“We will feel the effects of Brexit in the longer term…I don’t know if it will be this summer or in 2022”

Interview with Antoni Mercant, president of the Chamber of Commerce of Mallorca

Soon it will be a year since the Covid-19 pandemic began. What are the main problems that business people communicate to you, and how do you try to help them from the Chamber of Commerce of Mallorca, for example, managing European funds?

The uncertainty is very distressing. No one can predict exactly when we will get back to normal. There is a glimmer of light at the end of the tunnel, but easing travel restrictions in March will not be the same as easing them in July or September. It is not just a question of dates, but also of regulations, of what we can do today but not tomorrow. The rules are constantly changing. No country in the world has found the perfect solution. This uncertainty makes it difficult for us to plan for the future with all that this entails economically. When will I be able to get my workers out of the ERTE program (Spain’s Temporary Downsizing Plan)? Will my income be enough to support me with so many restrictions? Will I be able to cover all the expenses I still have? When will we see tourists on our streets again?

Given this dire situation, the Chamber of Commerce is assisting business owners. We provide information and advice on existing public aid and continue to offer our free services in collaboration with the various administrations: processing the registration and de-registration of self-employed workers, business plans for women, online processing of export documents, direct aid for technological innovation, etc.

The Spanish Chamber of Commerce recently created a website and a support unit called ‘Operation Transformation’ to gather information on all official calls for projects that can be financed with European funds. It will undoubtedly be an excellent tool for providing advice on the regulatory framework, legislative changes, and procedures applicable to various financing programs.

Because of its public-private nature, I am convinced that the chamber of commerce system will play a key role in the recovery and rebuilding process of our economy that the Next Generation Fund will bring about.

Mallorca’s economy is unquestionably dependent on tourism. What is your organization’s forecast for the coming summer season?

The next few months will be key in determining what kind of summer we will have. First of all, we must get the pandemic under control: we need a swift, rapid vaccination process. And, obviously, restrictions on travel and social contact must be safely lifted. This applies not only in Spain but also in our main source markets. Secondly, we must regain people’s confidence as a safe destination. There is no way we can afford to lose another summer.

In your opinion, do you think that this health crisis will change the islands’ economic model to a greater or lesser extent? Where do you think the future direction of our local economy is headed?

You cannot change the model overnight. But we must take advantage of the situation to improve it. Over the last five decades, the boom of a labor-intensive tourism sector has been a magnet for immigration, doubling the population. Add to this the 15 million tourists who, on average, are concentrated into a three-month period; this pressure overloads the region and leads to social and environmental imbalances.

Given this context, the Chamber of Commerce is committed to economic growth where tourism will undoubtedly continue to be our main economic driver, but which protects our natural resources and improves our citizens’ quality of life. It is difficult to get back the business that we have lost in recent years. But we must fight to restore our agri-food industry and make way for green and blue economies, as well as investing heavily in tech.

From your experience as head of the Chamber of Commerce of Mallorca, have you noticed any new burgeoning sectors of business activity on the island that could provide a boost to our GDP in the short or medium-term?

The yachting industry could be this ideal complement to generate income. We have the best repair and tuning companies in the Mediterranean. This year the Chamber of Commerce has successfully organized the first virtual fair for the Balearic yachting sector, the Balearic Yacht Show, and our goal is to make it a global benchmark. We are already working on the Balearic Marine website to ensure the continuity for the fair and gather all the information related to this industry 365 days a year to be a meeting point between supply and demand and also be a powerful platform for promoting the industry.

In addition to the pandemic’s effects on the islands, there are also Brexit-related repercussions. Can you give us a brief overview of what the major consequences of the UK leaving the EU are on Mallorca?

It is too early to analyze the initial consequences. We haven’t even been treating the United Kingdom as a “third country” for 30 days yet. The agreement entails a transition to the new trade relations that are gradually being implemented. For example, concerning exports of agri-foodstuffs, it was decided which products would be subject to customs control in January and which would not be until March to avoid bottlenecks.

On the other hand, it is obvious that Covid-19 prevents us from seeing the real effects: exports and imports of products are reduced to a minimum and no tourists are coming to our area. We will feel the impact of Brexit in the longer term…I don’t know if it will be this summer or in 2022. We will see how British citizens react to these new rules of the game: Will they sell their vacation homes? Will they stop investing in Mallorca? Will the new customs procedures make our products much more expensive or will we remain competitive for the British market? Will British flagged vessels go with our repair companies?

What goals and new challenges is the Chamber of Commerce of Mallorca facing in 2021?

We have several significant challenges in 2021 that I am convinced will be successfully met. Here are just a few examples, so as not to go on too long: we want to be a benchmark in managing Next Generation Funds; we are working on launching a Digital Transformation Office in March; we have already established this year’s Dona Impuls call for proposals, through which we are providing free business plans for projects led by women in collaboration with IBDona; we want to consolidate the digital platform for export procedures launched this month, and I do not doubt that we will increase the number of beneficiaries of free Youth Guarantee training with the virtual campus that we have just inaugurated.