Overview of discussions at 11th April TAP Knowledge B2B networking and Partnering Conference
Anamaria Magri Pantea
More and more often we realise nowadays that pooling capabilities and efforts is no longer a choice but an imperative in the current economic environment. The increasing global competition in all fields and from all perspectives (human resources, capital, companies, organisations, countries, etc.) requires in-depth specialisation and a narrow focus. At the same time, the clients are becoming more demanding for seamlessly integrated services and one-stop-shop solutions. So how can these opposite trends be reconciled? Definitely by proactively building relations and collaborating with other relevant market players to reach beyond individual boundaries!
As a strong believer in and supporter of such approach, TAP Knowledge Network – a collaborative network of independent professional service providers – teamed up with Property & Life Magazine to co-organise the business-to-business networking event that took place on Friday 11th April 2014 at the Intercontinental Hotel, St. Julian’s. The Network’s involvement in this event was driven by its mission to contribute to the development of a smarter, more sustainable and inclusive global society through the integrated application of specialist knowledge. Ofcourse, starting with Malta first!
Against the backdrop topic of “Malta – gateway to doing business in the 21st century”, the overall framework of discussion was focused on Malta’s strategic opportunity to act as a bridge between the EU and North Africa to address green issues, IT Security, trade development and business exchange, whilst simultaneously supporting SMEs and start-ups. In this context, the programme included two open panel discussions, one on Malta as a hub and catalyst for international trade, technology transfer and competence integration, and another looking into the importance of engineering optimum financing structures and harnessing the power of pervasive ICT for delivering such potential.
The Hon. Dr George Vella, Minister for Foreign Affairs, opened the discussions by emphasizing how both Europe and North Africa are seeking to expand and strengthen their economic and commercial ties by building on the strong political relations that Malta has had with both these regions over the years. These then translated into the establishment of robust economic links, including Bilateral Double Taxation and Air Service Agreements, hence facilitating the exchange of people and the movement of capital.
A number of TAP Knowledge Network members and other distinguished speakers contributed their insights to the discussion. In a first instance, the focus has been placed on what exactly are the potentialities of Malta as the gateway and linking-pin between Europe and North Africa. The geostrategic positioning , the cultural ties and similarities, the beauty of being small, flexible and innovative, were all brought forward and discussed in a constructive fashion, specifically looking into highlighting areas where more needs to be done.
The importance of collaboration and integration for servicing clients operating in a global environment and the emergence of a new approach to outsourcing has been highlighted by Dr. Tonio Fenech. As the Chairman of the TAP Knowledge Network and Joint Managing Partner of Fenech Farrugia Fiott Legal, he explained the concept and values around which some 15 different professional service providers – from legal, accounting, advisory, assurance, corporate finance and EU funding, up to project management, marine, ICT, marketing, property-related, management and infrastructure outsourcing – are collaborating for offering their clients customised integrated knowledge-based solutions.
Other Network members also added their perspectives to the discussion on the challenge of delivering Malta’s potential and the importance of making best and most innovative use of resources so much governed by the scarcity principle. As such, innovation, customisation, client relationship, sustainability and the adoption of new business models to deliver value to clients are becoming most relevant competitive advantages nowadays, be it at an individual, a company or even at the level of nations in general. With financing and ICT identified as enabling resources needed to make best use of the more traditional economic inputs (people, capital and land), the importance of leveraging and optimum engineering of various sources of funding (grants, credit, equity) according to the requirements and strategies of the bodies making use of them (companies, public organisations, NGOs, communities) has been stressed.
The EU funding opportunities available, particularly the recently launched SME Instrument but also other streams of the Horizon 2020 targeted at pan-European and international collaborative projects, as well as the EUROMED and European Neighbourhood Instrument for Cross-Border Cooperation in the Mediterranean Sea Programme are very relevant sources of support for initiatives aiming to further build bridges between Europe and North-Africa and strengthen Malta’s role as a facilitator and stepping-stone.
However attractive though, grants cannot be the only source of finance of any organisation and as Adrian Spiteri, RG Capital Advisors Managing Director explained, it is extremely encouraging to see the current trend towards blending EU funding with bank finance as a more sustainable way of facilitating access to finance. This is particularly relevant for SMEs, micro-enterprises and start-ups that have limited ability to satisfy the security requirements of the banks. Whilst there are a number of forms of bank finance which are less dependent on the traditional security and could be well structured for international trade and investment initiatives, like for example documentary credit, forfaiting, factoring and warehousing, project finance, there is one thing that a bank will always require, that is a certain degree of equity contribution. Unfortunately, this is not at all easy in Malta, or in North Africa, where the presence of business angels and venture capital is limited, to say the least.
The challenge of access to equity, but also to the other forms of finance in general, could in fact be an opportunity for Malta, as highlighted by David Borg, the Tax and Business Advisory Director of Capstone Group. Building on our previous experience in jurisdictional innovation (like for example in i-gaming), Malta could attain a first-mover advantage in the alternative funding sector by regulating the fast emerging area of crowd-funding. With the banks increasingly more risk averse and property collateral being often insufficient or no longer welcome following the recent financial meltdown, a gap has been created on the market that companies such as Kick-Start, Crowdcube, Seedrs, Funding Circle, MarketInvoice, have quickly moved in to fill. With the assistance of internet technologies they are now providing crowd-funding platforms for raising equity, debt and even auctioning invoices. Whilst opening up a completely new type of asset class to a wider investor profile, at the moment there is very little regulation with regards to crowd-funding, but more and more financial regulators are looking and being heavily lobbied to create some infrastructure. This is where there is an opportunity for Malta to come up with a dedicated regulatory and legislative framework. And the advantages would be not only for the local market but also for overseas, especially with the banking sector in Malta being relatively unscathed by the recent financial crisis and continuing in their support for SMEs.
Numerous other interesting insights were provided by other speakers like: Mr. Klaus-Peter Brandes, Ambassador of the Federal Republic of Germany to Malta; Mr Werner E Jung, Flexible Factory Institute, Germany; Ms. Rita Dulci Rahman, Ambassador of the Kingdom of the Netherlands; Mr. Emile Elewaut, Director International Affairs Energy at TNO Utrecht Area, Netherlands; Mr. Kenneth Farrugia, Chairman, Finance Malta; Ranier Fsadni, Lecturer Anthropological Sciences, Faculty of Arts, University of Malta; David Dingli, Maastricht University Lecturer; Stephanie Cutajar, Researcher, Centre for Entrepreneurship and Business Incubation, University of Malta; as well as Mr. Pierre Mallia, Managing Director, iMovo Ltd; Mr. Alex Grech, Managing Partner, StrategyWorks and Jean Paul Barthet, Operations Manager, GoBeyond.
It was definitely a very enticing and rewarding experience for me to moderate such an interesting discussion on how we can actually move closer to grabbing the opportunity of establishing Malta as a unique hub for innovation and collaboration across the whole Mediterranean region. Looking forward to more networking and concrete collaborative initiatives that will get us moving steadier along this way!