of initiatives 

initiative covering certification of cloud services, 

the switching of cloud service providers and a 

“research cloud”. 

2. define priorities for standards and interoperability 

in areas critical to the Digital Single Market, such 

as e-health, transport planning or energy (smart 

metering). 

3. support an inclusive digital society where citizens 

have the right skills to seize the opportunities of 

the Internet and boost their chances of getting 

a job. A new e-government action plan will also 

connect business registers across Europe, ensure 

• Overhaul of the telecom rules 

• A review of the audiovisual media framework 

• An analysis of the role of online platforms 

• Reinforcing trust and security in digital services 

and in the handling of personal data 

• A partnership with industry on cybersecurity 

• Rules to make cross-border e-commerce easier 

• Enforcing consumers rules 

• More efficient and affordable parcel delivery 

• Ending unjustified geo-blocking 

different national systems can work with each 

other, and ensure businesses and citizens only 

have to communicate their data once to public 

administrations, that means governments no 

longer making multiple requests for the same 

information when they can use the information 

they already have. This “only once” initiative 

will cut red tape and potentially save around 

€5 billion per year by 2017. The roll-out of 

e-procurement and interoperable e-signatures 

will be accelerated. 

• Launching an antitrust competition inquiry into 

e-commerce 

• A modern, more European copyright framework 

• A review of the Satellite and Cable Directive 

• Reducing VAT burdens 

• Propose a European free flow of data 

initiative 

• Define priorities for standards and 

interoperability 

• Support an inclusive digital society MBR 

Creditline: European Commission Representation in 

Malta; ec.europa.eu 


The internet and digital technologies are 

transforming our world. But existing barriers online 

mean citizens miss out on goods and services, 

internet companies and start-ups have their 

horizons limited, and businesses and governments 

cannot fully benefit from digital tools. It’s time to 

make the EU’s single market fit for the digital age 

– tearing down regulatory walls and moving from 

28 national markets to a single one. This could 

contribute €415 billion per year to our economy 

and create hundreds of thousands of new jobs. 

The Digital Single Market aims to create the right 

environment and conditions for digital networks 

and services to flourish by providing high-speed, 

secure and trustworthy infrastructures and services 

supported by the right regulatory conditions. 

44 45 



macro - economic analysis 

MALTA 

State of Play – Winter 2016 

MACROECONOMIC SITUATION 

No imbalances (no in-depth review). 

• Strong GDP growth and labour market dynamics 

• Unemployment is low but so too are activity rates 

• Bottlenecks in network industries; reform needs in 

public administration weigh on competitiveness 

DiNe at the LaguNa WaLk 

Dine I Relax I Events 

PROGRESS ON COUNTRY-SPECIFIC RECOMMENDATIONS 

• Some progress in addressing weaknesses in the 

education system 

• Some progress in improving SMEs’ access to 

financing 

• Limited progress on pension system reform 

Laguna Walk offers a selection of indoor and outdoor dining experiences 

with food and beverage outlets offering a variety of cuisines to tempt every 

palate. Following a delectable meal, visitors can also enjoy spectacularly 

choreographed fountains as they take a stroll on the beautiful promenade or sit 

on the grand steps and scenic terraced rooftops overlooking the lagoon. 

fiscal situation 

123 

• No excessive deficit 

• Structural balance not at the medium-term budgetary 

objective 

• Public debt decreasing towards the 60% of GDP 

reference value 

• Draft Budgetary Plan 2016 assessed as broadly 

compliant with the rules of the Stability and Growth Pact2 

More info at 

http://ec.europa.eu/economy_finance/eu/ 

Dine at one of our various restaurants: 

LAGUNA 

R E S T A U R A N T 

1: The overall assessment of the country-specific recommendations related to fiscal policy does not look at compliance with the 

Stability and Growth Pact. This will be assessed once final data for 2015 are available and Stability and Convergence Programmes 

have been submitted. 

2: The Commission issued its Opinion on the Draft Budgetary Plan on 16 November 2015. 

46


Economic Rundown 

JET 


Economy of Malta: strong points and development of 

Maltese business and trade 

Minister for Finance launches Joint Enforcement 

Task Force to combat black economy 

Minister for Finance Edward Scicluna 

announced the formation of a Joint 

Enforcement Task Force (JET) which 

will bolster the government’s efforts at 

combating the black economy. 

