Important to identify Air Malta's real problems - de Marco

A steering committee which brings together the government, Air Malta, the trade unions and consultants in the aviation sector, this morning got down to the details of a rescue plan for the airline during the first of what are expected to be weekly meetings.

As the meeting was under way, the Parliamentary Secretary for Tourism, Mario de Marco stressed that real solutions had to be found for the real problems of Air Malta.

Addressing the annual general meeting of the MHRA, Dr de Marco said that Air Malta was of strategic importance for Malta and it was essential that it could fly its colours proudly and strongly, while also being financially sound.

All airlines had gone through financial problems, he said. But it was incorrect to blame Air Malta’s problems on low cost carriers.

The worst thing to do for Air Malta was to wrongly identify the source of its problems, he said.

The introduction of low cost airlines to Malta was inevitable, and they posed the same challenges as they posed for other airlines.

“For the sake of the tourism industry and Air Malta employees, we have to concentrate on the real solutions to the real problems rather than attempting to score cheap political points,” Dr de Marco said.

MHRA president George Micallef also referred to Air Malta and said the tourism sector should be very grateful to the airline.

It was important, he stressed, that Malta maintained its seat capacity and accessibility, in order to attract tourists.

He also argued that had low cost airlines not started to operate to Malta, there would have been more casualties in the hotels sector.

In his address, Dr de Marco referred to the storm which erupted following the budget announcement of a 2% increase in VAT on tourist accommodation. He said that the Ministry of Finance was still in the process of evaluating contracts submitted by hoteliers which could be negatively affected by the increase in VAT.

The contracts are being evaluated as the ministry considers a rebate on part of the VAT increase.

The parliamentary secretary said that while the government was conscious of the impact of the increase in VAT on contracts which had already been signed, one also needed to keep in mind the increased financial allocations which the governemnt was making for the tourism sector, which ultimately benefited the hoteliers.

He also pointed out how in Rome, for example, a similar, but steeper tax was being introduced this January.

Dr de Marco noted that tourist arrivals this year up to September had increased by 12.6 per cent over last year – an increase of 120,000 arrivals. Tourist spending had reached €914 million, an increase of €177 million.

He underscored the importance of accessing new markets for tourism, including Brazil, Russia, China and India, and said that in this context Malta was working with the EU on tourism promotion.

Dr de Marco also referred to the planned new bus fares structure. He said that the structure did not discriminate against tourists. The difference was between residents and non-residents. The non-residents could also be Maltese. The authorities, he said, needed to communicate the fact that this was not discrimination against tourists, and that the bus reform would address one of the most frequent sources of complaint by tourists, which was the bus service.