Alan Camilleri, chairman of Malta Enterprises, discusses the use of Malta as an entry point for your business into Europe.
Among the advantages that Malta provides as an offshore center is ease of access to the European market. Often goods transited through a Maltese company with some valueadded on the island are able to escape sizable import tariffs, or restrictions on the provision of services which would otherwise stop you from accessing this large and lucrative market.
This extra stop-over for your product doesn't have to be a headache. With a knowledgable and talented Workforce, and scores of investment promotion incentives, the process of adding-value within Malta can turn into an opportunity instead of hassle.
China Offshore spoke to Alan Camilleri, chairman of Malta's investment and trade promotion agency Malta Enterprises, about the different reasons to make your first port of call in the Maltese capital of Valetta.
Q: What do you think are the main benefits to investing in Malta for Chinese clients?
A: Malta enjoys excellent economic, political and social stability, while ensuring a good quality of life all year round. With its strategic location in the middle of the Mediterranean Sea, Malta is ideal for setting up a business for international activities as it acts as a gateway to Europe, North Africa and the Middle East.
Having joined the European Union in 2004, adopted the euro in 2008, and also part of the Schengen Area, Malta gives easy access into the the European markets, while its long-standing positive relationship and friendship places it in a favorable position to access other surrounding markets, also thanks to its various air and sea connections and reliable logistics services.
Besides offshore services, Malta has a highly attractive onshore jurisdiction with a favorable fiscal regime for internal activities and double taxation treaties with around 55 countries. It offers - at 5% - the lowest corporate tax in the EU.
Q: Could you tell me what advantages your country has over other e-gaming centers and how big you imagine the industry is going to get?
A:Malta can boast an excellent communicationsinfrastructure, with 95% ofthe national territory being covered by abroadband connection, which in terms ofquality has been classified as the sixth in the world in a study published by OxfordUniversity in late 2010. Infrastructure continues>to improve, and new projects shall be providing more space for this growing industry as it gradually comes to life.
In particular, gaming companies alsobenefit from a sound regulatory system,with Malta enjoying an excellent reputationafter having been the first EU memberstate to regulate remote gaming. Itsregulatory regime aims to be both technologyneutral and game neutral - encompassingany type of gaming using a means of distance communication,including internet, digital TV, mobilephone technology, telephone and fax.
Q: What wealth management products does Malta specialize in?
A: Malta has a very well developed wealth management offering with the services ranging from discretionary investment management, to execution only services. Other services include the setting up of trusts by way of the presence of the Trusts Trustees Act of 2004 which was an important development in the history of trust law in Malta. It introduced rules of law which make Malta an attractive location for the administration of trusts, both Maltese Law Trusts as well as foreign Law Trusts. The act itself allows the formation of a wide range of tailored trust solutions. Moreover the Banks in Malta offer a comprehensive range of services from liquidity management accounts, to Term Deposits Accounts, Foreign Exchange International payments (SWIFT) Custody solutions, E-Banking, Prepaid, Debit and Credit Cards. .
Q: What sort of Maltese funds can Chinese investors invest in through the QDII program?
A: There are currently around 400 investment funds domiciled in Malta which include UCITS, retail non UCITS as well as a wide variety of Professional Investor Funds consisting of various hedge funds employing a variety of investment strategies. Malta is fast becoming a highly attractive domicile as a result of the presence of a comprehensive regulatory framework, an accessible regulator and particularly the highly competitive set up and operational costs. This is in turn attracting a wide array of start up funds which is in turn bringing with it an interesting pool of investment management talent and investment strategies to Malta.
Q: Which foreign markets can investors access through Malta, and what services does Malta offer them?
A: There are various industries that are popular for Chinese investment in Malta, mostly with the idea of tapping into the surrounding markets such as Europe, North Africa and the Middle East. As all other investors, Chinese entrepreneurs can also benefit from a wide range of incentives that assists companies throughout their lifetime, such as tax credits on the amounts invested, access to finance including financial support and loan interest subsidies, assistance for training of the workforce, as well as other schemes to encourage innovation and competitiveness.
Q: Why do you think that Malta was the only EU country which trade with China increased in 2009?
A: The benefits of investing in Malta and using it as a regional hub to tap into nearby markets - such as the excellent quality available at a relatively low cost, the political and economic stability, the easy accessibility to other markets, a great lifestyle with almost all year round sunshine, and several others as already outlined in other replies - speak for themselves.
On another note, Chinese are also interested in Malta's property market, as buying property in Malta gives them a permanent residency and with it the ability to travel within EU countries without a visa.
Q: How are your trading relationships with North Africa? Have Chinese companies taken advantage of that relationship as much as the European trading relationship?
A: Malta enjoys excellent trade relations with the Southern Mediterranean countries. Libya is one of Malta's most important business and trading partners in North Africa and two-way trade, investment and other business linkages between the two countries will continue to expand.
Malta is also a part to the EuroMed Agreements with Algeria, Morocco, Tunisia, Egypt, Jordan, Lebanon, Palestinian Authority, Syria, Israel and Turkey. These agreements, which cover essentially traden goods, are being complemented with a number of additional negotiations to open up additional agricultural trade, liberalize trade in services and investment, as well as establish bilateral dispute settlement mechanisms for trade matters.
Through the Association Agreements, industrial products and around 80% of agricultural produce made in these countries have duty-free access to the EU. On the other hand industrial products madein Malta enter Tunisia duty free and enjoy preferential access to the other Euromed countries. Selected agricultural products and agro based products also benefit from tariff concessions.
Q: Are there any other services you are considering expanding that would be of interest to Chinese investors?
A: Inspired by Government's Vision 2015+, the country is seeking to become a center of excellence and a regional hub in a number of sectors, which therefore present various opportunities as part of the growth process they are going through.
These sectors include the financial services sector - which has withstood the turmoil that has shaken other countries and grown by 22% in the past year - as well as ICT, tourism, health, education services, higher value-added manufacturing, as well as the environment.