businessuite weekly digital issue september 21st 2015

1 Businessuite Weekly


Cover Story

EDITORIAL

Technology

Leadership

Financial Planning

Company Reports

Investments

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Contents

Who Really Benefits From The Merger Of Radio Jamaica And The Gleaner Company?

“Something’s fishy. There is a reluctance to share pertinent information with shareholders and that seems fishy to me. This transaction doesn’t seem to be a good one and there needs to be more forthcoming disclosure...

What is it about Jamaicans and their aversion to good customer service? Despite the several call centers located across the island which seem to...

Samsung Galaxy S6edge+ arrives in Jamaica

Samsung is boasting what it says are finely crafted with improved video capabilities, the most advanced camera features and fast charging...

Are You A Champion of the Workplace?

Mark Cuban’s “How to Win at the Sport of Business” is a classic book for entrepreneurs and intreprenuers alike. Cuban, a man who built his...

MSMEs urged to fight the lack luster growth affecting Jamaican Economy

Business Leaders and the government are being urged to do everything within their portfolio to urgently address the challenges facing Micro Small...

Keith Duncan’s JMMB Group reports $2.05b profit, gets approval for the issue of 6billion additional preference shares

JMMB Group has reported a J$2.05billion profit for the financial year ending March 2015. According to the group’s Chief Financial Officer Patrick Ellis, this...

JAMPRO pushing for a better trade relationship with China and Mexico

Chinese Investors have expressed an interest in coming to and working with Jamaicans in an effort to boost trade and improve the business...


Regional

The Week Ahead

18

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Contents

Cayman Islands: Business sector gets boost with passage of new Trade and Business Law

The business environment in the Cayman Islands is expected to see a big boost following the recent passage of the new Trade and Business...

USVI: Hovensa LLC refinery owner files for bankruptcy

Owner of the Hovensa LLC refinery on St Croix in the US Virgin Islands has filed for chapter 11 bankruptcy protection as part of a plan to sell...

Businessuite Event Calendar

Content DirectorKayla Wright

The Businessuite News Centre BNC

Publisher and Editor in ChiefAldo [email protected]

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Graphic Design and Layout: Bonito Thompson

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Credits

Commentary

20 Mark,s Laas Lick: Economic growth and the dense

political fog

It is not unusual for politicians in opposition to be suddenly endowed with all of the answers and ‘perfect’ solutions to our economic ills. Just ask...


Editorial

What is it about Jamaicans and their aversion to good customer service? Despite the several call centers located across the island which seem to receive grand reviews about the way in which their agents communicate with overseas callers, Jamaican customer service on a whole has been

found wanting. I raise this concern ahead of plans by the Jamaica Customer Service Association ( JaCSA), observance of the week, from October 4 to 10, as National Customer Service Week which is expected to bring focus to the transformation that quality customer service can bring to the nation. However, how can we as a nation adequately celebrate customer service when we have such an apparent problem with the mere concept? Just last week, browsing popular social media site, Facebook, I came into contact with a young lady that has sworn bitterly that she will never visit a particular restaurant/beach on the North Coast ever again because the owner of the entity informed her that her patronage was not needed at his establishment as he did not ‘need her money’. Similarly, I visited a food establishment on a University Campus in the Mona/ Papine area where I ordered what equates to a chicken sandwich. If it hadn’t been for my hunger at the time, I would surely have asked for a refund and left the restaurant simply due to the way in which the server responded to a simple query on the delay of my order. I was told, without much regard, concern or respect that I would just have to wait and I would ‘get it when I get it’. Despite four orders which were made after mine being fulfilled. In contrast, I made an online order recently which got misplaced in the mail. I made an online query and was told that I would get a response in 24 hours. Sure enough, 13 hours later, a response was in my email informing me that my order was indeed misplaced and a reorder had been made free of charge. My question therefore, is what makes Jamaicans so unwilling or so unable to provide a customer service experience that is worthy of positive mention? My hope going forward is that something can be done to change this mindset. As we prepare to celebrate National Customer Service Week, let us actually do something about the poor customer service experience that we continue to offer. The week of activities will begin with a church service at the Sts. Peter and Paul Church on Old Hope Road and includes the staging of the JaCSA’s annual conference from October 6 to 7. Activities culminate with the Public Sector Customer Service Awards, where Prime Minister, Portia Simpson Miller, is expected to deliver the main address. BM

r

By Kayla Wright

What is it about Jamaicans and their aversion to good customer service? Despite the several call centers located across the island which seem to receive grand reviews about the way in which their agents communicate with overseas callers, Jamaican customer service on a whole

has been found wanting.


