In proposals submitted as part of the national Budget consultation, the MMF argues that, as an island economy dependent on shipping for trade, energy and essential supplies, Malta’s port capacity and maritime connectivity are fundamental to its economic resilience and prosperity. Timely investment, maintenance and policy coordination are therefore not only priorities for the maritime industry, but national necessities.

To this end, the Forum urged immediate attention to critical port infrastructure.  Its priorities include restoring and strengthening the Marsaxlokk breakwater, completing Ras Ħanżir with a permanent and fixed  Ro-Ro berth  and creating backup options for cargo operations. The Forum maintains that changes linked to the Grand Harbour Revival Project should not displace existing operations before suitable alternative facilities are provided .

At the centre of the proposals is a call to fund the implementation of the National Maritime Transport Strategy through a clear action plan identifying responsibilities, deadlines and measurable outcomes. The Forum is also proposing a permanent interministerial structure to coordinate maritime policy across transport, finance, energy, climate, infrastructure and foreign affairs, ensuring that urgent priorities are acted upon rather than delayed.

The budgetary proposals also include a dedicated financing framework for major maritime decarbonisation and digitalisation projects.  A meaningful share of climate funding linked to the EU Emissions Trading System – as long as this is in place – should be channelled back into cleaner vessels, alternative-fuel infrastructure, energy-efficient port machinery and digital technologies.

Addressing the industry’s skills shortage, the MMF recommends a National Maritime Certification Centre, a Maritime Skills Board and a national cadetship scheme.  It proposes a medium-term target of at least 600 valid Maltese Certificates of Competency, helping Malta develop its own maritime professionals alongside its internationally prominent ship register.

Other proposals include shifting cargo from road to sea through a Ro-Ro link between Malta Freeport and Gozo, developing legal frameworks for cleaner marine fuels, and establishing a public-private entity to promote Maritime Malta internationally.

Godwin Xerri, Chairman of the Malta Maritime Forum, said:

“Malta cannot aspire to be a leading maritime centre while treating port resilience, maritime skills and policy coordination as secondary matters.  The 2027 Budget should move beyond statements of intent and provide clear responsibilities, realistic deadlines and the resources needed for implementation.  These proposals are not solely about supporting maritime operators.  They concern Malta’s supply chains, energy security, environmental transition and ability to remain connected to international markets. Investment in maritime capability is investment in national resilience.”

The MMF presented its proposals personally and separately to the Minister for Sustainable Mobility as well as to the Leader of the Opposition and selected Shadow Ministers.  It offered its support and expertise to Government, Opposition and other stakeholders on the detailed implementation of its proposals.

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A comprehensive presentation of the Forum’s evolving position was led by Chairman, Godwin Xerri and Vice Chairman, Alex Montebello.  They maintained that the Forum’s consistently supported decarbonisation and the objectives of EU ETS. Nevertheless, they showed how, in line with their warnings ahead of its enactment, the application caused serious competition distortions and leakages with disproportionate risks on Malta and other member states.  These risks compromise fair competition, solidarity and other fundamental EU principles.

The Forum showed how EU ETS on maritime was not achieving its climate change objectives because ships still traversed the same sea but were increasingly diverting their transhipment operations away from the EU ports instead.  Besides this carbon and business leakage, the Directive was also diverting investment in new transhipment ports outside of the Union.

In the context of Malta’s dependence on global maritime connectivity, the presentation clearly outlined the risks of loss of mainline services with direct effects on the whole of the economy including connected feeder services, towage, pilotage, port services, terminal operations, stevedoring, mooring, ship agency, legal services, bunkering, importation of raw materials and supplies, and the manufacturing industry.  Loss of connectivity can cause the relocation of certain industry away from Malta due to market proximity considerations and limitations of export channels causing loss of jobs, investment and balance of payments imbalance for the country. 

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The increase is immediate and substantial, the statement said. Effective 1 October 2026 revised “EU ETS + FuelEU + BAF Surcharge” rates have been introduced on the Malta to Genoa service. The rates will apply until 31 December 2026 and will then be reviewed quarterly.

“This is a burden that European Union policy is placing on all Maltese citizens simply because we are an island. It is an unfair burden that will have repercussions on businesses and ultimately, all Maltese consumers,” said Joseph Bugeja, ATTO Chairman .

All operators have started contacting their respective clients to inform them of the increased rates.

The surcharge for a trailer travelling from Genoa to Malta rises from €35 to €39 per linear metre, translating into €530.40 per trailer. The same €530.40 applies to the return journey from Malta to Genoa, meaning that every trailer making a Genoa-Malta-Genoa round trip will now incur €1,060.80 in these surcharges alone.

