Almost everything that reaches Malta − fuel, food, medicines, raw materials and consumer goods − arrives by sea. Equally, much of the country’s economic activity is linked to the maritime sector: since Malta has no raw materials, it needs to import all its inputs and export a vast proportion of its manufactured products.

Today, the global shipping industry is facing one of its most challenging periods in decades. Armed conflicts stretching from Ukraine to the Middle East, alongside persistent security threats in parts of Africa, have transformed some of the world’s busiest sea routes into dangerous waters. Merchant vessels, once regarded as neutral carriers of global trade, increasingly find themselves caught in the crossfire.

For the thousands of men and women who crew these ships, the risks have become very real. Missile and drone attacks, piracy, vessel seizures and the constant threat of escalation have turned routine voyages into dangerous missions. Beyond the physical danger, many seafarers face growing psychological pressure as they sail through areas where commercial shipping has become an unintended casualty of geopolitical disputes.

While sea-faring careers are becoming less popular by the day, the consequences extend well beyond those on board.

Several of the world’s most important maritime chokepoints have become increasingly unstable.  The Strait of Hormuz remains vital for global energy supplies, while the Black Sea continues to be affected by the war in Ukraine. Elsewhere, attacks on commercial shipping in the Red Sea have forced many vessels to take much longer routes around the Cape of Good Hope, adding weeks to voyages and significantly increasing operating costs.

These disruptions eventually find their way into household budgets.

Higher insurance premiums, longer sailing distances, increased fuel consumption and operational uncertainty all translate into higher transport costs.

For a country like Malta, which, by necessity rather than choice, must import almost all of what it consumes, these additional costs cannot simply be avoided. While Malta has little influence over global commodity prices or international shipping routes, it must absorb the consequences of decisions and conflicts taking place thousands of kilometres away.

The effects are felt across the economy. Businesses pay more for imported materials, retailers face higher distribution costs, and consumers ultimately encounter increased prices for everyday goods.  All this also renders tourism, one of Malta’s main economic pillar less price competitive.  Energy markets are equally vulnerable. Even when physical supplies remain available, uncertainty alone can trigger price volatility that affects electricity generation, transport and industrial production throughout Europe.

Malta’s position as a maritime nation also brings responsibilities alongside its vulnerabilities. The country’s shipping register represents thousands of vessels trading across every ocean, while the maritime services sector supports a wide network of legal, financial, technical and operational activities. Any prolonged disruption to global shipping, therefore, has implications not only for merchandise trade but also for one of Malta’s most internationally connected industries.

The human dimension should not be overlooked. Behind every cargo ship are professional seafarers who continue to keep global trade moving despite increasingly hazardous conditions. They transport the fuel that powers economies, the grain that feeds populations, the medicine that cures the sick and the products that stock supermarket shelves. Yet their work often receives little public attention until tragedy strikes.

The growing insecurity at sea also serves as a reminder that maritime security is no longer solely a concern for naval forces or shipping companies. It has become an economic issue, a supply chain issue and, ultimately, a matter of national resilience for island states such as Malta.

The reality is that Malta cannot determine the course of international conflicts, nor can it influence global shipping markets or energy prices. Those are external realities that must largely be accepted. What Malta can do is continue strengthening the resilience of its maritime sector, invest in efficient port infrastructure, support international cooperation on maritime security and maintain the competitiveness of the services that have made it one of Europe’s leading maritime jurisdictions.

The sea has always been Malta’s greatest connection to the world. It remains our principal gateway for trade, prosperity and economic opportunity. At a time when global shipping is increasingly under siege, safeguarding the resilience of maritime commerce is firmly in Malta’s national interest.

Godwin Xerri and Kevin J. Borg are the Chairperson and CEO of the Malta Maritime Forum, respectively

Source: Times of Malta/Photo: Shutterstock.com

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The Commission published its review of the EU ETS on 17 July, proposing a number of changes aimed at reducing carbon emissions while addressing concerns raised by the shipping industry over the impact of the scheme on European ports.

MMF Chairman Godwin Xerri said the proposed amendments acknowledge several of the concerns raised by the sector but argued that additional changes will be necessary to ensure the EU’s decarbonisation objectives do not come at the expense of Europe’s maritime competitiveness.

