Renowned investor Jean-François de Clermont-Tonnerre explains his decision to invest in Malta, including robust regulation and a skilled workforce.
Malta offers a unique and innovative way for investors to access European markets, and the island nation is much more than just an alternative to the EU’s traditional powerhouses.
For me, the decision to invest in Malta means working within a sound regulatory framework and gaining access to excellent support services, as well as high-quality staff.
Regulation and services
I have spent most of my career based in Switzerland, so acquiring Malta-based AUM Asset Management was a new direction for me. I wanted to invest in Malta as a foothold into the EU, because Switzerland is not a member, but I soon realised Malta can offer much more than that.
Malta has a strong regulator and provides excellent support functions, such as corporate and risk management services, and it is clear that we are building an asset management company which goes beyond the ordinary.
Since we started out with AUM, what was supposed to be a foot in the EU has become a full-scope AIFMD-compliant asset management licensed business.
Malta can become a global player
Malta has traditionally been where small fund managers come to start, and that is a real positive in terms of attracting talent. But Malta can also be a player on the global stage, without having to take on the traditional heavyweights.
Companies in places like Luxembourg and Ireland have been in the asset and fund management industries for years, and competition between the big fund providers is intense.
But Malta can do something different. An asset management company is supposed to bring investors to the best investment ideas, so the freedom to innovate gives Malta real potential.
Malta is home to a highly concentrated, technologically sophisticated banking sector, with solid economic performance and a continuously improving standard of living.
Not only that, but Malta is an EU member state that is strategically located at the heart of the Mediterranean, with excellent flight connections for international business.
The fund management industry in Malta also benefits from easy access to European passporting in the EU zone for all funds.
Other key strengths it offers the financial services industry, include:
- A well-trained and highly qualified workforce.
- A sound legal framework.
- A favourable tax regime.
- A double tax treaty agreement with over 40 separate jurisdictions around the world.
- Political stability.
- World-class ICT infrastructure.
A recent study found that Malta has an ideal business climate for start-ups, while the World Economic Form listed Malta as an innovation-led economy and ranked it in the world’s top 50 for business sophistication, underlining country’s real strength for investors.
People are key reason to invest in Malta
The most important attribute for Malta in building its investment sector is the quality of the people and the skills they bring.
The university is outstanding and has already provided some very talented young people, on a par with those I have recruited in Switzerland, Luxembourg, France and in England. Maltese students are as good as anybody.
They clearly want to work hard, and they want to develop and learn, which is priceless for any employer. Being able to recruit such motivated young staff is of huge value.
Malta’s geography opens doors
As a Mediterranean island nation, Malta has a special place in the geography, culture and history of Europe. The country has been part of the EU since 2004, but is closer to the capitals of Tunisia and Libya than it is to Rome or Athens.
This position on the edge of Europe means it has some fascinating opportunities when it comes to attracting investment, and it is ideally suited for a role in trade with Africa and the Middle East.
Location is one of the reasons Malta has found real success in the shipping sector, as a number of funds investing in containers and barges have proved successful.
But even more importantly, Malta’s location creates opportunities for investors beyond Europe.
Malta is key to the South / South relationship
Maltese companies like AUM can capitalise on the fact that we are part of the EU in terms of stability and regulation, while working hard to attract investors beyond Europe, especially in India, China and Africa.
Malta can act as a bridge for investment opportunities coming from these regions, and we can we add value if we can play a strategic role in what I call this South / South relationship.
Africa is growing incredibly quickly, and we don’t have to compete for stocks and bonds markets, so much as position ourselves as an alternative place for investing in real assets.
Malta faces banking challenge
Malta does face some challenges, especially in the banking sector, as foreign workers and companies sometimes faced barriers in setting up bank accounts.
But I believe local banks will adapt to these challenges, while a number of international banks are also looking to begin operations in Malta.
This would certainly help the local asset management and financial services industry, which has so much potential for the Maltese economy.
Overall, Malta is a beautiful, well-resourced and exciting place, and the future for asset management companies here is bright. The potential to develop new markets and offer innovative investment opportunities makes Malta a great place to be doing business.
