Good morning Colleagues … First of all, it’s a great pleasure to welcome the combined team of the Ministry of Tourism and the Antigua and Barbuda Tourism Authority to this important meeting. Indeed, I expect this meeting to produce plans, strategies and outcomes that will set the tourism industry on an upward trajectory. From this meeting, I want new, creative ideas that will serve to considerably enhance our place in the world market as one of the leading tourism destinations globally. I want to hear what my friend, Ambassador Sir Ron Sanders, once described to me as “disruptive thinking” – thinking that questions the norms and pushes the boundaries of the imagination. You, this group assembled here, are the custodians of our nation’s economic growth. For tourism is our main industry accounting for almost 70% of our gross domestic product, earning 90% of our foreign exchange, and employing directly and indirectly the majority of people in both our public and private sector. I cannot stress enough the value and significance of tourism to every man, woman and child in our society. Without tourism, our country would be a wasteland and our people reduced to carriers of water and hewers of wood. The responsibility that we have – all of you and me, as the Minister of Tourism, – is huge. It is a sacred trust that we must fulfill on behalf of our country, and all who dwell within it. If we are to fulfill that trust, we must see it as an honorable and vital task. We must think of achieving what others believe to be impossible. I recently read something that Sir Dennis Byron, the President of the Caribbean Court of Justice said. I would like to repeat it to you, because it is relevant to you, to me, and to all of us who must succeed if our country is to flourish and our people prosper. It is this: “The most successful people in the history of the world are those who refused to give up in the face of impossible odds. Thomas Edison created the light bulb after one thousand failed attempts. Abraham Lincoln ran for public office six times before winning the Presidency. Vincent Van Gogh sold one painting in his lifetime and his most expensive work is now valued at $142.7 million. Colonel Sanders’ idea for a fried chicken restaurant was rejected 1,009 times before being accepted by an investor. Twelve publishers rejected JK Rowling’s book about a boy wizard called Harry Potter. Oprah Winfrey was fired from her first job and told she was not the right fit for television”. What makes these people enormously successful is their refusal to give up; their refusal to accept that they were too small, or that they did not have enough resources. They kept focussed on the achievement of their goals and they let none persuade them that they could not overcome the obstacles. According to a Japanese proverb you must be prepared to fall seven times and get up eight. The great Muhammed Ali put it best when he said: “Impossible is just a big word thrown around by small men who find it easier to live in the world they’ve been given than to explore the power they have to change it. Impossible is not a fact. It’s an opinion. Impossible is not a declaration. It’s a dare. Impossible is potential”. My friends, this is our first meeting as the leadership team. We should have had a week to explore every option; to discuss every scenario; to plan for the challenges and to map-out how we will grab the opportunities. But, our time is limited, and ours is a country in a hurry. We want results sooner not later. So, we will cram into one day today what others may want many days to accomplish. That is why I started with the theme of success and the theory of impossibility. Impossibility is potential; it is a dare not an edict; it is an opinion, not a fact. So, I want us all to embrace fully the sacred trust we carry for our nation – and, indeed, for ourselves. This nation looks to us to perform and to perform well. If we let-down the people, we let down ourselves. And we must do neither. We have many projects coming on stream. We have the responsibility to fill those rooms. But, while that is happening, we have a few existing properties that are non-performing. We have to figure out what can be done to make those properties vibrant again. We are facing fierce competition now – not only from our Caribbean neighbours, but also from further afield. How are we to meet that competition and better it? These are the issues that we must confront today, and every day after we leave here. And we must do so as a team; as a collective with a single-minded purpose, and a bold and unshakable resolve. I wish I could guarantee you that the days of little or no product development are over, and that minimal destination-advertising is a thing of the past, and that sparse public relations are over. But my government inherited a critical and perilous financial situation, and even as we are pledged to fund our tourism industry better than before, the complexities of our situation gives no guarantees. My Government will strive very hard to put the resources into tourism as the engine of our growth – the Prime Minister as the Minister of Finance has given that undertaking, and he means it. He is a banker and a businessman. He knows that there can be no profit without investment; no returns without spending. But we have a role to play. To do much with little. To do more with less. To reject that anything is impossible, and instead to show how it is possible. That is why we must spare no time or effort in making tourism vigourous and productive. To the extent that we – this team – can galvanize, energize and revitalize this industry, to that extent we will deliver what is expected of us; we will generate more revenues and earn a larger share of the resources to make our country flourish and our people prosper. Like many of you, I continue to expand my own knowledge of the business of tourism and I’m learning quickly. As we have our exchange today, I want you to be open with the facilitators and with yourselves. Our overriding objective of the next two days is focused on the plans that will be produced and effective means by which – as a team – we will deliver concrete and measurable results for the benefit of our country. In any free market economy we continually face challenges – – tourism is no different – – but how we view these challenges defines us! Do we choose to see the challenges as ‘opportunities” or as ‘obstacles’? Are they a moment to despair or a chance to do something different? A great deal of wasted energy can be spent focusing on a negative mindset which takes delight in complaining – mindsets like “I can’t”, “I won’t”, “I don’t want to” and “I shouldn’t have to”. But, we should all recall what put Barack Obama – an American Black in the White House. It was a simple phrase, but a powerful one in which he and millions of Americans placed their belief. Three little words that moved an entire nation – “Yes, we can”. Well, yes, we can too. And we can do it best, if we do it together. Your role now is to roll up your sleeves and believe not only in the value and importance of the sacred trust that has been given to you by this nation, but also to believe in yourselves that – yes, you can. And, you will. My friends, our task is agreed. The path is clear and the objective looms large ahead of us. Let us run with resolve the race that is set before us. Let us get tourism to work. Thank you.
(St. John’s, Antigua) – Minister of Tourism, the Hon. Asot Michael, has charged technicians in The Ministry of Tourism and The Antigua and Barbuda Tourism Authority, to be custodians of the country’s economic growth.
“We have many projects coming on stream. We have the responsibility to fill those rooms. But, while that is happening, we have a few existing properties that are non-performing. We have to figure out what can be done to make those properties vibrant again.”
The Tourism Minister made the remarks today as he met with over thirty-five technicians from the product development and marketing bodies of the organisations under his leadership, in a two day strategy and planning workshop.
Tourism senior officials from Antigua and Barbuda as well as the Antigua and Barbuda Tourism Authority’s Overseas Office converged in the destination for the sessions. Included were CEO of the Antigua and Barbuda Tourism Authority – Colin C. James, Rohan Hector – Chairman of the Antigua and Barbuda Tourism Authority, Jean Marc Flambert – UK& Europe VP of Sales and Marketing, Marie Walker – North American VP of Sales and Marketing, Cherrie Osborne, UK & Europe Director of Tourism, Charmaine Spencer – Regional Marketing Mananger, Pauline Frederick-Hunte, Permanent Secretary in the Ministry of Tourism, ShirleneNibbs -Tourism Consultant and other consultant teams.
