Speech by the Hon. J Dalli, at the first networking seminar of the Euro Globalisation Adjustment Fund

Ladies
Gentlemen

I am pleased that Malta is hosting the first Networking Seminar on the European
Globalisation Adjustment Fund. Malta has been one of the beneficiary countries from this
Fund in 2007-2008 and we are pleased to share our experiences with participants
from other countries about how to make the best use of this Fund.

Globalisation has seen the migration of the production of low-value adding activities from
Europe to Asia as producers could benefit from lower production costs.
This posed many challenges to EU member states as European workers were losing their
jobs to their Asian counterparts.

The European Globalisation Adjustment Fund was set up in 2006 primarily to support workers made redundant as a result of major structural changes in world trade patterns due to globalisation where these redundancies have a significant adverse impact on the regional or local economy. The Regulation highlighted the eligible actions that member states could employ to make use of this Fund and which mainly consist of job search assistance and allowances, guidance, training and re-training and entrepreneurship assistance.

10,000 workers were helped by the European Globalisation Adjustment Fund (EGF)last year and of these
more than two-thirds found a new job, according to a report adopted by the European Commission on 31 July 2009.
More than EUR 49 million were paid in 2008 for eight EGF contributions.

These funds were used to co-finance active labour market policy measures targeted at 10,000 redundant workers in five Member States - Italy, Lithuania, Malta, Portugal and Spain. The reports received by the Commission in 2008, including one from Malta, showed that the EGF allowed the Member States concerned to prepare a more effective package of measures benefiting the redundant workers, in particular through innovative social actions (e.g. interaction in peer groups, more one-to-one guidance and counseling) and an extended duration of support, which would not have been available without the EGF contribution.

The EGF contribution empowered Malta with the necessary resources to assist 660 persons made redundant from two clothing factories. These were ably given assistance by the Employment and Training Corporation in the form of job search assistance and allowances, training, aid for self-employment, and outplacement. A number of persons availed themselves of more than one measure.

When the international financial and economic crisis struck, it was very opportune for EU member states and the European Parliament to extend the application of the Fund in 2009 to support workers made redundant as a direct result of the global financial and economic crisis.

The holding of this Seminar is being done in a context of high levels of unemployment in the European Union brought about by the international financial and economic crisis. This contrasts sharply with the high levels of employment obtained by the European Union only one and a half years ago.

The levels of unemployment would have been higher had action not been taken by EU member states to contain the levels of unemployment and to incentivise the employment of employees, and especially of those who lost their job as a result of the crisis. The stimuli packages adopted by Member States had a major positive contribution in obtaining these results.

I am pleased to say that although unemployment increased as a result of the crisis in Malta, we managed to contain the rise and unemployment is now stable. The economic outlook for Europe shows that the worst may be over but we all know that there will be a delayed impact on employment and the Union is not expecting increased employment for months to come.

A number of measures were announced by the Maltese Government for 2010 aimed at stimulating employment and assisting disadvantaged groups to integrate in the labour market. For the purpose, the public employment services agency has been given additional funding.

Moreover, the Employment and Training Corporation has successfully applied for and obtained funding from the European Social Fund to implement a number of projects aimed at financially assisting employers to employ disadvantaged persons and to train their workforce. Other ESF-funded projects are aimed at training jobseekers to obtain the skills needed by employers today, at providing custom-made and appealing services to youth jobseekers and at undertaking a national campaign to increase the female employment rate.

In this scenario, both the European Social Fund and the European Globalisation Adjustment Fund can surely play a significant role in seeing the European Union out of the current economic crisis. While working to sustain current employment levels and address unemployment, we must be proactive and take active measures to see ourselves out of the crisis and to upskill our workforce now to be prepared for the challenges to be brought about by the different labour markets of the future.

I thank all those who contributed to the holding of this first networking seminar, the European Commission and its experts and the staff from the Employment and Training Corporation. I augur that the proceedings will be of interest to all the participants. We cannot live in the hope of labour markets becoming better, we must work together to achieve that aim.