Sun shines on business-friendly Spanish city
Few of the 16 million people who pass through Málaga International Airport annually step into the city that bears its name. Instead, they board coaches, trains and taxis that bear them to resorts overlooking the tranquil seas and sun-kissed beaches of the Costa del Sol. However, people are stepping off the plane and beginning to venture into Málaga itself, not only to visit, but to start new lives and careers in the ancient Spanish city.
"We believe that Málaga is the best place to live, work and invest for foreign companies," says Francisco de la Torre, who has been the city's mayor since 2000. In recent years, De la Torre and his fellow city council members have campaigned hard to transform Málaga's reputation as a quiet seaside holiday destination to a dynamic, business-friendly city at the southern tip of Europe.
"Foreign direct investment (FDI) is fundamental for creating a diverse, global, dynamic and sustainable economy in Málaga," De la Torre explains. "FDI creates jobs, increases direct and indirect tax revenues, injects foreign capital into the local economy, and increases the local GDP. The presence of foreign companies forces local companies to innovate, and become more efficient and cost-effective in providing their goods or services."
De la Torre and his city council colleagues firmly believe in the trickle-down effect that these new arrivals can have on the local economy, as they help to train the local workforce and expose them to new skills, unique processes, advanced research and intellectual property from around the world. "It is evident that one of the best ways to ensure that the citizens of Málaga can maintain and improve their standard of living is for foreign companies to conduct business in our local economy," he says. "Therefore, we want to make it as easy as possible for foreign companies to relocate and invest in Málaga."
This effort to attract new businesses to Málaga began in 1996, with the city's first strategic plan. The municipal authorities have upheld the driving principle behind the scheme - to provide a clear and common vision to build a city that attracts talented and skilled people - to this day. It is to this end that the municipal authorities provide what it terms 'soft-landing services' to businesses seeking to relocate. This can include finding the requisite space within the city limits for new offices, and helping out with recruitment, visa applications, work permits and social security registration. It isn't unheard of for the city to even offer valuable assistance in finding homes for new arrivals.
"International companies choose Málaga for different reasons; some for its low operating costs, and others for its incredibly well-connected international airport," explains De la Torre. "Caterpillar, for example, has a training and demonstration centre in Málaga. Each year, they invite nearly 20,000 customers from all over the world to see the capabilities of their new products. Their outdoor exhibitions require a location with many days of sunshine and a mild climate."
Another success story for Málaga was the arrival of Oracle, which employs over 500 people at its European sales centre in the city. One of the main reasons it was attracted to the city was the connectivity of its airport: Málaga International has low-cost direct flights to more than 133 destinations in 31 different countries.
"In the case of Google, Ericsson and Dekra, they were looking around the world for the best technology," says De la Torre. "Their searches led them to entrepreneurs and engineers in Málaga. Their acquisition of these local companies allowed them to create a presence in our city."
This, as it turns out, is one of Málaga's main attractions to blue-chip firms. "As innovation transform business models in almost every industry, the quest for and retention of talented people is becoming more difficult," says De la Torre. "Companies must offer not only solid career opportunities and good salaries, but also a work-life balance."
This is where Málaga's natural charms come into play. De la Torre describes it as a "beautiful coastal city with all the amenities of a major European capital", minus the traffic congestion, pollution and stress. "It is characterised by its wonderful climate, attractive beach and mountain landscapes, extraordinary sunsets, delicious cuisine and hospitable people," he says. The sixth-largest city in Spain, Málaga remains firmly cosmopolitan, a place where residents from more than 150 countries live and work together.
"The citizens of Málaga have a grand appreciation for the arts," explains De la Torre. "There are more than 30 museums and six theatres in the city, as well as dozens of cultural events throughout the year." These include the Holy Week processions, the Málaga Film Festival and the Cultural Feria in August. "The historical centre also has many pedestrian spaces where one can enjoy diverse cultural offerings such as the Christian Cathedral, Moorish Alcazaba or the Roman amphitheatre."
The city also plays host to a rich sporting culture and is home to professional football and basketball teams. "Malaguenas are avid sportspeople," says De la Torre. "You'll always find people playing football, padel tennis, golf, running, cycling, swimming or just walking along the beach. The excellent work-life balance makes Málaga an ideal place to live and raise your family."
Beyond the city limits lies the Málaga Valley. The area plays host to the University of Málaga, the Andalusian Technological Park and the Club Málaga Valley, a think tank founded in 2006 that has championed initiatives aimed at turning the region into Europe's Silicon Valley. Together, they form a support network that has nurtured high-tech business in the area.
"The University of Málaga, with 36,000 students, and the Samsung Tech Institute, as well as the nanomedicine and biotechnology firms in the valley, have helped to concentrate knowledge for the benefit of the local and national economies," says De la Torre.
Additionally, Málaga has more than 45 'Smart City' projects, programmes and initiatives under way, and boasts several internationally recognised pilot projects. "We created an Experimental Urban Laboratory within a municipal building, with equipment and co-working space, where companies can work side by side with the city's engineers to test, certify and demonstrate new services and technologies within the Smart City concept," explains De la Torre. "Our city boasts one of the largest European business incubator and accelerator networks, consisting of 14 facilities that have a total capacity for more than 300 start-ups."
All of this spells a bright future for Málaga. "Economic growth was 3.5% in 2015, 3.0% in 2016 and is projected to be 3.1% in 2017," says De la Torre. "Our city is leading in job creation and regional growth, and we're ranked fourth nationally in terms of economic expansion."
Tourism will fuel part of that growth, with Málaga continuing to benefit as the gateway to the popular Costa del Sol. At the same time, however, the city's commitment to fostering a culture of innovation has made it increasingly attractive for businesses looking for a new place to grow and shelter from shocks like Brexit, Eastern European unrest and the Catalonian crisis.
"More companies will take advantage of the benefits of Málaga," predicts De la Torre. "Millennials are attracted to the lifestyle in Málaga. More young people are choosing to study, live and work in our city. Ultimately, Málaga as a business location can add tremendous value to a company by lowering overall operating costs, while at the same time rewarding employees with a very high quality of life. Málaga is an excellent near-shoring destination."