To protect lives and livelihoods, repair the Single Market, as well as to build a lasting recovery, the European Commission has proposed a new recovery instrument, Next Generation EU of €750 billion as well as targeted reinforcements to the long-term EU budget for 2021-2027 that will bring the total financial firepower of the EU budget to €1.85 trillion.

Alfred Santnoted that the proposal that a large percentage of the funding will be in grants is positive. Its integration into the Multiannual Financial Framework also makes sense.

Next Generation EU will raise money by temporarily lifting the own resources ceiling to 2% of EU Gross National Income, allowing the Commission to use its strong credit rating to borrow €750 billion on the financial markets. Still the question remains: Will the proposed rise of the GNI Own Resources ceiling be enough to cover the envisaged requirements? Some economic forecasts seem to make this quite doubtful.

Then more crudely: Who will exactly benefit from the envisaged recovery plan? Will the multiple goals that are inbuilt into its proposed design skew benefits towards particular regions or sectors, at the expense of others?

“For instance, in response to Green Deal exigencies, significant resources will apply to the promotion of clean energy applications, like the creation of a million charging stations for electric cars. Naturally, producers of the latter, mainly located in two member states, will benefit most from this”, stated Alfred Sant.

The post Alfred Sant questions who will benefit from EU coronavirus recovery plan first appeared on The Malta Business Weekly.

The theme of the FinanceMalta webinar is “The role of financial services in moving Malta’s economy in a COVID-19 situation” and will provide the views of two leading figures in the Maltese economy, namely Kurt Farrugia – CEO at Malta Enterprise, and Dr Gordon Cordina – economist at E-Cubed Consultants.

Following an introduction by FinanceMalta’s Senior Manager of Business Development, Andrea Nurchi, and a welcome by Chairman Rudolph Psaila, participants will be addressed by Parliamentary Secretary for Financial Services and Digital Economy, Clayton Bartolo.

The webinar is aimed at all players in the financial services industry, entrepreneurs, students and anyone interested in knowing how the challenges posed by the pandemic are being tackled from an economic perspective.

During the event, several topics will be covered such as the current situation of the financial services industry and how it has been impacted by COVID-19, the role of the industry in stabilising the economy in a post-pandemic scenario, as well as the economic measures taken to face the pandemic. There will be a particular focus on the role that Malta Enterprise played in supporting and sustaining the economy, and the way forward.

The webinar, which is free to attend and will last one hour, will also feature a Q&A with the speakers. For more information and to register visit: https://financemalta.org/events/the-role-of-the-financial-services-industry-in-moving-maltas-economy-in-a-covid-19-situation/

FinanceMalta is the public-private initiative set up to promote Malta as an International Financial Centre.

The post FinanceMalta webinar on role of financial services in moving the Maltese economy first appeared on The Malta Business Weekly.

BOV Branches will now open from Monday to Friday between 8.30 am and 1.30 pm.  Cheque encashment and cash withdrawals will be accepted until noon as per normal pre-COVID procedures. All current procedures with regards to cashiering services and safety measures including limiting the number of customers inside the branch at any one time remain in force.  The Bank reminds its customers to avoid queuing and use ATMs at any time of the day for their cash requirements. Better still, customers should as much as possible opt to use the safer contactless payments such as BOV Cards, BOV Pay, BOV Mobile and Internet Banking.

“All throughout this pandemic we have been in close contact with the government and local health authorities. Any decisions we have taken, were taken to safeguard both our customers and employees. We adjusted our processes and procedures and opened new channels to ensure wider accessibility for our customers,” declared BOV CEO Rick Hunkin. “We have a large team of people working behind the scenes delivering banking services to customers at their homes, where previously these customers would have been required to visit a branch.” 

Mr Hunkin continued, “So while we reduced traffic towards physical branches, we offered alternatives for customers to stay safe and get served.  I am happy to say that these channels have worked so well during these past couple of months, that we shall continue using them.  In fact, I urge customers who require non-cashiering services to set up appointments with our branches so that they do not stay waiting in the queue and reduce contagion and exposure risks.” 

Customers can set up appointments for any non-cashiering services such as home loans, personal loans, investments, bank cards and internet banking applications by sending an email to info@bov.com with the type of service required, mobile number, ID Card number and preferred branch or by calling on +356 2275 3500 Monday to Friday 8am to 4pm.

Bank of Valletta is currently operating 28 branches, making it the largest network accessible to customers.  While a number of branches will remain temporarily closed due to staffing issues, the Bank is, on a roster basis, opening such branches on Saturdays to limit inconvenience to its customers.