Speaking during a press conference, 

Minister Scicluna explained that through 

JET, the government will channel the 

resources and technical knowhow of the 

Income Tax Department, VAT Department 

and Tax Compliant Unit to various degrees 

in order to prevent, detect, investigate, 

and prosecute offences related to unfair 

business competition and the avoidance 

and evasion of Income Tax, VAT, National 

Insurance and Excise Tax in order to 

uphold the country’s licensing, regulatory 

and tax laws. 

“JET will in no way replace any of 

these entities and departments,” 

said Minister Scicluna, “it will serve 

as a centre of intelligence and a 

central coordination unit supporting 

increased cooperation between these 

departments and entities, as well as 

facilitating the sharing of information 

between them.” He also confirmed that 

JET will be enabled to spearhead its own 

risk assessments and investigations. 

PHOTO: DOI - KEVIN ABELA 

JET will be recruiting a core team of 

multidisciplinary professionals in the field 

of gathering of intelligence, risk analysis, 

inspections and investigations. The core 

team will be supported by staff from the 

various entities and departments who will 

be retrained for this purpose. MBR 

Sources: DOI/Ministry of Finance 

Malta has limited resources 

but a thriving economy 

Malta’s Economy after the 

Second World War 

Malta’s Economy in the 

aftermath of EU membership 

Malta does not have any natural resources 

and experiences a limited fresh water 

supply; and it only produces around 

20% of the food requirements. Thus, the 

economy is dependent on the human 

resources and foreign trade. Malta’s 

economy is practically driven by financial 

services, tourism, real estate, Igaming 

and manufacturing, particularly of 

electronics. Other significant sectors are 

pharmaceuticals, information technology, 

and call centres. 

The Development of Malta’s 

Economy 

Before the 1800, most Maltese were 

farmers or fishermen, even if there was 

considerable commerce. At the time 

there were very few industries apart 

from cotton, tobacco and shipyards. 

During wars, Malta’s economy flourished 

because of its strategic location in the 

Mediterranean. With the opening of 

the Suez Canal in 1869, Malta saw a 

substantial rise in the number of ships 

entering the port, as the Mediterranean 

became the main trade road. 

By the end of the Second World War, Malta 

lost its strategic importance and the 

British had to wonder about alternative 

ways of income. When Malta got its 

independence in 1964, economic activity 

was minimal, but huge government efforts 

to start up the manufacturing and tourism 

industry yielded good results. Aided 

by agreeable international economic 

conditions and policies that supported 

foreign investment, the Maltese economy 

sustained fast growth right to the end of 

the 20th century. 

The Economy in Malta today 

Malta managed to maintain a relatively 

low unemployment rate, mainly 

because of the constant growth and 

by policies encouraging continuous 

training for the labour force. Globally, 

Malta ranks sixth in inward Foreign 

Direct Investment and amongst the top 

twenty among countries most likely 

to sustain economic growth over the 

medium and long term. 

Malta joined the European Union in 

2004 and the Eurozone in 2008. When 

comparing the per capita GDP in the EU, 

the country falls just above the middle 

with respect to wealth. The Maltese 

Government has pursued a policy 

of gradual economic liberalization 

and privatisation, taking some steps 

to shift the emphasis in trade and 

financial policies from reliance on direct 

government intervention and control 

to policy regimes that allow a greater 

role for market mechanisms. While 

change has been very substantial by 

international standards, the economy 

remains fairly regulated and continues 

to be hampered by some longstanding 

structural weaknesses. MBR 

Source: TMIS; malta.com; 

Web: www.daikin.com.mt Email: info@maa.com.mt Tel: 2385 0400 

48 49 



eCommerce 

Setting up your 

e-commerce 

venture in Malta 

By Rachel Saliba & Rachel Vella Baldacchino 

Throughout the past fifteen years or 

so, the small island state of Malta has 

witnessed tremendous economic growth, 

becoming one of the world’s fastest 

growing business hubs in sectors such as 

ICTs, iGaming, and financial technologies 

(‘fintechs’). This boom can be attributed 

to Malta’s high-quality and robust IT 

infrastructure, its favourable tax regime, 

and its safe and secure banking system. 

A digital business 

established in Malta must 

apply the VAT rates or 

exemptions applicable 

in the Member State of 

consumption 

Malta’s status as an attractive base 

for multinational e-commerce and 

knowledge-based technology ventures 

is underpinned by its secure yet flexible 

legislative and regulatory frameworks for 

business. Perhaps the most innovatively 

regulated sector under Maltese law is the 

remote gaming industry, pioneered by 

Malta in 2004 as a new EU Member State. 

