Category: Articles

The Government announced that the second round of the vouchers scheme will kick off on June 7th.

Following several discussions with the Government, the SME Chamber managed to secure the fastest possible release of the vouchers as well as a more balanced distribution – that of a total of €40 for retail outlets and €60 for the hospitality and entertainment sector.

The vouchers can be downloaded digitally from the website wallet.vouchersmimcol.com  until 4 June.
Those who do not download the vouchers digitally will automatically then receive them by post.

• The vouchers will be distributed as follows:

• Four red vouchers, each worth €15 to make up a total of €60, can be used at restaurants, hotels, accommodation places, bars, or diving centres.
• Four blue vouchers, each worth €10 to make up a total of €40, can be used at retail shops which sell clothes, footwear, jewellery, and gifts, hair and beauty salons, sports clubs and gyms, museums, arts and culture centres, and band clubs amongst others.

The COVID-19 pandemic has driven rapid adoption of digital channels across countries and industries, but digital’s growth has plateaued in the past six months and may begin to slip back once the pandemic eases—even as total digital adoption stays well above prepandemic levels. That’s one of the findings from a new McKinsey survey of global consumer sentiment conducted in April 2021. Companies can look to hold on to newly digital consumers by improving digital experiences, investing in “phygital,” and putting consumer trust at the heart of all they do.

The survey suggests that industries across regions experienced an average of 20 percent growth in “fully digital” users in the six months ending in April 2021, building on previous gains earlier in the pandemic. During that same time period, it was primarily younger people joining the ranks of digital users.

The COVID-19 pandemic has driven unprecedented numbers of consumers into digital channels, but some consumers have begun using those channels less in the six months leading up to April 2021. That may be unsurprising given that consumers during lockdowns had little choice but to shop online, and to turn to at-home-entertainment options. Now that consumers have more freedom to choose, they may express a preference for more physical-channel interactions in certain industries.

In the six months prior to April 2021, European and US consumers continued to embrace digital channels, as they had done since the start of the pandemic, in nearly every industry. But not all industries experienced the same growth in digital adoption. In both Europe and the United States, digital adoption grew fastest in the utilities and travel industries, which each jumped 46 percent, as well as in the public sector, which grew 45 percent. Digital adoption grew less in the apparel and general retail and telecommunications industries. Grocery, meanwhile, saw increased digital adoption last year, according to our 2020 survey results, but has since experienced a decrease in fully digital behavior. When it comes to growth rates, it’s worth noting the obvious: industries that are highly digitized already, such as entertainment, have less room for further growth than industries with low digital adoption, such as grocery.

Even if most consumers were driven to digital channels because of the COVID-19 pandemic, the majority of those who continue using those channels will do so for convenience. Other consumers simply prefer the experience of going to a physical store.

Companies can improve their digital services by innovating around the three dimensions that consumers say matter most: — Improve trust in digital services by increasing privacy and security. About 44% of consumers surveyed don’t fully trust digital services. — Improve the user experience in digital channels by refining user interfaces (UX/UI) and by creating phygital interactions, at least some of which (for example, high-ticket or complicatedto-purchase items) may involve a human agent. About 56% of dissatisfied users conveyed discomfort with digital UX/UI or lack of sufficient information about, for instance, products and services. — Improve the end-to-end consumer experience by making all products and services digitally available, by improving after-sales services, and by offering better prices and deals in digital channels. Some 39% of dissatisfied users say that they can’t accomplish everything they intend in digital channels, and roughly 20% of dissatisfied users want to mix online chat with a human into their digital interactions.

More than twice the number of consumers say that the best way to improve the user experience is by offering fully end-toend digital services—including services offered after the sale—with less friction along the way. This finding once again varies by industry. In the education, grocery, and healthcare industries, along with the public sector, consumers want a more complete digital journey, from initial awareness to the end of the sale and beyond. In the apparel and general retail and telecommunications industries, better after-sales service will improve the user experience, according to the survey. Banking and travel customers want more payment options, while consumers in the grocery, insurance, telecommunications, and travel industries prefer better product and service offerings at discounted prices.

47% felt that the experience of businesses with the closures this year were worse than last year

A study conducted by the Malta Chamber of SMEs among 250 business owners showed that 47% felt that the experience of businesses with the closures this year were worse than last year because they were in a weaker position and closing made it even harder.

The survey, carried out between May 10th and 18th, asked business owners how they would describe the experience of being closed during 2021.

