Retailers in Valletta have many reasons to feel besieged by the challenges they face on a daily basis. The steady decline of footfall in the capital’s shops, lack of adequate parking facilities in and around Valletta, and the almost continuous construction work going on in the city are often mentioned as the most daunting aspects of doing business.

A more serious problem seems to preoccupy as many as 500 shop owners in Valletta: the short term tenure of the property leased to them by the Land Department.

As many as 470 of the shops leased out by the Government in Valletta are on a six-monthly agreement, which means that technically a shop owner can be told to vacate his premises at relatively short notice. Not surprisingly, this precarious situation led to uncertainty that prevented shop owners from planning adequately for their business growth.

It was in this context that last December the Government introduced a scheme that enables shop owners in Valletta to convert their short lease agreements with the Land Department to 45-year leases.

This will give shop owners not only more security of tenure, but will enable them to procure finance for their refurbishment plans from banks which can rely on the long-term lease agreements as collateral.

This scheme will now be extended to other properties leased by the Land Departments in other areas in Malta and Gozo. Businesses need to take a long-term view of the future if they are to invest more money to grow their commercial activities. The extension of these short-term lease agreements should go some way in reducing the uncertainty that deters entrepreneurs from investing.

But shopkeepers in Valletta will still face daunting challenges to survive the major changes that are taking place in the retail industry. Until the public transport system reaches service levels that are higher than what they are today, and unless affordable and abundant parking facilities are created on the outskirts of Valletta, consumers will be discouraged to make the trip to procure the goods and services that are available there.

The cluster of shopping facilities within walking distance of each other in Sliema are proving irresistible to shoppers who still want to experience the thrill of shopping from attractive and large shopping outlets while not having to worry about where to park their cars. With a few exceptions, retail outlets in Valletta remain rather small and therefore unable to offer the variety of goods available at other outlets throughout the island.

This is indeed a tough challenge as it is not feasible to pull down old building in Valletta to build new, modern and spacious shopping outlets. So Valletta entrepreneurs must come up with strategies that concentrate on providing niche retail outlets in the undeniable historic beauty of our capital city.

Some success is already being achieved through such a strategy as a number of small restaurants are mushrooming in Valletta in places formerly occupied by dingy shops that were facing a terminal decline in business.

The Valletta retail business community has also exploited well the passing trade of tourists who visit the capital for cultural reasons. This model is not unique as all small but historically important cities try to reinvent themselves by adapting to the changing roles that the passing of time forces on them.

Retail business can survive in Valletta if the different stake holders come up with pragmatic solutions to the obstacles that they face.