ADDRESS BY THE HON. M. A. REFALO, MINISTER FOR TOURISM, AT THE WTO MINISTERS CONFERENCE IN HANOVER, GERMANY

When you next take a look at your home atlas map of the world concentrate hard on the Mediterranean. Plumb in the middle, south of Italy, east of Tunisia and north of Libya, you will see a black dot. That is Malta.

On a map of Europe that dot becomes bigger and you may even see a second one. That is Gozo, the second largest inhabited island in the Maltese archipelago. A third, Comino, is home to a family of farmers and two hotels. Nobody lives on the other rocky outcrops, one of which, Filfla and the sea around it, are nature reserves.

As maps become larger and more detailed, Malta takes the shape of a fish, Comino a stepping stone to Gozo which lies across. A former British colony, Malta gained independence in 1964. Valletta, which bears the name of its founder, Grandmaster Jean Parisot de la Valette, is our capital.

Our total area measures slightly less than 320 square kilometres and with a host population close to the 400,000 mark, Malta, averaging 1200 local residents per sq. km. is Europe's most densely populated nation state. As 82% of our land surface is undeveloped countryside, the actual resident population density is often much higher. In Sliema, my home town, it is close to 10,000 per sq. km.

Malta is a candidate for EU membership and our aim is to join in the Union's next enlargement.

Our islands' location in the centre of the ancient world's major sea lane, made their conquest and colonisation a strategic must for those powers that, over the millennia, strove to dominate the Mediterranean. A 7,000 year long history of human occupation reveals a succession of foreign rulers. Every settlement, each domination, left its very particular imprint on Malta and the Maltese. Our islands are often likened to an open air exhibition, a varied display reflecting the march and development of Mediterranean civilisation through the millennia.

Thousands of years of domination fashioned Malta's economy to the dictates of foreign rule. However, with independence came the shedding of an economy based on the strategies of war and the change to and development of one founded on the activities of peace.

That coincided with the time when travel became popular with a broad spectrum of Western Europe's post World War Two communities. In tourism Malta saw a ‘peaceful' substitute with the potential to make up for the loss of foreign exchange earnings previously derived from the British military presence.

From small beginnings tourism blossomed. It has more than repaid the vision and trust which newly independent Malta had placed in the industry. We currently host around 1.2 million international tourists annually, who, on average, stay for about 9 days each.

Our TSA model for tourism earnings excludes cruise line passenger and foreign residents' expenditure but includes aviation related revenue and services, including land transport, rendered to tour operators and individual travellers. The model estimates Malta's tourism earnings for 1998 at eight hundred million US dollars.

In a small and open market economy 800 million dollars represent a massive injection of funds from one source. At the maximum level of impacts, tourism earnings for 1998 contributed just under 25% to GNP, around 22% to government revenue, 11.5% to imports and outflows and over 27% to full time equivalent employment.

Surveys which support these findings show that 22% of earnings accrue from aviation related revenue, 39.5% from accommodation, 17% from catering, 4.5% from domestic transport, 6% from culture and recreation, 8.5% from shopping with the balance from passenger handling, resort transfers and revenue from other services.

Although this may appear to be a story of sustained success I must admit that similarly to the pattern of other destinations where parallel development took place, we did commit mistakes which have impacted on our social fabric as well as on Malta's environment. In a small country such mistakes are always more visible and their effects even more pronounced.

Till the mid eighties tourism development had reacted very much to the pressures of demand. Little consideration was given to Malta's social and physical resources. It was only when matters had reached a critical stage, that, belatedly, a Tourism Plan was drawn up, a Planning Authority was established and recently a Carrying Capacity Study commissioned.

In this study, based on WTO's Agenda 21 parameters and in line with sustainable development concepts, our planners advise that the finite nature of our human resource, social and physical capacity makes it imperative that we follow the only sensible and viable economic route; namely, that within the constraints of a controlled development scenario we should primarily aim to maximise the potential of what we hold rather than plan for expansion: the objective being to harness all human activities, the arts and sport, the legacy of humanity, our particular natural and man made environment and ensure that they can be sustainably handed down from one grateful generation to another.

My Ministry and the Malta Tourism Authority, a predominantly government funded organisation under the operational direction of private sector representatives and interests, undertake periodic surveys to gauge the Maltese population's rate of support and their general perception about tourism. The Authority undertakes on going surveys to elicit response and inquire what our visitors look for, feel about us, their likes and dislikes.

This is as much an economic as it is a social and marketing exercise. Seeing oneself through customers' eyes, in the light of consumer perceptions adds that essential, human dimension to otherwise stark, soul less data and presents decision makers with a more complete and rounded picture.

We are fortunate that a wide consensus exists between Government and Opposition on the broad lines of policy and tourism strategy. Popular recognition of the industry's valuable contribution is rated in the high nineties.

Conventional wisdom and experience underlines tourism's contribution to society's economic wellbeing, that it is a catalyst for the revitalisation of urban cores, and generates interest in a sound environment for pure economic reasons.

There is also however a down side to which sufficient weight should be given.

Increased use of services produce inevitable air, sea and land pollution. Peak seasons impinge and put stresses on the infrastructure, cause excessive pressure on cultural sites, negative changes to life styles and dilute one's socio cultural identity.

No country, least of all a small one such as Malta, where residents and visitors mix and live together and not apart, where visitors become friends and share the same experiences, joys and discomforts of the host population, is immune from these very real threats and can afford to disregard them.

The strength of the economic argument is heightened only by its ability to promote sustainable growth in all respects. We have to live with our past but learning from mistakes makes for a better future.