A quarter of the respondents said the impact was comparable to 2020 while 11% claimed there was confusion because some were unsure if they were allowed to open or not.  This, they said, led to unfair competition because others “opened regardless”. A further 13% said they were able to continue with their business through their online platforms. They were allowed to reopen again on April 26th.

On the days following the reopening last month, almost 40% said business was “very slow” while 27% said it was “slow”.  A further 34% said business was satisfactory.

The majority of business owners that participated in this survey, 59%, said they did not make use of the government’s tax scheme at any point since the start of the pandemic. A further 30% on the other hand, opted for the scheme, while 11 per cent claimed to not know about it.

Of those who made use of the scheme, over half, 52%, said they have started paying repayments while 22% plan to start paying “later this year when business restarts”.

A further 17%, however, said they are not sure when they will be in a position to start repayments while 9% said it will “surely not be before the year 2022”.

16% of the respondents made use of the moratoria on bank loans at any point since the start of Covid, while 84% did not make use of the bank moratoria.

Asked what their biggest concerns were, businesses flagged sales levels as the top concern with 19% of the respondents, followed by cash flow issues 15% and uncertainty 14%. Other problems included problems in collecting payments, employee wages, difficulty in paying commitments, rent and banking issues.

If the situation remains unchanged, 24% of businesses said they would only survive up to six months while 21% said they would make it for a period of up to 12 months. A further 38% would make it for longer than 12 months.

Others, however, said they would only last a few months, with 13% saying they would only survive up to three months and 4% said they would have to close in a month’s time if their situation did not improve.

On recovery, 23% said they are still unsure of when they envisaged recuperating while 19% said recovery has started.

When asked about business’ sales turnover during the first 4 months of 2021, 33% of the respondents said that they are “very dissatisfied”, 25% responded that they’re “dissatisfied” and 29% responded that sales are “neutral”.

48% responded that sales are worse than expected while 47% replied it’s in line with expectations, 5% said it was better than expected.

When asked about their plans for their business until the end of the year, 37% of businesses said that they do not plan to change anything, while 9% replied that they intent to expand in Malta, 14% replied that they’ll start eCommerce. Only 10% replied that they will downsize and 7% replied that they will reduce employees, amongst other options.

The study also flagged worrying trends related to employees’ mental health. Owners said 60% of their employees reported mental health issues, with 14% saying this was negatively impacting business.

Click here to download full survey results

The European Parliament officially green-lighted an agreement for a EU-wide vaccine passport scheme, which will be supported by €100 million to fund affordable Covid testing

The European Commission said it is set to be rolled out by July 1.

“This agreement has been reached in record time just two months after the Commission’s proposal.” It said.

“The EU Digital Covid Certificate is free of charge, secure and accessible to all. It will cover vaccination, test and recovery offering different options to citizens,” said EC President Ursula von der Leyen said.

“We are delivering on our commitment to have it up and running before the summer.”

Von der Leyen said it will protect the user’s personal data and can be used digitally or in a paper-based format.

Countries are expected to ratify it in phases with several countries testing it in early June before the EU-wide rollout on 1 July.

As for the right of member nations to impose their own additional restrictions, they agreed it must be ‘necessary and proportionate to safeguard public health.’

The SME Chamber is in full agreement with the strategy of gradual re-opening of the economy

Following a presentation made this morning to Social Partners at MCESD, of which the SME Chamber is a full member, it was clearly explained how well the vaccination strategy has been implemented, putting Malta at the very top amongst achievers.

The SME Chamber is pleased to note how fast Malta has progressed, currently being the country with the highest number of 1st dose of the vaccine administered amongst all other countries. Malta will most probably also be the first country to reach the coveted herd immunity within the coming few days.

Together with the semi-lockdown in March, the vaccination strategy has been the primary contributor to the drastic decrease in cases, lower contaminations, lowering of cases requiring hospitalisation and deaths.

This is a great result not just for our health but also for our economy. The businesses we represent have been eagerly awaiting this sign of hope and a level of security, both for their own safety and for business to be able to restart.

Health and business go hand in hand and now that Malta is doing well on the health front business is restarting.

The SME Chamber is in full agreement with the strategy of gradual re-opening of the economy.

It is however important not just to take it gradually but also for all economic sectors to be given the opportunity to re-start, operating within the agreed health restrictions. All sectors can operate within this new normal with standards regulated by the appropriate protocols.

Based on the positive health result, the SME Chamber expects the gradual re-opening to continue being implemented.

