MEP Josianne Cutajar pushes for State Aid solutions tailored to islands’ needs

In an address on State Aid rules in support of Covid-19 recovery for Europe’s maritime and insular regions, Maltese MEP Josianne Cutajar insisted on the need for the permanent increase of de minimis thresholds, as well as more flexibility and consideration for the natural disadvantages that Europe’s islands and business operating from them continue to experience today.

Dr Cutajar called for a frank discussion on the role of State Aid Rules in the current economic crisis affecting the continent in the wake of the pandemic.

Cutajar pressed for more flexible State Aid rules also with reference to maritime transport, since the current scheme fails to take into account local specificities and does not always help overcome the geographical disadvantage that small islands suffer from. This has also been the case with the Malta-Gozo ferry.

The Maltese MEP was addressing an important debate co-ordinated by the European Parliament Intergroup on Seas, Rivers, Islands and Coastal Areas (SEARICA), of which she is an active member.

‘Permanent disadvantages require lasting solutions and the special condition of islands should be recognised – once and for all,’ Cutajar insisted, while expressing her concern about what will happen to the economies of Europe’s islands once the State Aid Temporary Framework in response to Covid19 will be over.

‘I think it would not be amiss to ponder over a phase-out period during which the progressive and gradual return to a new normality must be ensured’, Cutajar insisted.

MEP Cutajar drew the attention of those present for the debate that short-term measures should be taken with a view to a long-term strategy tailored to the specific disadvantages that islands are experiencing in terms of connectivity and competitiveness.

The long term strategy, Dr Cutajar argued, should give more flexibility in terms of state aid in order to ensure adequate focus on islands’ strategic sectors such as sustainable tourism.

Cutajar insisted that sustainable tourism does not only mean hospitality, but also encompasses different sectors that can contribute to the diversification of our local economy, which is mainly constituted of small businesses.

She also noted that ‘sustainable tourism itself would help spur innovation to enable circular economy and clean mobility solutions, as well as help enhance initiatives in the field of landscape management and the valorisation of cultural heritage.’

‘I have already emphasised several times the call made by the European Parliament in the European SME Strategy to assess the special conditions of small and medium businesses operating in islands should any revision of State Aid rules occur. I would like to renew this call,’ Dr Cutajar concluded.