The €35 million annual figure has been calculated on over 55,000 trailers originating mainly from Genoa but also to and from other Italian ports each year. Based on the new €1,060.80 round-trip charge, this represents an annual cost of approximately €35 million.

“Virtually everything Malta imports to sustain its economy and economic activity must cross the sea. Unlike most countries on mainland Europe, Maltese businesses have no alternative. Malta must stand up and challenge a policy designed for Europe as a whole but imposed on an island economy without adequately considering our unique geographic disadvantage.”

“The annual €35 million is being presented as Malta’s environmental bill. Safeguarding the environment is important, but environmental policy cannot come at the price of disproportionately penalising an island that has no alternative to maritime transport. This is an additional cost being imposed on Malta’s entire supply chain and it will ultimately be paid by Maltese businesses, families and consumers.”

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As the first Budget of the new legislature, the Chamber argues that the focus must now move from identifying structural challenges and announcing policy commitments towards establishing credible implementation pathways that deliver tangible outcomes for Gozo.

A number of proposals and objectives advanced by the Chamber in recent years are now reflected, wholly or partly, in the Government’s programme for the new legislature. While this convergence is welcome, it also means that Budget 2027 should focus on translating commitments into clear programmes supported by institutional responsibility, adequate resources, realistic timelines and measurable milestones.

The document identifies eight principal priorities for Budget 2027:

Regionality – undertake an evidence-based assessment of alternative governance models and develop a roadmap for the progressive exercise of an appropriate devolution of responsibilities and powers to a regional autonomous entity.

Mġarr Harbour – finance the expansion and futureproofing of the harbour, aligned with future ferry-fleet requirements.

Logistics Hub – move the Government commitment from concept to implementation, with a defined location, functions, governance, financing and connection with Mġarr Harbour.

Innovation and Enterprise – reposition the Gozo Innovation Hub as the anchor of a wider start-up ecosystem together with designated start-up support measures that will support the development of such eco-system.

Rural Airfield and Air Connectivity – provide a realistic annual capital allocation and commence implementation of the Gozo Rural Airfield project.

Financial and Professional Services – introduce a pilot regular MFSA presence in Gozo and develop a coordinated proposition for attracting substantive operations to Gozo.

Skills and Talent – implement employee upskilling support, align training with Gozo’s economic priorities and develop the Youth4Entrepreneurship into a structured entrepreneurship platform for youth.

Existing Businesses – extend transport assistance, strengthen direct support for digitalisation and productivity, and implement the proposed Valletta facility for Gozobased enterprises.

The Chamber stressed that these priorities are interconnected and should not be pursued as isolated measures. Stronger regional governance, strategic infrastructure, connectivity, logistics, diversification, skills and support for existing businesses must form part of one coherent, place-based development framework for Gozo.

Implementation should also be underpinned by transparent decision-making, clear accountability, objective criteria and effective consultation. The inclusion of many of these measures into the present Government’s manifesto, following also proposals by the Chamber, make these binding steps for the next legislature providing already the strategic direction that needs to be taken.

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In a statement on Facebook, Camilleri said the evaluation process for these submissions will commence in the coming days and weeks.

This charter arrangement serves as an interim measure until two new permanent vessels are purchased to join the existing fleet, aligning with the long-term strategy for the future of the Gozo crossing service.

The new fourth vessel will be replacing the Nikolaus, which has been chartered by Gozo Channel for several years but which has limited operations and has been the subject of so much criticism by passengers.

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The Commission published its review of the EU ETS on 17 July, proposing a number of changes aimed at reducing carbon emissions while addressing concerns raised by the shipping industry over the impact of the scheme on European ports.

MMF Chairman Godwin Xerri said the proposed amendments acknowledge several of the concerns raised by the sector but argued that additional changes will be necessary to ensure the EU’s decarbonisation objectives do not come at the expense of Europe’s maritime competitiveness.

Among the proposals welcomed by the Forum is a temporary reduction in EU ETS allowance-surrender obligations for certain container cargo transhipped through EU ports, including Malta Freeport. The measure would apply until the end of 2035 for inbound voyages from non-EU ports undertaken by container ships with a capacity exceeding 10,000 TEUs, where cargo is transferred to another vessel destined for a non-EU port.

While the exemption would not apply to Malta’s import and export cargo, the MMF said it would help reduce the competitive disadvantage faced by European transhipment hubs when compared with nearby non-EU ports that are not subject to the same emissions trading rules.

According to the Forum, Malta Freeport has come under increasing competitive pressure from ports in North Africa, particularly in Egypt and Morocco, which have significantly expanded their infrastructure and capacity in recent years. Several shipping services have already shifted operations away from EU ports, resulting in non-EU hubs capturing the majority of new transhipment business.