The Tourism Minister in his foreword to the team said:
“I expect this meeting to produce plans, strategies and outcomes that will set the tourism industry on an upward trajectory. From this meeting, I want new, creative ideas that will serve to considerably enhance our place in the world market as one of the leading tourism destinations globally.”
“We are facing fierce competition now – not only from our Caribbean neighbours, but also from further afield. How are we to meet that competition and better it?”, said the Minister.
The strategy session was led by consultant,ShirleneNibbs. Nibbs working with the team, presented the strategic overview of the tourism industry having made an assessment of the vision, mission and brand promise for the Antigua and Barbuda Tourism organisations.
Technicians focused on identifying key areas of the product that were critical to the success of the industry and on immediate plans of action to be taken. An evaluation was done on the accommodation, yachting, cruise and transportation sectors as well as on the visitor experience.
CEO of the Antigua and Barbuda Tourism Authority, Colin C. James also announced new hotel developments coming on stream in the near future, and the economic opportunities available.
Airlift and Airport developments presentations highlighted new flights for Antigua and Barbuda and increases in airlift within various markets. “The destination is well served. We continue to make sure we grow the airlift, and the new airport allows us to grow this airlift from non-traditional markets,” said James. James also announced Eden Viaggi, the new Italian Charter for the destination which will be flying to Antigua from December come 2015.
Also announced today, were the 2015 marketing plans for the North American market and the UK, Ireland and Europe market. Within the UK, plans have been designed to target travellers with the potential to travel during the off peak periods of May/June and September to October, while in the North American market the focus will be on repositioning and recreating the buzz for the destination.
The tourism strategy and planning sessions being held have a number of objectives objective is to deliver plans to galvanize, energize and revitalize the industry; to create concrete and measurable results, generate more revenues and earn a larger share of the resources for the benefit of our country.
Day two of the session continues tomorrow with PR Plan Presentations, technicians engaging in further group interactive planning sessions, and a walk-through of the new airport terminfor Antigua.
(St. John’s, Antigua ) The Honourable Asot Michael, Minister of Tourism,Economic Development, Investment, and Energy completed his inaugural visit to Berlin, Germany last week. The Minister attended three conferences to seek new hotel investment and forge closer relationships with German tour operators and airline partners. Travelling with the Minister as part of his delegation were Ambassador Brian Challenger, Mr. Rohan Hector – Chairman of the Antigua and Barbuda Tourism Authority; Hans Kupin – Economic Envoy for Antigua and Barbuda in Germany, new Vice President of Sales and Marketing for UK and Europe Mr. Jean-Marc Flambert and Cherrie Osborne – Director of Tourism UK & Europe
Minister Michael and Ambassador Challenger first attended, the CARICOM Energy Conference, which explored Green Energy opportunities for making the country self-sufficient in this area. Minister Michael, then met with other
Ministers of Tourism at the International Hotel Investment Forum (IHIF) now in its 18th year. The forum included, a round table session where Ministers of Tourism discussed: critical issues; strategies for tourism investment promotions and reasons for global investors to invest. Minister Michael made a presentation to the session, which was recorded and along with the findings from the forum will be published to an audience of over 50,000 potential investors.
The forum also included a two-day event where Minister Michael, secured one on one meetings with the Regional Presidents of some of the world leading hotel chains – IHG, Wyndham, Viceroy, Marriott, Hilton, Park Inn and Starwood. In a separate meeting Minister Michael met with Michael Henssler, Managing Director, Key International Hotels management Co. Ltd and Xavier Destribats – President Europe to finalise a deal with the Kempinsky hotel group.
After some extremely positive meetings aimed at securing new hotel investment for Antigua and Barbuda, Minister Michael also participated in ITB one of the world’s largest annual business to business and consumer tourism event held in Berlin each year. This year’s event attracted over 174,000 trade and consumer visitors. In 2014 Germany saw the largest increase from Europe to Antigua and Barbuda, recording a growth of 9%.
The destination was supported by co exhibiting partners including – Antigua Yacht Club Marina, Blue Waters, Hermitage Bay, Sugar Ridge, Jolly Beach Resort and Spa, National Tours and The Inn at English Harbour.
The teams conducted a packed schedule of successful meetings with key European based Tourism Executives and Airlines partners such as Condor, TUI and Dertour, Meires Weltereisen, yachting specialists – Sailing Classics, KH +P Yacht Charter, Viaggidea (Italy), Eden Viaggi (Italy), Thomas Cook (Germany) as well as numerous new tour operators.
The destination has clearly set its sights on making greater inroads into the European market. Bookings from Germany to the Caribbean are up 20% for 2015 with Antigua and Barbuda also seeing similar growth trends. Overall the German Tour operators were optimistic about the future and want to continuing working closely with the destination to grow the business even further. Condor once again confirmed its weekly direct flight for winter 15/16.
A notable achievement at this year’s ITB was the commitment given by Eden Viaggi an Italian tour operator to again have direct flights from Milan to Antigua with a year round charter with 130 seats weekly to the destination. This flight will be shared with the Dominican Republic to service their Eden Village club and will starting in December 2015.
In summarising the week’s activities, Minister Michael commented that “Our intense week of tourism promotions and investment conferences presented me with a unique opportunity to introduce and promote Antigua and Barbuda to some of the key movers and shakers in the Global Hotel Investment and European Tourism arena. Significant progress has been made which will ultimately contribute to growing the industry”.
ST. JOHN’S, Antigua and Barbuda – 26th February 2015……
The Ministry of Information, Broadcasting, Telecommunications and Information Technology will be signing a milestone agreement with Microsoft on Monday 2nd March 2015.
Microsoft officials arrived on island earlier this week, to discuss the particulars of the partnership with Minister of Information, Broadcasting, Telecommunications and Information Technology, the Hon. Melford Nicholas.
The agreement will allow for the long awaited transformation of how government conducts business through the use of the “Microsoft Office 365” platform, which is being contracted through a Licensing Solutions Partner (LSP), SoftwareOne.
This programme is expected to create a portal for citizens to have better engagement with the government and also make more persons accountable for their work, through collaboration and inter office communication.
Developers say the platform will increase the country’s ease of doing business and will also facilitate the reduction of cost through more efficient and document management.
Officials at Microsoft have indicated their delight in assisting the Government with this important initiative.
