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In public debates about tourism I regularly point out that we do not have a national tourism strategic plan. All our competitors have their strategic plans, and more important than simply having them they are mobilising their human and financial resources to implement their national strategic plans to give their tourism a future.
On every occasion, Tourism Minister Francis Zammit Dimech tries to brush off this criticism by pretending that government already has such a plan and is already on the way of implementing it. He keeps talking about “our strategy” and “our plan”. Recently I asked the Minister point blank. What document would you be able to give me if I ask you “Can I see a copy of your national tourism strategic plan?”
He was silent. Such a document still does not exist, as government does not have such a strategic plan of action to revive tourism. I cannot understand why government tries to deceive by giving us the impression that it has such a strategic plan. According to the Implementation Report of 8 February 2005, between 15 July and 30 November 2005 the main targets for a three-year tourism plan will be identified. The national strategic tourism plan has still to be drawn up.
The Malta Tourism Authority review drawn up by Deloitte rightly points out as Key Issue No. 1: “MTA has produced a number of Strategic Plans, which have delivered little focused action and poor results.”
The proposed solution is “an integrated tourism planning approach with strong private sector input and a strategy that contains specific, measurable, attainable, realistic targets and action plans (supported by timeframes and budgets) which have designated ownership for each task.”
Government must not abdicate its responsibility and hide behind the MTA. Launching the Blueprint for New Tourism, less than two years ago, the President of the World Travel and Tourism Council (WTTC), Jean-Claude Baumgarten said: “There is now a new consciousness amongst governments that they cannot leave the growth of travel and tourism to chance. What is needed is a new vision and strategy involving a partnership between all stakeholders, public and private to turn future challenges into opportunities.”
Government must take the initiative to drive the wide and deep consultative process with all the stakeholders to formulate a strategic plan for tourism, which all the country will own. We can only succeed if we have a whole government and whole country approach and a really national effort to make our tourism survive and thrive.
Government must not take the back seat and conveniently delegate its political responsibility to the MTA for such a strategic tourism action plan. The private sector has been investing quite a lot of money over the years to improve its product and service. Government has fallen behind in this area and has allowed the country to become shabby and mediocre. As a result other countries are beating us in the fierce competition to attract tourists.
The Deloitte MTA review report states: “The Product Improvement Action Plan would consider issues such as the shabbiness of Malta, heritage sites, beaches, local transportation and a host of other issues which affect tourism, but do not fall under the remit of MTA or the Ministry of Tourism and where Government is called upon by the private sector to adopt a more proactive role. To succeed the Product Improvement Plan must be specific and must identify realistic target dates for the achievement of each objective and shall clearly delegate specific Ministerial responsibility for each phase of initiative.”
Government is ultimately responsible for the success or failure of tourism. The Deloitte review stresses that “notwithstanding the current financial limitations Government must look at the implementation of a Product Improvement Action Plan as a national priority investment and should be prepared to make an immediate and significant ‘catch-up’ investment which will bring Product Malta‚ up to scratch. Government should consider ways of using additional revenue from tourism growth as a means of financing this initial investment and ongoing annual investment. If tourism does not achieve its growth potential then Malta will have a serious national economic problem.”
The businessman I am talking to is rather gloomy about our economic prospects. “Till March this year our economic growth was negative. If this has persisted till June it could be that we are facing a recession. Exports are falling and tourism is still stagnant. This will deepen our balance of payments and in turn affect the lira. The domestic economy is not growing while the budget deficit and public debt are continuing to rise.”
He feels that government is making things worse by the way it is privatising our national assets. “Just look at the adverse effect that a privatised Freeport is having on manufacturing industries. This will get worse by the privatising Sea Malta.”
He believes that “our economic pillars are wobbling. The only sign of life in the economy is the construction industry and here again there seems to be a bubble emerging. Overseas buyers are scant. Even the property letting market is becoming depressed because without new factories or businesses, no new expatriates are taking up residence in Malta.”
This businessman thinks that government rushed into pushing Malta to adopt the Euro too early as its currency and when the Maltese economy has not been prepared for the shock. He also thinks it is wrong for the Maltese government to have given up a strategic tool by ceding its monetary policy to the European Central Bank.
He tells me that recently the Swedish Central bank cut interest rate by 0.5 per cent (instead of the 0.25 pr cent that was expected) and the Euro fell again on speculation that the European Central Bank will also lower its present base rate of two per cent. “The price of oil continues to rise. So our economy is being hit on two fronts. What has become of the hedging agreements on oil and what about hedging the Maltese Lira-Euro against the US Dollar? Chances are that our economy will continue to be hit harder and harder.
“Now investors and businessmen have a problem less. Before, our currency fluctuated against all currencies including the Euro (although it was 70 per cent linked to Euro and so more or less tracked it, but government still had the liberty to fluctuate the exchange rate), but now we need not worry what the Maltese Lira will do against the Euro because it is pegged. When the Lm floated, Maltese investors were uncertain what the Central Bank and government could do to protect our currency. But now as the fate of the Lm is linked to the Euro, investors just have to watch what the Euro does. And obviously this is a far easier task because the Euro is so widely traded (not like the Lm was).”
He thinks that this can make our country more economically fragile and vulnerable. “Investors who want to hedge against the fall in the Lm/Euro will now buy the hard/strong currencies as US Dollars, Sterling, Yen and Swiss franc, plus Australian and New Zealand dollars. The astute investors will outsmart the PN government and there could still be a run on the Maltese Lira and a drain on our reserves because our currency is not supported by fundamentals.
evaristbartolo@hotmail.com
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