How will subsidising just 35,500 tourists help overcome a crisis?

There is no doubt that Malta cannot afford another summer with practically no tourists. Tourism has always been a fickle industry but the effects of the COVID-19 pandemic on tourism have led to a nightmare in the industry.

As the Prime Minister put it, Malta will save serious problems if it loses out again on tourism this summer.

Faced with this situation, the ministry responsible for tourism has launched a scheme whereby tourists will be paid €100 if they stay at a 5-star hotel, €75 if they stay at a 4-star hotel and €50 if they stay at a 3-star hotel. The scheme has been given a lot of publicity in the British press with headlines such as: ‘Malta is paying tourists to visit’; ‘Malta is paying some travellers to go on holiday this summer’; and ‘Malta will pay travellers to visit this summer’.

The scheme – as announced – raises some important questions. First of all, as the PN spokesman on tourism, Robert Arrigo, told a newspaper earlier this week, we shouldn’t be giving free holidays. He also promised a more detailed reply complete with alternative proposals later this week. Because of time constraints, I am writing before the PN’s official reaction has been published.

But some things are obvious: the tourist industry in Malta is not the hotel industry. More than half of tourists visiting Malta do not stay in hotels. In Gozo the proportion is even bigger – witness the reaction to the scheme of the Gozitan Tourism Association that knows that in Gozo most tourists stay in ‘farmhouses’ and short lets rather than in hotels. The tourism ministry and regulator seem to have been influenced too much by the hotel lobby (MHRA) that disregards the fact that they do not have a monopoly of tourist accommodation in Malta and push the government into acting likewise.

The scheme does not take into account the fact that hotels have already given discounts on their normal rates in view of the existing situation: discounts ranging from 25% to 50%. This means that in the case of 3-star hotels, the promised hand-out amounts to practically free accommodation – a real possibility since the scheme is subject to only a minimum of three nights. I think this limitation on the number of days is too generous.

Moreover, the scheme is applicable to tourists booking directly to the hotel concerned, thus avoiding any foreign operator or local agent being involved in the transaction. Is this the right thing to do when our tourism industry desperately needs these organisations to work with them?

The Federated Association of Travel and Tourism Agents (FATTA) were reported by The Malta Independent last Tuesday as saying that “losing out on a summer of tourism this year could be a ‘death knell’ for tourism agencies.”  So why does government award subsidies only to tourists who avoid their services?

It is obvious that this was instigated by the hotel lobby who want to do away with the small percentage that would be normally due to these agencies. Again, the hotel lobby seems to be dictating things.

The amount of subsidy is limited and no one knows whether it will be implemented on a first come first served basis. Nor do we know when applications for this subsidy start to be accepted and whether those who have already booked a direct holiday with a hotel qualify for it? Moreover it seems that the aim is the British tourist, but is it applicable to anyone visiting Malta, say a Sicilian or a Tunisian?

And how will the logistics of handing out the subsidy work? Will it be completely in the hands of hoteliers with the NTOM taking just a monitoring role? Again I sense, that the MHRA lobby has persuaded the tourism authorities to hand them the organisation and the implementation of the subsidy. If my hunch is correct, this will be another great mistake.

I understand that the scheme is not open-ended. When, at some point, all the funds available for it are utilised, the tap would have to be closed. I reckon only some 35,500 tourists will be able to get this subsidy. If Malta is aiming at 1 million tourists this year, how can subsidising just 35,500 of them help?

Once again the government seems to have adopted a half-baked idea without any deep thinking. It seems that the government grasped at the idea and took it on board without realising the inherent problems that could have been avoided if the scheme was revised. In short the idea should not have been discarded but it should not have been adopted without discerning its inherent problems and revising it to avoid them.

I am sure that the money involved could have been more wisely spent with a more judicious scheme.

The graveyard of empires

US President Joe Biden has announced the withdrawal of all U.S. forces from Afghanistan by 11 September, the 20th anniversary of the al-Qaeda attacks on the United States that were planned from Afghan soil. The announcement follows Biden’s election campaign promise to close down the longest war in US history. He believes that wars become self-perpetuating if the generals call the shots.

Afghanistan has been dubbed as the ‘graveyard of empires’ – a land where the designs of mighty powers fall into ruin. The frequently quoted phrase invokes a tidy simplistic history of the country: several foreign invaders found their just desserts in the country’s mountain redoubts and arid wastes, foiled by its rugged terrain, its inhospitable climate and its indomitable tribesmen.

Over almost a hundred years, the British launched three variously ill-fated incursions beyond the Khyber Pass, bloody expeditions and short-lived occupations mostly remembered in what was the British Empire from the colonial storybook adventures for boys!

The gruelling, decade-long Soviet occupation of Afghanistan in the 1980s became the miserable end of the U.S.S.R. – a quagmire that preceded the end of the Cold War and made worse by U.S. aid and weapons given to the Afghan mujahideen,

Now, there has been the experience of the United States. The initial punitive mission after the events of 9/11 turned into America’s longest war, a futile exercise in counter-insurgency and state-building that has seen more than 2,300 U.S. soldiers die, more than 20,000 wounded in action and tens of thousands of Afghan civilians perish.

Ironically, these figures surpass the number of those who died on 9/11.