“We at Microsoft are grateful that the Government of Antigua and Barbuda are giving us the opportunity to collaborate with them to modernize the management of the government through technology. This modernization will ultimately transform the way employees work, improve transparency, and enhance the services provided to citizens,” mentioned Guillermo Almada, Public Sector lead for Microsoft Latin America Emerging Markets. “In addition to our joint efforts to help modernize the way the government operates, this partnership also allows us to help impact positively the development of society in key areas, including education.”
Representatives from Software One have also indicated their delight in partnering with Microsoft and the Government of Antigua on the new Enterprise Agreement and are looking forward to making the transition a seamless and successful one.
It is envisioned that Ministries and Government agencies will move ahead through the use of this top of the line full office programme and a wide range of integrated collaboration services, which are coupled with advanced compliance features and full IT power.
Through this platform, Government will be demonstrating leadership in the adoption and use of ICT Technology. This implementation will enable greater transparency, improved collaboration and the ease of doing business with the government.
Minister Nicholas says the platform will further assist in the development of special initiatives within the Ministry of Education, assist in Human Capital Development and improve interactivity between citizens and the government, thus creating more openness, sharing, communication and collaboration.
Prime Minister, the Hon. Gaston Browne, Minister of Information, Broadcasting, Telecommunications and Information Technology, the Hon. Melford Nicholas, Representatives from Microsoft Office and other Seniour Public Service Officials will be in attendance at the signing of the agreement, which will take place on Monday, 2nd March at the Office of the Prime Minister at 2 pm.
The agreement will also facilitate the placement of all employees within the government sector on a single domain (ab.gov.ag) for online communication purposes.
Following Monday’s signing, teams will be on the ground to commence implementation and make presentations to various stakeholders to include: Cabinet, Permanent Secretaries, Seniour Government Officials and Information Technology Managers within Ministries.
Implementation is expected to run over the next six months.
The Honorable Asot Michael, Minister of Tourism, Economic Development, Investment and Energy was among senior ministers and other officials from the CARICOM region taking part in a series of high level meetings between CARICOM countries and the Government of Germany in Berlin and Hamburg, Germany on March 2 – 3, 2015.
The meeting, which followed on an invitation from the Government of Germany, discussed a range of issues including concessionary development financing for Caribbean countries, energy security and renewable energy, information and communication technologies, regional geopolitical developments, CARICOM relations with Germany, and climate change. A series of meetings were also held with senior German parliamentarians in Berlin and Hamburg.
In his presentation to the the two day meeting, Minister Michael welcomed the initiative by the government of Germany and highlighted his governments intention to promote Antigua and Barbuda as a centre for renewable energy within the eastern Caribbean in its attempts to reduce the cost of energy to consumers and to spur economic growth in Antigua and Barbuda.
In addition to government representatives, the CARICOM officials met with representatives from the German private sector in Berlin and Hamburg interested in in investing in renewable energy projects in the Caribbean. Caribbean officials also visited a leading university in Hamburg to discuss possibilities for enhanced tertiary level training for the region and for cooperation between CARICOM and German universities. Discussions were also held with the President of the EU-LAC Foundation, a private sector organization based in Hamburg promoting commercial and cultural linkages between the European Union and Latin America and the Caribbean.
Minister Michael was accompanied on his visit by Ambassador Brian Challenger, Advisor to the Ministry of Energy.
At TRINIDAD AND TOBAGO ENERGY CONFERENCE 2015
Powering Development and Ensuring Stability
0n 26 January 2015
at the Hyatt Regency Hotel
Commodity prices have never been free of the influence of politics; and of none more so than oil.
But, the world has now entered a phase where politics play a quite different role in the price of oil than it has played previously.
This situation has led to volatility and unpredictability in the prices of oil and gas.
There are currently as many views on how long the present lower price of oil will last as there are experts who are asked to venture an opinion.
The only single certainty seems to be that, in the short-term, the price of oil will not return to figures of US$100 a barrel or more.
The world – and in the context of this Conference – the Caribbean now enjoys a respite from high costs of petroleum products.
It may not last long.
The United States Energy Information Administration) forecasts that West Texas Intermediate crude oil prices will average around US$ 55 per barrel in 2015 and US$ 71 per barrel in 2016.
So, there is a small window of opportunity.
Throughout the Caribbean, there is now significant interest in the adoption and use of clean energy, renewable energy, and energy efficiency technologies.
What is more, almost every Caribbean country has vast renewable energy resources with only 1% of the existing potential harnessed.i
Therein lies opportunities for better energy security for the region, but not before many challenges are overcome, principally access to capital on affordable terms.
Factors impacting price on the International Stage
On the international stage, it seems that two factors have impacted the current oil and gas scenario.
The first is economic and the other political.
On the economic point, in October last year, the Organization of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia and with the exception of Venezuela principally, decided not to increase the production of oil even in the face of declining revenues from falling prices.
This decision was confirmed at an OPEC meeting on November 27th.ii
Economic politics were at play.
The government of Saudi Arabia decided that, in its own interest, it wants to keep oil prices low so as to maintain its share of the global market.
Therefore, it led the argument in OPEC to hold production levels at 30 million barrels per day.
Simply stated the Saudi government feels threatened by the booming shale oil and gas sector being led by the US whose oil production has increased by 65% since 2008.
Authoritative studies say the US “shale production has reached 8.7 million barrels a day, about a million barrels a day more than just a year ago and the highest level in nearly a quarter century”.
This has caused a significant reduction in imports from OPEC since 2008, forcing many of their members to compete with one another for markets.
In deciding to keep prices low, the Saudi calculation appears to be that if returns from oil sales decline, the fracking companies in the US (that produce shale oil and gas) will be pushed into uneconomic situations forcing them either to cut back or suspend production.
Should this gambit work, conventional oil producers such as Saudi Arabia would continue to receive significant revenues over a longer period of time, and they would retain the reins of oil’s power.
How this will work out in the future is anybody’s guess.
But not all OPEC members are happy.
Particularly unhappy is Venezuela, which according to the IMF, needs oil prices at about US$115 a barrel to keep its economy afloat, pay back its considerable debt and maintain an expensive social welfare programme.
The Venezuelans put that figure much lower, claiming that “the current budget was estimated with the cost of a barrel of oil at US$60”.iii
But they admit that the revenue earned above US$60 a barrel “supports the activities outside of the budget framework”.iv
Last week Brent crude oil dropped to $48 a barrel, and US crude fell to $47 a barrel.
At US$40 a barrel and below, the Venezuelans know that meeting all their obligations, including servicing their debts, is extremely difficult and can only be addressed by massive cuts in spending.