Technology

Samsung is boasting what it says are finely crafted with improved video capabilities, the most advanced camera features and fast charging technology with its new Galaxy

S6 edge Plus.

Samsung says the phone which became locally available last Friday (September 18) further strengthens Samsung’s position as a market leader and sets new standards in terms of screen technology, quality of photos and videos, wireless and wired charging, and processing capabilities.

Regional product manager at Samsung Electronics Latin America, Jorge Lopez says the Galaxy S6edge+ features unprecedented multimedia capabilities and includes the new ‘Apps edge’ for easy access to favorite apps and enhanced ‘People edge’ for easy communications with preferred contacts. He says the latest mobile Galaxy device also has a richer screen contrast through Samsung’s industry-leading 5.7-inch Quad HD Super AMOLED display, further enhancing the user experience. The Galaxy S6edge+ also features 4K Video filming and Live Broadcast, which allows users to instantly live stream Full HD video directly from the phone to any individual, group of contacts, or even the public through YouTube Live.

Samsung Galaxy S6edge+ arrives in Jamaica

Lopez says Galaxy S6edge+ users will also benefit from Samsung’s advanced camera system, including Quick launch (double click the home button to launch the camera within 0.6 seconds), Auto Real-time High Dynamic Range (HDR), Smart Optical Image Stabilization (OIS) and brand new filters. He says this new device will also feature Samsung’s high speed wired and wireless charging technology. The Regional product manager says the embedded wireless charging technology is compatible with virtually any wireless pad currently available in the market. He says with wired charging, the device can be fully charged in approximately 90 minutes; while through the wireless charger it can be fully charged in only 120 minutes. The Galaxy S6edge+ supports SideSync, which offers both wireless and wired PC-smartphone integration for seamless connections across devices.

Lopez says with auto-detection and an ultra quick setup, users can instantly connect their Samsung device to their PC or tablet for easy access to files and data across all platforms and operating systems. He says the mobile device will also include enhanced security features with KNOX Active Protection (built into devices and ready to use) in addition to My KNOX (app with simple/fast setup) to further protect sensitive personal and work data. BM

UpgradeThe Galaxy S6edge+ also

features 4K Video filming and Live Broadcast, which allows users to instantly live stream

Full HD video

A


“Today I will do what others won’t, so tomorrow I can accomplish what others can’t”Jerry Price, retired American Football Player

Leadership

Mark Cuban’s “How to Win at the Sport of Business” is a classic book for entrepreneurs and intreprenuers alike. Cuban, a man who built his empire through hard work, vision, a commitment to learning, and above all adapting

to change demonstrates how business is in many ways like a sport that we all want to win big in!

Sport in Jamaica, in particular track and field, is big, businesses however, have not been able to completely gain what I see as the internal benefits that it can provide. We are all aware of the external benefits, the monetized and ‘memorized’ gains from marketing, brand awareness and aligning oneself to their super human figures such as Usain Bolt and Shelly-Ann Frasier Pryce. However, on the internal side something is amiss.

Outside of the pride, excitement and dollars that we as Jamaicans derive from the sport, there is a missing link, not of the homo sapiens variety, which exists in the space between sounds of clanging Dutch pots that could be heard island wide when we took the 4x100 men’s and women’s races at the World Championships in Beijing not too long ago. One of my favorite quotes from Cuban’s book is, “it’s not about money or connections. It’s the willingness to outwork and outlearn everyone.” If it were left up to financial support, our athletes would never see the light of day. Without a doubt, time and time again it has been their determination and grit.

