New Economy discussed at BoV Gozo conference

Bank of Valletta, in conjunction with the Ministry of Gozo, last Friday held the ninth edition of its annual Gozo Conference at l-Imgarr Hotel Gozo. The conference, entitled "Gozo and the New Economy: Prospects and Perspectives," addressed issues linked to the new opportunities offered by e-commerce, within the scenario of the new digital economy.

The conference, which was introduced by BoV Chairman, Joseph F X Zahra and inaugurated by Gozo Minister Giovanna Debono, was addressed by various speakers. The conference follows a series of similar conferences that BoV has organised over the past years with themes of particular interest to the Gozitan community.

In his address, Mr Zahra said that the term “New Economy” describes the transformation of economic activities taking place as digital technologies make accessing, processing and storage of information increasingly cheaper and easier. The enormous volume of information is changing the way markets operate, leading to the restructuring of businesses and the opening up opportunities to create wealth through exploitation of available information.

He said that the main advantages brought about by the new economy can be summarised into six points, namely: lower input prices, lower inventories, reduced time to market, lower transaction costs, greater global reach and lower market entry costs.

Mr Zahra said that Malta is positioning itself in the international digital economy. With the recently published Business Promotion Act and the special incentives offered to enterprises operating from Gozo, it is anticipated that Gozo too will take advantage of the digital economy.

He spoke about the importance of tackling the IT skills gap and fostering a research and innovation culture in our enterprises.

Addressing the conference, Minister Debono stated, “This conference has now become an established annual event which offers us all a very valuable opportunity to discuss issues of critical importance to the further development of Gozo.

“Indeed, it should encourage other prominent corporate entities to lend their support and devote some of their human and financial resources to the design and implementation of a feasible economic and social development policy for our island.

“The inherent pecularities of Gozo make it imperative that both public and private sector organisations exert a concerted effort to chart the most feasible plan of action and to mobilise the necessary human, financial, legal and infrastructural requisites.”

Hon Debono added, “The emergence of the new economy, coupled with the relentless push towards globalisation is giving rise to a host of very promising opportunities for Gozo. The preparation and implementation of a feasible strategic plan for the attraction of what is loosely referred to as new economy activities can provide an effective way to alleviate the negative repercussions of Gozo’s double insularity.

“My Ministry is determined to take a leading role in the preparation and implementation of a strategy aimed at making Gozo a feasible proposition in the emerging international division of labour.

“We are prepared to co-operate with both parastatal and private sector corporations to realize our ambition of helping Gozo exploit the new opportunities generated by the information society. Otherwise, we would have wasted away a rare opportunity to neutralise the double insularity which our geographical characteristics are imposing on us all."

In his address, "Helping Gozo exploit its potential in the new economy," eMalta Commission Chairman John Portelli described how the Commission aims to provide strategic support to local small businesses in taking up the opportunities offered by the new economy and to establish Malta as a centre of excellence for the supply of Information and Communication Technology.

He explained, “The eMalta Commission will be supporting small businesses to exploit and rapidly take up eCommerce, extend Business-to-Business Activity, support the industry in adopting eBusiness practices and to establish the financial services sector as a strategic partner. Moreover, in our quest to position Malta as a leading provider of Information and Communication Technology in the Mediterranean, the government is now committed to accelerate and upgrade those initiatives aimed at providing widespread digital literacy and producing a crop of much-needed IT specialists that will fit the labour shortage which will inevitably occur."

Mr Portelli adds, "The envisaged initiatives which are expected to develop along four lines namely IT literacy in schools, Life-long learning, Vocational Training and Tertiary Education will be taken up in collaboration with the Private Sector, the Ministry of Education, Local Councils and public organisations namely the ETC, MDC, IPSE and MITTS."

Meanwhile, "What can the new economy deliver to Gozo?" was the theme presented by Victor Denaro, BoV’s Executive Head of IT. Mr Denaro described how "In Europe, 76 per cent of large companies have access to the Internet while other surveys show that over 80 per cent of top-managers in Europe are expecting to use e-commerce intensively by 2004.

“In contrast, 66 per cent of small companies have access to Internet while only 47 per cent are using it to generate sales and only six per cent of SMEs use the net for full straight e-commerce online transactions."

Mr Denaro explained, "In recent years, Bank of Valletta launched a number of computer based products and services such as PC and telephone banking whereas within the last few months, the bank, following its relationship banking strategy has carried out an overhaul in its IT platform making it ‘client based’ and not ‘account based’."

Joseph Grech, Treasurer, Gozo Business Chamber addressed the Conference on the theme "The new economy and business ventures operating from Gozo". In his address, Mr Grech described how at the dawn of an electronic era, Gozitan businessmen should be analysing the benefits of e-Commerce, introducing it into their business and making the most of it.

“Unfortunately, some Gozitan business operators are still waiting for e-commerce applications to be more extensively used by the public before venturing into this new form of trade. Thus, Gozo risks being wiped off the commercial map if it does not keep up with these new IT developments.

Mr Grech explained, "The solution lies in that Gozitan SMEs need to be taught how to use e-commerce and take advantage of it, they must offer a faster service, Gozitan people must start venturing into online shopping, and telecom charges must be kept competitive. "

In his speech entitled "The New Economy - Promoting Investment in Gozo" Investment Promotion Consultant Barry Mason outlined that the New Economy is having a major impact on the financial services sector which has been evidenced by back office administration, internet marketing of investment funds, e-banking and other areas.

Mr Mason recommended a number of actions that should be considered in developing New Economy business and investment in Gozo. These include the development of an upgraded incentives and assistance package for new investment, a thorough review of Gozo’s strengths and weaknesses should be completed, a marketing document and a suitable New Economy web site should be produced setting out Gozo as a base for New Economy business.