In all this China is a wild card.
However, it is uncertain how much of a wild card China can afford to be since it is now owed US$50 billion by Venezuela and the recent announcement in Caracas that it has agreed to lend another US$20 billion has not yet been confirmed.v
I will return to Venezuela’s situation in the context of implications for the Caribbean later.
The International Political imperatives
For now, I draw attention to the political aspects of the price for oil and gas.
The countries of the West and NATO – even though at least two of them, the United Kingdom and Canada, are suffering setbacks to their economies because their own oil and gas earnings have declined – are relieved by the effect on two adversaries: Russia and Iran.
To balance its budget, the Russian government should be selling oil at US$98 a barrel this year and US$105 next year.
Apart from the dent in the Russian budget and its effect on domestic programmes, the fall in revenue from lower oil prices will also force the country’s leader, Vladimir Putin, to make a choice between spending on domestic projects or involvement in theatres of conflict with the West such as Ukraine.
In the case of Iran, declining oil revenues will, the West believes, constrain its activities, including its efforts to develop a nuclear capacity for peaceful or any other purposes.
Undoubtedly, the weakening of the Russian and Iranian economies are unspoken imperatives of the foreign policy ambitions of many countries in the West, particularly the United States which now finds itself in a powerfully influential position in oil and gas production.
The world would be foolhardy not to expect the US to take full advantage of the enormous political, economic and strategic leverage of its current position to reassert its weight if not its dominance.
All of this has implications for the Caribbean region.
Opportunities for the Caribbean
For many Caribbean countries – the exception being the host-state of this Conference, Trinidad and Tobago – the lower price of oil is a god-send that should ease the strain on their populations for transportation and electricity – and in the case of Guyana and Suriname particularly, facilitate resource development.
Lower oil prices should also help to boost tourism and manufacturing by bringing down costs and making products and services more competitive globally, provided that owners are sensible enough to share the windfall with their customers and not try to gobble-up the benefits only to their bottom line.
Further, if the benefitting Caribbean countries – both governments and private sector – take advantage of this period of lower cost oil, they should be investing in green technology such as solar, wind, hydro and geothermal sources, to be better placed to cope if and when oil prices rise again.
The production of solar and geothermal energy appear both possible and capable of attracting financing and there is evidence of this in St Vincent, St Lucia and Dominica.
Another aspect of future planning for the region should be the feasibility of converting electricity generating systems from diesel to natural gas which, in time, may prove to be more beneficial to Caribbean economies.
I lay down the marker, however, that in the current situation of lower oil prices, encouraging investment in – and securing capital for – the conversion of systems for natural gas, particularly in the OECS countries, may not be attractive to governments in the region that are already highly-indebted and cash-strapped.
Ironically, in past discussions of the persistent and debilitating effect of the prices of oil, gas and energy in the Caribbean, Trinidad and Tobago – as an oil and gas producer – has been the exception.
It also remains the exception in the current situation since, for while the economies of other regional countries will benefit from lower oil prices, Trinidad and Tobago is suffering a loss of revenues and, perforce, has had to curtail a number of development projects.
Reportedly, the government faces a budget deficit of approximately US$1.7 billion.
Nonetheless, a statement last week from the Trinidad and Tobago government that it is talking with the Inter-American Development Bank about “a Caribbean solution in which Trinidad and Tobago is the lead player in terms of the energy challenge and crisis”vi is encouraging.
The opportunity now exists for Trinidad and Tobago to take the lead in developing a genuine pan-Caribbean owned project for the creation and implementation of energy, based on natural gas, in which all Caribbean countries – governments and the private sectors – are owners and beneficiaries.
I recognise, however, that such an initiative will only be achieved by resolute and mature regionalism on the part of all countries.
Narrow political and nationalistic ambitions would have to be overcome – never an easy task, and, so far, not one that has been decorated with success in the region.
As the former Prime Minister of Barbados, Owen Arthur, pointed out in this capital just one week ago:
“In a real sense, the region has come to this moment with the integration movement functioning virtually as the fifth wheel to a coach. It exists, but it is of very little practical value”.vii
The United States geo-political interest
Even as we meet now, the US government is holding a one-day Caribbean Energy Security Summit in Washington with Caribbean leaders and US Vice President Joe Biden.
This meeting is being held as President Barack Obama boasted in his State of the Union address on 20 January that: “Today, America is number one in oil and gas. America is number one in wind power. Every three weeks, we bring online as much solar power as we did in all of 2008”.viii
Additionally, two days later the US Energy Information Administration (EIA) reported that U.S. commercial crude inventories increased by a whopping 10.1 million barrels, maintaining a total commercial crude inventory of 397.9 million barrels.ix The Caribbean leaders invited to the meeting are from the 14 independent member-states of the Caribbean Community (CARICOM) and the Dominican Republic.
As far as I am aware, there has been little – if any – joint regional preparation for this meeting, particularly as a “Draft Joint Statement” was not given to many Caribbean governments until last Wednesday, January 21st.
If anything, leaders might have met in Washington on the eve of today’s meeting, but in the absence of knowing precisely what the US is asking them to commit to, and any expert study of the proposals, it is difficult to see what meaningful or cohesive response the Caribbean leaders will have.
I expect the Joint Statement, pre-drafted by US officials, will be issued at the end of the meeting later today.
Hopefully, Caribbean governments will take a strong hand in amending the US draft to reflect their own concerns and priorities.
We will all have to await its issuance and careful study before any understanding of what the US has in mind, and how inclusive a process with the Caribbean it intends.
For the US – with the Venezuelan economy reeling, and the future of its signature Caribbean project, Petro Caribe, apparently on shaky ground – this is a good psychological and strategic moment at which to proffer an energy initiative.
If the US is sincerely interested in the region’s development, it should set aside a committed and declared amount of money for the implementation in the region of projects that would install renewable energy plants and help to convert electricity generating and distribution systems to natural gas on highly concessionary terms.
It should be noted, at this juncture, that with oil prices as relatively low as they are, investment in natural gas on a national basis will make little financial sense for the small countries of the Caribbean, namely the member states of the Organisation of Eastern Caribbean States (OECS) – the magnitude of their individual consumption would not be sufficient to amortise the capital investment, unless the technology for doing so improves and becomes less expensive.
Concessionary financing and grants would, therefore, be essential for them.
If these are not the elements of the initiative the US intend from today’s Washington Energy Summit, the Caribbean will be very disappointed, and little will change.
6.Venezuela and Petro Caribe
This brings me then to Venezuela and Petro Caribe.
