The president of the Gozo Business Chamber, Michael Grech, is a firm believer in a permanent link – a tunnel, not a bridge – but he told Vanessa Macdonald that the link alone would not be enough to help Gozo’s economy grow.

Gozitans always lament that the economy is not doing well but the NSO reported that in 2013, Gozitan gross value added went up by 4.8 per cent while that of Malta went up by 4.5 per cent...

We are not saying it is not doing well but it could do better. We could get a fairer share of the cake if there were more opportunities, then we could perform better and in turn help the economy of the islands.

Gozo accounts for only 5.1 per cent of the islands’ GDP. What should that figure be, all else being equal?

Statistically we have nearly eight per cent of the population, so there is room for growth. However, that is based on NSO’s population figures. We believe the population is smaller than their reports say.

Gozo needs incentives to be competitive. The disadvantage of double insularity is there, but will hopefully not be an issue forever. We are pushing for a tunnel. At least we can aim for single insularity!

You repeatedly mention the need for a permanent link. The bridge would cost €1 billion. How much would a tunnel cost?

We believe we could build four tunnels for the cost of one bridge, although that is admittedly a calculation done on the back of an envelope, not based on any real data or geological surveys...

We brought over a Norwegian tunnelling expert a few years ago to give us an estimate. Obviously, you would need in-depth studies to see whether there are any undersea faults, as this would drive up the cost. The indications are that it could be done in five years or less.

However, we believe that a private enterprise could build it without any need for government funds.

There would be a huge upfront cost. How would they recoup the money?

The land could be given as a concession for a long period – say 65 years – and then the revenue would come from the usage toll.

How would the toll compare with the cost of the ferry?

It would be fair and equal for everyone – whether Maltese or Gozitans – and probably cheaper than what people are paying now for the ferries.

Would the tunnel increase the number of people going to Gozo? Wouldn’t Gozo lose its ‘magic’ appeal for visitors as an island?

The numbers will go up. But do not forget that there are many shoulder months: you get a concentration of people crossing between mid-May and mid-October but then the figures drop. The permanent link would spread people out more evenly over the whole year.

It will also be a real incentive for visitors if they saved the time it takes to queue up for the ferry and to embark and disembark.

The ferry could be retained during the day for those who are not in a hurry, or who like the experience of the boat crossing. But for the business community, students, people flying overseas, patients etc., the time saved by the tunnel is significant. Time lost in commuting is costing the economy millions. Imagine if the two hours currently lost because of the crossing could be used more productively.

Would the tunnel solve the problem – and the cost – of transporting hazardous material?

Hazardous material would still be transported on the ferry: Gozo Channel does a special trip with no passengers on board for hazardous material like fuel bowsers, gas cylinders and so on, to minimise risk.

You are not quite convinced about the population of Gozo. The NSO says it is 31,446, fairly unchanged over the past five years. How many Maltese hold Gozitan ID cards because of their holiday homes, and how many Gozitans are working and studying in Malta but still count as living in Gozo?

We met the NSO to discuss this. They say that through the last census they were able to eliminate from their figures the Maltese who have a Gozitan ID card. But we still think the figure is not correct.

So many Gozitans have work in Malta and have settled in Malta over the past few years. If a student is living in Malta Monday to Friday but returns to Gozo on the weekend, that person is still registered as a Gozitan, which does not make sense. It does not reflect that they are spending most of their money in Malta, whether on clothes and groceries, or petrol and leisure.

Even the birth figures are misleading as there might be Maltese who go to Gozo to deliver as the hospital is not nearly as busy.

This is worrying as you are talking about the exodus of young people. Are we going to end up with an island of old people?

The process tends to accelerate with time, so it will get worse very quickly. Speak to local parish priests and they tell you it is pointless to organise anything for youths during the week as there is no one around.

One way to reverse this is obviously to have more jobs in Gozo... Are you attracting FDI to Gozo?

FDI has been quite a problem in the past few years. The agreement on the medical school would give a boost to the economy as we would have foreign students who need accommodation, food, clothing, leisure and so on.

