MBR ISSUE 25 - low res all

Malta Business Review
hubbing
Malta as a Logistics Hub
But is Malta Ready To Embrace the Changes Needed to make Hubbing a Success Story?
By Special Correspondent
“The idea of making Malta a logistics hub makes a lot of sense and should be an idea embraced by all. Truth be
told, Malta is not new to this concept and the country has been part of the hub industry for several years. But for
this idea to take off, the country needs to take serious and hard decisions to create the right environment for this
industry,” says Franco Azzopardi, Chairman and CEO of Express Trailers.
warehouse can take, needs to be imported
8 times from the Freeport and exported
8 times from the cargo terminals. The
400,000 cubic meters of new warehousing
space being offered at Hal Far, would
probably translate to 1.6 million cubic
meters carried from the Freeport to the
warehouse annually and another 1.6
million cubic meters out of the warehouse
via the cargo terminals.
I am not so sure the last leg out of the
terminals is possible with the current
infrastructure at Corradino as this
would mean a further 400 trailers to be
exported weekly!
Malta’s problem is the wide imbalance
between the volume of cargo we import
for consumption and the very small
amounts we export. This imbalance for
cargo carriers like ourselves means that
part of our round-trips end up being done
empty, and as a consequence, the cost of
that empty space transported is suffered
locally, partly by us, the carriers, and partly
by the client.
Hubbing is positive because by optimizing
the routes of the journey of the cargo
via Malta, we can generate more export
to correct this import-export imbalance.
This imbalance can also be corrected by
shipping south-bound cargo to North
Africa via the Freeport in containers.
This not only corrects the import-export
imbalance but brings also more economic
value to our island, create economies
of scale in favour of our consumer
and manufacturer, and creates further
investment and employment.
Needless to say, at Express Trailers, we
are leaders in Third Party Logistics and
have been specialists in the transport of
cargo and managed warehousing for many
years. This is why the concept of hubbing,
is an exciting proposition for our business.
However, our operations and experience in
logistics allow us to be more aware of the
bottlenecks that Malta needs to address if
hubbing is to take off successfully.
The cargo terminals both at the airport
and at Corradino could stifle the extent of
the growth possible through international
hubbing. Logistics and the environment
are not best of friends and we have
to decide on balance and equating
the differences. More cargo from the
Freeport means more trailers on the road
to the warehouse.
Another serious limitation is the lack of
trailer parks on the island. I can say we
have a serious problem where to park our
trailers safely off the public roads. Now
multiply that by the number of the other
operators. Space is an issue.
Space is also a primary issue. Warehouses
need space. Industry standards suggest
that inventories in warehouses need to
be ‘turned around’ between five and eight
times, meaning that the volume that the
This brings us to the issue of road
congestion which is already very dense.
The national problem we need to address
is the acute traffic in rush hours. This is
disrupting the quality of life of people
and disturbing also the supply chain of
the carriage of goods. Our trips are taking
longer and longer posing difficulties in
planning routes and giving estimated time
of arrivals to clients.
As one can see, the viability of hubbing
needs to remain conscious of the physical
limitations and on further investment in
our terminals, remaining also sensitive
to our environmental obligations. Hardnosed
decisions pointed at the festering
problem need to be taken and driven
by Government. Unless we embrace
change, the hubbing concept will die
before even taking off. MBR
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