Initiative

The Export Network Programme (ENP), which was launched a couple of weeks ago, will help businesses pool their resources for greater export success.

The programme requires a minimum of two manufacturing enterprises that together have 15 employees or more. Jointly, they submit an international marketing plan, and they will hire an export network manager who will be responsible for the implementation of the plan.

For qualifying plans, IPSE and METCO will cover up to half of the manager's gross salary for a three-year period. The programme also funds up to Lm20,000 for the implementation of measures identified in the plan. Assistance may go for the development of distribution channels, market research, fact-finding delegations and product launch initiatives in target markets.

The furniture sector has been a prime example of how networking between firms can result in joint benefits for companies that join forces to undertake projects and to market their products. The ENP will facilitate co-operative endeavours across manufacturing.

This ENP was launched jointly by IPSE and METCO. The new venture brings together IPSE's experience with small and medium-sized manufacturers with METCO's expertise in export and trade promotion

Malta Enterprise

While the ENP is a focused venture of two support institutions, Malta Enterprise is a more fundamental application of the same concept: exploiting the synergy of all three institutions: METCO, IPSE and MDC.

Still, in his reply to the Budget speech, Dr Alfred Sant described Malta Enterprise as a "monster". Mercifully, he did not try to pin even this one on Malta's bid for EU membership. There are certain connections that even he won't make.

Malta Enterprise is not some capricious exercise, but the result of careful deliberation of what it takes to overcome current deficiencies. A recent survey assessed perceptions of IPSE's, MDC's and METCO's clients.

It emerged that respondents were concerned at the lack of an integrated approach to enterprise support. Often users do not know which agency can help them best. It also emerged that customer service is not a core capability of these agencies, which are perceived as over-bureaucratic and too complex to deal with.

Clients complain that it takes too long to get things done. Businesses also complained of a lack of transparency, and of an uneven playing field in incentives. These survey results echo the internal findings of the separate agencies. All the indications are that a one-stop shop is essential for Malta's firms.

One focal point of Malta Enterprise is its interaction with other stakeholders - the educational, research, financial and infrastructural entities that have a bearing on business development. Also, having one entity will save administrative overheads that are currently duplicated or triplicated.

A culture change must also occur within, to create a 'can do' attitude and to overcome the current tendency for each separate agency to concentrate on its own particular operation. The focus has to be on the national business promotion strategy.

Malta has to develop the ability to identify and target product niches for which we have the right qualities, and which will provide us with substantial valued added. This approach was embarked upon with the Business Promotion Act. However, targeting is an ongoing project. Continual updating of information particular to niches is essential for such targeting to remain valid. Malta Enterprise is designed to deliver this kind of information and to act upon it.

Labour's opposition to Malta Enterprise has never developed beyond sweeping statements and shallow remarks. A more mature attitude is called for.

Clutching at straws

The Labour Party's case against EU membership is a stew of poor judgment and wrong conclusions. The crusade to convince us that the partnership option is what we really want depends also on an endless stream of outrageous claims.

Take the termination of the Generalised System of Preferences (GSP) for exports to the United States, for which Malta qualified in mid-2000. As with everything else that crops up on his dim radar screen, Dr Sant had to squint pretty hard before he could see the makings of yet another argument against EU membership. Last Monday The Times quoted him as follows: "Malta could have at the time negotiated with the US to continue benefiting from the scheme, but it did not as it was negotiating membership of the EU".

No! The GSP is offered by a richer country to help developing nations improve their economic condition by opening its doors further to their exports. It provides for the duty-free import of a wide range of products that would otherwise be subject to customs duty upon entry into, say, the United States. However, once a country reaches a certain level of national income, it loses this advantage. On the grounds that Malta's economic well-being no longer justifies the preferential treatment, the US terminated our GSP status.

The end of this benefit has nothing at all to do with Malta's negotiation for EU membership. In fact, all countries whose exports to the US benefit from the GSP are economically behind Malta. If Dr Sant thinks that partnership with the EU would keep us on the GSP list, he should think again.

Switzerland, which until recently set the standard in Labour's books of what a relationship with the EU should be, is not on the list, because it is too rich. On the other hand Latvia, the Czech Republic, Lithuania, Slovakia, Hungary and Poland are EU candidate countries that are poorer than Malta, and not coincidentally they are still on the list.

We'll see what Dr Sant comes up with next. In the meantime, common sense keeps taking a beating.

100 million

The Labour Party also tries to play down the role which the freezing of Malta application had on the availability of pre-accession funds. Agenda 2000 was presented in July 1997. This was a document in which the Commission outlined the broad perspective for the development of the EU, its policies and its financial framework beyond the year 2000. Agenda 2000 also addressed the challenges and quantified the impact of enlargement. One of the reforms it proposed was that of structural policy so as to facilitate the accession of new member states.

The document stated: "Several conditions need to be met if the structural policy is to cope efficiently with enlargement... Various instruments will contribute to this aim. Firstly, the PHARE programme, which aids the countries of central and eastern Europe, recently underwent a policy change and has a budget from now on of €10.92 billion for pre-accession assistance between 2000 and 2006. ISPA (the Instrument for Structural Policies for Pre-Accession), finances projects in the environment and transport sectors and has a budget of €7.28 billion. SAPARD another financial instrument for agriculture has €3.64 billion."

Malta had frozen its application for membership in 1996. Thus in July 1997, it was not included as a candidate country. There was a total of €21.84 billion as pre-accession aid. In 1997 the population of then accession countries totalled 74.85 million. This meant an average of €292 per head. Thus Malta's allocation, given our population, should have been somewhere around the €110 million.

After unfreezing its application, Malta received €38 million in pre-accession funds, for the period 2000-2004, an average of Lm44 per capita. Slovenia received Lm80 per capita, for the period 1992-2002. This country has a higher standard of living, in purchasing power parity terms, than Malta. Lithuania received Lm82 per capita between 1992 and 2002, Latvia received Lm102 and Estonia Lm127. Indeed, with the freeze, we have been significant net losers!

Exports

In spite of the still wobbly international environment, recent improvements in export performance were sustained also during the month of October. A sensitive indicator is the path taken the comparison of each month's figure with the same month of last year.

The turnaround in monthly exports started in July 2002. In the four months from July to October, total exports were Lm48.2 million up on the same four months of 2001. The corresponding figure for domestic exports was Lm31.2 million

In October alone, domestic exports were up Lm8.9 million. Increases were reported across a broad range of manufacturers, including electronics, printed matter, office machinery, toys, and food preparations.

Also during October, imports of industrial supplies were up for the fifth consecutive month. Imports of capital goods rose marginally from last year, and October's rise was the third consecutive monthly increase.

On the other hand, imports of consumer goods reached a record Lm246.7 million in the first ten months of 2002, with a Lm0.8 million rise being reported in October alone.

These trade numbers provide continued reassurance that the economy is weathering difficult times in foreign demand.