Among the proposals welcomed by the Forum is a temporary reduction in EU ETS allowance-surrender obligations for certain container cargo transhipped through EU ports, including Malta Freeport. The measure would apply until the end of 2035 for inbound voyages from non-EU ports undertaken by container ships with a capacity exceeding 10,000 TEUs, where cargo is transferred to another vessel destined for a non-EU port.

While the exemption would not apply to Malta’s import and export cargo, the MMF said it would help reduce the competitive disadvantage faced by European transhipment hubs when compared with nearby non-EU ports that are not subject to the same emissions trading rules.

According to the Forum, Malta Freeport has come under increasing competitive pressure from ports in North Africa, particularly in Egypt and Morocco, which have significantly expanded their infrastructure and capacity in recent years. Several shipping services have already shifted operations away from EU ports, resulting in non-EU hubs capturing the majority of new transhipment business.

The Commission has also proposed tightening the rules governing neighbouring non-EU transhipment ports by lowering the transhipment threshold from 65% to 50% and broadening the criteria used to identify ports that could benefit from avoiding EU ETS costs.

However, the MMF said these changes do not fully address the issue, noting that the rules become ineffective whenever vessels bypass EU ports altogether.

“The proposed changes represent positive progress in addressing business and carbon leakage resulting from the implementation of the Directive,” Xerri said. “However, the review process must continue to ensure the legislation protects both Europe’s environmental ambitions and the competitiveness of its maritime sector.”

The Forum is also calling for permanent exemptions for island member states and other geographically disadvantaged regions, arguing that their dependence on maritime transport places them at a structural disadvantage.

Xerri said Malta’s insularity makes reliable maritime connectivity essential for both consumers and businesses, and that this should be permanently recognised within the EU ETS framework.

The MMF further urged the European Commission to clarify what would happen should the International Maritime Organization (IMO) introduce a global carbon pricing mechanism for shipping. The Forum believes the Commission should commit to withdrawing the regional ETS regime if a global measure is adopted, thereby avoiding overlapping compliance obligations and additional costs for shipping operators.

The Forum also welcomed proposals to earmark EU ETS revenues for the shipping sector through both national funding and the planned Maritime Transport Decarbonisation Fund.

However, it argued that financial support should extend beyond wind-assisted propulsion and shore-side electricity to include a broader range of technologies capable of improving energy efficiency and reducing emissions across all shipping segments, including short-sea, bulk and tramp shipping.

The MMF said it remains committed to working with the Maltese government, European institutions and industry stakeholders to pursue further reforms to the EU ETS Maritime framework, particularly those recognising the unique challenges faced by island states that rely heavily on maritime links for their supply chains.

Source: Malta Business Weekly

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It was reported that the deal would also extend the ceasefire between the two nations, but challenges remain to ending the war. The deal’s details were not immediately released, but it appeared it would not be implemented until it is signed on Friday.

The war has had an impact on trade in the Gulf region and also on international oil prices. In Malta, fuel and energy prices have remained stable due to Government subsidies, which have been in place since the Covid-19 pandemic, but international oil prices had risen.

Chairman of the Malta Maritime Forum, Godwin Xerri, welcomed the news of the deal. “If the flow of fuel continues on its normal path, the first reaction should be a drop in the price of oil, which will be very positive,” he said.

He also mentioned the positive humanitarian perspective of such a agreement, saying that the seafarers who were stranded in the region would no longer be so.

As for the impact of the war on Malta, “there were some import and export industries affected in the country,” he said. “Hopefully negotiations will be successful and a permanent solution will be found.”

While services operating from the Freeport in Malta were not very negatively impacted to begin with, the opening of the Strait would be good news for the entire shipping industry, Alex Montebello, the CEO of Malta Freeport Terminals, told this newsroom.

“It will bring about an element of normality which we have been deprived of over the past few months in the region. For shipping in general it also means stability in oil prices, which is one of the main cost items for shipping. This augurs well for shipping at large,” he said.

Shipping sector operators also welcomed the news of the deal.

Kurt Camilleri, Managing Director of O&S Shipping Ltd, a Maltese company that provides freight, logistics and relocation services, said that freight costs skyrocketed as a result of surcharges and fuel prices emanating from the war.

The news of the initial deal, he said, means that if the Strait of Hormuz is reopened fuel from the Gulf to the rest of the world will resume as normal. He expects the market to settle, prices to go down, and some trade to pick up after the Strait is opened. “Hopefully it will be back to business as usual.”