Our athletes have undeniably outworked and outlearned everyone, putting their body through torturous regiments, leading to their persistent and consistent success over nations which dwarf Jamaica in population size and investments in sport and research into the seed of speed. I think Usain Bolt, the countries golden goose who was recently compared to Muhammed Ali would agree with Ali’s words that “I hated every minute of training, but I said, ‘Don’t quit. Suffer now and live the rest of your life as a champion.” And a champion he is but what of the rest of us, those unable to run 100m in 9.54seconds, are we prepared and giving our all in our own life’s big event? Another example comes by way of Jerry Rice, retired America football player. Rice once said “Today I will do what others won’t, so tomorrow I can accomplish what others can’t”, because he stayed true to his mantra he is widely considered

Are You A Champion of the Workplace?By Dr Leachim Semaj

to be the greatest wide receiver in NFL history. Many other top achievers, held similar values, Michael Jordon ensured he practiced more than anyone else in the NBA, to retain his title as the greatest. Do you consciously aim to be the best? If your place of employ held its own Olympics, would you qualify? Better yet, would you medal?

What if? What if the rest of us Jamaicans applied ourselves to our work the same way that our athletes do to theirs? Did you make “the finals” at work today? Are you working at world class standard? We best honor our athletes by emulating their dedication and commitment to excellence in our work as they have done to theirs?

Can you imagine the Jamaica we would create? Everyday, my company, the JobBank tries to push us closer to this goal by enhancing the productivity and profitability for the many companies we are privileged to call clients. Our goal is to take companies above where they presently are or beyond their wildest dreams. It is our wildest dream to see Jamaica become the next world power. And it’s a dream we work on daily. ----

The Jamaica Employers’ Federation has recognized Dr. Semaj for “Leadership in Innovative Workplace Practices”. He is included in Peter Ferguson’s publication CHANGE MAKERS as one of the 101 men who have helped to define modern day Jamaica. This Psychologist combines ancient wisdom with contemporary ‘livity’ to bring fresh insight to old human problems. As a Transformation Specialist he offers two options – ABOVE or BEYOND. Above where you presently are or Beyond your wildest dreams.

He is a frequent facilitator for Strategic Planning Retreats, Organizational Restructuring, Cultural and Work/Values Alignment, Leadership Training and Corporate Coaching. Dr. Semaj has worked with many sectors including - • Energy, Hospitality, Finance, Gaming, Telecommunications, Security, Agriculture, Pharmaceutical, Shipping, Distribution, Manufacturing, Education and Government. • He has worked in North America, South America, Europe and across the Caribbean.


Cover Story

Who Really Benefits From The Merger

of Radio Jamaica andthe Gleaner Company?


Merger And Acquisations:

Something’s fishy. There is a reluctance to share pertinent information with shareholders and that seems fishy to me. This transaction doesn’t seem to be a good one and there needs to be more forthcoming disclosure.” Those words which were said by

Chairman of local finance house Mayberry Investments, Christopher Berry when speaking at the recent Radio Jamaica Annual General Meeting earlier this week. Berry, like the shareholders of Radio Jamaica, says he is concerned that the recently announced Gleaner/RJR Merger will in the end prove more beneficial for Gleaner shareholders than those of RJR. According to Berry, Radio Jamaica has not only failed to keep its shareholders up to date on the details of the merger, but it has also failed to prove that the announced merger will be as beneficial to RJR shareholders as it is to shareholders from the Gleaner Company. Asking questions at the recently held AGM, Berry said that when the deal was announced on August 5th 2015, it was expected that further details would be unveiled 10 days later. However, he says now that it is the middle of September, shareholders are yet to be furnished with critical information on what will be the largest media entity in Jamaica. The Mayberry Chairman says if one looks at The Gleaner’s latest financial results, its media businesses has posted losses whereas RJR’s has recorded good profits yet the merger sees a 50/50 stock swap.

Gleaner/ RJR Merger

Last month, the Gleaner Company Limited and Radio Jamaica announced their decision to join forces. Chairman of The Gleaner Company Oliver Clarke says the merger follows what he describes as unfavorable local economic conditions. He says independent news cannot be provided

“This transaction doesn’t seem to be a good one and there needs to be more forthcoming disclosure.”