We will also need to enlarge the Gozo Hospital as the students will need cases to handle – we might even need to bring cases over from Malta, which would in turn ease the waiting list at Mater Dei.

But the school would hardly create a lot of employment for Gozitans, will it? What about new manufacturing opportunities, new back office units? The employment figures improved – but 200 of the jobs were public administration transferred to Gozo.

It is not enough. The Gozo Minister helped to persuade software company RS2 to set up an office in Gozo. That could bring back youths who were lured by the IT sector in Malta, although some might already have a home there and might find it hard to return. But for those graduating now it offers a real opportunity.

There could be other possibilities. For example, we missed out completely on i-gaming. We were led to believe that it could not be done: we have a problem with the fibre-optic cable but the government knows about this and there is a study under way at the moment on a second cable to be in place in the coming year or so.

Other private sector investment could be attracted if there were the necessary incentives. For example, if you look at the big four audit firms, 25 years ago they all had offices in Gozo; now there are none.

These firms are centralising and they have become more specialised. It does not make sense for them to have offices in Gozo...

Why not? You could bring an entire unit to Gozo. All these entities need is a fiscal incentive. It worked perfectly well in the late 1960s and 1970s when foreign investors were given a 10-year tax holiday. Clearly, you have to be careful not break any EU rules on state subsidies and so on.

But there could be ways and means to offer incentives. The Budget had some incentives through the Employment and Training Corporation for Gozo which we think will work.

You can bring a horse to water but you can’t make him drink. Even if there were a cable, i-gaming employees want to live near an entertainment area with restaurants and bars. What can Gozo offer to compete with that?

Everything is tied to supply and demand. If there were enough people, then I am sure that Gozitan – or Maltese – businessmen would react. Some 30 or 35 years ago, there were dozens of nightclubs in Gozo, and this at a time when there were only a handful of trips every day, the last one at 5.30pm! And yet they were thriving and were filled with Maltese.

Are you just being nostalgic and sentimental? Can you really go back to the way things were 35 years ago? It is not only Gozo which has changed but the rest of the world!

The way in which people seek entertainment might have changed over the past decades but people still want to enjoy themselves. The concept of what you offer might have to change.

What new investment does Gozo need? Hotels? A casino? The marina? The cruise terminal?

There was one bidder for a marina. With regards to a casino, we think that, if there were the necessary support infrastructure, such as the airstrip – which now seems to be on the cards – it would help as we could then offer it to people coming by private jet.

People who want to come to Gozo just to gamble would be put off by the time it takes to cross over by ferry. We think the airfield will give a boost to the Gozitan economy as it could also pave the way for visitors not just from Malta but beyond.

It could open up new forms of tourism, especially from countries close to us. You could also have people landing at MIA and then catching a plane to Gozo, saving a lot of time, which is also important.

We do not need he sort of development that has been going on. Most of it was crazy as all we did was build apartments without paying any attention to how they should be done. That has to stop.

We do not want Gozo to be built up any more – except for projects that make sense, which fill a gap. We need a few more branded hotels on Gozo, five-star hotels, like a Hilton or Hyatt.

Perhaps the government can help by investing in more projects to entice people to come to Gozo to live, to work or for leisure.

With a permanent link, we could have many more Maltese settling in Gozo. There is already a small Maltese community who commute every day.

People fret that the permanent link could have an adverse impact on the quiet and peace – but have small villages like Safi and Gudja changed because they are linked by road? Have they been ruined? I don’t think so. They kept their character.

Of course, the link would highlight the need for more infrastructure, like a ring-road around Victoria.

At the moment, the upper part of Victoria and the main square are closed. Unfortunately, business has suffered and commuters have to take a diversion which causes jams.

Are businesses in Victoria being compensated for the loss of business?

I do not believe so. It is an issue and we hope that works will be finished as soon as ­possible as the businesses there are suffering.

Did you know?

• There are 1,075 Gozitan students at the University of Malta, and 219 at Mcast.
• The number of unemploy­ed in Malta went up by 8.2 per cent, and in Gozo by 5.8 per cent.