Suggestions that Petro Caribe might collapse find strength in reports, that Venezuela is selling debt owed to it by the Dominican Republic to Goldman Sachs for 41 percent of its value in exchange for a lump-sum payment, and is pursuing plans to do the same with oil debt owed by Jamaica.
But, even in the current terms of Petro Caribe where countries pay 60% of the world price of petroleum products to PDVSA and retain 40% as a long term loan (23 years) at 1% interest, the scheme remains attractive.
Petro Caribe was a crucial life-line for the participating Caribbean countries, and it remains so today.
It should be recalled that supplies of petroleum products under Petro Caribe amount to about 5% of Venezuela’s total production which it is not giving away. PDVSA is receiving part payment in cash, and repayments of the loan component.
As for the Caribbean recipient countries, while, with prices of petroleum products below US$80, the equation has changed requiring them to make a 60% a cash payment whereas before it was 40% (when the price was between US$80 and US$100), the fact that the prices have declined also means that the sum of the cash they pay is also reduced.
Moreover, the Venezuelan President and his Ministers of Energy and Foreign Affairs have indicated quite clearly that they have no intention of reneging on Petro Caribe, and the authorities have done nothing to indicate its demise.
But if prices reach the US$40 mark or below, I suspect Petro Caribe will be suspended however much the Nicolas Maduro government might like to maintain it in its own geo-political interest.
The Caribbean is therefore at an interesting juncture in energy terms.
Acting together the countries of the region can take advantage of low cost oil to diversify their energy sources, improve their energy security, reduce costs and make their economies more competitive in tourism and manufacturing.
But, to do so will require governments acting in concert and cohesion – not with beggar-thy-neighbour policies.
A number of countries are now looking at the Caribbean as a market and for financing including Abu Dhabi and Germany. These efforts should be co-ordinated in the region’s interest.
While there is interest in energy in the Caribbean displayed by the World Bank, the Caribbean’s experience in the administration and disbursement of funds is not encouraging.
But, the region – both governments and the private sector – have the advantage of the Caribbean Development Bank’s commitment to Energy Security in its Strategic Plan 2015-19 and its capacity to act as
a catalyst for concessional resources – money, therefore, could become available to reduce considerably the Caribbean’s dependence on external energy suppliers.
The fullest participation of energy companies such as the ones represented here will be required.
Indeed, it may require you not to wait for government action but to put forward a regional plan to the governments in whose countries you operate.
It is an exceptional time, requiring exceptional planning and action.
You should seize the moment.
i Caribbean Development Bank, 264th Meeting of the Board of Directors in Barbados, December 11th 2014, Paper BD 98/14, “Draft Energy Sector Policy and Strategy”, (Typescript)
ii OPEC 166th Meeting concludes, Statement by OPEC on November 27, 2014, http://www.opec.org/opec_web/en/press_room/2938.htm (accessed on 21 January 2015)
iii Personal interviews with Venezuela officials on 19 January 2015
v Shannon Tiezzi,The Diplomat, “Will China save Venezuela”, January 7, 2015 http://thediplomat.com/2015/01/will-china-save-venezuela/ (accessed on 21 January 2015)
vi Barbados Advocate, “Tewarie on falling oil prices: Gov’t wants T&T to lead regional response”, p.11, Wednesday, January 21, 2015.
vii Owen Arthur, Guest Lecture at the Institute of International Relations, St Augustine Campus of the University of the West Indies, Caribbean Regionalism in the Context of Economic Challenges”, January 19, 2015 (typescript)
viii US President Barack Obama, State of the Union Address, 20 January 2015, transcript in The Washington Post, http://www.washingtonpost.com/politics/transcript-state-of-the-union-address-2015-remarks-as-prepared-for-delivery/2015/01/20/fd803c4c-a0ef-11e4-b146-577832eafcb4_story.html?wpisrc=nl_politics&wpmm=1 (accessed 21 January 2015)
ix Paul Ausick, Crude Oil Inventory Soars by 10 Million Barrels, http://247wallst.com/energy-economy/2015/01/22/crude-oil-inventory-soars-by-10-million-barrels/ (accessed 22 January 2015)
Sir Ronald Sanders is an International Consultant, Senior Fellow at the Institute of Commonwealth Studies at London University and former Antigua and Barbuda High Commissioner to London, Ambassador to the World Trade Organisation and Ambassador to the European Union. He is the author of several publications on small sates in the International Community and on the Commonwealth. His weekly syndicated column on Caribbean and international affairs is published in major Caribbean newspapers and on several Internet News portals and is read by a worldwide audience,
Mr. Speaker, Members of this Honourable House, Citizens and Residents of Antigua and Barbuda… I begin by wishing each and everyone a prosperous and blessed 2015 and congratulating the Honourable Prime Minister and Minister of Finance and his team for his sterling Budget Presentation. It was indeed one of the finest ever delivered in this house for many years. It was frank and substantiated with facts.
I am again honoured to have the opportunity to represent the people of St Peters who elected me to this Honourable House, and to stand in defense of all Antiguans and Barbudans at this most challenging time.
Mr. Speaker, I want to at the very beginning of my budget contribution to re- confirm my undying love for this country, my love for my fellow Antiguans and Barbudans and my commitment to work, to make Antigua and Barbuda a country which we all can be proud of and where we can all live in peace and prosperity.
Mr. Speaker, prior to June 12th 2014 the dreams and aspirations of our people were fast fading. Opportunities for our people to live a life of hope, a life of happiness, a life of accomplishments, a life of prosperity, were fast disappearing.
Mr. Speaker, this budget must be the people’s first stand, it must be the point where we make the necessary decisions by which the future of our people and the future of this country are restored.
Unlike the UPP Government, The Gaston Browne’s Administration understands that the people did not elect us to destroy this country; the people did not elect us to make them jobless, our people did not elect us to make them poorer, to bankrupt their businesses or to sit in tears as the banks sell their homes and repossess their cars, buses and trucks.
Mr. Speaker, the ABLP Government got a mandate to make this country better, and it should be painfully obvious to us all, that under the previous UPP Government evidence shows beyond a shadow of doubt that this country did not improve, but rather life became brutish, broke, bankrupt, jobless and, hungry.
Mr. Speaker, economic conditions had deteriorated to the point where our people could not take it anymore; they had no credible and practical plans to bring back prosperity to the land. The Government was having a party with the people’s money buying buildings of friends, hiring friends at exorbitant salaries, people were left to die at Mount St. John’s as outstanding contracts or fees were paid, $ 67 million for the fences, over a $100 million for jellybean sidewalks.