The Commission has also proposed tightening the rules governing neighbouring non-EU transhipment ports by lowering the transhipment threshold from 65% to 50% and broadening the criteria used to identify ports that could benefit from avoiding EU ETS costs.

However, the MMF said these changes do not fully address the issue, noting that the rules become ineffective whenever vessels bypass EU ports altogether.

“The proposed changes represent positive progress in addressing business and carbon leakage resulting from the implementation of the Directive,” Xerri said. “However, the review process must continue to ensure the legislation protects both Europe’s environmental ambitions and the competitiveness of its maritime sector.”

The Forum is also calling for permanent exemptions for island member states and other geographically disadvantaged regions, arguing that their dependence on maritime transport places them at a structural disadvantage.

Xerri said Malta’s insularity makes reliable maritime connectivity essential for both consumers and businesses, and that this should be permanently recognised within the EU ETS framework.

The MMF further urged the European Commission to clarify what would happen should the International Maritime Organization (IMO) introduce a global carbon pricing mechanism for shipping. The Forum believes the Commission should commit to withdrawing the regional ETS regime if a global measure is adopted, thereby avoiding overlapping compliance obligations and additional costs for shipping operators.

The Forum also welcomed proposals to earmark EU ETS revenues for the shipping sector through both national funding and the planned Maritime Transport Decarbonisation Fund.

However, it argued that financial support should extend beyond wind-assisted propulsion and shore-side electricity to include a broader range of technologies capable of improving energy efficiency and reducing emissions across all shipping segments, including short-sea, bulk and tramp shipping.

The MMF said it remains committed to working with the Maltese government, European institutions and industry stakeholders to pursue further reforms to the EU ETS Maritime framework, particularly those recognising the unique challenges faced by island states that rely heavily on maritime links for their supply chains.

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Lost time in congestion translates directly into delayed deliveries, missed appointments, reduced efficiency, higher operating costs, and lower quality of life. When traffic becomes normalised, the country pays for it in hours lost, fuel wasted, wellbeing reduced and business opportunities diminished, the chamber said.

It added it has been consistently putting forward concrete proposals to address Malta’s traffic and mobility crisis throughout the last legislature. We have done so in published press releases, consultation documents, pre-Budget submissions, pre-election submissions and sector-specific proposals because the status quo is not sustainable. Yet, despite repeated warnings and practical suggestions, very few of the Chamber’s recommendations have been taken on board in any meaningful way.

“The Malta Chamber has said this repeatedly: a real shift in behaviour will not happen through incentives and positive reinforcement alone. If the objective is to reduce private car dependency, disincentives must also form part of the policy mix. Without a balanced approach that includes practical alternatives and measures that make continued car use less attractive in peak conditions, behavioural change will remain limited and the roads will remain congested,” the chamber said.

It is of great concerned to note that effective implementation improves quality of life and productivity has been lagging far behind. In an age of digitalisation and AI, Malta is still discussing basic coordination issues, with too many roadworks, permits and transport decisions still managed in fragmented ways. The country cannot continue deploying manpower to manage roundabouts and congestion manually when intelligent traffic-light systems, smarter data tools, and better coordination platforms should already be standard.

The Malta Chamber therefore reiterated its call for a fundamental change in the way traffic is managed. This is not a matter of isolated fixes; it requires a coherent national effort, backed by strong governance, proper coordination and the political courage to take decisions that may be difficult in the short term but are essential for the country’s long-term health.

The Malta Chamber’s proposals include the following:

• Introduce mobility e-wallets funded through targeted urban parking and congestion-management revenues, so that the scheme promotes actual modal shift.

• Use an AI driven solution through which local councils process domestic and business requests for road closures and permits, including an interactive public-facing platform to give residents and businesses advance visibility of disruptions to allow for their proper planning. This system should build on and be an integral part of the internal system being used between various government entities intended to minimize road disruptions and which currently is lacking on the public-facing on-the-fly information updates.

• Introduce a public-facing platform for local council domestic and business requests for road closures, giving residents and businesses advance visibility of disruptions. This should complement the existing coordination system between entities, while addressing the missing public-facing element.

• Reform school transport through geographic pooling and wider use of supervised walking and community-based initiatives to reduce school-front congestion.

• Deploy smart parking information systems in congestion-prone localities to reduce unnecessary circulation in search of parking.

• Roll out smart mobility and logistics solutions for commercial areas, including loading-bay management, delivery-slot booking and enforcement tools.

