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The Blue Economy is a Vital Component of the Maltese Economy, says Michael Callus

Being an EU member state, Malta forms an integral part of the Union’s blue economy initiative. Given Malta’s island status, the blue economy can contribute to our country’s overall prosperity.

The seas surrounding Malta can produce investment, jobs and economic growth and the healthier they are, the more productive they can be.

Therefore, the blue economy must be a sustainable blue economy. But what is the blue economy? A definition of the blue economy largely depends on the sectors included and the extent to which direct and indirect effects can be identified and measured. For the sake of simplicity, the blue economy includes economic activities that are marine-based and marine-related activities.

The marine-based activities include those undertaken in the oceans, seas and coastal areas, such as fisheries and aquaculture, offshore oil and gas, offshore wind energy, ocean energy, desalination, shipping & marine transport and marine & coastal tourism. The marine-related activities are those which use products and or produce products and services for the ocean and marinebased activities, such as seafood processing, marine biotechnology, shipbuilding and repair, port activities, communication, equipment, maritime insurance and maritime surveillance.

 

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The blue economy also includes those parts of the public sector with direct coastal and ocean responsibilities like the coast guard, marine environmental protection as well as marine education and research. For practical purposes the EU groups the blue economy into six sectors, namely: living resources, offshore oil and gas, port activities, shipbuilding and repair, maritime transport and coastal tourism. These sectors are then subdivided as follows: living resources including aquaculture, harvesting of fish, processing and preserving fish and mollusks. Offshore oil and gas include extraction of crude oil, extraction of natural gas and support activities for petroleum and natural gas extraction. Port activities include cargo handling, warehousing and storage, construction of water projects and service activities incidental to water transportation. Shipbuilding and repair include building of ships and floating structures, building of pleasure and sporting boats and repair and maintenance of ships and boats.

The maritime transport sector includes sea and coastal passenger water transport, sea and coastal freight water transport, inland water transport, inland freight water transport, rental and leasing of water transport equipment. The coastal tourism sector includes hotels and similar accommodation, holiday and other short stay accommodation, camping grounds and transport. The importance of the blue economy to the Maltese economy cannot be underestimated. Although, when considering the wide range of activities, they may appear to be fragmented, yet taken together, they become very important. According to the 2018 Annual Economic Report on EU Blue Economy, in 2016 around 10,400 people were employed in sectors included in the blue economy and it generated €406m. The lion’s share of this turnover (around 75 per cent) was, however, generated by the tourism sector.

Indeed in 2016 the blue economy contributed 4.7 per cent to the Maltese economy, which is a respectable fourth in the 28-member block against an EU average of 1.3 per cent. Of course, considering our physical and population size, we cannot really compare data on a like-with-like basis in absolute terms, but we definitely have the fundamentals in the right place and one hopes that investment will continue to increase in these sectors especially in those areas where we have an opportunity to improve like in aquaculture and in the port activities.

The blue economy has its own emerging activities like blue bio-economy – such as bio-technology and bio-fuels – which have various and different types of applications. These have had an impact both in the healthcare and in the pharmaceutical sector. In agriculture, veterinary products and aquaculture, the blue bio-economy has helped to produce vaccines and improve animal feed. In industrial processes and manufacturing, it has led to the use of enzymes in the production of detergents, pulp and paper, textiles, and biomass.

Finally in energy production, blue biotechnology can produce large amounts of oil using micro-algae. Growth in the emerging sectors is expected to gain momentum as economic activity in the euro area experiences solid and lasting expansion. Robust job creation is expected to continue to fuel growth in consumer spending. Therefore there is the need to promote new skills and to renew the skills of those who work in the maritime economy. Renewable energy is another area where Malta has an opportunity to grow. It is not only limited to onshore wind but there are opportunities in offshore wind and other forms of ocean energy like wave energy.

All in all, this means that further job creation can be envisaged within this sector. During the last decade, it has seen a steady growth in Malta thanks to various companies like the Malta Freeport, Malta Cruise Port, MIH and Medserv, by way of example. There are also many others which, although smaller in size, are undoubtedly very important to the blue economy.

 

Photo Credits: Viewing Malta

Source: MaltaWinds

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