The iGaming sector and supporting ICT 

businesses have thrived due to laws that 

safeguard the multi-faceted interests of 

both operators and players, interposed 

with the presence of a highly-skilled 

and cost-effective English-speaking 

labour market. 

Yet, no business set-up decision would 

be complete without a thorough 

understanding of how the corporate 

fiscal base will impact business finances. 

Malta’s international tax system boasts of 

a strong double tax treaty network, among 

other features that permit efficient tax 

planning for corporations. The operation 

of a full imputation tax system means that 

corporate dividend distributions on which 

tax has been paid will not be subject to 

further tax by shareholders, who may be 

eligible for tax refunds on the Malta tax 

paid by the distributing company. Several 

business incentives are spearheaded 

by Malta Enterprise, the country’s 

economic development agency tasked 

with attracting high quality foreign direct 

investment to Malta. These incentives are 

aimed at young technology enterprises 

and encourage undertakings to invest in 

innovation by providing benefits such as 

tax credits. 

Another important component to take 

into consideration is VAT. As of 1 January 

2015, new EU rules apply to the businessto-customer 

and business-to-business 

supply of electronically supplied services. 

In either case, the applicable VAT rules are 

those of the place where the customer is 

established, has his permanent address, 

or usually resides. The place of supply 

of electronically supplied services (such 

as downloadable software, supply of 

books, journals or games disseminated 

electronically on tangible media, purchase 

of goods over the internet) has thus 

shifted to the country of consumption, 

and is regulated by the VAT rules of the 

member state of consumption. A digital 

business established in Malta must apply 

the VAT rates or exemptions applicable 

in the Member State of consumption. 

No VAT is charged on sales to consumers 

or businesses resident outside of the EU. 

Without doubt this has increased the 

e-commerce business administration. 

A growing number of well-known 

technology market players have in 

recent years located their tax domicile or 

operations to Malta. The forward-looking 

market is also eagerly anticipating a 

reformative overhaul to Malta’s remote 

gaming regime, which will enhance 

and modernise technology neutrality 

provisions and improve efficiency and 

regulatory transparency. MBR 


Rachel Vella Baldacchino is 

an Associate at WH Partners. 

Her main practice areas are 

technology law, corporate 

law, M&A, corporate finance 

and capital markets. 

Rachel Saliba is Senior 

Advisor at WH Partners. 

She is a corporate and 

taxation lawyer with over 11 

years’ experience in assisting 

multinational companies 

and high net worth 

individuals on both direct 

and indirect taxation. 

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50


ICT 

Responsible Gaming Conference 


Minister Mallia addresses 

Responsible Gaming Conference 

Fexserv Financial Services Launch Myney 

Malta’s First Mobile Payment App 

Fexserv Financial Services today launched 

Myney, Malta’s first mobile payment 

solution which has been developed in 

conjunction with NTT DATA of Japan, one 

of the world’s largest organisations in the 

field of IT and Innovation, through their 

Italian subsidiary, NTT DATA Italia. The 

Launch aptly took place at the Casino 

Maltese which formerly housed the 

Treasury of the Knights of St John and 

also served for a while as the Government 

Treasury during the early British period. 

Myney has been in creation for over three 

years and has been developed at one of 

the three Research and Development 

Centres owned by NTT DATA. 

Present for the Launch were 

representatives of NTT DATA from Japan 

and Italy as well as other support partners 

from overseas including representatives 

of Western Union, Deutsche Bank, 

Paycasso, IPG – Intelligent Payments 

Group, MasterCard, IDT Financial Services, 

MySafePay, and GPS – Global Payment 

Services who came specifically for this 

occasion. Also in attendance were the 

Hon. Dr. Christian Cardona, Minister for the 

Economy, Investment and Small Business 

and the Hon. Professor Edward Scicluna 

Minister for Finance. After an opening 

welcome address by David Borg Hedley, 

General Manager of Fexserv and Project 

Leader who explained briefly the functions 

available on the Myney App through a 

short video demonstration of some of 

the main features, Tony Zahra Chairman 

of Fexserv addressed the guests present 

and thanked all those who played a part 

in bringing this Payment System to market. 

A number of the foreign support partners 

also made short addresses following 

which Ministers Dr. Christian Cardona and 

Professor Edward Scicluna also spoke for 

the occasion. 