Chairman of Mayberry Investments

Christopher Berry

Who Really Benefits From The Merger


unless the move is viable. ‘What Jamaica faces is that there are a number of foreign companies coming in and putting up programmes that solicit advertising and you have a lot of businesses that are not making their way’. The transaction, which is to be pursued through a court approved scheme of amalgamation, will be a stock for stock deal where Radio Jamaica Limited will issue and exchange 1.2 billion shares on a one for one basis to shareholders of the Gleaner Company Limited for 100 per cent of a newly formed subsidiary Gleaner Company (Media) Limited which will hold the assets of the media entities of the Gleaner Company.

A Good move for Shareholders Despite the concerns that have been on several shareholders’ minds, Investment Guru, John Jackson says the merger is a good move for both companies. He says there is no proof that the move will benefit the Gleaner shareholders more. Jackson says if executed properly the move will be just as beneficial to both sets of shareholders as together RJR and the Gleaner will see major growth. The investment guru says each of the two has a unique strength which put together will result in greater growth for a merged entity. This is seconded by lecturer in finance at the Mona School of Business and Management, Dr Twila-Mae Logan who has endorsed the proposed deal as what she says is a good move for shareholders. Highlighting the share-price appreciation of both companies, Dr Logan said they have more than doubled since January with a post-announcement spike and subsequent correction. The Finance Lecturer says if the scheme of arrangement goes through, shareholders should continue to benefit with even better prospects for Gleaner shareholders who

retain ownership of stocks in the proposed 1834 Limited that will be listed separately from the merged entity. She says management needs to seize the chance offered by the proposed merger. Dr Logan was speaking during the latest Public Advocacy Series of the Mona School of Business and Management on the Mona campus of the University of the West Indies under the theme ‘The RJR-Gleaner Merger: Implications for the Media Business in Jamaica’.

A good move for Jamaica Meanwhile, several media representatives and academics are of the strong view that the proposed merger will also be good for Jamaica on a whole.

“...if one looks at The Gleaner’s latest financial results, its media businesses has posted losses whereas RJR’s has recorded good profits yet the merger sees a 50/50 stock swap.”

Chairman of Mayberry Investments

Christopher Berry


was estimated to cost about $750 million. Spaulding says the RJR Group is already exploring its over-the-top content (OTT) via the Internet - through One Spot Media. He says RJR is already garnering revenue through OTT content, which is free to Jamaicans but paid for by overseas subscribers, and that some of the Gleaner’s assets and facilities represent a good opportunity to accelerate growth of the platform. Spaulding says one of the strong attractions of the transaction that with The Gleaner Company is that the Gleaner is not just a newspaper. He says the Gleaner has a marketing facility, “an entree into wider markets where we would have to go and invest in, purchase or acquire from third parties, or start from scratch”. BM

Noted pollster, Don Anderson says the move comes at an opportune time as there is currently a decline in radio audiences with the estimated total radio sets are down from 2.1 million 14 years ago to about 1.4 million today. He says the rapid growth of Internet audiences along with phenomenal smartphone penetration means the Jamaican audience is increasingly looking to these sources for media content. Anderson says a merger of the Gleaner and RJR will allow both entities to employ each other’s strengths while charting a course in a new direction to take advantage of developments. Management and communications consultant, Kay Osborne has also supported the move, saying that the entry of telecoms companies such as Digicel and FLOW represent a clear and present danger to the viability of traditional media. She says the aggression of their entry and the novelty of their offerings will quickly present a drain on revenue from a static advertising pie and changing audience profiles. Over the next few months, the deal will be examined by regulators, including the Broadcast Commission, the Jamaica Stock Exchange and the Financial Services Commission. The scheme of arrangement will also have to pass the scrutiny of auditors, shareholders and the courts. The parties expect the process to be wrapped up by yearend.

Merger to push global strategy Meanwhile, Chairman of the RJR Group, J.A. Lester Spaulding, says he expects to see international growth as a beneficial effect of the pending merger. He says it is also in line with the group’s ‘going global’ strategy. He says this is furthered by a more than $600-million cash infusion from the deal which will finance the group’s digital switchover project that

“...if executed properly the move will be just as beneficial to both sets of shareholders as together RJR and the Gleaner will see major growth.”