Mr. Speaker, I am here to make the case that economic and social conditions over the last 10 years had reached rock bottom and disaster was fast spreading over Antigua and Barbuda, our people were suffering and that is why it was time for a new mandate, it was time for a new team. I am confident that the Prime Minister, the Honourable Gaston Browne will stand up and make the tough decisions, to forge the political, economic and social solution needed to save this country.
MARCH 2004- JUNE 2013
These were dark days in our nation’s history… dark days of hopelessness and despair visited upon us by the men and women of the United Progressive Party whose presence in Government was not the natural consequence of the rule of law but rather the corrupt result of a manipulation of the rule of law.
These were the dark days indeed Mr. Speaker… dark days of government consumed by acts of trickery and deception relentlessly engaged to frustrate and eventually bury the public desire for fair, transparent governance and the rule of law. They even fired you unfairly Mr. Speaker for adhering to the rule of law and standing for justice. They went on to strip the Supervisor of Elections of all her powers.
Mr. Speaker and Members of the House, Distinguished Ladies and Gentlemen, this is the year when the rebuilding exercise, promised to the people of Antigua and Barbuda, gallops gracefully forward. Having battled for the hearts and minds of the Antigua and Barbuda electorate, the time when the people will reasonably begin to experience the measure of excellence of our performance is quickly approaching. A term is 60 months; only seven have passed, 53 more to go. More excellence to come!
Mr. Speaker, this Budget is intended to provide a new awakening. The new administration—of which I am an integral part—is preparing to awaken the creative juices, the concealed passions, the embrace of excellence, of the Antiguan and Barbudan people. Our drive is intended to excite the passion; dredge-up the knowledge; bring forward the creativity, while relying upon the competence, the boldness, the integrity, the honesty, the strength, of the Antiguan and Barbudan people.
This Budget is intended to ignite the dynamism and the quest for dominance, displayed by our heroes; to express the ambition for excellence, inherent in our culture; to propel our leaders forward, on the journey towards solutions; and, to create an economic powerhouse, an idyllic paradise, a place of peace and tranquility that will wipe from our memories the dark decade of leadership-failure which the Antigua and Barbuda people ended seven months ago.
It is a call for action, performance, and excellence. It is a new beginning, a new chapter in the history of our country. It is a new awakening!
Mr. Speaker, we will achieve our goals despite inheriting an economy destroyed by the disaster called the UPP. The past managers left the nation’s finances in shambles; destroyed the swagger of the people by three consecutive years of negative growth; high unemployment, especially among the youth; mounting taxes, an ever-escalating high cost of living. Their shockingly poor governance included corrupt practices, a consuming sea of indebtedness and bankruptcy plaguing government, families and small businesses. What a disaster!
Mr. Speaker, we will succeed in changing the circumstances because of superior intellect, greater capacity, genuine concern for the betterment of people, a willingness to work hard, and by providing inspiration to the employees of the Government of Antigua and Barbuda.
Mr. Speaker, the world is what the world is, the size of our country is what the size is, our small size is not a limitation. They are both simply realities for us to deal with, to face each and every challenge and winning each and every battle.
Small is nimble, small is manageable. Antigua and Barbuda is small and beautiful. The new, seven-month old government is ready for the rebuilding challenge. We are ready to keep Antigua and Barbuda beautiful by rebuilding this magnificent place that we all love.
Mr. Speaker, for it is not just about sun and sand and beaches Mr. Speaker its about a “New Brand” Its about Transforming and revolutionizing the Tourism Industry, and creating a niche that distinguishes us as the “Best”.
No excuses! The tougher the battle, the sweeter the victory. For Great Leaders are made through the struggle, the conquest of facing down great odds, rising to every challenge and building a new dispensation.
Mr. Speaker, we will shock the World as Sir Viv. Richards did, as V.C Bird did, as Bob Marley and Mandela did, as Sir. Lester Bryant Bird did, by their sheer brilliance, in the face of massive adversity. This is the history of the ABLP, this is the legacy we inherited and this is the responsibility we pledge to fulfill.
With the election of the new ABLP government, the class of 2014, under Gaston Browne the New Prime Minister’s Leadership, a brilliant, visionary, and, exuberant leader with intellect has emerged as the nation’s fourth Prime Minister. I say to the people of Antigua and Barbuda, rise up, stand up, let us all together rise up in a new awakening, a new dawn is coming, a new era “The Dawn of a new day”. An Awakening that fuels the Antiguan and Barbudan pride, that fuels a call for that action, a call for performance, a call for excellence, in a mighty movement that will be transformational, that will transform The Ministry of Tourism and in particular the Tourism Product into the economic powerhouse of the Caribbean.
Mr. Speaker, gone are the days when you run the Ministry of tourism by remote from an Ipad or on an airplane. The spirit of our fore fathers and the great heights they achieved and kept, provide us with a superior platform for accomplishing our generational responsibilities of building a new Antigua and Barbuda, making ourselves and our country into a place greater than we met.
Mr. Speaker, we stand on the shoulders of giants; gigantic deeds and accomplishments that are expected from us; For my predecessors the Honourable Lester Bryant Bird the first Minister of Tourism and Economic Development and Energy Governor General Dr. Rodney Williams, Ambassador Bernard Sebastian Percival, Honourable Molwyn Montgomery Joseph I shall not fail them, I shall surely not fail Prime Minister Gaston Browne and the people of this country. Mr. Speaker we will deliver.
Mr. Speaker, Tourism continues to be the driving force of our economy. Most of the Nation’s commercial activities and growth in GDP is driven by the industry. Antigua and Barbuda will be implementing a strategic plan for an action agenda based on sustainability, community, and heritage tourism all delivered with an authentic Antiguan and Barbudan experience.
Even the Ministry Headquarters was allowed to fall into such a poor state of maintenance that the staff was working only half-day for several years with very little productivity.
There were serious health and safety issues pertaining to missing roof tiles, bathrooms with poor ventilation, and poor air quality. At times only 2 of the 6 AC units were operable. This contributed to the growth of mold and harmful bacteria that may have resulted in the many reports of building related illnesses among the staff.
We have since taken steps to address and rectify these poor working conditions at the Ministry.
STATE OF THE PRODUCT
Mr. Speaker, improved service delivery, Offering quality service and value for money will be hallmarks of the new brand. A strong focus on human resource management with having the right people in the right roles.
Mr. Speaker, safety and security will be paramount. There will be greater emphasis on the development of standards, their implementation and monitoring of hotels, tour operators and transportation. Development of new Events, Clean-up of the environment and beautification of the country Enhancement of our national heritage sites; Appropriate Signage are all on the action agenda.