Karl Gollcher, an Executive Director at the Gollcher Group, a transportation, logistics, supply chain and storage company, said that if the deal is signed it would help tremendously on the economic side of the shipping industry. Many owners who have ships locked in the Strait would be relieved, he said, adding that if it opens, goods, especially fuel, would move freely affecting market prices.

He hopes that it would be a long-term agreement that holds.

Thomas Sullivan, Commercial Director at Seatrans Shipping Ltd, a multifaceted maritime service organization, said that aside from easing world oil supply prices, a deal would also mean that vessels might start using the Suez Canal again.

“For local market and service providers, this will mean an increase in maritime activity,” Mr Sullivan said. He said operators would likely wait a while to ensure things settle down before doing so.

If that happens, prices will also drop, as instead of vessels going around the Cape of Good Hope, spending 10-12 days extra which increases costs, they would pass through the Suez Canal, he explained.

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MMF Electoral Proposals 2026

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The Exclusive Economic Zone Act of 2021, as amended in 2023, provides for the establishment of an exclusive economic zone adjacent to the territorial waters of Malta, outlining Malta’s extensive rights over such a zone. However, to date, no zone has as yet been designated.

The maritime sector in Malta is one of Malta’s main economic pillars. While many associate the maritime sector limitedly with the registration of ships in Malta, in reality, while the Malta flag is the largest flag in Europe with some of the most prestigious and important fleets in the world registered in Malta, maritime Malta is much, much more.

It encompasses every conceivable maritime activity, including the registration of ships, from transhipment to ship repair, from yachting to maritime education, from providing supplies and provisions to ships to arranging for crew changes, from pilotage to cruise line operation, from inter island transportation to towage to bunkering, from the provision of international fast ferry services to ship agency and ship management and crewing.

All of these sectors supported by highly experienced professional teams of maritime lawyers, corporate service providers, marine surveyors, technical experts and naval architects.

One of the reasons why the maritime sector is second nature to Malta is due to the fact that we are an island bang in the middle of the Mediterranean equidistant from Suez and Gibraltar and the shores of Sicily and North Africa. Malta is directly on the rum line between Suez and Gibraltar and, therefore, Malta is a hugely convenient stop for vessels wishing to take on supplies en route without needing to deviate from the contractual route in a business where the slightest deviation means additional sailing days and money.

Whether it is provisions, fresh water, crew changes, awaiting instructions for onward voyages or bunkering, Malta is, therefore, extremely convenient and has made a very good name for itself.

In addition to its prime geographical location, the deep waters surrounding Malta shallow to the southeast at an area referred to as Hurd’s Bank on our 12-mile territorial limit where ships can actually drop their anchor and procure their maritime services from Malta without having to come into harbour.

So, the very idea of having an LNG terminal, a fuel hub, out at Hurd’s Bank is not only highly commendable but it is precisely the type of important additional activity which Malta needs and requires. As a leading maritime nation there is the expectation that the country continues to develop its maritime space and this project has succeeded in getting the entire maritime community to be hugely supportive and enthusiastic about it.

The idea of having an LNG terminal which can in future adapt to take on other green fuels is ingenious for a number of reasons.

Currently, Malta provides the location for the bunkering of conventional fuels – this has been going on at Hurd’s Bank for decades. However, at the moment no vessel which runs on LNG can actually bunker off Malta because there is no LNG bunkering capability. LNG, although a fossil fuel, is considered as the greenest of fossil fuels and is the least pollutant, which is why a number of new builds now run on LNG.

Furthermore, decarbonisation of the maritime space has been the talk of the town in Europe, at other regional levels and at an international level, principally the IMO, for many, many months and we have seen the introduction of the EU ETS and similar measures by other regions quite apart from the extensive discussion at the IMO on the Net Zero framework. Commercial shipping is seriously gravitating towards cleaner fuels and alternative green fuels including, for instance, methanol and ammonia.

Thus, a terminal off Malta, the Mediterranean Fuel Hub, at Hurd’s Bank, which can act as an LNG provider to other bunker suppliers who will supply ships with LNG or as an LNG provider to vessels carrying LNG as cargo, is clearly a concept that will take Malta and maritime service providers in Malta to another highly desirable level.

