'Starting up is a tough business'

Public institutions based in Malta are not aware of the specific needs and difficulties encountered by small businesses, according to almost 60 per cent of respondents to a study.

The research results were announced yesterday by the Parliamentary Secretary for the Self-Employed, Edwin Vassallo. The study was conducted by M. Fsadni and Associates on behalf of Malta Enterprise and the Euro Info Centre. The study found that 68 per cent of the experienced entrepreneur respondents did not think Malta's environment was conducive to an individual setting up a business operation. Mr Vassallo said the government was committed to taking innovative approaches to dealing with the needs of small businesses. However, this was not possible without carrying out research.

The report, he said, should serve as a guide to political parties when they came to develop a vision on how they should respond to the needs of small businesses.

The government would be using the document as the basis of a wider consultation exercise in preparation for his secretariat's plan of action for the next year.

The research, he said, was carried out among self-employed in Malta and Gozo so that the government could better understand the needs of small businesses.

The report found that 55 per cent of the problems and limitations faced by respondents in their first 12 months of operation were of an internal nature.

The two most pressing external difficulties encountered were finding the first clients (34 per cent) and bureaucracy (19 per cent). The most pressing internal problem was financial difficulties (63 per cent).

Eight of 15 start-up respondents indicated they did not find Malta's existing external environment encouraging enough to set up a business. The main reason cited was exorbitant taxes and NI contributions.

The entrepreneurs proposed that the government and public institutions should focus more on small businesses, offer more financing opportunities, ease bureaucracy and better promote incentives and initiatives.

They said Malta-based public institutions should offer more financial assistance, training, factory space, marketing and management assistance and consultancy services. They should also reduce bureaucracy.