The Myney app is possibly the most 

integrated mobile payments APP 

imaginable and is available for free 

download on the App Store and Google 

Play as from today. Once downloaded 

private customers can immediately 

register and get an account. Private users 

are able to register digitally, verify their 

identification and get an account within 

minutes without needing to visit any of 

Fexserv’s offices. Myney user accounts 

can be topped up in seven different ways 

whilst funds on the holders account can be 

utilised in ten different functions. The app 

also includes a loyalty program, account 

maintenance and personalisation and an 

optional Personal Finance Manager system 

whereby the system tracks and compares 

to user budgets all transactions processed 

through the Myney Payment Account. 

Interest shown by the business community 

is very strong and it is expected that 

over 600 shops will be accepting Myney 

Payments in the coming months. MBR 

Credit: www.myney.com 

Tony Zahra Chairman of Fexserv 

Minister for Competitiveness and Digital, 

Maritime and Services Economy, Dr 

Emmanuel Mallia addressed guests and 

participants at the Responsible Gaming 

Conference organised by The Foundation 

for Social Welfare in conjunction with 

Sedqa and sponsored by Unibet. 

The Minister commenced by stating that 

the gaming industry is a pursuit of leisure 

that is different from most industries 

and ‘what is perfectly harmless for the 

majority can have terrible consequences 

for the vulnerable few’. 

Dr Mallia pointed out that there is no 

demographic bias between gamblers as, 

irresponsible gaming can affect anyone 

regardless of age, social status, religion, 

gender or race. He observed that at 

European level, between 0.5 % to 2 % 

of those making use of gaming services, 

end up with some sort of addiction, with 

youths being five times more vulnerable 

than adults. He continued that 

Even though the number of problem 

gamblers can appear inconsequential 

when compared to overall figures of 

persons who gamble, even one afflicted 

person is one too many. 

The government, he said, has been 

consistent in its enactment of legislation 

pertaining to gaming and ‘any liberalisation 

must be tandem with enhanced player 

protection, and genuine commitment to 

social responsibility’. Gone are the days, 

the Minister remarked, when companies 

Are you an employer looking to 

expand your team while saving 

valuable time and recruitment costs? 

acted with impunity and total disregard of 

the dire consequences that the use of their 

products and services wrought on society 

as a whole. The government values, and 

will support responsible gaming initiatives. 

Self-limit and self-exclusion programmes 

are indeed stipulated by the Malta Gaming 

Authority. 

Dr Mallia added that all stake holders 

and service providers in the gaming 

industry have a responsibility to adhere to 

guidelines, responsible gaming standards, 

and programmes that are internationally 

recognised. 

It is the intention, Minister Mallia 

concluded, of this government to further 

enhance Malta’s futuristic approach 

towards gaming legislation. This will be 

done by treating gaming addiction as the 

serious problem it is, yet simultaneously 

keeping Malta competitive and in the 

vanguard of innovation in all aspects and 

sectors of the gaming industry. Dr Mallia 

thanked the organisers and sponsor. MBR 

Creditline: Minister for Competitiveness, Digital, 

Maritime and Services Economy/DOI 

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52 53 



Salaries & Benefit Report 

EU Presidency 


MISCO’s recent Salaries and Benefit Report 

shows that there was a 4.9% increase 

in the annual average salaries in Malta. 

The highest increases in average salaries 

were noted for the posts of Business 

Development Manager, Operations 

Manager (within the Services Sector) 

and ICT Manager. Minimal changes in the 

average salary were noted in the posts 

of Managing Director, Administration 

Manager, Production Manager, Warehouse 

Manager and Engineering Manager. 

having access to robust 

and up-to-date market 

information is essential 

The 31st edition of The MISCO’s Salaries 

and Benefit Report features 85 positions, 

compared to the last year’s 79, and carries 

a number of new positions, including 

that of Assistant Financial Controller, 

Sales Executive, Sales Representative, 

Compliance / Anti-Money Laundering 

Officer, Logistics Manager, Head of Stores, 

Maintenance Manager, Research and 

Development Specialist and Maintenance 

Supervisor. 

MISCO’s Director Lawrence Zammit said that 

in a challenging marketplace, effective and 

competitive remuneration is a key priority. 

