What the industry wants
The man who strongly lobbied the government on tourism issues has set himself a new challenge: to bring out the good side of the Malta Tourism Authority. Its CEO, Josef Formosa Gauci, tells Fiona Galea Debono that, despite its current success, the industry cannot escape the problems the international situation could pose in the near future.
The MTA has had its fair share of problems and its public image has not been great, Mr Formosa Gauci admits. "But although there has been criticism - and much of it is justified - there is a lot of good in it too," he says, stepping into his new shoes.
In fact, one of the challenges he has set himself is to ensure that the authority's image is improved. His strategy is: "I believe we should act and let actions speak for themselves.
"As with any organisation, there is the good and the bad. Unfortunately, due to circumstances over the last years, the bad has been more visible." And, maybe, as the former president of the major tourism lobby group, the Malta Hotels and Restaurants Association, he was partly responsible for that too. But he does not take the credit: "All the private sector highlighted its deficiencies, which is its job, after all."
As to the bad side, Mr Formosa Gauci says "criticism has been levelled at too much bureaucracy; not enough enforcement and a lengthy restructuring process.
"Certain adjustments need to be carried out within the existing structure to enhance the way we operate. But I have no intentions of going through more restructuring. I do not think there is a need and I am also keeping public perception in mind. You run the risk of being criticised if all you do is restructure."
Turning a negative into a positive, he feels the recent nation-wide public transport strike has actually boosted the MTA's image. It is estimated that the authority's management chauffered over 2,000 tourists in their cars during the three days of the strike, which had the potential of causing major problems to the industry and definitely harmed it.
Mr Formosa Gauci moved from heading an association that strongly lobbies the tourism authority to running the authority: a move he calls "interesting".
"On one side, you are representing the interests of the members to push what is best for the industry. But, in reality, you have little power; it's mainly about making your voice heard.
"On the other side, you have to actually get things done and I think that is the biggest challenge."
Another is that the MHRA only represents one sector of the industry, unlike the MTA. "I will definitely be ensuring that all other sectors are given due importance."
Mr Formosa Gauci has moved from one side of the fence to the other, taking with him "a better understanding than some others may have had of the business aspect. Sometimes, bureaucratic government organisations may not always fully appreciate what it is like on the other side of the fence... I have the background of what the industry really wants and what makes it tick. I am now seeing from the other side how we can move towards meeting these expectations."
One of the measures is the establishment of weekly meetings among a core group of stakeholders to monitor problems encountered and be proactive.
Knowing what the industry wants, one of the main areas the MTA will be focusing on is the product, which "maybe" was not given enough attention. "We intend to focus on getting it right and when we say product we mean it in the complete sense."
The MTA will be embarking on EU-funded projects, having received the green light for both those that fall directly under its wing and others.
"We are also aiming to enhance the MTA's enforcement arm, which has vacancies that need to be filled... One of the biggest criticisms I used to make was that we were not enforcing enough.
"I believe that every MTA-licensed premises should be visited at least once a year. Across the board, I do not think that is the case."
For enforcement that is not the MTA's responsibility, the aim is to establish better liaisons with the other departments.
Records are being broken in tourism, but Mr Formosa Gauci maintains that the future is not that rosy. "The picture for the remainder of the year is that Malta, like the rest of the world, is going to face the problems caused by the rising price of oil, which, in the industry, means aviation fuel.
"Malta is on the edge of the European flying zone, which means most of its core markets are beyond two-hour-long flights, which become highly expensive to fly.
"And we cannot forget that the UK, which accounts for 40 per cent of travel to Malta, is experiencing economic problems."
In the face of these factors, the MTA has a plan of action: to try and ensure that the seat capacity reductions next winter are kept to a minimum. Certain airlines are likely to reduce their flights - Ryanair is dropping daily flights from Luton to five times a week.
The authority is also boosting its marketing strategy to increase the seat load factor of those airlines that continue to fly. "We won't have as many planes but we will try and increase the number of passengers on operating flights."