Investment Guru

John Jackson


Financial Planning

Business Leaders and the government are being urged to do everything within their portfolio to urgently address the challenges facing Micro Small and Medium Enterprises (MSMEs) from generating

sustainable growth. According to CEO of the Private Sector Organization of Jamaica (PSOJ), Dennis Chung, MSMEs need to be encouraged to grow and achieve a more vibrant and sustainable economic model for development in Jamaica.

Chung, who was speaking at the staging of DenWay’s Inaugural SME Business Growth Breakfast Forum at the Jamaica Pegasus Hotel recently, hosted under the theme “Helping Micro, Small and Medium Sized Businesses to Generate Growth”, said even though many SME’s say that one of the most recurring challenges that they face is access to financing, the government has over the years made substantial amounts available to the sector through agencies like the Development Bank of Jamaica (DBJ) and EXIM Bank to assist with this challenge. He said with that in mind, lack of available financing was only the symptom of the underlying problem, and until recently, it is the failure to address the underlying challenges faced by SMEs that has been the real reason Jamaica has continued to experience lack-luster growth in this important sector.

Chung posits that this lack-luster growth is evidenced in the fact that over the past 20 years, there has not been much

MSMEs urged to fight the lack luster growth affecting Jamaican Economy

change to the companies that are publicly listed on the stock exchange. He says this is in stark contrast, in economies like the United States, where many new companies are listed every year and there are constant changes seen with the companies that are more prominent on the exchange. “I think that there was a successful attempt to bring companies on to the stock exchange through the Junior Stock exchange, and that I believe was working very well until in my view we made the mistake of removing the incentives for listing.” However, Chung says this was an error for two reasons, “it discouraged new listings and thus reduced the probability of growing the SME sector in a structured manner that could provide more sustainable financing; and it slowed down the process of bringing companies into the more formal sector of the economy, which would have been positive for things like greater tax compliance and employment through growth”.

Chung says MSMEs should consider equity investments as a preferred option for financing as it is a less costly and more sustainable option for young businesses. He also emphasized the need to “take the necessary steps to build your structure and capacity to reduce the risk of your business.” The PSOJ CEO says a well-done business plan, properly maintained accounts, proper governance structure and long term contracts are factors that go into reducing the risk associated with a business, and will improve the chances of entrepreneurs accessing debt financing. BM

Chief Executive Officer of the Private Sector Organization of Jamaica (PSOJ)

Dennis Chung

“MSMEs should consider equity investments as a preferred option for financing as it is a less costly and more sustainable option for young businesses.”


JMMB Group has reported a J$2.05billion profit for the financial year ending March 2015. According to the group’s Chief Financial Officer Patrick Ellis, this is a reduction in Profit After Taxes over the prior financial year which recorded profit at

J$3.06bn). He says the performance for 2013/14 included non-recurring gains on acquisition of subsidiaries. Ellis says this relates to the acquisition of IBL Group at a cost of J$361.7mn. He says the company’s operating Revenues also grew by 18.2% as a result of improved performance from existing companies and additional revenues from our acquisitions. However, Ellis says despite the profit being calculated, it does not show a satisfactory growth. He says management remains cognizant of the need to continue to prudently manage its operating expenses while it builds out a solid regional operating model and garner increased synergies and efficiencies from various companies across the Group. Future Direction For his part, CEO Keith Duncan says the JMMB Group remains committed to achieving long-term earnings growth and increased returns to our shareholders. He says to this extent, the group intends to improve operational excellence across the region with the roll-out of its Group Operating model to anchor the regional Integrated Services business model. Speaking at the recent JMMB Limited Annual General Meeting, Duncan said JMMB will also continue the roll-out of its new Integrated Financial Services model across the region. He says it will also roll out the Portfolio Mgmt. services and Mutual Funds across the region and attempt to further diversify JMMB business lines through continued growth in the Capital Markets Business unit and growing off-balance sheet assets which will ultimately reduce the company’s on balance sheet risk. Approval of new preference shares Meanwhile, JMMB Group has been given permission to create six billion new preference shares, which will be floated at intervals to raise capital for the company’s regional acquisitions and operations. At last week’s AGM, the shareholders were asked to approve a special resolution to issue six billion new fixed-rate cumulative redeemable preference shares. During the AGM, Chairman Noel Lyons said the term ‘fixed rate’ would not be included in the resolution as this would allow the company to issue US dollar or Jamaican dollar shares with either fixed or variable rate coupons. The resolution got 100 per cent approval from meeting participants and proxy votes. BM

