Rethinking our Economy: The Impact of COVID-19 on the Gozitan economy and the Way Forward Daniel Borg Chief Executive Officer Standing Committee on Gozo Affairs – 16 September 2020
THE WAY FORWARD 2 “ At the same time I hope that, with the converging ng commitmen ent of all politica cal and economic c leaders, work might resume: families and society cannot continue without work . . . It is and will be a problem in the aftermath of the pandemic: poverty and lack of work. A lot of solidar arity ity and creativi vity will be needed to resolve this problem” Pope Francis (2020), Angelus Saint Peter Square, Sunday 2 August 2020
3 GOZO’S UNDERLYING ECONOMIC STRUCTURE
GOZO’S UNDERLYING ECONOMIC STRUCTURE 4 64 64% 64% 64 60.3% Employment Business Units GDP per capita In 2018, 64% of the people in full- 60.3% of the business units in Gozo GDP per capita in Gozo at Euro time employment in Gozo were in employed between 1 to 9 persons 15,997 is 64 % of the national the private sector, while 36 % were (2019) economy (2018) in the public sector
GOZO’S UNDERLYING ECONOMIC STRUCTURE 5 9.8% 7.5% Contribution of Construction to Average Rate of Growth – GDP – Gozo Gozo’s Regional GVA - 2014 - 2018 Malta: 3.5% Malta: 10.29% Upcoming Deposits 50% T ourism 8.9% Estimated Contribution of Gozo’ s GDP 215,272 Domestic Tourists (2019) Contribution of Real Estate Foreign Inbound Tourists (2019) 180,979 Activities to Gozo’s Regional GVA - Malta: 4.6% 1,346,550 Same day visitors (2019)
6 CURRENT BUSINESS SENTIMENT
WHAT IS THE SECTOR IN WHICH YOU ARE 7 OPERATING? 13% Others 24% Tourism 2% Crafts 2% Agriculture/Fishing 5% Transport 7% Construction 18% Importing/Wholesaling/Retailing 11% Manufacturing/ Exporting 18% Financial/Insurance/Legal/Health & other Professional Services
HOW HAS THE OUTBREAK OF THE COVID 19 8 AFFECTED GOZITAN BUSINESS? 46.70% 1 (No Effect) 2 20% 22.20% 3 4 5 (Very 6.70% 4.40% Negative)
THE IMPACT OF THE COVID 19 WAGE 9 SUPPLEMENT ON GOZITAN BUSINESSES Positive 31.10% Negligible or minimal impact 57.80% My business was 11.10% not entitled to benefit from this incentive
THE IMPACT OF THE RENT REFUND SCHEME ON 10 GOZITAN BUSINESSES Positive 22.20% Negligible or minimal impact 13.30% 64.40% My business was not entitled to benefit from this incentive
THE IMPACT OF THE ELECTRICITY BILL REFUND 11 ON GOZITAN BUSINESSES Positive 26.70% 40.00% Negligible or minimal impact My business was not entitled to 33.30% benefit from this incentive
THE IMPACT OF THE VOUCHER SCHEME ON 12 GOZITAN BUSINESSES Positive 35.60% Negligible or 48.90% minimal impact My business was not entitled to 15.60% benefit from this incentive
THE IMPACT OF THE OTHER MEASURES 13 ANNOUNCED BY GOVERNMENT ON GOZITAN BUSINESSES 25.00% Positive Negligible or minimal impact 75.00%
WAY FORWARD 14 80.00% 75.60% The COVID-19 Wage 70.00% Supplement should be 64.40% extended beyond the 60.00% month of October 50.00% The COVID-19 Wage Supplement should be 42.20% 40.00% reviewed to include other categories of 30.00% workers The Government should 20.00% issue another round of vouchers in order to 10.00% stimulate the economy 0.00%
15 WAY FORWARD
MAIN MEASURES BEING PROPOSED BY THE GBC 16 Digital l Sector Sustaina inabil ility ity Provide a tax holiday for companies in the digital • Replace the present leased ferry with a hybrid ferry. • sector to establish themselves here in Gozo. This should also be considered for the other Gozo Grant a subsidy on rent for companies in the digital • Channel vehicles as a long-term approach when coming sector which establish themselves in the Digital to replace the existing fleet. Innovation Hub. Electric vehicles of Maltese residents crossing over to • Creating an eco-system of incentives specific for • Gozo are to pay a reduced fare. On the other hand Gozo, for business enterprises within the wide Gozitan residents with electric vehicles would cross for spectrum of the digital technology sector alongside a free on Gozo channel ferries. holistic strategy for Gozo in this sector.. Refund on electric vehicles for Gozo residents to be • raised to € 9,000 instead of the present maximum of € 7,000. Public ic Infrastruc ructur ure . The building of a new hospital for Gozo. • Trans nsport and Connectiv ivity ity The building of an underground multi-storey • Continue with important projects for Gozo • parking in Victoria that would not impinge on including enhancing further maritime and air Victoria’s historic and authentic landscape. links between Gozo and Malta. The building of a new breakwater for Marsalforn • Continuation of the permanent link project • Harbour. between Gozo and Malta. .
THANK YOU
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