Last year was record-breaking in terms of arrivals and, all things being equal, 2008 should still see an increase over 2007. But the problem is the decreasing length of stay.
On a daily basis, tourists may be spending more money but if their holidays are cut from seven to four days, overall they are spending less, Mr Formosa Gauci explains. As things stand, the increase in arrivals is being watered down by the reduction in the length of stay and things are likely to get worse, he maintains.
The MTA is embarking on a detailed study, a long-term exercise, to assess the exact benefits the economy reaps from every euro it spends in marketing. "We owe it to the government and the taxpayers to see for themselves what the added value of the industry is," Mr Formosa Gauci says.
He is hoping - and is optimistic - that the MTA would be allocated at least the same increased budget as last year. Ideally more, he says, stepping back into the lobbying shoes.
"Realities are changing, competition is increasing, the authority is spending quite a sum supporting airlines, which is good. But to support them and also market the country, funds have to be available," he argues.
Due to budget constraints, the MTA has decided to be much more selective in its choice of which events it should fund, concentrating more on those that can attract tourists to Malta, Mr Formosa Gauci says.
His optimism regarding an increased budget stems from the fact that the Prime Minister has taken the industry under his wing, giving it due importance - also from the point of view of coordination among ministries.
"One of the MTA's problems is that any complaints from tourists for anything that happens out there are directed to us. But, at the end of the day, the authority is not responsible for everything. Coordination between entities is therefore paramount, and having tourism under the Prime Minister can help to ensure that."
Mr Formosa Gauci's appointment is for three years, but how long it will actually last is another story, he laughs. It was not an easy decision to leave his former job and step into the shoes of former CEOs, whose term of office did not always last too long.
"It has been an exponential curve downwards, decreasing by 50 per cent every time, so the odds are I may last three months," he jokes.
Mr Formosa Gauci knew from his involvement with MHRA what a major challenge it would be. "Perhaps I did not even realise then to what extent, but I took the plunge." His first month in office has been "hectic", what with the baptism of fire in the form of the transport strike.
Stepping into these shoes when the industry's state of affairs has been good is probably harder as people have high expectations, he believes. But the reality is that, despite the good growth for the last 20 months, there is no doubt that the international situation can affect Malta "and we cannot run away from it".
In fact, one of the challenges he has set himself is to ensure that the authority's image is improved. His strategy is: "I believe we should act and let actions speak for themselves.
"As with any organisation, there is the good and the bad. Unfortunately, due to circumstances over the last years, the bad has been more visible." And, maybe, as the former president of the major tourism lobby group, the Malta Hotels and Restaurants Association, he was partly responsible for that too. But he does not take the credit: "All the private sector highlighted its deficiencies, which is its job, after all."
As to the bad side, Mr Formosa Gauci says "criticism has been levelled at too much bureaucracy; not enough enforcement and a lengthy restructuring process.
"Certain adjustments need to be carried out within the existing structure to enhance the way we operate. But I have no intentions of going through more restructuring. I do not think there is a need and I am also keeping public perception in mind. You run the risk of being criticised if all you do is restructure."
Turning a negative into a positive, he feels the recent nation-wide public transport strike has actually boosted the MTA's image. It is estimated that the authority's management chauffered over 2,000 tourists in their cars during the three days of the strike, which had the potential of causing major problems to the industry and definitely harmed it.
Mr Formosa Gauci moved from heading an association that strongly lobbies the tourism authority to running the authority: a move he calls "interesting".
"On one side, you are representing the interests of the members to push what is best for the industry. But, in reality, you have little power; it's mainly about making your voice heard.
"On the other side, you have to actually get things done and I think that is the biggest challenge."
Another is that the MHRA only represents one sector of the industry, unlike the MTA. "I will definitely be ensuring that all other sectors are given due importance."
Mr Formosa Gauci has moved from one side of the fence to the other, taking with him "a better understanding than some others may have had of the business aspect. Sometimes, bureaucratic government organisations may not always fully appreciate what it is like on the other side of the fence... I have the background of what the industry really wants and what makes it tick. I am now seeing from the other side how we can move towards meeting these expectations."
