Published on The Malta Independent¸ issue 22nd May 2011
It was a well-attended investment promotion event organised by Malta Enterprise at the Hilton this week. Thanks to the proactive chairman¸ Malta Enterprise is succeeding where its predecessor organisations wavered in the past. I refer to the ignominious bunch who ran the three sister agencies MDC¸ IPSE and METCO which¸ in disparate ways¸ spent thousands going nowhere in their attempt to generate an entrepreneurial culture and attract tangible foreign direct investment (FDI) to the islands.
One of the speakers at the event who was quite effective in her presentation was Susan Hayes¸ who runs her own teaching academy and is a self-styled Irish “positive economist”.
Ireland is another island with a brief history of the glorious Celtic Tiger which¸ for a decade¸ surprised all and sundry with its glorious pattern of economic growth. It all started with a bunch of politicians oozing a bright policy of actively attracting large foreign (mostly American) companies to set up in economic zones (like us with the Freeport¸ regrettably with no success). It laid the path to a string of multi-national organisations creating wealth while enjoying tax advantages.
Alas¸ the Celtic Tiger is now limping¸ having suffered from a watershed in the Irish banking sector which relied too much on heaping cheap credit on to the property magnates who¸ in turn¸ blew up a property balloon with astronomical price levels. Ms Hayes believes that part of the solution to the troubled eurozone states can lie in promoting confidence in consumer spending. Back to investment promotion where¸ not unlike Malta Enterprise¸ the Irish development agency is very actively promoting entrepreneurship and hard-hitting initiatives to place Ireland as a country with a stable and business-friendly government.
This policy has reaped rich dividends in the past and it is to be expected that¸ once the impasse of the credit crunch has passed¸ it will continue to promote St Patrick’s island to regain its lost status as the number one exporter in the eurozone. Ms Hayes recalls how between four and 10 companies are established in Ireland every day – despite there being no social welfare on offer¸ should the venture fail – and a string of incubation centres supported by business angels thrive.
In spite of three EU countries under bail-out conditions¸ one can attempt to be cautiously optimistic on the future of eurozone countries. After a mild economic rebound last year¸ the European Commission is forecasting a moderate growth¸ particularly spearheaded by Germany’s economy which is firing on all cylinders. Here in Malta we need to be thankful for agencies such as Malta Enterprise and Finance Malta which¸ in my opinion¸ and despite their meagre budgets and limitations¸ are doing wonders to see that these tiny islands are visible on the radar screen of commercial fairs. Naturally¸ much more needs to be done¸ particularly in the aftermath of a recession that saw the Japanese economy falter and the recent social unrest in the Arab world that is creating so many uncertainties.
Back to the Maltese economy¸ we hit the jackpot in 2010 when it registered a 3.7 per cent growth amid so much turbulence in the post-credit crunch. This