A forum playing a pivotal role in Malta maritime industry’s success

Source: Times of Malta

Date: 1st March 2021

By: Kevin J. Borg

The maritime industry continues to be a mainstay for Malta’s continued growth and development and the country must ensure it remains so in a post-COVID, 21st century world. Photo: Darrin Zammit Lupi

It is unfortunate and disappointing to note a general lack of awareness and appreciation about the vital importance of the strategic role and economic contribution of the maritime Industry to our country in many aspects.

Despite this situation, the industry and the people working within it have “silently” continued to seamlessly deliver essential goods and medicines to us residents of the Maltese islands through thick and thin during the most challenging situations presented by the global pandemic.

From an economic point of view, the maritime industry continues to be a mainstay for Malta’s continued growth and development and the country must ensure it remains so in a post-COVID, 21st century world.

The industry suffers from an “out of sight, out of mind” situation – hence the general lack of awareness about its importance. Indeed, most of the economic activity performed by the industry happens out at sea or in the confines of the Maltese harbours and immediate hinterland.

Nevertheless, as part of its mission, the Malta Maritime Forum strives to “fly the flag” of the entire industry, which also includes port and terminal operators, vessel towage providers, ship agencies, bunkering operators, pilots, tank-cleaning facilities, docking operations mooring personnel, dockers, cargo hauliers, professional services providers and suppliers of yachting services, among many other activities.

These players form a chain of inter-related activities which, in turn, interact with a much wider network of economic providers in related sectors to offer the client on the international market a complete, professional and attractive proposition.

According to a recent study commissioned by the Malta Mari­time Forum and performed by E-Cubed Consultants in 2019, the Maltese maritime Industry gene­rated €855 million worth of direct economic activity, which rises to almost €2.2 billion when considering indirect and induced effects. Furthermore, the industry provided almost 12,000 direct jobs, which figure rose to 20,515 when account is taken of both indirect and induced effects. This was equivalent to roughly 10 per cent of the total gainfully occupied population in 2018.

The same study highlighted close economic multiplier effects generated in the financial and insurance sectors. In that year, the maritime industry also contributed approximately €25 million to the government coffers. Moreover, it is pertinent to note a general positive trend in the industry’s contribution to the economy’s total output − climbing from 5.3 to 7.4 per cent during a seven-year period to 2018. The industry grew at an average growth rate of 12 per cent in terms of value added – two percentage points higher that the aggregate growth rate registered across the entire economy. In terms of competitiveness and productivity, the study also points out that per capita value added in the Maltese economy stood at €47,000, compared to €72,000 within the maritime industry.

The latter indicators are symptomatic of the fact that the maritime industry is highly capital-intensive, and the forum has recently had occasion to celebrate important renewed investments made both by the private and public sector. These included the announced investment in six megamax quay cranes by Malta Freeport Terminals and the modernisation of the Tug Malta fleet with the addition of four new technically advanced vessels.

Such important decisions are complemented by public-sector investment in the ship-to-shore power project and the further upgrading of infrastructure which is mainly part of − but not limited to − the Grand Harbour regeneration initiative.

Nevertheless, as the islands’ foremost maritime cluster, the Malta Maritime Forum cannot concede that the future is all rosy. In fact, like many others, it sees, at best, an unclear future ahead unless the industry and stakeholders plan, prepare and take the necessary strategic decisions.

Of course, our country and the maritime corporations that operate from within it have no say whatsoever on the depressed market conditions on a global scale that have been exacerbated by a prolonged pandemic situation. Coupled to that, the industry in Malta is a “price-taker” when it comes to the highly-volatile politi­cal situation in the region to our south, the consistent moves towards vertical integration by the global industry giants, the rapid strides in digitalisation and the challenges of decarbonisation in terms of obligations to the IMO and the EU environmental policy agenda. Despite having little or no say in all the above, there is certainly no denying that such factors are strongly shaping Malta’s future success in the maritime industry in the years to come.

That said, there has never been a better time for all stakeholders connected to the industry to come together to design and implement their renewed vision, objectives, strategies and plans aimed at ensuring that we prevail irrespective of the changing environment and new realities around us.

Serving as a common platform for all Malta-based entities involved in the maritime, logistical and transport sector in Malta, the Malta Maritime Forum already contributes to sector-specific fora and supports the formulation of national maritime policy. However, as a direct representative of the main players in the national maritime transport industry, the forum feels it ought to be more actively consulted through a permanent presence in national fora and government-led events which are of direct relevance to the maritime industry so that it may contribute its vision and expertise in the national interest.

Of course, the interests and objectives of the industry and those of the policymaker are very well aligned because each side only desires future smart and sustainable growth across the entire value chain for the common good. Like the policymaker, the forum strives to overcome those obstacles that stand in our way to achieve such growth, not least the skills and information gaps, the deficiencies in the maritime legal structures and bureaucratic procedures, the breakthroughs required in short-sea shipping, the adequately planned and timely completion of the public infrastructural projects, as well as ongoing progress in terms of our environmental obligations, among other factors.

There can be little doubt that the players forming part of the forum constitute a most valid resource to Maltese policymakers in an effort to chart a way forward to create new value in the global post-COVID scenarios that await us. After all, the raison d’être of the forum is to facilitate communication and interaction between the various sectors in the industry as well as with government with a view to assist and promote the development of this industry to the benefit of Malta’s continued economic and social development.

Kevin J. Borg, CEO, Malta Maritime Forum

Tags: Malta Maritime Forum |