The role of the development corporation as an investment bank

Abstract

The Development Corporation has to play an important role especially now that Malta is in the process of remodelling its economy after centuries of complete reliance on the realization of its strategic value. Malta's unique position in the Mediterranean has been the source of its past wealth and has been the most important determinant of its economic structure. Because of the change in the strategic importance economic planners had to devise an economic structure largely oriented towards the export market. It has been noted that the problems facing economic planners although not insurmountable are formidable. They are in short, an expanding population; an economic structure which requires a revolutionary change after centuries of stagnation; a need for the orientation towards local investment of the relatively high rata of savings; lack of industrial know how; the neglect of the tourist trade which can now only be built up at a high cost due to Mediterranean competition; the smallness of the local market; the complete lack of indigenous industrial raw materials. A final important problem to be faced is the misfortune of having to build up a new structure when the trends of world demand, on which any local industrialization plan has to thrive are "themselves in the process of change due to the result of the European Common Market. In this respect the Development Corporation to set up to speed administrative work which in turn affects developmental projects. The main functions of the Development Corporation should. be : (i) To investigate, formulate and carry out projects for the establishment, continuation, expansion or improvement of industrial enterprise conducive to the development of the economy of Malta. (ii) 2nd promote the participation of private capital, both domestic and foreign, in the development of manufacturing, tourist, agricultural, fishing and other industrial enterprises. This is the most important sector in which the Development Corporation can help the economy of Malta. Most of the local industrial enterprises can be financed with local funds which are invested abroad. The Development Corporation can be responsible for the local investments, the money which is abroad could be brought to Malta and invested through the Corporation. (iii) The Development Corporation is also to render assistance and advice in the formulation and execution of industrial projects by providing technical assistance on managerial, engineering, accountancy and other matters requiring technical skill. [...]