Employers need to ensure their reward 

policies and practices are both practical 

and relevant to today’s labour market. As 

such having access to robust and up-todate 

market information is essential. In fact, 

Mr Zammit said that MISCO compiles such 

reports to provide guidance on the pay ranges 

to be attached to grades or bands when 

designing a 

pay structure. 

The study shows 

that there was 3.8% 

increase in finance-related positions and 

a 5.7% in HR-related positions. Marketing- 

Related positions registered a 2.1% 

increase. 

Mr. Zammit said that “MISCO is conscious of 

the need of employers to have information 

that is more focused on their specific 

requirements. For this reason we also 

publish a number of sector specific salaries 

and benefits reports throughout the year 

and provide compensation benchmarking 

MISCO Study Shows 

An Average 4.9% 

Increase In 

Salaries 

By James Vella Clark 

reports to individual organisations 

facing challenges in keeping their best 

talent and concerned with matching their 

packages to those offered in the market.” 

In fact, he added that this report, like 

the other sectorial ones, are important 

tools which give the company’s senior 

management the necessary information 

upon which, one can take informed 

decisions to ensure that pay will attract and 

retain the people the organisation needs. 

Having said that, Mr Zammit added that 

MISCO strongly believes that salaries are 

just one component of the HR strategy of 

an organisation and needs to be supported 

by appropriate training and development 

activities, motivational activities and 

creating a work environment that is caring 

of the employees’ wellbeing. MBR 

No income tax for 

pensions up to €13,000 

@MaltaGov 

“Malta is well-prepared to address EU’s Justice and Home Affairs agenda during 

its Council Presidency” European Commission First Vice President 

The Maltese government is very wellprepared 

to take over the rotating 

Presidency of the Council of the European 

Union on January 2017, said Frans 

Timmermans, First Vice President of 

the European Commission. In a meeting 

with Minister for Justice, Culture and 

Local Government Owen Bonnici and 

Minister for Home Affairs and National 

Security Carmelo Abela, on Friday 7th 

October 2016 in Valletta, Vice President 

Timmermans pointed out that the areas 

of Justice and Home Affairs will be two of 

the most important ones, as they include 

highly-topical issues such as migration and 

asylum, border management, and security. 

During this meeting, Minister Bonnici 

emphasised that the Justice and Culture 

sectors are well-prepared to register 

progress during the upcoming Maltese 

Presidency of the European Union. He 

added that amongst other preparations, 

people that will be involved in every stage 

of the Presidency were adequately trained. 

Minister Bonnici explained that the 

Ministry for Justice, Culture and Local 

Government will be responsible for twelve 

conferences and meetings during the 

Presidency, 19 working parties and 19 

dossiers. In total, Minister Bonnici said, 

there are 50 people from the Justice and 

Culture sectors involved in the Presidency 

preparations and training has been 

provided. He explained that the priority 

of this Ministry is to register progress on 

the respective legislative pending files and 

work hard on the new legislative files put 

on the table. 

As regards Brexit, the Minister emphasised 

that Malta as a Presidency is prepared to 

start off discussions in Council. He added 

that the EU should create a plan for a 

post-Brexit EU and the process, which 

has already started in Bratislava about a 

new idea for Europe, should continue in 

Malta. This, he said, is essential to have 

a European Union which is stronger and 

closer to the people. 

On his part, Minister Carmelo Abela said it 

is important to address both the internal 

and external aspects of migration. He 

referred to the Valletta action plan that was 

agreed upon in last November’s Valletta 

Summit on Migration, and noted that 

Malta will be endeavouring to monitor its 

implementation through a Senior Officials’ 

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performing two high powered fashion 

shows of 10 minutes each profiling 

their latest Collection, designed by 

Nilay Camilleri. The sow will include 

professional make-up artists, hair and 

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Photo- DOI-Reuben Piscopo 

Meeting which will be held in Malta in 

February of next year to take stock of the 

state of play, and map the way forward. 

Minister Abela referred to the important 

dossiers that will be on the table during 

Malta’s Presidency, including the proposals 

revising the Common European Asylum 

System, proposals relating to border 

management, and measures taken to 

safeguard internal security and combat 

terrorism. He concluded by thanking the 

European Commission for its continued 

support and looked forward to further 

cooperation during the Presidency. MBR 

Source: Minister for Justice, Culture and Local 

Government 

54 

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www.maltabusinessreview.net 

55


Economy Focus: Gozo 

CSR 


Sustaining economic growth in Gozo 

By Anton Refalo, Minister for Gozo 

As our government presents its fourth 

consecutive budget, we would do well to 

look at our achievements in recent months 

and start thinking of how to sustain what 

is good and how to improve matters that 

could have been done better. 

