MHRA president Tony Zahra speaks to Anthony Manduca about the challenges and opportunities for the tourism industry, which has just announced very encouraging 2015 results.
“There is no doubt that over the years the Maltese have tended to opt to work in other industries, and are moving out of the tourism industry,” says MHRA president Tony Zahra.
“We need to portray the industry as a very viable career option. Employees are meeting people all the time, they are in the hospitality business and are doing something different. Such a career not only gives you satisfaction but is also financially rewarding.”
Mr Zahra stresses that the industry needs well trained people. “With such trained people, if you have 50 covers, you can work with two people. If you have untrained people, you will need four people. Training improves productivity and improves the capacity of the industry.”
Isn’t the Institute of Tourism Studies (ITS) meant to be training people for the industry, I ask him.
He pauses a little, and then says: “The ITS was suffering from a common malaise – a lack of continuity. Every time there is a change in minister there is a change in direction of the ITS. We would like the ITS to be relaunched in a different fashion. It should not be an institution for only Maltese nationals, but it should become an institution for the Mediterranean; we have an advantage in that the language of instruction is English.
“This will also benefit the Maltese students who will be interacting with students of different nationalities, it will give these students the opportunities to work in the Mediterranean region and it will attract people to Malta. We are talking to the government about some form of PPP for the ITS; it is work in progress.”
However, he does say that the ITS is today “much more proactive” and points out that the MHRA has come to an agreement with the ITS so that people who do certain courses are guaranteed a job.
Asked at what level was the industry finding it difficult to attract people, Mr Zahra says: “Mostly front liners: waiters and receptionists, and this is a problem because these are the people who are meeting our customers, they are the face of the industry. Today a high percentage of front liners are not Maltese, and that is a problem.”
Certainly the government gets 10 out of 10 for sitting down with us, which for me is very positive
He adds: “For a long time the industry has not been successful in projecting itself as a career. It pays, it’s great fun and it’s something people should be doing. This is an industry that is going to be here for ever, it is a career that offers stability, job satisfaction because you are always meeting people, and it pays well. For example, many don’t appreciate that in our industry everybody gets free meals. We need to talk more to our youngsters and school leavers: this isn’t something you do when you don’t have anything else to do, this is something you do as a first choice.”
Mr Zahra calls the tourism results for 2015, with 1.8 million arrivals, “extremely encouraging” adding that this represents a fifth year of records. He says there is very close cooperation between all the stakeholders in tourism and that the MHRA had lobbied for greater connectivity to Malta.
“There has been an increase in airline routes to Malta and connectivity is the key to the industry. We have been very successful in marketing the destination, especially through promotions, including on the social media, and also by the media reporting about events in Malta such as CHOGM and the EU-Africa summit, which are all positive.”
Another welcome development, he says, which has been extensively covered in the media, are the training sessions held by football teams in Malta, 16 so far.
“People are investing in the product, particularly the hotels; the next one is the Hilton where a huge amount of money is being spent on refurbishment and upgrades. The tourism results have been positive not only for the industry itself but also for the spillover effect in the economy, where everyone benefits.”
He adds a word of caution, however, about Malta’s very encouraging tourist numbers. “We mustn’t forget that at the moment that are a number of markets that are closed such as Tunisia and Egypt, and to a certain extent Turkey, but these are not going to remain closed for ever. What happens when they come on stream?”
He says the tourism industry needs to be forward looking and to ask itself where it wants to be in 20 years. Change, he points out, does not come overnight and the industry needs to look well ahead.
“The size of our island is what it is and it is not going to get bigger, which has limitations. Our strategy has to take this into consideration. We want to attract tourists who want to come to Malta and who are not simply looking at the price. We always must remain competitive but price must not be the first consideration of tourists. It’s not the price of the product but the value, so we must start talking about value added.”
After all, he points out, if tourists want to see a baroque city like Valletta, or beautiful churches or temples, or want to be in a small nice island, then they can come to Malta. He believes the focus should be on attracting a more educated, higher-spending tourist, which could also help reduce the pressure on the country’s infrastructure as well as help the economy because tourists will spend more.
Mr Zahra says there are a number of concerns “which have been around for years” which the MHRA regularly brings up with the authorities.
‘Public transport is a huge issue’
“We have regular discussions with Enemalta about the problem of power cuts. Such cuts come about because the distribution – not generation – is not strong enough to take certain loads, particularly in summer when the demand is huge. The generation issue has been solved, now we need to solve the distribution problem.”
He adds: “Enemalta has told us it is spending close to €50 million a year to upgrade the distribution system. Obviously this problem is not going to be solved overnight as over the last 30 years there has been a massive underinvestment in generation and distribution.”
Enemalta has told us it is spending close to €50 million a year to upgrade the distribution system
Switching to Malta’s roads, which the tourism industry has long complained about, Mr Zahra says the MHRA had suggested that since most of the country’s roads need to be rebuilt, the government should find ways of raising money on the market to do this, “especially at this moment in time when money is in great supply, and very cheap”.
He explains that if the capital costs are raised from the market and the government pays the money back over a period of years it will have achieved its objective of building roads without putting pressure on its Budget.
“The point we are trying to make is that there is more than one way of dealing with such problems, the important thing is to identify a problem and seek various solutions – chose one of them and then move forward. By talking about these problems will not make them go away, they’ll just make them grow bigger.”
He describes public transport as a huge issue and says it has been so for many years. “For some time I had believed we had one chance when the public transport system was turned into a company to get it right, and if we missed that one chance I believed that we would have what we have today, a tremendous amount of cars on the road, which are jam packing everything, and our public transport not working.
“We need to have a long-term look at what we want. Is it sustainable to have almost 300,000 cars on our roads? My view is that this is not sustainable. We badly need a good public transport system and a reduction in the number of cars on the roads.”
He says it is definitely time to look at other means of public transport, besides buses.
“I was the chairman of the new initiatives projects group in 1996. One of the things we had published was the connections project, which proposed a tunnel from Marsamxett to the Grand Harbour, with a stop in the centre of Valletta, and you would have connections from Sliema to the three cities or Valletta. So you can have a number of solutions, but every solution has to be practical and with a focus on the customer. Obviously we have to change our habits; if you know that the bus service is an efficient one it shouldn’t be a problem to use a bus instead of a car.”
Asked whether the MHRA agreed with the Chamber of Commerce and the GRTU that electricity tariffs should be further lowered because of the decrease in the price of oil, Mr Zahra replies: “When the MHRA was talking about the high electricity rates, some years back, neither the GRTU nor the Chamber were siding with us, and we were told that such a reduction couldn’t happen because of the price of oil.
“Today the situation has improved because the rates have been reduced by 25 per cent and this has substantially decreased our members’ costs, which is one of the reasons they are investing in the product.”
He says the MHRA had proposed before the last Budget that its members be given incentives to replace units that consume a lot of electricity, and that the association is presently in discussions about this with the government.
Regarding the price of oil and the effect on electricity rates Mr Zahra says there are two main strands of thought. “Should we have a long-term hedge and therefore one will know the price he is going to pay, or should a formula be worked out which takes into account a number of considerations and will come up with a price? This latter system is quite similar to COLA and of course there could be increases or decreases in the price.”
He adds: “I believe we will be able to find common ground. Energy is the key to every industry and we have to talk about it all the time.”
Asked if he feels the government is receptive to the tourism industry’s needs, he replies: “The government is extremely receptive, we discuss issues and fight over issues. Occasionally, they are right and occasionally we are right. Certainly, the government gets 10 out of 10 for sitting down with us, which for me is very positive.”