Behind the stars

It’s been almost four years since the first Maltese restaurant made it to the Michelin guide and just over a month since the first one was awarded two stars in it.

Evidently, these are exciting times for the local culinary scene. It is both a confirmation of how far we’ve come and an incentive to continue investing to improve it.

Let’s face it, Maltese restaurant owners are lucky. We just love to socialise and dine out. It’s the Mediterranean in us, I guess.

In northern Europe, this combination is not as steadfast. Countries like Germany and Austria, for instance, do not seem to pursue the same lifestyle of dining out with family and friends as a primary form of entertainment and socialising, the way the Maltese, Italians and Greeks do.

Speaking from the experience of the db Group, which today owns and runs 14 restaurants across the country, our clientele is practically split down the middle in terms of local and foreign patrons.

This is one of the reasons why many of Malta’s restaurants managed to survive the COVID shock, which effectively sealed our airport overnight. Thankfully, when possible, the Maltese continued to seek the pleasures of eating out, albeit with restrictions. Coupled with taxpayer support, this sustained demand for tables meant that many restaurants came out the other end of COVID alive and kicking.

Our passion for food and dining out has also pushed restaurant owners to up the bar and invest in their product – from bringing over new and exciting cuisines to elevating classic local dishes in creative and intriguing ways.

There are other positive factors in the mix: frequent travel has made Maltese palates more discerning, the increasing number, quality and variety of tourists is diversifying the market and so are those coming from all over to work here, particularly in this sector.

Seeing so many new cuisines available in Malta is genuinely satisfying, as is the flourishing of contemporary and unique (and, sometimes, specifically Maltese) interpretations of classic dishes.

Even the ambiance of our restaurants is changing, with proper investment in decor, sound design, plating, entertainment and more. This is in line with the global trend driven by what is known as the ‘experience economy’.

Today’s consumers expect an experience to be at the heart of their purchases, whether in retail, travel or hospitality. Our restaurants have capitalised on this development by using design, entertainment, innovation, theatre and service to deliver something more immersive than a menu and a decent cellar.

Simultaneously, restaurant owners are facing two stiff challenges. Firstly, it has become more difficult than ever to find local staff (a reality faced across the board because our economic growth has outpaced our supply of human resources) and the second is competitive pricing.

Our restaurant VAT rate is the sixth-highest in the EU and the highest among our Mediterranean competitors- Robert Debono

From their travels abroad, Maltese people note the lower restaurant prices in, say, Portugal, Spain and Italy. The comparison, however, is not quite fair on local restaurants. We are an island importing around 70 per cent of the ingredients. By contrast, most European countries have access to cheaper, local ingredients and import only about 10 per cent of their needs.

Exacerbating matters, our restaurant VAT rate is the sixth-highest in the EU and the highest among our Mediterranean competitors. The Association of Catering Establishments has long proposed a win-win solution, which would make the restaurant business more sustainable and competitive, while mitigating the effect of inflation.

This is an important challenge to overcome because both locals and tourists are becoming ever more avid seekers of value for money. It’s not that patrons are desperately trying to spend less on their experience. Rather, they expect to get the right bang for their buck.

Recent reports suggest that Malta has around 3,000 restaurants serving a population of half a million. That’s more per capita than New York, Paris or London.

While this makes our country vibrant and our patrons spoiled for choice, it also means that restaurants are struggling on the bottom-line front.

As with many things, we should strive to achieve a balance. Sure, let’s celebrate our growth, diversity and success as a culinary destination worthy of the Michelin guide and much more.

In parallel, however, we must find ways to keep our sector sustainable. This includes trying to source more products locally, investing in economies of scale and implementing eco-friendly measures that can reduce costs without affecting the product.

Robert Debono is the CEO of db Group.