The Maltese tourism industry is in need of a clear direction to attract higher-spending clients and begin to move away from reliance on quantity Corinthia Group chairman Alfred Pisani said.
Speaking during a Times of Malta business breakfast where industry leaders gathered to discuss the way forward for tourism post the pandemic era, Pisani highlighted how the Maltese tourism industry is desperate for a bump in quality to attract higher-spending clients, in a bid to stop relying on volume to sustain itself.
“It is important to see what other countries have done when experiencing a surge in tourism numbers. Bigger countries like Spain, for example, have set out strategic areas for the different budgets of visiting tourists, but what is appropriate for larger countries is not always applicable to Malta. We will always be limited by the size and capacity of the island,” he said.
“It is because of the limited size and resources that we should be aiming for higher spending clients and have a limit on the volume of tourists we should aim for.”
This, he continued, should be accompanied by a rise in the quality of products offered and the general environment of the island.
“We must plan a roadmap to how we are going to reach this target, where we solidify interest based on high standards of service and Malta’s unique attraction,” Pisani said.
More employees, supporting services will be needed
“For every 100,000 additional tourists, we need an estimated 5,000 to 10,000 additional employees to support them. These additional labourers will need accommodation, as well as supporting services, that continue to strain our infrastructure. This is on top of that already being used by the additional tourists so we need to seriously understand the real implication of this.”
Going for higher quality tourists would allow the industry to charge higher rates, which, while generating higher profitability, would also improve wages and encourage more locals to see tourism as a career, he said.
The industry must also acknowledge the rising costs of commodities like fuel that cannot continue to be absorbed by the government indefinitely.
“While rising costs will mean that we will see less low spending visitors, high-net income tourists who are more affluent will continue to travel immaterial of the cost and the priority for the high-income tourist is quality,” he said.
“Making these changes is both risky and challenging but it is also an opportunity to embrace a new upmarket vision for our industry. A targeted way forward to achieve this is required.”
'Quality and quantity need to walk hand in hand'
Tourism Minister Clayton Bartolo said quality tourism should not be confused with luxury as the two are distinct elements in the industry.
“Quality and quantity need to walk hand in hand and one does not necessarily exclude the other,” he said.
“While we do need to find the balance in volume to keep operations feasible, it is crucial that we move towards attracting more high-quality visitors.”
He added that while the war in Ukraine would certainly pose a challenge to tourism, the outlook for the coming year remains optimistic, with the government committed to increasing the seating capacity of flights to Malta.
'Gozo can show the way'
In a panel discussion on the way forward for the industry post-pandemic, Gozo Tourism Association CEO Joe Muscat said Gozo feels the pinch of overcrowding more due to its limited size and expressed concern that Gozo was quickly becoming an “extension of Malta” and losing its unique qualities.
“I don’t think we really need to add capacity, Gozo is small, with only 1,000 hotel rooms and 103 licensed restaurants, I think it's possible to focus on upgrading and making the product better. In this sense Gozo could be a model on how to lead tourism quality,” he said.
He added that, in terms of overcrowding, decreasing numbers might not be the principal problem as much as enforcing the limits on existing carrying capacity.
CEO of the Malta Chamber of Commerce Marthese Portelli said that, according to a recent study commissioned by the chamber, tourism is the industry most likely to feel the effects of the rising cost of living and inflation.
But, she added, this should not be discouraging because if the industry is aware of its disadvantages and works to improve them, attracting higher-spending clients could serve to mitigate this.
Malta needs to be aware of how it is packaging its offering to different types of travellers, Portelli continued, and more coordination is needed between industries that all have a finger in the pie of tourism in their own way.