The entire project would be within Malta’s EEZ, regulated by Maltese law and monitored by an appropriate entity.

This is precisely the type of quality project which an already highly enterprising and hard-working maritime community in Malta strives for.

This is precisely the type of development which the maritime industry requires and deserves and, thus, it is no surprise at all that this visionary concept has met with such a great degree of approval and enthusiasm.

In addition to the above, a further bonus is that, as a result of the placing of a Floating Storage Regasification Unit (FSRU) at the terminal at Hurd’s Bank, LNG can be piped via undersea cables as gas directly from the terminal at Hurd’s Bank to the power station at Marsaxlokk.

This would immediately eliminate the Floating Storage Unit currently moored inside Marsaxlokk with all the obvious health and safety risks to the entire population of Marsaxlokk, which should never have been there in the first place.

In conclusion, Malta should not miss out on this resounding opportunity of a Mediterranean Fuel Hub. It is the type of vision we need.

by Dr Ann Fenech,  Partner at Fenech & Fenech Advocates, President of CMI and  Member of the MMF BOD

Source: This article appeared in the Times of Malta

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The forum stressed that EU policies should better reflect Malta’s island-state realities.

The document argues that the maritime industry should no longer be treated as a supporting sector but as a strategic economic pillar central to Malta’s future growth and resilience.

The forum pointed to growing geopolitical instability, digitalisation and decarbonisation pressures reshaping the global shipping landscape.

At the centre of the forum’s proposals is the re-establishment of a National Maritime Authority, a long-standing recommendation which it believes would improve coordination, speed up decision-making and provide clearer direction for the industry.

The MMF also called for the appointment of a minister specifically responsible for maritime affairs, alongside a permanent interministerial structure to ensure coordination across government departments.

The forum said Malta needed a “more maritime-centred approach” to economic and social development if it wanted to fulfil the targets outlined in the government’s Vision 2050 strategy.

A major focus of the manifesto is the creation of a National Maritime Transport Strategy to guide investment, competitiveness and decarbonisation efforts over the coming years.

According to the forum, the strategy must align not only with Malta Vision 2050 but also with emerging EU maritime regulations and the European Commission’s own developing maritime strategy.

The MMF said this alignment was necessary to ensure Malta remained competitive within the wider European maritime framework while continuing to attract investment.

The forum also warned that labour shortages were becoming increasingly problematic for the sector and called for urgent reforms in education and training.

Among its proposals is the establishment of a National Maritime Certification Centre aimed at simplifying career pathways and increasing the number of Maltese-issued Certificates of Competency.

Expanded port facilities

Infrastructure investment is another key priority identified by the forum, which called for expanded port facilities, logistics hubs and new fuel bunkering infrastructure.

Particular emphasis was placed on the long-delayed Ras Ħanżir project, with the MMF urging the next administration to ensure the planned 365-metre quay becomes operational before works linked to the Grand Harbour Revival Plan begin.

The forum also reiterated calls for a full Nautical Risk Assessment to ensure that commercial port activity within the Grand Harbour is protected and strengthened during future redevelopment projects.

The manifesto further stresses the need for stronger regulation and enforcement to safeguard Malta’s international reputation within the maritime industry.

Concluding its proposals, the forum warned that Malta was facing a “crucial juncture” as global shipping undergoes rapid transformation.

Source: Times of Malta; Picture: Shutterstock

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A delegation of the Malta Maritime Forum (MMF) travelled to Brussels to discuss the EU’s Emission Trading System with the EU Institutions, Industry Associations and Maltese policy interlocutors.   The visit was intended to influence the forthcoming review of the Directive expected in July and served to :

1. present data on the negative repercussions of ETS in terms of business and carbon leakage and
2. to discuss possible alternatives to the implementation of ETS, the principles of which the Forum regards commendable.

To this end, meetings were held with the:

• European Commissioner Glenn Micallef and Head of Cabinet
• European Commission DG Clima EU ETS Head of Unit and Staff
• Deputy Permanent Representative to the EU and Maritime Attache
• European Tug Owners Association
• European Maritime Pilots Association
• European Sea Ports Organisation
• Federation of European Private Port Companies and Terminals
• European Parliament President Main Policy Advisor
• Malta’s MEPs Peter Agius, Alex Agius Saliba, Thomas Bajada, Daniel Attard and representatives from the offices of David Casa and EP President Roberta Metsola.