One of the measures is the establishment of weekly meetings among a core group of stakeholders to monitor problems encountered and be proactive.
Knowing what the industry wants, one of the main areas the MTA will be focusing on is the product, which "maybe" was not given enough attention. "We intend to focus on getting it right and when we say product we mean it in the complete sense."
The MTA will be embarking on EU-funded projects, having received the green light for both those that fall directly under its wing and others.
"We are also aiming to enhance the MTA's enforcement arm, which has vacancies that need to be filled... One of the biggest criticisms I used to make was that we were not enforcing enough.
"I believe that every MTA-licensed premises should be visited at least once a year. Across the board, I do not think that is the case."
For enforcement that is not the MTA's responsibility, the aim is to establish better liaisons with the other departments.
Records are being broken in tourism, but Mr Formosa Gauci maintains that the future is not that rosy. "The picture for the remainder of the year is that Malta, like the rest of the world, is going to face the problems caused by the rising price of oil, which, in the industry, means aviation fuel.
"Malta is on the edge of the European flying zone, which means most of its core markets are beyond two-hour-long flights, which become highly expensive to fly.
"And we cannot forget that the UK, which accounts for 40 per cent of travel to Malta, is experiencing economic problems."
In the face of these factors, the MTA has a plan of action: to try and ensure that the seat capacity reductions next winter are kept to a minimum. Certain airlines are likely to reduce their flights - Ryanair is dropping daily flights from Luton to five times a week.
The authority is also boosting its marketing strategy to increase the seat load factor of those airlines that continue to fly. "We won't have as many planes but we will try and increase the number of passengers on operating flights."
Last year was record-breaking in terms of arrivals and, all things being equal, 2008 should still see an increase over 2007. But the problem is the decreasing length of stay.
On a daily basis, tourists may be spending more money but if their holidays are cut from seven to four days, overall they are spending less, Mr Formosa Gauci explains. As things stand, the increase in arrivals is being watered down by the reduction in the length of stay and things are likely to get worse, he maintains.
The MTA is embarking on a detailed study, a long-term exercise, to assess the exact benefits the economy reaps from every euro it spends in marketing. "We owe it to the government and the taxpayers to see for themselves what the added value of the industry is," Mr Formosa Gauci says.
He is hoping - and is optimistic - that the MTA would be allocated at least the same increased budget as last year. Ideally more, he says, stepping back into the lobbying shoes.
"Realities are changing, competition is increasing, the authority is spending quite a sum supporting airlines, which is good. But to support them and also market the country, funds have to be available," he argues.
Due to budget constraints, the MTA has decided to be much more selective in its choice of which events it should fund, concentrating more on those that can attract tourists to Malta, Mr Formosa Gauci says.
His optimism regarding an increased budget stems from the fact that the Prime Minister has taken the industry under his wing, giving it due importance - also from the point of view of coordination among ministries.
"One of the MTA's problems is that any complaints from tourists for anything that happens out there are directed to us. But, at the end of the day, the authority is not responsible for everything. Coordination between entities is therefore paramount, and having tourism under the Prime Minister can help to ensure that."
Mr Formosa Gauci's appointment is for three years, but how long it will actually last is another story, he laughs. It was not an easy decision to leave his former job and step into the shoes of former CEOs, whose term of office did not always last too long.
"It has been an exponential curve downwards, decreasing by 50 per cent every time, so the odds are I may last three months," he jokes.
Mr Formosa Gauci knew from his involvement with MHRA what a major challenge it would be. "Perhaps I did not even realise then to what extent, but I took the plunge." His first month in office has been "hectic", what with the baptism of fire in the form of the transport strike.
Stepping into these shoes when the industry's state of affairs has been good is probably harder as people have high expectations, he believes. But the reality is that, despite the good growth for the last 20 months, there is no doubt that the international situation can affect Malta "and we cannot run away from it".