The Malta Independent
Since the beginning of the year this weekly column have been dedicated to the exposition and explanation of 10 key points, deliverables, that in my opinion should form the basis for an emerging consensus for re-energising our economy to set it lose from the sclerosis that has set it.
My intention was to put forward a set of proposals for passing from rhetoric about the need for the formation of a national social pact, to specific measures that need to be taken for making such social pact a worthwhile exercise. It was meant to challenge the thinking of those who clamour for such social pact but who evidently are little prepared to shoulder their fair share of the burden whilst expecting others to do so. From this category none is excluded and all are included ` government, opposition, entrepreneurs and trade unions.
I make no claim that the ten deliverables represent an exhaustive exercise for conducting the restructuring that has long been talked about but conveniently avoided. Others could indeed challenge my thinking and argue against some of the deliverables and include new ones I could have missed.` Let then come forward with the arguments and the proposals. But for goodness sake let`s start doing something about it before the challenges of EU membership pass us by and we miss the opportunities that turn into additional burdens of bureaucracy that will threaten our economic survival.
The scope of the 10 deliverables I enunciated is to render our economy more competitive globally. To eliminate the barriers to flexibility in a competitive world where our small size is a big barrier to achieving economies of scale in a world where even corporate giants have to merge to maintain competitiveness. Through rendering our economy flexible and market-driven within a moderate social structure, we can make our small size a distinctive competitive feature where speed of action and ability to adjust quickly to evolving circumstances should help us steal a march on our competitors who are too big to match our flexibility.
We can never compete on the price factor alone.` We must compete on our unique qualities, our value to price ratio and the quality of our products and services.
To do this we need investment, direct and productive investments in those areas where we have the natural characteristics to compete. In a book I published in 1999 I had listed these as light manufacturing in high value added processes (the ST/Playmobil/Baxter/Methode type of operation), tourism mostly oriented to the short stay visitor with special interest (conferences, incentives, fly-cruise, event-driven), film production and location shooting, international education programmes and last but not least call centres, back office work and outsourcing mostly related to corporate and financial services.
Such investment will not come by chance. Not even if we try our earnest such investment will escape us, certainly on the scale we require it, unless we can first re-energise our economy through restructuring involving the ten deliverables.
Beyond the ten deliverables there is the promise of real productive investment, domestic and foreign, that is absolutely necessary for economic growth to return to exploitation of our real potential rather than continue with anaemic growth based on unsustainable consumption and deficits.
Many of the candidate countries joining the EU with us on 1st May 2004 are starting from a comparative backward state our economic development but they are winning the foreign investment battle that we are missing. Because our economy is not competitive we have fallen off the short list of investors who are already deciding to relocate operations from expensive EU centres to new candidate country centres. No amount of organisational restructuring of the investment promotion agency will make up for the deficiency that we are not sufficiently competitive at a macro level.
As the new Prime Minister in waiting gets ready to take his new role at Castille, it would be utterly wrong to adopt a business as usual attitude. The country needs the unusual, the sense of urgency to get along with the restructuring job before we lose the game in a definitive matter.
Since the beginning of the year this weekly column have been dedicated to the exposition and explanation of 10 key points, deliverables, that in my opinion should form the basis for an emerging consensus for re-energising our economy to set it lose from the sclerosis that has set it. My intention was to put forward a set of proposals for passing from rhetoric about the need for the formation of a national social pact, to specific measures that need to be taken for making such social pact a worthwhile exercise. It was meant to challenge the thinking of those who clamour for such social pact but who evidently are little prepared to shoulder their fair share of the burden whilst expecting others to do so. From this category none is excluded and all are included ` government, opposition, entrepreneurs and trade unions.
I make no claim that the ten deliverables represent an exhaustive exercise for conducting the restructuring that has long been talked about but conveniently avoided. Others could indeed challenge my thinking and argue against some of the deliverables and include new ones I could have missed.` Let then come forward with the arguments and the proposals. But for goodness sake let`s start doing something about it before the challenges of EU membership pass us by and we miss the opportunities that turn into additional burdens of bureaucracy that will threaten our economic survival.
The scope of the 10 deliverables I enunciated is to render our economy more competitive globally. To eliminate the barriers to flexibility in a competitive world where our small size is a big barrier to achieving economies of scale in a world where even corporate giants have to merge to maintain competitiveness. Through rendering our economy flexible and market-driven within a moderate social structure, we can make our small size a distinctive competitive feature where speed of action and ability to adjust quickly to evolving circumstances should help us steal a march on our competitors who are too big to match our flexibility.
We can never compete on the price factor alone.` We must compete on our unique qualities, our value to price ratio and the quality of our products and services.
To do this we need investment, direct and productive investments in those areas where we have the natural characteristics to compete. In a book I published in 1999 I had listed these as light manufacturing in high value added processes (the ST/Playmobil/Baxter/Methode type of operation), tourism mostly oriented to the short stay visitor with special interest (conferences, incentives, fly-cruise, event-driven), film production and location shooting, international education programmes and last but not least call centres, back office work and outsourcing mostly related to corporate and financial services.
Such investment will not come by chance. Not even if we try our earnest such investment will escape us, certainly on the scale we require it, unless we can first re-energise our economy through restructuring involving the ten deliverables.
Beyond the ten deliverables there is the promise of real productive investment, domestic and foreign, that is absolutely necessary for economic growth to return to exploitation of our real potential rather than continue with anaemic growth based on unsustainable consumption and deficits.
Many of the candidate countries joining the EU with us on 1st May 2004 are starting from a comparative backward state our economic development but they are winning the foreign investment battle that we are missing. Because our economy is not competitive we have fallen off the short list of investors who are already deciding to relocate operations from expensive EU centres to new candidate country centres. No amount of organisational restructuring of the investment promotion agency will make up for the deficiency that we are not sufficiently competitive at a macro level.
As the new Prime Minister in waiting gets ready to take his new role at Castille, it would be utterly wrong to adopt a business as usual attitude. The country needs the unusual, the sense of urgency to get along with the restructuring job before we lose the game in a definitive matter.
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