• Use public-private partnerships to relocate on-road parking into underground or multi-storey facilities, while freeing surface space for more efficient mobility uses.

• Develop logistics consolidation hubs where evidence supports them, in order to reduce duplicate freight trips and improve competitiveness.

• Link public funding for transport and infrastructure to independently verified mobility outcomes, so that money follows results, not promises. 

The Malta Chamber urged the government to heed these proposals with urgency and seriousness. Malta can no longer afford piecemeal measures, slow implementation and half-measures that fail to address the root causes of congestion. If Government does not act decisively now, the country risks entrenching inefficiency, weakening competitiveness and failing residents, workers and businesses alike. It’s time to break the gridlock!

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The strategies, unveiled on 10 June 2026, focus on improving connectivity, boosting economic resilience, and tackling structural barriers affecting islands across Europe.

ATTO chairman Joseph Bugeja said the initiative marks an important step for Malta’s transport and logistics sector, which has long argued that EU policies do not fully reflect the realities of operating from an island state.

“For years, Malta and other island regions have had to work within EU frameworks that failed to adequately address the higher costs, logistical difficulties, and competitiveness challenges linked to insularity,” Bugeja said.

He added that the Commission’s strategy validates concerns repeatedly raised by ATTO over transport inefficiencies, limited connectivity, and the disproportionate burden carried by island-based operators.

ATTO said the Commission’s priorities closely mirror the day-to-day realities faced by Maltese transport operators, who play a key role in maintaining supply chains and supporting economic stability.

The association also welcomed the EU’s commitment to engaging more closely with island stakeholders in future policymaking, saying it is ready to contribute to discussions to ensure Malta’s transport and logistics sector is properly represented.

While describing the announcement as a significant breakthrough, ATTO stressed that the strategy must now lead to concrete legislative and financial measures, particularly in areas such as transport, climate policy, and state aid.

“Only through effective implementation can the full promise of this strategy be realised,” Bugeja said, adding that ATTO looks forward to working with both national and EU institutions to ensure Malta’s realities as an island state are fully recognised in future policymaking.

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The Malta Maritime Forum (MMF) has called for active measures to strengthen Malta’s position as a regional maritime hub, warning that growing geopolitical uncertainty, regulatory pressures and the transition towards decarbonisation are reshaping the global shipping landscape.

Addressing the Forum’s Annual General Assembly held at MaritimeMT, MMF chairman Godwin Xerri presented a 77-point maritime-centred electoral manifesto aimed at reinforcing the sector’s strategic contribution to the Maltese economy ahead of the next general election.

The proposals, which have already been presented to Malta’s main political parties, focus on four key areas: governance, the National Maritime Transport Strategy, education and skills, and infrastructure. Central among the recommendations is the re-establishment of a National Maritime Authority, a measure the forum argues would improve coordination, accelerate decision-making and provide clearer strategic direction for the industry.

Xerri also called for the appointment of a minister specifically responsible for maritime affairs, supported by a permanent interministerial structure to strengthen coordination across government.

“The common objective across all proposals is to strengthen the industry’s role within the economy and position Malta as a leading regional maritime hub,” he said.

The MMF stressed that Malta’s maritime policies must align both with the government’s Vision 2050 framework and emerging European Union strategies. Xerri argued that EU policies should better reflect the realities faced by island states such as Malta, particularly as the industry grapples with digitalisation and decarbonisation requirements.

Among the forum’s proposals are measures to enhance the competitiveness of the Malta ship registry, attract investment in ship finance and support the development of clean-fuel bunkering infrastructure.

On infrastructure, the MMF reiterated its call for new multi-purpose quays within the Grand Harbour and urged the government to proceed with the long-delayed Ras Ħanżir project before works linked to the Grand Harbour Revival Plan commence. The forum also renewed calls for a full nautical risk assessment to safeguard existing and future commercial port activity.

Addressing members during the assembly, MMF CEO Kevin J. Borg outlined the organisation’s lobbying efforts in Brussels, particularly concerning the European Union Emissions Trading System (EU ETS).

Borg said an MMF delegation had met European Commission officials, Maltese MEPs and European Commissioner Glenn Micallef earlier this year to highlight concerns about carbon leakage and business competitiveness arising from the current ETS framework.

While supporting the principle behind the emissions system, the forum argued that revisions are needed to better reflect the operational realities of European ports and maritime operators.

The MMF has also submitted formal positions to the European Commission regarding the EU’s Islands and Coastal Communities Communication, as well as proposed Ports and Maritime Industrial strategies.

Meanwhile, Kenneth Farrugia, CEO of Bank of Valletta, highlighted the banking sector’s role in supporting the industry’s next phase of growth.