Mr. Speaker, incorporating a focus on clean energy with all tourism investments with special emphasis for Barbuda. Raising national awareness; improving education, training and development for the sector.
Mr. Speaker, at this juncture we inherited a product that has deteriorated to a level that has taken Antigua and Barbuda back significantly compared to our regional competitors; and that Mr. Speaker will be the recurring theme throughout my contribution. Currently we are given figures of 3,000 rooms which including villas. However if we were to use a strict approach based on the rooms that are sellable, we have just over 2,000 rooms for the entire destination.
Mr. Speaker, if you contrast this with destinations such as St Lucia and St Kitts who commenced their foray into the Tourism industry well after Antigua and Barbuda and now have over 6,000 and 2,000 rooms respectively you can see how far behind we have fallen. That is why my Government has been aggressively pursuing a strategy of new hotel investment since assuming office.
NEW TOURISM INVESTMENTS
Mr. Speaker, since coming to office in June of 2014 the Gaston Browne’s Government has signed a series of memoranda on new hotel projects and investments in the region of two billion dollars. These projects will create thousands of Jobs and new hotel rooms, plus a significant contribution to Government’s revenue for further sustainable economic growth.
This means more disposable income for our citizens and taxes for the Government, which will improve the standard of living for all our people.
Mr. Speaker, the Sunny Hill Group has announced this year a $200 Million Dollar investment for Antigua and Barbuda. The 400-unit project will be located on a 100-acre site in the Falmouth and Bethesda areas of Antigua, land owned by CO Williams Property Development Company Limited.
This project will create over one thousand new jobs for Antiguans and Barbudans with five hundred in the construction sector and over five hundred in operation and management positions.
The new USD$150M Beaches Resort by Sandals Resorts International at Long Bay will provide up to 400 rooms, 1,000 construction jobs and 850 permanent hotel positions when completed.
Mr. Speaker, Hodges Bay Club renamed “The Resort at Hodges Bay” will be fully open in 2015. The economic impact of this USD $50 million new 79-suite resort will have a significant impact on our local economy during construction. This new resort facility will provide meaningful employment to as many as 150 persons at any given time and upwards of 200 when all phases of the development are completed.
Mr. Speaker, The Morris Bay Project an MOA was signed last July with His Excellency Sheik Tariq Faisal Alqassemi of Dubai, for a 5 star luxury hotel project valued at US $120M This project will include a Public National Park for residents.
Mr. Speaker, we now come to the Sunwing Group but before I go into the details with Sunwing group, I want to address comments by the Honourable Member for St John’s Rural West the former Prime Minister, said that “Oh we were already in discussions with Sunwing and they already started these negotiations and it was not done under the Gaston Brown Administration” Mr. Speaker I want to provide this Honourable House with the tangible facts. I have in my hand a letter that the then Minister of Tourism the Hon. John Maginley wrote to Mr. Hunter the CEO of the Sunwing group…..
Sunwing Group- the Government has signed an agreement for $ 150 Million with the Sunwing Group out of Canada to build an additional five-star hotel on adjacent property to the Royal Antiguan. The project will be built in two phases. The $75M investment in the first phase will see the construction of a “Royalton” hotel complex with 300 rooms, multiple restaurants, a casino, disco, full service spa, tennis courts and theatres. Phase two will include the $50M construction of 200 mixed-use condominiums.
Sunwing is collaborating with the TUI Travel group, the World’s leading integrated travel company with 30 million customers. As partners in the new Dieppe Bay Project TUI flights will operate from the UK, US and Canada once the project is completed.
The appointment of Robert Deniro as an Economic Envoy for Antigua and Barbuda has started the process for the sale and upgrade of the former K-Club in Barbuda. A new $250 million resort will shortly begin in Barbuda. This announcement has been well received and publicised in the international media and has positively raised our country’s profile and reputation around the world.
GUIANA ISLAND RESORTS
Mr. Speaker, this is in addition to the $1.2 Billion project for the Guiana Island Property with Chinese investment firm Yida within days of its election victory. The group has acquired the Stanford Guiana Island property at a cost of US$70M and will break ground this year.
Mr. Speaker, these are the types of investments that the Gaston Browne Government has attracted so far.
Contrast this Mr. Speaker with an example of the dolly house budgets which were presented here, in the past 10 years in this Parliament, the former Ministers of Finance should have put up their Armani and Hugo Boss suits and put on the frills and pinks of a dolly house tea party. Mr. Speaker, do you remember the big announcement of a government farm, six million and training for young people?
Mr. Speaker back then, I searched and searched and I could not find a single dollar for that programme in the 2011 budget. It was not mentioned any where it was just something made up in the dolly house tea party. Perhaps the Minister was hallucinating or simply just high on good bush tea.
Mr. Speaker, the 20 million US dollar chicken farm that they had given out land for; The proposed investor could not pay his two bedroom house rent, could not pay to brush cut an acre of land and used to be an extension officer at extension. Mr. Speaker when cocks have teeth we would have seen this investment or maybe after donkeys turn green or when pigs take flight.
Mr. Speaker, a new Investment climate has dawned upon this beautiful country of ours. To this end my Ministry will be working with a proven and well-qualified team of experts to create a guide to investment in Antigua and Barbuda. This manual will be a detailed document intended to create a tailor-made solution complete with brand building strategies focusing on business development, strategic alliances and global market penetration. Our team of experts will develop a comprehensive plan to advance the countries investment mission and objectives, in order to promote Antigua and Barbuda’s range of business services and investment opportunities.
Mr. Speaker, these opportunities include Tourism, CIP (including legislation for incentives and concessions), Maritime Ship Registry, Yachting, a new registry of private jets, manufacturing, the free trade zone, trademarks and patents, Intellectual Property, Cooperatives and financial services (inclusive of off shore banking, gaming and IBC’s).
Mr. Speaker, the document will serve as an in-depth guide complete with listings of Banks and Financial Services, Lawyers, Accountants, Telecommunication services, Estate Agents, Insurance Brokers, Restaurants, entertainment, Healthcare Providers just to name a few.
Mr. Speaker, to accompany the handbook will be a fully integrated website that will provide links directly to our various partners and business related services. It is important to note that a similar document existed some 25 years ago under the leadership of the Hon Lester Bryant Bird.
Mr. Speaker, due to lack of adequate and saleable room stock Antigua and Barbuda has not been able to aggressively grow the airlift as much as would have been possible had this not been the case. While the current airlift from our major source markets in the USA, UK, Europe and Canada is adequate for the number of rooms, my Ministry has undertaken a series of successful negotiations with multiple airlines to ensure that there is increased air access capacity into the destination for the anticipated increase in demand. This will lead to an increase in visitor arrivals in 2015 and will support the expansion with new hotel room stock.