It should be noted that there are some sectors that have been made to stop their operations for an indefinite period now. Some are still in the dark as to when their business can be allowed to restart. The SME Chamber will ensure that no sector is left behind in the progress our country is achieving.

The Malta Chamber of SMEs is making it clear that the government’s requirements for payments, requirements which are ill-fitting during COVID times, are threatening their survival

Tourism vessel operators have been very hardly hit by COVID, like any other tourism dependent sector.

Other sectors in the tourism industry have benefitted from the basic wage supplement, complete waiver of 2020 and 2021 license fees and even the consumption boosting vouchers. This was all necessary for their survival.

The tourism vessel sector is completely tourism dependent. While on the one hand they have been given some basic help that is passed on immediately to their employees in the form of the wage supplement, the government ends up taking much much more from them by still requesting them to pay tens of thousands of euros in licensing to Transport Malta to operate.

The government is adopting a very unfair and discriminatory approach depending on which entity is regulating the sector. Operators falling under MTA had their mind put at rest from the very beginning that they would not be asked to pay fees and licenses while they continue suffering lack of business due to the effects of the pandemic. To the contrary these operators have been pleading with the authorities for months and not only have licenses not been waived or reduced but they have also incurred fines for late payments.

Irrespective of the regulatory authority this is one government and no such discrimination can be tolerated. The Prime Minister has frequently said that no business will be left on its own. The Malta Chamber of SMEs is making it clear that the government’s requirements for payments, requirements which are ill-fitting during COVID times, are threatening their survival.

This matter is currently in front of the Prime Minister and the Minister responsible for Transport Malta. The Chamber of SMEs does not exclude taking further action to safeguard the survival of its members should this situation not improve.

Currently exploring potential solutions with the Government

The Malta Chamber of SMEs has been monitoring an issue over the past months that is of serious concern to Malta. This matter was raised by members and affects all imports coming from the Far East and Turkey.

Importers have explained to us how, especially since January of this year, their operation has suffered a big shock because of changes that occurred in the shipping industry, within these countries. A number of factors have contributed to great shortages in the availability of containers and coupled with this, substantial increases in their cost.

This problem has not only impacted Malta, however the final resulting effect on Malta is bigger due to our dependency on importation and reliance on the maritime industry. Malta is in fact much more sensitive when compared to other states where importers have more options to rely on.

Importers have explained how difficult dealing with the shipping issue has been. Finding available containers is a big struggle and when, after some time, this is successful, they end up paying at a premium for the empty container. A number of new requirements further exasperate the situation. This includes being asked for a substantial sum upfront as a deposit to secure the space. It has unfortunately also become common practice that importers are asked to pay a top-up even when a commitment has been taken and given a choice to take it or leave it.

So far importers have adopted various mitigation measures at business level. Some have tried to hold off on importing, but they are now running low on stocks. Others have tried to absorb the cost as much as possible for their products to remain competitive. Maltese importers were hoping for the situation to resolve itself in the short term. Five months on however they are having to revisit their positions as it has now become unsustainable.

Apart from the cost aspect businesses are having to operate within abnormal settings, being charged much more for work they already had committed to and not being able to satisfy delivery timeframes.

The ultimate impact will be on how competitive our businesses can be in their offering. The SME Chamber foresees that, apart from the already present disruptions, Malta will be visibly experiencing price inflation on a multitude of goods across many sectors. This includes furniture, DIY and home improvement products, healthcare items, cosmetics and medicine, food products, power tools and equipment, tech products, household goods and appliances, clothing and jewellery, amongst others.

The matter has been raised with the Ministry for Enterprise and possible solutions are currently being explored. Businesses experiencing such a problem are asked to get in touch with the Malta Chamber of SMEs.

The SME Chamber is working to seek further clarifications on the gradual return to normality

Deadline to apply for the scheme is the 26^th May 2021

Through the Micro Invest Scheme you can receive a tax credit of up to Eur 50,000 or up to Eur 70,000 (in the case 50% of the ownership attributed to female persons, a registered family business or is based in Gozo).

The scheme operates retrospectively and one can claim costs incurred in the previous year.

The submission date for companies is on 26th May 2021.  

Please do not hesitate to get in touch should you need further information. May we kindly remind you that the Malta Chamber of SMEs also offers the service of applying for Micro Invest on behalf of its members. This can be done through a dedicated service for a minimal administrative fee of Eur 150.00 (up to 10 claims) or Eur 250.00 (More than 10 claims).

Should you wish further information, please do not hesitate to get in touch with Ms. Bernice Sammut on