Transforming Gozo into a financial services hub

Is Gozo a good location for foreigners willing to take their fund management business there?
"I believe that Gozo can be a good location for taking fund management business which is currently coming from abroad. Contrary to the i-Gaming industry, the executives coming from abroad are people in their 30s or 40s with a young family who are looking for a peaceful, safe and tranquil environment, who more often than not  are accompanied by young family members."

Does Gozo have a good market potential?
"Yes, I believe that Gozo does have a market potential in all sectors. At the moment there are nearly 1,300 Gozitan students attending University and MCAST which can easily provide the necessary workforce for all kinds of trades and professions, which are currently in demand, apart from other students attending ITS. Furthermore, the Gozitan entrepreneur was never afraid to invest in Gozo. All we need is some backup from the government so that Gozo will be on a level playing field as Malta."

After investing in a €5 million state-of-the-art brokerage block in Victoria, you must believe that something will drastically change...
"Yes, I believe that patience and perseverance are the best of all virtues and as long as one continues to put the necessary pressure on the authorities to bring us to a level playing field with our colleagues in Malta, Gozo will make it in the end."

What is your opinion on the Gozo permanent link project?
"If the permanent link between Gozo and Malta was a solution to Gozo's problems 20 years ago, now it's become a necessity."

What is being done to create jobs for Gozo's youths?
"Unfortunately, this is one of our main preoccupations at the moment. The level of foreign direct investment in Gozo in the last few years has practically been inexistent. In the past 20 years, Gozo has entered a vicious circle because we have seen an exodus of our youths seeking employment in Malta and outside it.  
"Young Gozitan couples are now opting to buy property in Malta and settle there for good because they cannot find employment in the sister island. This in turn creates less demand for goods and services in Gozo which again pushes the younger generation to seek employment outside of Gozo."

Are there any up-and-coming Gozitan entrepreneurs?
"Gozo is still producing some brilliant minds who can be very creative and have a lot of potential. However, as I have already explained, the limitations that the Gozitan market has is pushing these young entrepreneurs to develop their ideas either in Malta or outside of it where the rewards for their endeavours can be of a much higher ratio than if they had stayed in Gozo."

Is Gozo considered an island to retire in or is it simply a holiday island?
"Gozo can be quite ideal to holiday or retire in, but it also offers a pleasant working environment. There are no rush hour queues to frustrate you."

Should it be declared an offshore financial centre like Guernsey and Jersey?
"I think that the days of offshore financial centres are now a thing of the past. Due to OECD and European Union pressures, even Switzerland has its days numbered.
"Gozo can be a financial hub by offering back-office operations to government departments, public and parastatal companies and to foreign companies seeking a skilled and dedicated workforce."

As a Gozitan businessman, does EcoGozo mean a value-added potential for its future?
"Yes, I believe that if Gozo really focuses on eco-friendly initiatives it can attract the high-end net worth type of clients who can choose Gozo as their destination not only to spend a holiday there but also to purchase their retirement home."

What is the Chamber's stand on the airstrip and large-scale projects such as Hondoq Ir-Rummien, the government's partly privatised Mgarr Marina? Are they attracting jobs to Gozo?
"As a Chamber we are in favour of an airstrip because this does not only make easier to get to the airport in Malta but it can attract other business directly from abroad. Gozo can have small planes flying directly from let's say Sicily or Sardinia to Gozo directly. There is also a potential market for the private jet business.
"On projects like Hondoq ir-Rummien, the GBC has already publicly expressed its opinion on such a project as long as one cautiously protects the environment whilst creating long-term jobs for Gozo's tourism industry. A case in point on a similar project is the one in Sardinia where a whole resort is so engulfed in such a beautiful landscape that it is impossible for you to see either from land or the sea.
"On marinas, we believe that the time has come for MEPA to identify another site apart from the Mgarr marina, since the potential for this type of business is evident and the Mgarr harbour has become a very crowded place with hardly any more room for expansion."

Do you think that the economic uncertainty has affected government stocks?
"I believe that up till now there hasn't been any particular movement in government stock prices due to the political uncertainty."

Do you believe changes in government policies, actions do affect stock prices? How does the market react to such changes?
"Up until now, the change in prices of government bonds has always been affected by the demand and supply scenario which ultimately reflects the movement in the European Central Bank (ECB) interest rates and the perception by investors on the ability of government to honour its debt obligations.  
"In this case, Malta's sovereign rating has not fared too badly when compared with other countries like Spain, Greece, Portugal, Ireland and Italy. However, investors are becoming more sophisticated and are always following closely government's spending and its way of controlling deficit."

Are clients investing in fixed-income products more? Has the service offered a ray of hope for asset managers?
"Fixed income has always been a favourite line of investment for the Maltese investor. We may however be nearing the end of the bull market where bonds are concerned since inflationary pressures in the eurozone may push the ECB to increase interest rates within a couple of years' time. In such a scenario bond prices, especially the longer dated ones, will suffer heavily."

Do you think that corporate and sovereign bonds are going to be the frontrunners in fixed-income markets?
"In the current environment that we have, on an international basis, corporates are finding it very difficult to get finance from banks and so they have to issue bonds for their financing needs. On the other hand, government always needs to raise finance to balance their deficits and countries which haven't been careful with their finances in the past are now paying the price.
"Up to a few days ago, Spain was paying over five per cent to borrow money for a five-year term while Malta was paying 3.55% for the same period of time. In my opinion the shrewd investors have already started investing in shares of good stable companies which are providing a high dividend yield of more than four per cent net with a potential for capital growth in the future."

Has the euro crisis, debt-laden Greece, affected the European economy drastically? Do you think the international market should  stabilise soon?
"The debt-laden countries of the European Union have brought along a huge crisis on the EU itself and investors are now questioning whether the EU in its current format can actually survive.
"There has been speculation that some of these countries may actually be kicked out of the eurozone, others think that Germany will opt out of the euro and go back to the Deutche Mark (rumour has it that Germany never destroyed their old currency after all!). Other rumours have it that there can be two different kinds of euros, the euro of the north and that of the south, with the 'southern euro' being the weaker euro.  
"In my humble opinion the mess in Europe is far too big for the markets to stabilise soon. I am afraid that for Europe the worst is still to come."

Do you feel that since the ECB hasn't increased its interest rates for over three years, the minute the market will stabilise, will it come down like a tonne of bricks to make up for the lost revenue?
"The ECB, along with the Federal Reserve in the US, the Bank of England and most other central banks around the world, have continued to keep interest rates as low as possible to give a chance for the economy to gain ground.  
"The ECB may increase interest rates if they see that inflation in the eurozone is picking up. Or it will be the market which will twist its hand to increase. The state of things is very delicate at the moment and we may possibly be looking at two extreme scenarios, a huge deflationary period or a period of hyperinflation."

Will eurobonds save the markets?
"This option has been on the mind of the ECB for quite some time now. It may be the case that in order to save the EU as we know it today, the ECB will have to resort to the issue of eurobonds.

Have you seen a change in investment style?
"Yes, investors nowadays are getting more sophisticated.  The amount of information available at the push of a button and the availability of certain platforms have given investors the chance to participate in the market with split- second efficiency. However, two very important words in investment remain always fixed for everyone to see: greed and fear. People don't seem to ever learn from past experiences and greed and fear may continue to have the same affect forever.