Mr. Speaker, direct daily flights BA from London will continue all year round. This represents an increase from 6 flights a week in summer to daily service. 3 of these flights will be Antigua turn around only and not shared with any other destination.
Virgin Atlantic will operate 4 Flights with 3 of these dedicated as Antigua turn around flights only. The new configured Virgin Aircraft will have more premium upper class seats that are the ideal fit to the high end product that Antigua and Barbuda has to offer.
Once Weekly Condor Flight from Frankfurt will continue during the winter season.
Mr. Speaker, direct daily flights from JFK New York on American Airlines along with direct daily flights from MIA will continue on American Airlines.
Delta and US Airways: Other US gateways such as Atlanta and Charlotte will be served by once weekly direct from Delta and US Airways respectively.
Mr. Speaker, Air Canada will be adding an additional flight for this winter season each Tuesday. This represents a total of 5 flights (4 from Toronto and 1 from Montreal)
WestJet will now be adding a larger Aircraft of 179 seats, which represents a 15% increase in seats from our second Canadian carrier.
The destination will also be concluding negotiations for additional Airlift from new carriers such as COPA Airlines, Avianca and other carriers to allow us to take advantage of the anticipated growth and demand for the destination with the New Airport terminal and the host of new tourism investment projects.
Mr. Speaker, I will be attending the Routes Americas Airline Conference in Denver next month where I will be meeting 16 airlines to attract new airlift to the destination in anticipation of the new terminal and new hotel projects that are coming on stream.
Mr. Speaker, similar to the Ships Registry the Government is looking to establish an airline Jet registry which would be separate and distinct from commercial Aircraft Operators holding an Air Operators Certificate (AOC).
This registry is similar to those established in the Cayman Islands and the Isle of Man which has generated millions of dollars in revenue for the government in those jurisdictions over the past 5 years.
This service caters to aircrafts owned by High Net Worth individuals who would also be potential CIP clients. These aircrafts will also provide Antigua and Barbuda with immense marketing value by virtue of the flag being engraved on the tails of these carriers. This is the creative and innovative thinking of Gaston Browne and his Government in finding new ways to generate revenue for our country.
STAYOVER AIR ARRIVALS
The number of air arrivals to Antigua and Barbuda at the end of December 2014 was 249,316 a growth of just 2.5% on the previous year. The destination has not yet recovered from the arrival numbers of 265,841 stay over visitors in 2008. These figures are expected to increase significantly with the additional airlift and renewed marketing and focus on tourism for 2015.
While my Government will be aggressively pursing foreign direct investment, we will encourage the participation of local entrepreneurs in meaningful activities to support the economic development of the nation.
Mr. Speaker, we inherited a situation where the destination had lost over 144,000 passengers a year with the loss of a major cruise line which called weekly following the Brooklyn six incident. This is a clear indication of the lack of management of the cruise sector as other destinations have experienced incidences, but with the right crisis management and personnel to communicate effectively the fallout could have been averted.
We have held initial meetings with our cruise line partners to get an assessment of the issues and in our subsequent follow ups were told in clear terms that the perception of us by the senior decision makers and executives is very poor. In fact we were told that we were the first officials at a senior Government level that they had seen in over 10 years. The last person that they had seen in an official capacity in their Corporate offices was the Hon member from St. Mary’s North the Honourable Molwyn Joseph.
A Senior cruise ship executive indicated that unlike Antigua and Barbuda they see the Minister of Tourism From St Kitts the Hon Ricky Skerritt every 3 months, which explains their significant growth in cruise ship calls which has now surpassed Antigua and Barbuda. Their feedback was “Antigua and Barbuda does not understand, appreciate or care about their business”. These meetings are critical to our negotiations with key decision makers to increase our cruise ship calls. This has become our top priority on our critical path to growing the cruise tourism sector.
ST JOHN’S DEVELOPMENT CORPORATION
Mr. Speaker, we inherited a Corporation, which was run as a personal fiefdom. No audited financial statements have been produced since 2007.
Over ECD$5M dollars were taken in loans from Norman Wexelman to assist in the development of the Airport, which has absolutely nothing to do with St. Johns Development Corporation. When this loan could not be serviced, Mr. Wexelman received a garnishee order on the Airport Authority, which was applied to all revenues that would normally come to SJDC from NewPort Antigua Ltd. Newport is a joint venture company between Mr. Wexelman and SJDC. There is absolutely NO documentation on this loan anywhere at SJDC.
Mr. Speaker, another example of the type of gross mismanagement of such a vital organization is the callous nature in which the corporation was allowed to enter into agreements.
In November 2010 the then Chairman of the Corporation entered into a Memorandum of Understanding with Caribinvest Holding Company Ltd. to undertake the development of specified areas in Heritage Quay, with the intention to erect more duty free shopping buildings. The Developer would then own a whopping 75% shares in the Company and the SJDC would own 25% shares in the company.
It was such a disastrous agreement the subsequent Chairman Sylvester Brown launched and investigation and subsequently sought a legal opinion on the matter.
Mr. Speaker, I quote now from this legal opinion….“While a memorandum of understanding (MOU) is document usually intended to only express a common line of action between parties and often not used to express a legal commitment. In this instance it is the only document, apart from Downtown incorporation documents evidencing the intention of SJDC and Caribinvest to create legal relations and should clearly and definitively in the absence of such other documentation reflect that fact. It is indeed regrettable that for a transaction which holds such serious legal ramifications the terms evidencing the development have not been set out in a more substantive and acceptable fashion.” And if that wasn’t bad enough it goes on.
“I am of the considered view that this project to date has been undertaken with haste evidenced by certain errors of some import….the authorities will be well advised to re-examine this entire undertaking to ensure that the interests of the State are properly protected.
“The lease agreements purportedly executed are incomplete and therefore cannot be registered. The payment of rent is central to a lease agreement; rent must be certain or capable of being calculated with certainty, and the provisions in the said agreements related to the payment of rent do not provide a definite figure nor do they provide a means by which a definite figure can be ascertained.”
“With a shaky MOU, two incomplete leases and the construction thus far, the bargaining position of the SJDC is greatly enhanced, and it is very unlikely that the Developer would bring an action for breach of the agreement, were SJDC to seek more favourable terms in this undertaking. The willingness of the principal of Caribinvest to reconsider the rental terms for building #4, coupled with the foregoing circumstances as outlined seems to me a clear indicator that the present Chairman can insist on more favourable terms for SJDC, and by extension the State.”