During the last days of 2015, the National 

Statistics Office published its figures for 

regional gross domestic product (GDP) 

covering the 2011-2014 period. The 

picture emerging from these statistics is 

truly encouraging. Whilst during 2014 GDP 

increased by 5.8 per cent in Malta, the 

growth in Gozo reached 8.1 per cent. The 

Gross Value Added in Malta increased by 

4.9 per cent, whilst that of Gozo increased 

by 7.3 per cent. Employment in Gozo 

was also up, increasing by 4.8 per cent 

compared with the 3.9 per cent increase 

registered in Malta. 

These are the first steps towards achieving 

full convergence with Malta. It is also a 

confirmation that Gozo is contributing 

positively to the national growth rates, 

something that was unthinkable only a few 

years ago. 

When a person is inundated with positive 

news, it is expected that he or she becomes 

less responsive to good news. The economic 

success achieved during the last two years 

has created a sense of security and at times 

people take it for granted. Just to put these 

figures into their context, growth in Gozo 

between 2000 and 2005 averaged 0.4 

per cent, while between 2009 and 2012 

it managed an average of 3.9 per cent. In 

employment, the same dynamics were 

present: the number of people gainfully 

employed increased by an average of 2.2 

per cent between the first five years of the 

new millennium and by one per cent during 

the last legislature. 

Minister, Anton Refalo 

As I had the opportunity to state, these 

achievements do not occur by pure 

coincidence. Rather, they are the result 

of a clear strategy built on the genuine 

input of all the stakeholders and numerous 

individuals that were willing to contribute 

towards the growth and development of 

Gozo. 

The government is a key player in creating 

the necessary environment that is 

conducive to growth. However, ultimately 

it is the private sector which invests its 

resources and skills in new ventures and 

creates employment and wealth. The 

central role of the private sector increases 

our confidence that economic growth will 

not be a one trick pony but instead will be 

sustained in the future. 

It is exactly for this reason that we are 

confident that the success achieved during 

the last two-and-a-half years is not an 

accident. They are, instead, the first results 

of a new norm. This can only happen if 

economic growth is backed up by strong 

fundamentals. 

The NSO figures shed further light, albeit 

indirectly, on this important issue. If one 

looks at the details provided, one notes that 

the growth in Gross Value Added (GVA) was 

very much a broad-based development, 

with all sectors, (except financial/insurance 

and real estate) registering very positive 

growth. Yet even for these two sectors 

where GVA declined, employment 

increased, suggesting that these sectors 

will see an improvement in the months to 

come. 

Another indicator of sustainability is the 

degree of volatility - how much growth 

oscillates from one period to another. Having 

a sector registering a good performance in 

one year and then declining in the next is 

no good. Good fundamentals point towards 

consecutive periods of expansion. 

In fact, discounting for agriculture which 

is impacted by seasonal and one-off 

events, the overwhelming majority of 

sectors registered both consecutive and 

The newly restored Cittadella 

accelerating growth. Manufacturing in 

Gozo, which suffered a massive contraction 

in importance during the last two decades, 

seems to have succeeded in turning the 

corner, registering an increase in GVA of 

4.2 per cent. This augurs very well for 

the future, especially now that a leading 

manufacturing firm in IT and related 

services has started operations in Gozo. 

The changes we are seeing in Gozo are part 

of a long-term process. During the past two 

decades, our economic reality has changed 

but at times we failed to take note and 

preferred to persist in trying the same old 

thing. This Administration is not afraid to 

explore new things and go into new growth 

sectors. The decision to back RS2 to start 

its operation in Gozo is one of them. The 

Barts school and the new hospital in Gozo 

is another example. 

Gozo will become an eco-island by 2020, 

supported by a keen and committed 

sustainable community. We want to see 

quality of life in Gozo improving further 

through education, economic development 

and social progress. Gozo will strive to 

reduce its carbon and water footprints. We 

want to protect the Gozitan lifestyle, the 

island’s environment, resources, culture 

and identity, and see that all these play a 

significant part in attracting more visitors 

and investors to the Island. 

