Bartolo calls for government strategic plan for tourism

The opposition spokesman for tourism yesterday urged the government to draw up its own strategic tourism plan and not just rely on a Malta Tourism Authority plan due to be published in May.

Various areas of government activity - such as taxation and the granting of visas - had a direct impact on tourism but did not fall within the remit of the MTA, hence the need for a coordinated approach, Evarist Bartolo said in Parliament.

Speaking during the debate on the financial estimates of the authority, Mr Bartolo said an all-round effort was needed to strengthen the tourism industry. Competition with other destinations was tough. Rather than compete against each other, Maltese politicians, as well as operators, needed to compete with other destinations.

There were several worrying signs in the tourism industry which needed to be seen to with urgency but within the context of a long-term plan.

For example, statistics showed an increase in cruise passengers visiting Malta last year, but that was still less than in 2003 and 2004. And there was need for a better method to calculate the impact of these visitors on the economy.

Tourism had to be seen as an important job-creating activity, but unfortunately the number of full-time jobs was falling. In 1998 there were 9,713 full-timers in tourism and now there were 8,360. It was not enough to say that the number of part-timers had increased.

It was good that new hotels had opened, but the number of tourist beds had declined by over 1,000 since 1998.

Tourism simply could not be calculated on the basis of arrival figures, but also with spending in mind. MHRA figures showed that in summer 2005, compared to 2004, there were seven per cent less rooms in the four-star category, tourist spending dropped by Lm7.5 million and per capita expenditure was down by seven per cent. The situation was worse in Gozo.

Mr Bartolo said increased spending on marketing would be useless unless the government acted to improve Malta's competitiveness. Unfortunately the government lacked a strategic plan for tourism. It was good that the MTA intended to issue its plan in May, but the government should have its own tourism strategic plan which incorporated all the sectors of the administration involved in tourism. The MTA could not work in isolation.

The government also needed to shoulder its responsibilities with regard to the prices charged by the tourism industry. Prices were as important as quality but the government, in taking its decisions on tax rates, was not considering their impact on tourism competitiveness. Taxation should be used as a tool to actually improve competitiveness. In the EU accession talks, the government should have negotiated a lower VAT rate on restaurant bills. It should also have been considerate in the way it imposed the power surcharge. And it was a mistake if, since last November, the government did not hedge oil prices, which were now back on the rise.

Other government actions also had a direct impact on tourism. For example, the administration needed to start subsidising the Gozo helicopter service so that it could be efficient and affordable. Other EU countries subsidised such services.

The government also needed to be more efficient in the way it issued visas for foreigners to learn a language in Malta. Malta needed the same system adopted in the UK and Ireland. Some 70,000 Chinese went to the UK to learn English last year, compared to just 1,000 for Malta. The granting of visas should not be a way how someone made money or found an occasion to sleep with somebody.

Mr Bartolo said he was glad that the proportion of the MTA budget going to promotion and marketing was being raised to 72 per cent from 66 per cent up to last year. But it was important to ensure that every lira spent on marketing was effective.

He said a vocational survey which had to identify the skills available for the tourist sector, and which had to be published in the first months of 2005, remained unpublished. He feared that the Institute for Tourism Studies had become something of an orphan. It did not fall under the Ministry of Tourism and it did not fall within MCAST, where emphasis was being made on raising the prestige of vocational education. Indeed, recognition of the importance of tourism should be instilled even in primary schoolchildren.

Mr Bartolo referred to the fact that the activities of various MTA representative offices had now been taken over by locally-based companies. It was important, he said, that these companies gave the Malta account the importance it deserved. He feared that some may not give it enough importance because it was small.

Malta also needed to boost its quest for new markets, such as China, Mr Bartolo said. France had started boosting marketing in China even before being granted Preferred Destination Status and it was aiming to attract a million tourists per year to Paris alone. Malta also had this status but had not done anything about it. This too underlined the need for the government's own strategic tourism plan.

Mr Bartolo said he was concerned at how seasonal Malta's tourism still was, but this factor was especially acute in Gozo, where the tourist season had been narrowed to two months in summer.

Concluding, Mr Bartolo said he hoped that the chairman of the MTA could in the coming months be able to speak differently about the authority than his predecessor who had complained that the authority had not achieved an acceptable degree of respect from the trade to be the leader of the industry because it lacked a clear strategic focus and proper structure.

