Manufacturing’s future prospects depend on a collective effort – FOI

The Federation of Industry has hit out at certain remarks, passed during last week’s UHM General Council by the Leader of the Opposition and the UHM Secretary General on the future of manufacturing industry.

The FOI explains that Alfred Sant was quoted, in the heading of a report in one of the dailies, that manufacturing industry in Malta faces a grim future. It is an acknowledged fact that the grim reality of globalisation exposes all enterprises to competitive pressures from all quarters. This is a common factor even in the strongest economies of the world. The FOI believes that whereas this calls for determined action it should be no cause for alarm.

The FOI insists that the future of manufacturing and service industries hinges on their capabilities of having a realistic vision; reacting effectively to market demands in terms of product, price and quality; adapting the work-force to changing technologies; and increasing productivity. This is what restructuring is all about. There are institutions, like IPSE, MDC and METCO, that were established to encourage and assist industry in its efforts to restructure. This has nothing to do with EU membership and related pressures from Government, but is the result of pressures exerted on enterprise by the market situation that oblige it to compete by giving the consumers more value.

EU membership or any other available alternative political status for Malta will neither bring new investment nor make an enterprise competitive. It is the operating environment in a country and the opportunity costs that influence the investors’ decision. The amount of regulation, the related bureaucracy, the wage levels, the availability of labour in number and quality, stability in industrial relations, the efficiency of our infrastructure, and the economic situation could all have a bearing on the time and cost factors that make all the difference in the bottom-line of an enterprise and on the profits an investor can expect on the risks he takes. A favourable mix of such factors will convince investors to take those decisions that Government, Opposition and Union leaders are eager to see.

The Malta Federation of Industry appeals to the other social partners, ideally within the Malta Council for Economic and Social Development, to play their part in keeping the situation under control. That is the only guarantee for more investment and the generation of wealth that everyone looks forward to enjoy in the coming years.