These results and events should please a 

lot of people and show that Gozo is looking 

at new growth paths, giving the island a 

breath of fresh air and investment. A new 

year brings innovative resolutions, although 

uncertainties are also a part of life. We are 

confident that what we have achieved so 

far is built on strong foundations and we will 

do everything in our power to ensure that 

its success is strengthened in the coming 

years. We know that we still have a lot of 

work to do but I am sure that, together, we 

can see a better Gozo in the coming years - a 

Gozo that will make us all proud. MBR 

MBR Publications teams up with 

Puttinu Cares in fundraising Activity during 

Malta’s Best in Business Awards 2016 

Dr Andrew Decelis thanked MBR 

Publications Limited for their undivided 

support, saying, “We would like to thank 

you wholeheartedly for your noble gesture 

which your company has embarked on to 

assist former and current cancer patients, 

their families, and because this event is 

extremely prestigious and exhausting, we 

look towards local businesses to help out in 

donations for our patients.” 

Martin Vella, Managing Director of MBR 

Publications Limited, addressing the 

media during a Press Conference held 

at The Palace Hotel, Sliema, said, “We 

expect to have over 500 participants this 

year, nominee companies representing 

the pre-eminent models of our business 

community. Cancer touches so many 

people in our community and providing 

Puttinu Cares a platform out of something 

we have successfully created and 

expanded throughout the past years is a 

great way, even though it is not enough, to 

help fight this terrible disease, especially 

for families who need to go abroad to 

pursue any kind of further treatment. I 

appeal to everyone to seriously consider 

this request and let your family, friends, 

neighbours, your customers, and your 

community know that you are joining 

them in the fight.” 

“Disruption is changing the rules of the 

game in the philanthropic space. Gifts are 

being made at unprecedented levels to 

resolve complex social issues, and as the size 

of the gifts grow, so do the accountabilities 

key funders are placing on fundraisers. 

Foreign companies have come along and 

inextricably not enough screening is being 

done on professional fund-raising level, 

that this gives rise to serious suspicions 

about the end goal. Our business partners, 

colleagues and customers are invited to be 

part of our community of leading funders 

and fundraisers exploring new strategies for 

social innovation and community impact 

by giving genuinely, giving suitably, giving 

correctly. Our company has been always 

involved in philanthropic activities and we 

have supported foundations involved in such 

activities, so we all should contribute to this 

noble cause,” concluded Mr Vella. MBR 

Puttinu Cares Children’s Cancer Support Group 

Postal Address: Rainbow Ward Paediatric 

Adolescent Ward, Sir Anthony Mamo Oncology 

Centre level -1, Msida 

VO Number: VO/0087 

Contact No: +356 7980 9778 

Email: info@puttinucares.org 

Martin Vella, Managing Director of MBR Publications Ltd. 

MBR Publications Limited are at the forefront of 

leading business publications and corporate event 

organisation which has an appeal to a diverse 

business audience and corporate executives on 

a nationwide basis. MBR Publications Limited is 

a micro business aimed at the big time. In order 

to reach its lofty goals, MBR Publications Limited 

focuses on the mission behind the vision and has 

rapidly become Malta’s premier business and 

award gala event organisers and publishers of 

Malta’s leading business publication the Malta 

Business Review. 

56 57 



newsmaker 

Malta SME Week 

For the eighth consecutive year, the 

Ministry for the Economy, Investment 

and Small Business is organising the Malta 

SME Week, with the aim to provide insight 

on what is offered to support start-ups and 

micro, small and medium-sized businesses. 

The activities organised during the SME Week 

focus on entrepreneurship with one specific 

focus being female entrepreneurship. It is for 

this reason that, the Ministry together with 

the Foundation for Women Entrepreneurs, 

the National Council of Women and the 

Maltese Association of Women in Business 

organised a half-day conference entitled 

‘Women Mean Business’. 

The conference was informative, motivational 

and allowed for the sharing of best practices 

amongst those present. The conference was 

moderated by Angele Giuliano from the 

Foundation for Women Entrepreneurs, and 

kicked-off with a motivational speech by 

Debbie Tully. A panel discussion followed. 

The panel was composed of various 

successful female entrepreneurs; Claire 

Cassar, Stephanie Borg, Roselyn Borg, 

Claudine Cassar and Mariella Camilleri. These 

shared their experience and provided their 

insights and advice to the audience. Four 

parallel workshops were also carried out, 

each focusing on important aspects of either 

starting or scaling-up one’s business; 

• Access to Finance 

• What’s in it for me? (Tips for aspiring 

entrepreneurs) 

• Marketing and Innovation 

• Internationalisation 

Each workshop was moderated by 

seasoned individuals and there were also 

interventions by various organisations and 

entities operating in the sector tackled in the 

workshop such as ZAAR: the crowd-funding 

platform, Enterprise Europe Network, Trade 

Malta and Bank of Valletta. 

