According to the World Economic Forum’s ‘Global Competitiveness Report’, Switzerland remains the world’s most competitive economy. Malta, on the other hand, now finds itself in 47th place, slipping down six positions in the ranking. Why this difference?

The answer lies in a combination of factors, although the issue of innovation stands out predominantly.

While Switzerland has created an innovation hub, with the world’s highest rate of international patent applications, the report highlights Malta’s insufficient capacity to innovate as a major stumbling block.

Talent needs an innovation-friendly environment in which to grow. Innovation needs to be promoted and fostered, particularly amongst SMEs. Improved access to finance, more innovation-friendly regulations, and additional incentives for R&D can spur Maltese entrepreneurs to turn their ideas into reality. Clustering can give local companies the economies of scale to pool knowledge and develop joint research and innovation potential. More investment in science and technology is a means of developing a culture of local technological innovation.

The development of innovative capacity can only come about through the consistent application of the correct strategies. Malta has shown glimpses of its potential to become one of the world’s most successful economies.

To achieve this potential, it needs to invest in those who through their talent, skill, entrepreneurship and the development of intellectual property can bring the best out of this country.

Margrith Lütschg-Emmeneger is the president of Competitive Malta – the foundation for national competitiveness, and a World Economic Forum partner. Ms Lütschg-Emmenegger is also the president of FIMBank plc.