Retail sector struggles to survive in post-COVID limbo as Sliema trumps Valletta

Sliema was the shopping destination to have fared best in the run-up to Father’s Day two Sundays ago but sales only averaged 40% of last year.

Valletta is the locality where retailers appear to be the worst hit, with coffee shops in the capital believed to have averaged as low as 15% of their normal turnover on the same Sunday.

The information comes from an exercise undertaken by sister publication BusinessToday that spoke to retailers on the outlook of business after all COVID-19 restrictions were lifted.

Industry insiders said numerous retailers have been forced to lay off employees and in some cases, close down the business, as measures imposed during the COVID-19 pandemic made it impossible for them to meet financial obligations, especially high rent.

“Those worst are affected are businesses that entered into rent agreements in recent years, when the rents have sky-rocketed as many landlords have tried to make a quick buck off the foreigners wishing to open a business in Malta,” the report said.

But there is also a disparity between localities in terms of attracting shoppers and diners.

The problems for Valletta are exacerbated because of a lack of tourists. The tourism authorities are expecting 700,000 arrivals by the end of the year, a far cry from the 2.7 million that reached Malta last year.

One industry insider told BusinessToday that he calculated that some 70% to 80% of Valletta’s business depended on tourists, including cruise line passengers visiting on day trips to the historic capital.

“I would say that Sliema, another shopping mecca, only depends on tourism for around 50% of its business… This means Sliema will fare much better than Valletta as we come to grips with welcoming only around 26% the volume of tourists that visited Malta last year,” the sources said.

One exception stands out, the sources said. Retail outlets at PAMA Shopping Village in Mosta seemed to be enjoying brisk business, boosted by the immediate access to the supermarket and ample parking space, a huge attraction to shoppers.