Government intervention saved 2,000 jobs - Fenech

Small and medium sized businesses should react positively to the recession and take the opportunity to restructure their firms and invest in research and development.

Addressing a conference as part of the First European SME week, Malta Enterprise chairman Alan Camilleri outlined nine points which form a "recipe to recession resilience".

"We must brace ourselves for the challenging months ahead and we need to take measures in the wake of the bleak economic climate. The nine essential ingredients of what we are calling the recipe for recession resilience are meant to help you, as small enterprises, rise to the challenge and continue to compete in a highly competitive environment," he said.

Mr Camilleri said business people have to look at this time as positively as possible to be able to invest and turn the crisis into an opportunity. "We must stop living beyond our means, tighten the belt, compete and fight for the market. But more importantly, we have to be positive about it all," he said.

Cutting costs was the second ingredient which would help companies face the challenges. Laying off workers might not be the best move to cut HR costs because skills did not grow on trees, he said.

Moreover, SMEs must look into improving their management structures and overhaul their companies. Malta Enterprise could help by offering the assistance of its business advisers.

Investment in human resources, making sure that they were motivated and as flexible as possible, was another important ingredient, he said. As was innovation, doing business through technology and investing in alternative energy sources.

Mr Camilleri said marketing was another important aspect. "We've had it too good for far too long and we have to eradicate the misconception that marketing is only related to sales.

"Exposing companies to the market is vital."

Finally, companies had to keep abreast with whatever was happening around them and use the facilities at Malta Enterprise to help them face the challenges.

The conference was also addressed by Finance Minister Tonio Fenech who said that some 2,000 jobs were saved thanks to the government's direct assistance to firms which ran into problems as a result of the international economic crisis.

He said the fact that these companies had kept going had also been vital for many SMEs which had regular business with them.

Mr Fenech said a Malta Enterprise call for applications from SMEs to benefit from EU funds had been overwhelming, and a fresh call was in the pipeline.

The schemes are financed by the European Regional Development Fund and are part of Malta's 2009-2013 funds allocated to it by the European Union.

In all there were 212 applications for grants. The schemes provide assistance to a variety of businesses, ranging from large established industries to start-up SMEs aimed at ensuring they develop into independent, innovative and well-performing businesses. These companies will benefit from assistance amounting to €6 million.

Mr Fenech gave an overview of the current economic situation, noting that several countries were being more seriously affected than Malta. In Spain, for example, unemployment had now soared to 17.5 per cent.

Mr Fenech insisted that despite the current economic scenario, the government still viewed its 2015 targets as achievable.