Photo: MEIB 

The participants also had the opportunity 

to ask questions to relevant entities or 

organisations at the end of the conference. 

A networking lunch was held at the end 

so as to offer an informal atmosphere for 

attendees to mingle with the entrepreneurs 

present in an attempt to exchange ideas 

and advice with the aim of promoting 

entrepreneurship in Malta. MBR 

Source: THE MINISTRY FOR THE ECONOMY, 

INVESTMENT AND SMALL BUSINESS 

Finance Minister in Washington for IMF/WB meetings 

Photo: MFIN/DOI 

Minister for Finance, Prof Edward 

Scicluna is holding talks with senior 

officials of leading international financial 

institutions on the margin of the 2016 

International Monetary Fund (IMF) 

and World Bank Group (WBG) Annual 

Meetings in Washington D.C., USA 

between 7th and 9th October 2016. 

Minister Scicluna is discussing Malta’s 

economic, fiscal and financial outlook, 

as well as its aims and aspirations for 

its Presidency of the EU Council in the 

first half of 2017 to senior officials of a 

number of leading international banks, 

as well as top officials from leading rating 

agencies Moody’s, Standards and Poor’s, 

FitchRating and DBRS Sovereign. 

Prof Scicluna also had high-level meetings 

with World Bank Executive Director Mr 

Patrizio Pagano, Country Director for the 

Maghreb Ms Marie Françoise Nelly, IMF 

Executive Director Mr Carlo Cottarelli, 

Head of Article IV Mission to Malta Mr Nir 

Klein and Deputy Director Fiscal Affairs 

Department Mr Christopher Towe. 

These annual meetings serve as a platform 

where finance and development ministers, 

central bank governors, private sector 

executives and academics discuss issues 

of global concern, including the world 

economic outlook, poverty eradication 

and economic development. 

Minister Scicluna was accompanied by Central 

Bank of Malta Governor Dr Mario Vella and 

Deputy Governor Alfred Mifsud. MBR 

Photo & credit: MFIN/DOI 

Completion of the Single Market is one of the Maltese Presidency priorities 

The benefits of the Single Market through 

the development of the Digital Market 

will not just boost Europe’s home-gown 

technology business to compete with 

giant firms but it will also bring benefits 

and a higher degree of efficiency to the 

European citizens. 

Minister for European Affairs and 

Implementation of the Electoral 

Manifesto Louis Grech said that the 

Single Market is the major economic 

unifying factor within the European 

Union, especially at this delicate juncture 

of the European integration process. 

The well functioning of the Single Market 

will help to restore citizens’ trust in the 

European project. Both Minister Grech 

and the Vice-President of the Commission 

Mr. Andrus Ansip agreed that the Single 

Market is the major engine which 

reinvigorates the European project and 

economy to create economic growth. 

Having agreed on the Single Market’s 

power, it was also noted that the 

completion process of the European 

internal market especially that of the 

Digital Market is not moving at the 

necessary dynamic pace. The properly 

developed Single Market would 

bring about the necessary impetus 

making the European economy more 

competitive. Unfortunately, following 

the recent financial and economic 

downturn, the Single Market suffered 

from fatigue and mostly, the European 

citizens did not perceive the Single 

Market as working in their benefit. 

Therefore, the completion of the Single 

Market and the focus on the Digital 

Market will remain one of the priorities 

of the Maltese Presidency. 

Europe should deliver a Single 

Market that really works for the 

European citizens. 

Photo: DOI - Kevin Abela 

Minister Louis Grech, accompanied by 

Parliamentary Secretary for the EU Presidency 

2017 and EU Funds Ian Borg, held discussions 

with the Commissioner for the Digital Market 

and former Prime Minister of Estonia, Andrus 

Ansip. Other issues which were addressed 

include the Multiannual Financial Framework, 

migration, Brexit, security, maritime policy and 

the Mediterranean policy dimension. MBR 

Credit: Ministry for European Affairs and the 

Implementation of the Electoral Manifesto/DOI 

58

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the art of performance

mbr special edition 2016 low (1)

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