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Eco-Innovation in Malta

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Eco-Innovation in Malta Eco-innovation in Malta EIO Country Profile 2013 Eco-Innovation Observatory The Eco-Innovation Observatory functions as a platform for the structured collection and analysis of an extensive range of eco-innovation information, gathered from across the European Union and key economic regions around the globe, providing a much-needed integrated information source on eco-innovation for companies and innovation service providers, as well as providing a solid decision-making basis for policy development. The Observatory approaches eco-innovation as a persuasive phenomenon present in all economic sectors and therefore relevant for all types of innovation, defining eco-innovation as: “Eco-innovation is any innovation that reduces the use of natural resources and decreases the release of harmful substances across the whole life-cycle”. To find out more, visit www.eco-innovation.eu Any views or opinions expressed in this report are solely those of the authors and do not necessarily reflect the position of the European Commission. Eco-innovation in Malta 1 Eco-Innovation Observatory Country Profile 2013: Malta Author: Dr. Georgios Papanagnou Coordinator of the work package: Technopolis Group Belgium Eco-innovation in Malta 2 A note to Readers Any views or opinions expressed in this report are solely those of the authors and do not necessarily reflect the position of the European Union. A number of companies are presented as illustrative examples of eco-innovation in this report. The EIO does not endorse these companies and is not an exhaustive source of information on innovation at the company level. This brief is available for downloaded from www.eco-innovation.eu/countries Comments on this brief are welcomed and can be provided at www.eco-innovation.eu/malta Eco-innovation in Malta 3 Table&of&contents& Summary .............................................................................................................................................. 5! 1! | Introduction................................................................................................................................... 6! 2! | Eco-innovation performance ....................................................................................................... 7! 3! | Selected eco-innovation areas and new trends....................................................................... 10! 4! | Eco-innovation barriers and drivers in Malta........................................................................... 11! 5! | Eco-innovation policy landscape.............................................................................................. 12! 6! | Good practice examples ............................................................................................................ 13! References........................................................................................................................................... 17! Eco-innovation in Malta 4 Summary Malta’s composite index in the 2013 Eco-Innovation Scoreboard stood at 67 compared to the EU-28 average (100). In 2013 Malta ranked in 17th place performing better than other new member states with small populations like Cyprus and Latvia but worse than Estonia. Malta does not possess mature eco-innovation markets but nonetheless there are certain sectors where important initiatives have been made. A notable development has been the adoption of the plan to transform Malta into the first smart-grid country in the world. Moreover, Malta has made good progress in green tourism. The country has established the ECO-Certification which is the national standard for ensuring the environmental, socioeconomic, and cultural sustainability of hotels on the Maltese Islands. Also, Gozo the second largest island in the Maltese archipelago is to become an eco-island by 2020. In terms of drivers Malta enjoys a rich natural capital in renewable energies and biodiversity. The potential for solar energy in particular is substantial. Concerning innovation capacity, in dynamic terms Malta has been progressing in R&D investments and this is also reflected in its scientific and technological outputs. The Maltese Government has put in place a range of measures aimed at training enough researchers to meet its R&D targets and promoting employment in public research institutions. Authorities have also put in place a range of financial incentives and fiscal assistance towards supporting innovation – including eco-innovation. Regarding barriers the prevalence of SMEs in the economic structure limits the potential for innovation. Inherently the Maltese market is small and growing a business by simply focusing on the local individual consumers and businesses is extremely difficult. Additionally, Malta is one of the least developed financial markets in the EU as far as eco-innovation is concerned. Eco-innovation in Malta 5 1 | Introduction Due to its small island geography, Malta is particularly at risk from climate change, in particular sea- level rise, and extreme weather events. Indeed, Malta is expected to suffer moderate impacts from climate change mainly related to drought, deterioration of freshwater quality and availability, increased risk of floods, soil and coastal erosion, changes in sea level and biodiversity loss and degradation. (EEA, 2011: 2010). The islands’ natural water resources are entirely rain-fed, while over half of the drinking water produced by Malta’s major supplier is sourced from desalinated sea water. Malta’s groundwater resources are in a perilous state and suffer from severe over- exploitation. (Malta Independent 5/2/2014). Malta remains the most densely populated EU Member State, while at the same time tourism – a very important economic sector – places significant pressures on the environment due to additional consumption of resources (and related waste generation and transportation demand) and land take- up. The fact that almost 100 % of the population lives in coastal areas, mostly in densely populated coastal settlements, brings to the fore the need for energy efficiency in buildings. The inland also is almost exclusively dependent on fossil fuels for its energy supply. At the same time, the increased availability and lower prices of imported goods have increased household consumption, with impacts on environmental issues such as waste generation, energy use and transport. Overall, it is expected that increasing living standards will place continuing pressure on the environment, particularly through growth in the sectors of housing and other land development, transport, and tourism. Waste management, biodiversity protection, land use, water management, and air pollution, particularly the control of traffic emissions, are expected to remain pressure points. In the last decade, R&D intensity has been steadily increasing, reaching 0.73% of GDP in 2011. (Innovation Union, 2013). Malta has thus reached and exceeded its stipulated Europe 2020 Strategy target of 0.67% of GDP. Despite the progress made however, Malta remains a ‘moderate innovator’ and still scores under the EU average (EU Innovation Union 2013). An economic structure organized around the service sector and dominated by micro enterprises with less than 10 employees, negatively influences the capacity of the country to increase its overall R&D intensity. Given the size of the country and the capacity of the research system, Malta will need to specialize its R&D investments in particular niche fields where the system can achieve sufficient critical mass to support the local economy. Presently, Malta has identified health and biotechnology, energy and environmental technologies, ICT and value added manufacturing and services as potential areas to focus on. Eco-innovation in Malta 6 2 | Eco-innovation performance The analysis in this section is based on the EU 28 Eco-innovation scoreboard (Eco-IS) for the year 2013. Eco-IS via its composite Eco-innovation index demonstrates the eco-innovation performance of a country compared with the EU average and with the EU top performers. Eco-IS is based on 16 indicators which are aggregated into five components: eco-innovation inputs, eco-innovation activities and eco-innovation outputs as well as environmental outcomes and socio-economic outcomes Figure 2.1 EU28 Eco-innovation scoreboard 2013, composite index Source: EIO, 2013 Malta’s composite index in 2013 stood at 67 compared to the EU-28 average index of 100, falling from 72 in 2012. Malta ranked in 17th place performing better than other new members states with small populations like Cyprus and Latvia but worse than Estonia. Malta exceeds the EU-28 performance in terms of Resource Efficiency Outcomes (110) but lags behind in eco-innovation inputs, activities and outputs and socio-economic outcomes. Eco-innovation inputs The eco-innovation input index is based on the national indicators of the government’s environmental and energy R&D appropriations and outlays, R&D personnel, and cleantech investment. In this component, Malta is one of the weakest performs - sixth from the bottom - with a score of 26 (EU average index 100). In 2012 total government environmental and energy R&D appropriations and outlays amounted to 0.001% of GDP with an EU average of 0.043. The total R&D personnel and researchers for Malta in Eco-innovation in Malta 7 2012 counted for 0.86% of total employment (EU average of 1.21%). In this regard Malta shows a stronger performance than Cyprus and Latvia (0.41 and 0.64 respectively) but not Estonia (0.94). No green early
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