The World Bank has published the results for Business Enterprise Survey 2019 in Malta. In Malta, the survey was conducted in the first half of this year. The sample in Malta was of 242 business enterprises. The same survey was also conducted in a number of other countries. The results provide some interesting pointers on what Maltese businesses believe are the greatest obstacles they are experiencing.

The results are available at Enterprise Surveys www.enterprisesurveys.org, The World Bank.

Although the survey questions were varied, covering a number of topics, the data does indicate that, in terms of legislation, there is little that seems to be bothering businesses operating in Malta. What appears to be an issue is the implementation of this legislation.

For example, only 14 per cent of respondents, compared to 32 per cent for all countries taking part in the survey, identify tax rates as being a major constraint, and only four per cent, compared to 22 per cent overall, identify tax administration as being a major concern.

On the other hand, Maltese businesses stated that it takes on average 99 days to obtain an operating licence, while in other countries it takes 29 days. Moreover, it takes an average of 213 days to obtain a construction-related permit, compared to 71 days in other countries.

The more investment there is in innovation, the stronger the indication that businesses look to the future with optimism

The section related to banks and finance provides positive results. Ten per cent of respondents identify access to finance as a major constraint. On average, 33 per cent of the working capital of businesses is financed by banks, while it is 12 per cent in other countries. Twenty-one per cent of investment is financed by banks and only eight per cent of respondents stated that a recent loan application was rejected.

Respondents were more critical on infrastructure issues. Thirty-seven per cent of respondents have identified electricity as a major constraint and 33 per cent identified transportation as a major constraint. Thirty-four per cent of businesses experience electricity outages and 45 per cent own or share a generator. Respondents also stated that the average amount of days required to obtain an electricity connection from the date of application is 80. Two per cent of companies stated that they lost products to breakage or spoilage during shipping to domestic market. In certain respects this data is worse than it is in other countries.

Innovation is an aspect that indicates the extent to which businesses look to the future with optimism. The more investment there is in innovation, the stronger the indication that businesses look to the future with optimism. In this respect we have conflicting views. While 45 per cent of respondents claim to have introduced a new product or service, only 18 per cent claimed that they have introduced a new process innovation. This would indicate that businesses respond to market demands but are less likely to invest in finding ways and means to become more efficient and productive.

Human resources was another topic dealt with. Only eight per cent of businesses stated that labour regulations are a major constraint. On the other hand, 33 per cent identified an inadequately educated workforce as a major constraint.

The data is far more extensive than this summary. It may also be argued that certain replies provided may not fully reflect the true situation. However, they reflect what respondents claim to experience, and in this respect the issues still need to be addressed. These are aspects that go to the very heart of the overall competitiveness issue of businesses operating in Malta and determine their propensity to invest.

This is why I strongly believe that while the economy performs well by any standard, we cannot get complacent, and we must continue striving to address those elements that may be hindering or will eventually hinder our economic growth.