Whilst in Brussels the Forum sounding the alarm over the failings of EU ETS, arguing that it is failing spectacularly to achieve its commendable climate change green objectives because it is unable to enforce its Directive outside its jurisdiction.  As a result, transhipment business is largely shifting to new and expanded transhipment hubs that have mushroomed along the coast of North Africa to capture the business of cargo carriers that are re-routing away from EU ports to avoid ETS requirements with the risk of reducing southern EU ports to feeder hubs playing a secondary role to extra-EU ports where global cargo will become principally transhipped.

This effect runs diametrically counter to the objectives of the Commission’s new Port Strategy which was published while the MMF was holding its talks in Brussels and producing concrete evidence that EU ports were losing rather than gaining competitiveness yet the same amount of carbon was being generated in EU waters.  Hard facts were produced on the substantial growth being registered in non-EU ports at the expense of EU transhipment hubs. This shift has led to increased feeder traffic, paradoxically boosting overall emissions rather than curbing them.

This mounting practice is creating disproportionate economic risks for small island state economies like Malta’s which rely heavily on global maritime carriers to generate jobs and export-led growth. With high ETS costs and a relatively minute domestic container volume, the island risks losing direct calls from major shipping lines. If cargo bound for Malta is unloaded at neighbouring non-EU ports, Malta’s connectivity and competitiveness are undermined, jeopardising sectors such as manufacturing and logistics.

During its active interactions in Brussels, the Forum recommended that the European Commission:

• Adopts a temporary freeze on EU ETS and FuelEU for maritime transport until the establishment of a global decarbonisation measure
• Gives clear and concrete assurances to the industry that it would withdraw its ETS and FuelEU regimes once a global system is in place
• Extends derogations for small islands to major islands and prolong the sunset clause until 2035
• Exclude EU transhipment ports—where transhipment exceeds 65% of total activity—from the definition of “port of call” under the ETS Directive.
• Exclude short sea shipping from the scope of EU ETS until road transport ETS2 is operational.
• Introduce a risk assessment mechanism for ETS monitoring, applying predictive criteria to ensure fair oversight.

The Malta Maritime Forum is most appreciative of all Maltese MEPs for their unequivocal non-partisan approach in this matter and for attending in full force for the MMF presentation.  It also thanks EP President Dr Roberta Metsola and Commissioner Glenn Micallef for their support.

Buoyed by this positive feedback and support, the Forum plans to keep up its advocacy momentum with further visits in the coming weeks with a view to continue to urge EU policymakers to heed these recommendations and bring about a level playing field for all EU ports, thereby promoting an effective, sustainable and globally coordinated decarbonisation process in the maritime sector.

The MMF delegation consisted of Godwin Xerri, Chairman; Alex Montebello, Vice Chairman; Claudia Vella Casagrande, Director; and Kevin J Borg, CEO.

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The meeting was held shortly after the Forum’s announced commissioning of a second study about the Economic Contribution of the Maritime Industry which announcement was praised by Hon Dr Borg.  The MMF Chairman, Mr Godwin Xerri explained how this second study builds on the previous report and how it complements the forthcoming National Maritime Transport Strategy to which the MMF also contributed actively.

During the exchange of views, in fact, the Opposition and the Forum agreed on the potential for growth in the Industry beyond ship registration, cruise-liner operations and transhipment.  The meeting discussed areas that are ripe for further development and growth including ship finance, bunkering of new fuels and the establishment of a regional logistics hub, all of which were recommended in the Forum’s recent 2026 Budget Proposals position paper.

The meeting also served to discuss current issues of prime mutual interest which are acting as bottlenecks to future growth including international regulation, infrastructural limitations and an acute shortage of workers.

To this end, the meeting underlined the role of education and talent in ensuring further success for the industry.  The MMF explained that as a matter of priority, it was consistently pressing for increased exposure of maritime careers and better coordination between the relevant stakeholders in this regard.

The Leader of the Opposition reaffirmed his Party’s belief that the maritime industry remains one of the most important for the Maltese economy and every initiative aimed at strengthening its competitiveness, employment and long-term resilience is a significant step forward.  He reiterated the Opposition’s firm intentions to establish a dedicated maritime authority and a Minister for maritime affairs if elected to govern.

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