About 35 companies have requested help from the Chamber of Commerce following its call on businesses with interests and investments in Libya to come forward and present their concerns, Chamber president Helga Ellul told the Times Business.

Ms Ellul said she and the Chamber of Commerce were in constant touch with the government and Malta Enterprise over the situation in Libya and she was satisfied with the way things were being co-ordinated.

“A number of companies in Malta are entirely dependent on the Libyan market so obviously they are very worried about what is happening over there. There are questions about payments due as well as large quantities of stocks stored in Libya,” Ms Ellul said.

Ms Ellul said a meeting of the Malta Council for Economic and Social Development is to be held soon to discuss the situation in Libya which she described as being “very fluid”.

Businesses which have invested in Libya are concerned about financial security and uncertainty. In a statement the Chamber of Commerce told The Times Business a meeting with Malta Enterprise yesterday was to focus on companies’ difficulties in recouping payments due on invoices issued to Libyan clients and exposure to foreign principals on works in progress.

Companies were also facing hardship as they tried to withdraw their funds from Libyan banks: balances were dropping with the Libyan dinar’s devaluation.

A string of challenges included the repatriation of stock and other assets to Malta and maintaining payroll costs – even for humanitarian reasons – when business was at a standstill, with no indication of when operations might resume. The Chamber said some specialised banks were also putting pressure on firms.

“Further undesirable consequences include increases in insurance claims reported by the financial sector,” the Chamber added. “Companies that have invested in Libya are now faced with the prospect of having their assets and substantial investments stuck in the country. Others which have invested in the steadily growing export market have also been severely disrupted. The volatile situation has further compromised the chances of certain companies recouping historical debts.”

“Following meetings with the Prime Minister and the Minister for Finance, the Economy and Investment, the Chamber’s call for a task force specifically on this issue was positively received. It is imperative that the task force meets regularly to monitor this uncertain situation at close range and to be able to act quickly and efficiently,” the Chamber added.

Meanwhile, the Chamber said it was reassured companies had managed to repatriate their Maltese staff – the foremost priority in the crisis. It was now encouraging the business community to heed the prime minister’s call to offer humanitarian assistance.

Medserv, which operates support bases for the oil and gas industry in the Mediterranean and owns one such base in Misurata, Libya, said it “significantly” curtailed its operations in Libya because of the turmoil in the country.

The Corinthia Group said on Monday its expatriate employees and their dependents at the Corinthia Hotel Tripoli and Palm City Residences have been evacuated over the past days. “The Corinthia Group is closely following events in Libya, basing our action on our responsibilities to secure the welfare of our staff and clients and providing humanitarian assistance that our resources in the country allow,” it said.

Although many Maltese companies which conduct business in Libya are extremely worried about their investments there, the Libyan crisis has also proved to be beneficial for some sectors of the Maltese economy, although this is expected to be short-lived.

Hotels have reported a mini-boom due to the large numbers of foreign journalists, diplomats, military officials as well as expatriates fleeing Libya who ended up in Malta. Malta International Airport was turned to a transit base for people leaving Libya, Virtu Rapid’s catamarans were charted by the US State Department and several companies to get workers out of the North African country and a number of ships on their way to Libya, including foreign naval vessels, have been supplied by ship chandling companies with a variety of goods.

JOBS WORRY

However, the jobs of Maltese company employees with Libya-based roles could be at risk if the crisis is drawn out.

Malta Employers Association director-general Joe Farrugia said the MEA was among the stakeholders calling for an urgent meeting of the Malta Council for Social and Economic Development. Discussions would focus on short-term mitigating measures to alleviate the hardships of firms and their staff.

Local businesses could sustain employees previously engaged in Libya to varying degrees, depending on the type of organisation and the duration of the crisis, Mr Farrugia pointed out.

“Some businesses can transfer employees from the Libyan operation to the domestic outfit,” Mr Farrugia added. “However, in most cases this will not be possible and these employees may well face redundancies. This will also depend on the kind of contractual agreements that were signed between the companies and the employee. There may be cases where the employer may suffer the full cost of the contract, even though the work is suspended.”

Mr Farrugia admitted the manner in which the situation in Libya flared up was unexpected and many companies were caught unawares. They were now anxiously trying to gauge the duration of the situation while employees were understandably concerned about their livelihood.

Sources confirmed that some employees who have returned to Malta have been told to stay at home until further notice.

However, Mr Farrugia is optimistic about the future prospects in Libya.

“Many multinational companies are already positioned on the starting line in the race to grab the opportunities which will arise once the dust settles,” he stressed. “Libya is a vast country with a low population and practically unlimited economic potential which has been largely untapped due to an inefficient dictatorial regime. Although the short term prospects for Maltese companies are bleak, we should, as a country, start thinking of a strategy to hit the ground running once the crisis is over.”

He stressed the business community with interests in Libya had to look beyond the immediate issues and be proactive in designing a national strategy to benefit from the opportunities which will arise after the crisis.

Mr Farrugia said democracy in Libya – if it happened – could offer a tremendous boost to Malta’s economy.

“Malta can establish itself as a bridge between the European Union and the US on the one hand, and young Arab democracies on the other. The extensive international media exposure has already set the perception that Malta is a physical gateway. If the right conditions prevail, we could become a conceptual bridge as well. To achieve this, we need dialogue, vision and political consensus,” Mr Farrugia said.

Around 240 Maltese have been evacuated from Libya since the crisis began. According to official figures, 300 Maltese work in Libya.