Malta’s infrastructure has taken a centre stage recently. The ability of the country to invest in, and maintain, an infrastructure to support our growing economy is a formidable challenge.
As Malta confronts the substantial infrastructure investments required to support its growth, a key concern emerges: how can we avoid the pitfalls of duplication and redundancy in infrastructure development? A potential answer lies in the strategic adoption of shared infrastructure models. The upcoming EY Future Realised event on October 23 will delve into the transformative potential of shared infrastructure in fostering a more integrated and effective Maltese economy.
By definition, shared infrastructure refers to the collective use of physical and virtual resources, such as transportation systems, utilities, IT networks, digital infrastructure, ports and public services. This concept is not only a cost-saving strategy but also a means to optimise resource utilisation and reduce environmental impact. By cultivating collaborative ecosystems, we can achieve significant improvements, particularly in vital areas such as connectivity and utility services.
The increasing demand on our infrastructure requires a rethink in how our infrastructural assets can be leveraged more efficiently. Indeed, there are multifaceted benefits of a shared infrastructure that can be a game-changer for organisations and society if done properly, such as:
Cost savings: One of the most compelling arguments for shared infrastructure is the potential for significant cost savings. When entities consolidate their resources, they eliminate the redundancy of having multiple, underutilised assets. This approach not only trims down capital expenditure but also lowers operational costs. For instance, shared logistics and distribution allow businesses to cut down on operating expenses, effort and operational complexities.
Improved resource utilisation: Pooled infrastructure leads to improved resource utilisation by achieving economies of scale, optimisation of infrastructure use, energy optimisation, centralisation of management and maintenance considerations and allowing for flexibility and scalability of the underlying infrastructure.
Environmental benefits: The environmental benefits of a shared infrastructure can be considerable. By reducing the need for multiple facilities, energy consumption is minimised, leading to a smaller carbon footprint. Shared transportation, for example, can significantly decrease the number of vehicles on the road, thus lowering emissions and mitigating traffic congestion.
Foster innovation and competitive advantages: By sharing infrastructure, different users can collaborate more easily, which can lead to innovation and the sharing of best practices.
However, shared infrastructure is not without its challenges. Dependency on shared systems can lead to vulnerabilities, such as a single point of failure that can disrupt services for many users. Security concerns, particularly in shared IT infrastructures, raise questions about data protection and cyber threats.
The complexity of managing and coordinating shared services is typically higher, requiring robust governance and skilled management that is critical to the success of shared infrastructure. Clear policies, transparent processes and accountability are essential to ensure that shared services are reliable, secure and equitable. Moreover, a collaborative approach to management can foster innovation and continuous improvement.
There are multifaceted benefits of a shared infrastructure which can be a game-changer for organisations and society– Gilbert Guillaumier
Cooperation between the public and private sector is a vital component in the development and management of shared infrastructure. This can leverage the strengths of both sectors, with the public sector providing regulatory support and the private sector bringing in expertise and efficiency. Government initiatives can encourage private investments and participation by offering incentives and creating a favourable policy environment.
The private sector is also instrumental in this process, providing a foundation for resource maximisation and bolstering productivity across the board. This dynamic can unlock synergies between different sectors, enabling small- and medium-sized enterprises to access facilities and technologies that would otherwise be beyond their reach.
By sharing resources such as logistics networks, digital infrastructure and sustainable energy solutions, businesses can benefit from economies of scale and ability to focus on core business activities.
Regulatory and policy frameworks can either facilitate or hinder the sharing of infrastructure. It is essential to establish regulations that protect stakeholders while promoting the sharing of resources. Policies that incentivise shared infrastructure can accelerate its adoption.
Shared infrastructure represents a paradigm shift towards a more collaborative and sustainable future. While there are challenges to be navigated, the benefits of cost savings, improved resource utilisation and environmental stewardship are compelling. As technology continues to evolve, so too will the opportunities for shared infrastructure to enhance efficiency and drive innovation.
It is a journey that requires careful planning, robust governance and a commitment to continuous improvement, but the rewards are well worth the effort.
These are areas that we will address in more detail at the EY Future Realised event, where we will engage with industry experts on how to address the challenges and opportunities that shared infrastructure presents. As a small nation, it is imperative that we explore the creation of incentives to encourage businesses to participate in shared models.
Designing and implementing these collaborative models is undoubtedly complex and will require dedicated funding and resources. However, the long-term benefits for Malta’s economy and society are clear.
By embracing a shared infrastructure, Malta can pave the way for a more unified, efficient and competitive future, ensuring that the nation’s infrastructure meets the evolving needs of its population and economy.
Gilbert Guillaumier is EY Malta, Strategy and Transactions, Partner.
