Gozitan Businesses Upbeat About Island's Economic Prospects

Marie-Claire Grima - 14th December 2018

Leading businesses in Gozo believe that 2019 will be a positive year for most enterprises on the island.

2019 is set to be a prosperous year for Gozo, with Government rolling out the red carpet for entrepreneurs choosing to locate across the Channel, a growing amount of interest from digital and tech companies in settling down on the island, and mounting support for the Malta-Gozo tunnel project.

The 2019 Budget, which was announced in October, extended the number of fiscal incentives which were introduced for new jobs created in the private sector in Gozo, including refunds for employers offering contracts of three years or more. It also pledged to continue work on projects such as the SME village and the experimental farm in Xewkija. Furthermore, companies investing in Gozo can continue to benefit from advantageous tax credits, up to 20 per cent more than would be afforded to companies investing in Malta. Together with the Gozo Ministry, Malta Enterprise has also allocated €16 million for a partially EU-funded project to develop a digital hub aimed at attracting more high-tech companies to Gozo, mainly for R&D purposes. Indeed, in November, Google Cloud Premium Partner Noovle became the first company approved by Malta Enterprise to be housed in the new Gozo Innovation Hub which is being developed by Malta Industrial Parks at the former Malta Dairy Products plant, with Prime Minister Joseph Muscat lauding Gozo as “the place to do business smartly.”

Furthermore, the tunnel connection between Malta and Gozo, which has now been confirmed as geographically feasible, and for which a call for tender is expected to be published within the next six months, enjoys widespread support from residents of both islands, particularly the Gozitan side. A survey carried out earlier this year by the Gozo Business Chamber showed that 82 per cent of people living in Gozo were in favour of the tunnel, believing that it will be beneficial to the Gozitan economy and convenient for those commuting to Malta to work and study. Additionally, the second submarine fibre-optic cable which is currently scheduled for Gozo would also offer security to companies which rely heavily on international services and transactions, including gaming companies.

Gozitan businesspeople who spoke to us for this feature confirmed their optimism for business prospects in 2019. “It was a very good year for business

Gozitan businesspeople who spoke to us for this feature confirmed their optimism for business prospects in 2019. “It was a very good year for business for us,” said Michael Grech, Managing Director of investment services company Michael Grech Financial. “Profits for the year were amongst the best in the last 15 years. I think that in general, 2019 should be a positive year for most businesses in Gozo. Most sectors of the economy are doing very well, especially the key sectors of tourism, construction and services, and the extension of the reduced stamp duty for second-home buyers in Gozo and the employees subsidy scheme will be good for business.”

“Overall 2018 was a good year for our Group, especially on the local market,” said Christian Magro, CEO of Magro Brothers Ltd, a legacy Gozitan family business which has just successfully completed its hand-over from one generation to the next. “The current positive economic outlook has brought with it an increase of people in the domestic market and this increase has helped us expand our market share further. Our SAVINA operations depend considerably on the tourism sec-tor and since Gozo had a successful year in this sector, this has left a positive impact.”

Mr Magro said that he expected the extension of the job creation incentives in Gozo to have a positive effect on the economy. “Similarly, the measures taken by the authorities to increase tourism to the Maltese islands will yield a positive economic result.” Furthermore, he added, the Group has a property division, and the retention of the 2 per cent stamp duty on the purchase of property in Gozo is a positive measure that will continue to strengthen this sector. For both these sectors, he envisages another positive year, with plans for the Group to continue diversifying its operations and portfolio through new partnerships. Looking ahead, Mr Magro said that 2019 will bring with it new and exciting times for the company on the local market, due to increased economic activity. When it comes to the export markets, he’s not quite as sure. “For our European export markets, a lot depends on the outcome of the Brexit negotiations and how this will affect the surrounding markets that we offer Service to. We feel that there could be new opportunities which we shall be exploring, depending on the outcome of the dealings.”

This article originally appeared in The Malta Business Observer

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