Issue link: https://maltatoday.uberflip.com/i/1161128
29.08.19 6 NEWS Rita Schembri, Head of the Central Bank's Economic Analysis Department THE gaming and financial services sector are garnering a lot of attention lately. Gam- ing has indeed been an important driver of growth in Malta, but the most important contributions to our economy are not com- ing from gaming. If you consider the contribution to nom- inal GDP from the various economic sec- tors, in the last five years gaming has indeed been a strong source of growth, but the sec- tor of professional, scientific and technical activities has also grown significantly. is includes activities like advertising, legal consultancies, scientific research and devel- opment and veterinary services. One of the reasons such professional ser- vices are growing is because they are essen- tial in order to support the gaming and finan- cial services sector – one can't exist without the other. erefore, there is a much greater multiplier effect from the gaming and finan- cial services sector than some might realise. Moreover, all the other sectors had posi- tive contributions throughout the past few years, so the growth was quite broad across the economy's sectors. When it comes to growth by the size of firms, the Bank's chief economist concludes that a lot of the gap between Malta's growth rate and that seen in the EU is actually driven by growth in SMEs. is makes the growth model more resilient to external shocks, because the country relies less on a few key players, and more on smaller enterprises. In terms of Gross Value Added, the nom- inal data we have shows that, in 2018, the wholesale and retail sector contributed the greatest share in total Gross Value Added, at 21% is is followed by public administra- tion and defence, at 16.8%. Arts and enter- tainment, which includes the gaming sector, actually came in third in terms of share of GVA, with 15%. Our economy is therefore very diversified, and sectors which are relatively new are cer- tainly not the only drivers of growth. Regarding the sustainability of the surplus, you have to keep in mind that fiscal sus- tainability has different dimensions, and we should not only look at the fiscal balance – the surplus – but also at the debt. e surplus is affected by many things, in- cluding the cyclical position of the econo- my. When the economy is doing well, you expect there to be a surplus. But the Bank and other institutions adjust the official fig- ure to factor in the effect of the cycle and thus obtain the structural balance. e structural balance has been in surplus since 2016, which is a good sign. It is also close to the headline or official balance, sug- gesting that most of our surplus is not af- fected by the cycle and by one-off outliers. According to our projections we expect the structural balance to remain in surplus till 2021, and the government had commit- ted to keep a surplus net of revenue from the Individual Investor Program (IIP). Of course, in 2017 and 2018 we had quite a large surplus, partly due to the buoyancy in the economy which boosts revenue, and partly due to the IIP flow. e expectation is that the surplus will decrease in the coming year, but it will be maintained and Malta will continue to be one of the best performers in the EU. e Bank also publishes a debt sustaina- bility assessment. e 2018 Annual Report's conclusion was that the risks were low in this area, especially if the government ad- hered to its commitment of maintaining a structural surplus net of IIP. Malta's debt is already low compared to other countries, but it will fall further. If after 2021 the government returns to a deficit, the debt ratio will start rising, but it won't be at an alarming pace. Risks here include an ageing population and Malta's relatively high share of govern- ment guarantees. How important is iGaming for Malta's economy, and is the surplus the country has been achieving for the past years sustainable in the long-term? MALTA BNI de Redin Chap- ter is organising a meeting between a delegation of Chi- nese businesswomen from Shanghai's Women Federation and female entrepreneurs in Malta on Friday, 6 September 2019 at the Alexandra Hotel in Paceville. Starting at 9am and running for 90 minutes, the meeting will address topics such as the cultural difficulties that wom- en encounter when starting their own business and best practices to promote women entrepreneurship or to facili- tate their startups. Before joining the meeting with the Chinese delegation, visitors are also invited to at- tend the BNI de Redin Chap- ter weekly meeting starting at 7am to understand how BNI functions and what opportu- nities BNI offers in Malta and abroad. Persons wishing to attend either or both meetings are asked to contact BNI member Viviana Premazzi of Global Mindset Development at viv- iana@gmdmalta.com by not later than 12noon on Wednes- day 4 September. As places are limited, they will be assigned on a first come, first served basis. e Shanghai delegation will be accompanied by GY Acade- my who are coordinating their meetings in Malta. BNI has five chapters in Mal- ta, meeting weekly in Sliema, Mriehel, St Paul's Bay, Valletta and Paceville. Over the years and across the 70+ coun- tries where it is actively pres- ent, BNI (www.bni.com) has helped hundreds of women entrepreneurs to grow their business, whether it was just a start-up or an already recog- nised business. rough its unique system of more than 9,500 chapters, BNI has given them the opportuni- ty to expand and grow their business in other countries as well. Malta BNI invitation to meet Chinese businesswomen ON 19 August, World Pho- tography Day, APS Bank launched its annual photo competition, with winning images to be included in the Bank's 2020 calendar. 'Time to care' is the tag line coined last year, a recurring theme also present in this year's calendar, aimed at cre- ating awareness and inspiring people to take action to be more sustainable. e 2019 calendar portrayed images of how people are hav- ing a negative impact on the environment. is year, the Bank is invit- ing participants to take photos that help to raise awareness on how people can come together to create a positive change to their communities. All twelve selected images will be given a cash prize. First place will be awarded €500, €400 for the runner up, €300 for third place and all oth- er shortlisted entries will get €100 each. Registration deadline is 16 September 2019 and photos are to be submitted by 14th October 2019. More about the photo com- petition is available at aps- bank.com.mt/photo-competi- tion to learn APS Bank launches its annual photo competition