Labour MP Joseph Cuschieri, who spoke earlier, said the Tourism Minister always tried to give the impression that all was well in the industry. Stakeholders would appreciate a more realistic picture.

Mr Cuschieri said the restructuring of the Malta Tourism Authority was only held after insistence from the Opposition. It would have been better, however, had the authority's annual report been presented with the financial estimates so that it could be debated in the House.

Mr Cuschieri recalled that the government in 2005 did not achieve its target of raising tourist arrival targets by 50,000. It had also not succeeded in raising the quality of visitors.

Up to a few years ago, the government used to argue that Malta should not be too reliant on tourism from the UK. Now, in this debate, the minister had boasted that performance from the UK market was the best since 1995!

The minister boasted about hotels which were opening, but said nothing about those which closed and were being converted into apartments or homes for the elderly. This shift was especially evident in the three-star category. At the same time, four-star hotels were taking three-star type guests.

In the budget for last year, the government said much about promoting tourism in areas such as culture, sport, language teaching, conference and incentive visits, Gozo, as well as agro and gastronomic tourism. Now the minister was saying nothing. Nor was he saying anything about how the long promised new yacht marinas, bay development, casinos, the Gozo ferry terminal and the new golf courses had not appeared, the exception being the St George's Bay development.

To rub salt into the wound, recent projects, such as the Bugibba upgrading by the Labour government, was now in a disgraceful state.

Mr Cuschieri referred to the draft Labour policy document on tourism, saying it was realistic and based on consultations across the industry. He said Malta under a Labour government would have a clear strategic plan for tourism focused on reducing government-induced costs and taxation in order to improve competitiveness.

Replying, Tourism Minister Francis Zammit Dimech said the MTA report had, to date, never been tabled with the financial estimates, but he was not against a debate in the public accounts committee.

On the MHRA summer survey mentioned by Mr Bartolo, the minister said five- and four-star hotels had reported an improved gross operating profit during those months. The MHRA reference to lower spending was on expenditure, not earnings from tourism. Earnings had actually increased. Still, expenditure on, say, accommodation, improved during the summer, which was why the gross profit improved.

On Mr Cuschieri's reference to quality tourists, Dr Zammit Dimech said Malta needed all tourists. It wanted to raise tourist volumes as well as attract higher yield tourists. Indeed, the number of conference and incentive travellers last year had increased by 8.7 per cent.

Although it was true that some hotels had closed down, it was also true that investment was continuous and rising, reaching a projected Lm54 million over the next two years. Bedstock in four- and five-star hotels had risen since 1999 and there had been only a marginal drop in the three-star category.

Mr Cuschieri in his reference to infrastructural projects only mentioned the Bugibba project, but this government had carried out many more, such as the upgrading of various promenades, gardens - including Barrakka - as well as the improvement of several heritage sites.

He disagreed with Mr Bartolo that with regard to cruise liners, the current situation was not as good as in 2003 and 2004. Malta now had more cruise liner passengers, though fewer cruise ships were calling.

Dr Zammit Dimech said the publication of the MTA's tourist strategic plan would follow the established deadlines. The ministry was working on its own policy papers for the sectors it was responsible for - tourism, culture, the cultural heritage and the audiovisual sectors. They would dove-tail with the MTA plan but one should not overlap with what the MTA was doing. Turning to price competitiveness, Dr Zammit Dimech said Malta generally could never compete only on price because, irrespective of fiscal considerations, several nearby competing destinations had much lower wage structures and cheaper land and property. Malta's emphasis had to be on value added. Malta would, where it could, take fiscal measures to benefit tourism, but in reducing taxes one had to see where the revenue would come from if spending on other sectors was to continue.

The minister said he agreed with Mr Bartolo about the need for policies which were reasonable and serious with regard to the granting of visas for language students. He had participated at a meeting with Feltom (the federation of language schools) in which the Prime Minister and the ministers of home and foreign affairs were also present. They had discussed clear guidelines for the granting of student visas while being careful not to have abuse leading to the sort of tragedies which happened in the past.

Dr Zammit Dimech said a skills survey had been completed and the findings were being worked upon by a working group in association with the Institute for Tourism Studies.

The MTA would soon invite the tourism trade to nominate representatives for the segment advisory groups to be formed shortly.

Concluding, Dr Zammit Dimech said the companies which had taken over the work done by the MTA's offices abroad had clear benchmarks and their contract would be terminated if they fail to achieve expected results.

The estimates were later approved after a division.