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“Small businesses need that extra push foreword” Vince Farrugia – Director General
28 April 2013
Speaking to trade leaders, GRTU Director
General Vince Farrugia, said that the results of the in-depth review on the
prevention and correction of micro-economic imbalances gives an excellent
report on Malta. "I'm surprised that the Government of
Malta did not make good use of this report to rebut the false statements made
about Malta in comparing our economy with that of Cyprus.
This Report was
followed also by very positive comments made by two leading credit agencies.
We
as representatives of business expect that when the truth is said about our
country and the great effort all of us make to keep the country's name high and
among the best in Europe, we make good use of it. Malta has a great story of
achievements to say. The success belongs to all of us. It is on selling Malta's
good name that our economic advancement depends", emphasised GRTU's Director
General Vince Farrugia.
followed also by very positive comments made by two leading credit agencies.
We
as representatives of business expect that when the truth is said about our
country and the great effort all of us make to keep the country's name high and
among the best in Europe, we make good use of it. Malta has a great story of
achievements to say. The success belongs to all of us. It is on selling Malta's
good name that our economic advancement depends", emphasised GRTU's Director
General Vince Farrugia.
On the major issue raised by amongst
others the chairman of the European Finance Ministers, related to the status of
our large financial sector, the in-depth review states that the majority of the
very large financial sector is internationally-oriented with very little to
link to the domestic, and therefore does not pose large risks to the domestic
stability.
GRTU notes however that the issue
raised in the past by GRTU with the banks, MFSA and the Ministry of Finance,
that property developers unfairly compete with micro and small businesses for
the available credit facilities made available by the banks through Malta's high savings ratio
is again highlighted in the Commission in-depth review. The Maltese major banks
are over-lenient with property developers with the result that Malta now is
flooded with unsold properties while the access to finance for micro and small
businesses gets higher.
Government under pressure from GRTU
resorted to the Micro-Credit Scheme, supporting small businesses, and now to
the Micro-Guarantee Scheme, effectively a commercial banks loan for small
businesses whereby government covers most of the guarantee demanded by the
banks.
The rule of economic development for Malta and therefore
Government revenue could be much healthier if Government and the banks wake up
to the facts: 98% of enterprises in Malta are small and micro enterprises and
not property developers. GRTU supports scheme to help developers transform
their unsold properties into income generating enterprises- self-catering
tourist accommodation, new office spaces, new old age residential facilities,
new back office facilities – whatever can generate new work and new enterprise.
But credit and money available to build more of the same or the expense of a
squeeze on credit for direct productive enterprise is illogical.
