The crisis we are experiencing has a triple face: a global health emergency and a resulting serious economic situation accompanied by an increasingly urgent climate catastrophe. Crises mark transitions and turning points and it is exactly at these turning points that crises become productive.

This is the moment when we can remove the aftertaste of catastrophe and use it as a ‘decisive turning point’, as per the meaning of the Greek word krisis.

As a nation, we need to start seeing this point in time as an opportunity from an economic perspective.

As we recover, our end goal must go beyond the usual focus on GDP. We must go beyond and focus on well-being which, in turn, needs prosperity to be able to happen. When trying to unlock prosperity and to see why countries fare better than others, studies show that it boils down to competitiveness.

The question here should not only be where do we stand in terms of competitiveness but, more importantly, what policies are needed to improve and which will eventually usher a new direction of growth. In order to do so, we cannot stop at just hindsight. In policymaking we need foresight to start charting our future and to explore the direction we want our future economy to take.

When looking at competitive levels in the EU, it is clear that there are two sets of countries: the highly-competitive countries and the rest. Malta is at the outer bound of the other countries and, to sustain future growth, we need to make the leap to the other group, the members that have highly-competitive economies. Making the leap does not mean focusing on the problems but being aware of the challenges to focus on the solutions.

The challenges we face are complex in nature, implying that solutions are not straightforward. In the National Productivity Board Report 2020, I attempted to unpack this complexity revolving around competitiveness through mathematical modelling using the Global Competitiveness Index Indicators on the EU-27 countries over a five-year period, ending 2019.

The results showed that low competitiveness countries can still have high levels of infrastructure, ICT adoption and macroeconomic stability and, to some extent, human capital and innovation. However, they fail in having the right combination or, in better terms, in an ecosystem supporting competitiveness.

It will no longer be back to normal but a new normal- Stephanie Fabri

On the other hand, in highly-competitive countries, infrastructure, ICT adoption and innovation are a necessity for competitiveness. However, this is not enough. High competitiveness needs to be either supported by macroeconomic stability or, when challenges exist in macroeconomic stability, the private sector through human capital and flexible markets needs to take centre stage.

Therefore, Malta needs to now focus on the key fundamentals and on building an innovation ecosystem. Malta faces challenges that require resources but also a strategy for their investment. This is crucial to make the most of the unique opportunity coming from the European Union. The recently-approved Next Generation EU gives us a unique opportunity as a country to leverage this financing package to build our economy of the future.

The drafting of recovery and resilience plans, therefore, becomes crucial for the approval of resources and for the transformative impact of the investments that will be made. Combining this European perspective with Malta’s requirements makes us conclude that Mission Malta should be built on three main pillars: innovation, the digital economy and the green economy. The NRP builds on this thinking and lists a number of actionable proposals under these three main pillars.

COVID-19 will pass and economic agents and the economy will recover too. However, it will no longer be back to normal but a new normal.

The new normal needs to look at the economy as a living organism. We need to view our economy and its structure through its DNA. All policies should take into consideration our foundational elements, culture and economic heritage.

The time is now.

It is in our hands to chart this new way forward.

Stephanie Fabri is an economist and lecturer at the University of Malta.