Farrugia pointed to opportunities in ship finance and noted that the bank is exploring syndicated financing structures in collaboration with the MMF. He also emphasised the importance of financing digitalisation and green investments through partnerships with the European Investment Bank and the Malta Development Bank.

The BOV CEO underlined the importance of compliance, transparency and anti-money laundering procedures, while noting that a resilient maritime ecosystem remains critical to Malta’s wider economy given the country’s dependence on maritime connectivity.

Economic projections presented by economist Gordon Cordina showed the maritime industry continued to expand steadily between 2018 and 2025, driven by port activities, maritime business services and water transport.

Cordina said the sector now generates 4.8% of Malta’s value added while accounting for around 2% of national employment, making labour productivity in the industry more than double the economy-wide average.

He noted that future growth should increasingly focus on high-productivity services such as regulatory and governance functions, maritime finance and legal services, as well as education and human capital development.

“The industry is of systemic importance to Malta’s economic model,” Cordina said, adding that continued competitiveness and sustainability would be essential for long-term economic resilience and the successful implementation of the National Maritime Transport Strategy.

He concluded that Malta’s maritime ambitions under Vision 2050 would depend on continued innovation, private investment and political commitment to higher-value maritime services.

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In an interview with The Malta Business Weekly, Etienne Attard says the logistics industry has moved beyond reacting to occasional shocks and is now adapting to a fundamentally different global trading environment shaped by geopolitical instability, trade fragmentation, energy volatility, and supply chain insecurity.

“International logistics is no longer characterised by episodic disruption,” Attard explains. “What we are seeing today is a structural condition of uncertainty that is reshaping the entire sector.”

With more than seventy years of experience in transport and logistics, Express Trailers has witnessed multiple economic and geopolitical cycles. However, Attard argues that the current environment differs significantly from previous periods of volatility.

“In the past, crises were generally viewed as temporary events — whether it was the pandemic, the war in Ukraine, port congestion, or energy shocks. The assumption was always that markets would eventually stabilise. Today, there is growing recognition across the industry that instability itself has become the operating environment.”

According to Attard, the traditional logistics model built around efficiency optimisation and predictable globalisation is being replaced by one centred on resilience and adaptability.

“Global trade is more fragmented, more politicised, and less predictable than at any point in recent decades,” he says. “Supply chains are now being redesigned around the expectation of recurring disruption rather than stable international conditions.”

The impact is particularly visible in smaller and strategically located markets such as Malta, where maritime connectivity and international trade routes are critical to economic activity.

“For Malta’s logistics sector, trade wars, tariff volatility, and maritime insecurity can no longer be treated as temporary distortions,” Attard notes. “They are increasingly structural features that directly influence routing decisions, pricing, transit times, and customer behaviour.”

One of the most immediate challenges facing operators is growing operational complexity.

Attard identifies three major dynamics currently reshaping the sector.

“The first is persistent route volatility,” he explains. “Disruptions in maritime corridors such as the Red Sea have forced significant rerouting around Africa, increasing transit times and creating cascading effects throughout supply chains.”

A second challenge is regulatory fragmentation.

“As trade blocs become more rigid and tariff regimes shift more frequently, logistics companies are having to develop stronger capabilities in customs intelligence, compliance management, and regulatory coordination,” he says. “These are no longer administrative functions — they are now strategic operational requirements.”

At the same time, customer expectations are also evolving rapidly.

“Many businesses are moving away from purely cost-driven just-in-time supply chain models,” Attard says. “There is a growing emphasis on resilience, redundancy, regional diversification, and maintaining higher inventory buffers.”

This transformation, he argues, is also changing the role of logistics providers themselves.

“The sector is becoming less transactional and far more advisory in nature. Customers increasingly need partners who can help them interpret instability, manage scenarios, and maintain visibility across disrupted networks.”

For operators in Malta, this creates both pressure and opportunity.

“The pressure is clear — tighter margins, shorter planning cycles, and less predictable asset utilisation,” Attard says. “Traditional efficiency-led models are becoming increasingly insufficient.”

However, he believes companies that can offer agility, intelligence, and responsiveness will be best positioned to grow.

“As complexity increases, so does the value of orchestration,” he explains. “Logistics providers are evolving from transport operators into strategic intermediaries between global volatility and local execution.”

In this environment, Attard believes scale alone is no longer enough.

“The key differentiators today are adaptability, information, and responsiveness,” he says.

Looking ahead, Attard believes the industry must abandon the expectation that global logistics will eventually return to a stable equilibrium.

“The strategic question is no longer how to return to normal,” he concludes. “The real question is how to operate reliably in a world where normal no longer exists.”

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