Dana Farrugia is the CEO of Tech.mt, a foundation established in partnership between the Government of Malta and The Malta Chamber of Commerce to promote the National strategy for Technology & Innovation. She is engaged in ensuring sector growth for technology and innovation, primarily focusing on AI, blockchain, IOT, cloud services, data analytics, software development, robotics, cyber security and research on innovative solutions. Dana Farrugia has worked in the telecoms industry for fourteen years, mainly shaping the mobile, fixed, internet, tv, fiber and IP networks in Malta. She has also worked at the Ministry for the Economy, Investment and Small Businesses for six years were she has developed an in-depth understanding of the needs of different local industries and also gained a sound exposure on the potential of various international markets. In an exclusive interview we talked with her about new technologies and how Malta tries to invest in them in order to gain new development opportunities.
Ms. Farrugia, Malta has long been seen as a tech-based economy. A diversified set of sectors are underpinned by a strong tech and ICT sector. What is the current state of play?
“Malta has a strong tech and digital sector and a basis to compete in the new future; however, there is still no room for complacency. During the pandemic, the ICT & tech sectors actually increased their gross value added over a year earlier displaying a strong resilience of the sector. In quarter two, a very narrow margin of the Tech sector puts it at contributing close to 10% of Gross Value Added and this in fact increased by over 5% over the same period a year earlier. In parallel, the productivity of the sector has seen the strongest increase over the past decade reflecting the strong basis of this sector as well as Malta’s attractiveness in this sector including its skilled workforce; strong educational institutions; robust telecommunications infrastructure and various incentives that continue to bolster Malta’s attractiveness.”
What makes Malta attractive for the tech sector to set-up and thrive in Malta?
“The Maltese ecosystem is the result of various investments over the past. Today we have a very strong telecommunications infrastructure which is powered by fibre cables with deep internet connectivity and excess bandwidth needed to cater for an increase in demand. We have a strong internet network which is also being enhanced by the testing of 5G network. Our English-speaking workforce is highly skilled and talented in the tech sector with various collaborations sustaining this between educational institutions and industry. Our location, despite being island, ensures that we are well-connected to all European hubs with frequent and short flights. We also have a plethora of tax and non-tax incentives. Malta’s tax system remains one of the most competitive systems and this is further supplemented by numerous schemes the Government is launching to support private investment through tax credits, grants and R&D support.”
The tech sector is a fast-changing one thus requiring any tech-hub to remain ahead of such changes. What do you think are Malta’s challenges in this regard and what is the Government and industry doing in this regard?
“Innovation funding is critical for Malta’s startup & innovation ecosystem. Access to finance and financing are key elements in building innovation ecosystems, including those related to tech and the digital economy. Malta needs to further strengthen this element through venture capital and other private equity schemes. The Malta Development Bank can also play an important role in filling this gap.
Another important issue is enabled and digital-to-the-core public sector. Malta’s success in this sector is also due to various governments’ drive and commitment towards the digital sector. The latest DESI Index, in which Malta placed 5th, commented and highlighted on the key role of the public sector. Although a lot is being done; we need further digital transformation to ensure that the public sector can become not only an enabler of growth but a main driver.
We can also not forget digital education, reskilling and upskilling. The future of the digital economy will require a new skillset of the workforce. With new technologies such as IoT, blockchain, virtual reality and the onset of 5G; the skillsets are going to be critical for the success of any enterprise and economy. It is therefore critical that our educational institutions; including our primary and secondary schools to start equipping our future workforce. Concurrently, it is going to be critical for us to reskill and upskill our current workforce. To this end, industry and educational institutions need to collaborate and Tech.MT will play a key role in this collaboration.”
What do you think about the importance of regulation and standards?
“Malta has built a diversified economy on the basis of regulatory innovation and key sectors such as remote gaming, financial services and pharmaceutical manufacturing are all based on the power of regulation. We need to continue carving out new economic sectors that are digitally focused. Malta has already started threading new ground including blockchain, artificial intelligence and other key areas including the establishment of MDIA. Going forward, it is critical to ensure that the complete ecosystem is functioning and not broken or fragmented. The future is here to stay, and we need to ensure that we are ahead of the curve.”
How do you see the development of the Blockchain tecnology and the Blockchain Island more than two years after the legislation that has made Malta a pioneering country in this field?
“Blockchain is a transversal technology which will transform various economic sectors and facilitate various processes and procedures. It will facilitate key sectors including finance, insurance, KYC and due diligence, trade finance and other key areas. It will also bring tangible benefits to government processes and procedures including key business registries such as business and land registries – facilitating businesses and investment.
Malta launched a voluntary blockchain certification process to ensure that it fulfills a number of criteria including but not limited to smart contracts, cybersecurity. It is true that we have lost traction on the drive that there was; the first few licences started being issued only recently; however this stands to show the rigorous element of the process and I believe that certain companies will want to follow this process. I believe that blockchain is here to stay and will continue to increase its applicability and impact on the economy. I am confident that we will continue seeing more companies and applications being developed and I believe that Malta can play a role in this.”
What in your opinion are the required elements or cornerstone of a digital policy or strategy?
“I believe that for a strategy to be effective it needs to be kept simple and therefore I believe that any strategy in this regard needs to have two main priorities: fostering the development of a high-performing digital ecosystem, and enhancing digital skills and competencies for the digital transformation. Fostering the development of a high-performing digital ecosystem requires infrastructure, connectivity and digital equipment; effective digital capacity planning and development, including up-to-date organisational capabilities; and digitally competent and confident workforce; attractive incentives for companies to establish themselves. Here Tech.MT and the Government and other stakeholders are already doing a lot to ensure that the ecosystem remains competitive. Investments in connectivity, telecommunications, industrial space and also in incentives which are both tax and non-tax continue making Malta an attractive hub.
Enhancing digital skills and competences for the digital transformation requires basic digital skills and competences from an early age including digital literacy of the population, strong IT workforce with the right skills for future technology developments, good knowledge and understanding of data-intensive technologies, such as artificial intelligence, blockchain, virtual reality and IoT, and ensure that all professions such as lawyers and accountants are also exposed to the digital developments in their profession. Also necessary are advanced digital skills which produce more digital specialists and also ensure that girls and young women are equally represented in digital studies and careers. Here, we continue registering success and also investing in the educational infrastructure of the country to ensure a highly skilled workforce.”