The BOV CEO concluded, “The increase in our opening hours takes us another step towards normality. It is regretful that we are still not in a position to open all our branches as we still need to support our staff who are either in the vulnerable category or have young children to look after and thus have no other alternative but to work from home.  We will continue to support and protect our employees as required, while at the same time do all our utmost to continue supporting and serving our customers and all our stakeholders in the best possible way during these unprecedented times.”

The post Bank of Valletta increases its branch opening hours first appeared on The Malta Business Weekly.

In April, the Central Bank of Malta’s BCI fell when compared with the previous month, suggesting notably weaker levels of economic activity with respect to the long-term average.

Similarly, the ESI declined sharply. Sentiment weakened in all sectors, with the largest falls recorded in the services and construction sectors.

In March, tourism activity contracted sharply as a result of the containment measures and the subsequent travel ban that was introduced on 21 March in response to COVID-19. The volume of retail trade also contracted, though by far less than tourism activity. Meanwhile, growth in industrial production slowed down.

The number of registered unemployed increased in March. However, the unemployment rate remained low from a historical perspective.

Consumer price inflation edged up in March, though still remaining at low levels, with the annual inflation rate based on the Harmonised Index of Consumer Prices rising to 1.2%. Similarly, inflation based on the Retail Price Index rose slightly to 1.1%.

The publication also looks at public finance developments and notes that the deficit on the cash-based Consolidated Fund widened significantly compared with a year earlier, partly reflecting the Government’s decision to defer the collection of a number of tax revenue components in view of COVID-19.

It also reports on recourse to the moratorium on loan repayments offered by domestic credit institutions by the end of March in response to COVID-19. The value of household and corporate loans subject to a moratorium at the end of the month was €487.0 million, equivalent to 4.5% of related outstanding loans.

The full Economic Update, which also reports on international trade and financial markets, is available here.

The post CBM Economic Update: The number of registered unemployed increased in March first appeared on The Malta Business Weekly.

2.8 million inbound tourist trips were registered last year, but the sector ground to a halt this year with the suspension of all passenger flights as a result of the COVID-19 pandemic.

It is believed that the pandemic could cost the country up to €3 billion in tourism revenue and lead to thousands of redundancies.

Zahra told this newsroom that it is difficult to predict tourist arrivals for 2021, but the best case scenario predicted by industry sources would place the totals for next year at around a third of last year’s numbers.

The Malta Independent asked Zahra whether he could confirm reports that several routes will be cut from the Winter 2020 and Summer 2021 flight schedules. He said that the association does not have any information to this effect.

Zahra added that it is very difficult to predict what routes could be axed and if flight frequencies would change, adding that Malta would have to adapt to the situation.

“If we manage to get 30% to 40% of last year’s numbers in the upcoming winter schedule, it would not be so bad,” Zahra said.

He added that those who think that things will go back to normal the day the airport reopens are “gravely mistaken.”

“This is not some annual shutdown where you pick up where you left off,” he said.

Zahra noted that there are many who are putting pressure on the authorities to keep the airport shut. “For sure, if the airport remains closed, there will be no flights and no passengers.”

The government said last week that it is discussing the possibility of opening ‘safe corridors’ with nine other countries that have kept their COVID-19 numbers low. These are: Luxembourg, Norway, Serbia, Slovakia, Austria, the Czech Republic, Latvia, Lithuania and Israel.

The UK is also mulling the idea of ‘air bridges’, removing the 14-day quarantine requirement for people coming from ‘safe’ countries, while Italy has said it will open its airports on 3 June. It is unlikely, however, that Malta will consider re-launching flights to the two countries – even if they are Malta’s biggest tourism markets – given their high COVID-19 infection rates.

The idea of restarting flights has been met with fierce opposition by a number of social partners and medical associations, who say that the economy is being prioritised over public health.

On Thursday, the Medical Association of Malta (MAM) and UHM-Voice of the Workers said that Malta is now in the second Coronavirus wave and warned that the country could end up with the “worst statistics in the Mediterranean.”

Asked for a reaction, Zahra said he would not go into the medical argument but wanted to make an economic argument that everyone can understand.

“Imagine that tourism is a hosepipe attached to a water tap. This hosepipe feeds into other smaller pipes, a sort of irrigation system. These small pipes represent many sectors of the economy; airport shops, taxis, public transport, restaurants, hotels, bars and many more. At the end, there is something called ‘government taxes’ and these taxes finance things such as public healthcare and education. If you close the tap, there will be no water in any of the pipes. So how can you expect the flowers to live?”

Zahra said there has been a lot of talk about a “second, third, fourth or fifth wave, but the only thing that is certain is that if the hose remains closed, the economy will remain in a disastrous state.”

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