Keith Duncan’s JMMB Group reports $2.05b profit,

gets approval for the issue of 6billion additional preference shares

Company Reports

l


Investment

JAMPRO pushing for a better trade relationship With China and Mexico

Chinese Investors have expressed an interest in coming to and working with Jamaicans in an effort to boost trade and improve the business relationship between both countries. Following a visit to Beijing by a delegation

including Minister of Industry, Investment and Commerce, Anthony Hylton and representatives from the Jamaica Promotions Corporation ( JAMPRO), Jamaicans can expect several visits from investors who are interested in sectors such as agriculture, logistics, manufacturing assembly, tourism and nutraceuticals.

Vice President of Investment Promotion, Claude Duncan says visits from investors can be expected as early as October. He says it follows the move by JAMPRO to promote thirteen projects that it felt were right for the Chinese market. Duncan says this includes projects such as the Trelawny Stadium, the Good Year Film Production Facility in St Thomas and the Caymanas Logistics Center. He says the delegation met with close to 40 executives of Chinese companies who gave positive responses to the call for investments in Jamaica. Duncan says particular interest was shown in a livestock project promoted by a Jamaican agency and the importation of Jamaican products to be distributed to the Chinese market.

Duncan says while there are legislative and infrastructural changes that need to be made to facilitate the trade, steps

are being made to put in place the necessary policies and legislations to encourage investment. He says Jamaican business owners who are interested in formulating a business relationship with international partners should contact JAMPRO as the agency continues to pursue Chinese business interest. Duncan says to this extent, the agency is also targeting South Korea, China and Japan for sustainable investments and lucrative trade opportunities.

Improvement in trade relationships with Mexico Meanwhile, Duncan says there is also a push to improve the current relationship the country has with Mexico. Speaking following a Breakfast Forum with key private sector entities and Mexico’s Deputy Minister of Latin America and the Caribbean, Ambassador Socorro Flores Liera, last week, the Investment Promotion Vice President said Jamaica is sending the signal to the world that it is ripe for investment.

Friday’s breakfast meeting saw key private sector partners including Wisynco’s William Mahfood, the Jamaica Manufacturer’s Association’s Metry Seaga and the Jamaica Employer’s Federations Marjorie Kennedy airing concerns over the barriers to entry to trade with Mexico as well as the need for further discussions about trade between Jamaican and Mexican businesses and investors. BM


September 21 Marketing Your Small Firm Webinar Lunchtime Serie Venue: anymeeting.com Email: [email protected] Rotary Club St. Andrew North Venue: Wyndham Hotel New Kingston

September 22 JEF CEO Breakfast Venue: Knutsford Court Hotel, 11 Ruthven Road, Kingston 10 PSOJ President’s Forum Venue: The Jamaica Pegasus Hotel, 81 Knutsford Boulevard, Kingston Email: [email protected] JAMPRO Food Labelling Requirements Venue: JAMPRO Business Auditorium, Kingston 10 Email: [email protected] JCC Annual General Meeting Venue: Knutsford Court Hotel, 11 Ruthven Road, Kingston 10 KPMG Common Tax and Corporate Compliance Matters for Businesses & Charities Venue: Secrets Resorts, Montego Bay, St.James Email: [email protected] Rotary Club of Mandeville Venue: Golf View Hotel, 5 1/2 Caledonia Road, Conference Room, Mandeville, Manchester

September 23 HRMAJ Administration Training Workshop Venue: Knutsford Court Hotel, 11 Ruthven Road, Kingston 10 Email: [email protected] The Power of Sisterhood II: The Juggling Act Venue: The Jamaica Pegasus Hotel, 81 Knutsford Boulevard, Kingston Email: [email protected] ICAJ Taxation Seminar Venue: The Jamaica Pegasus Hotel, 81 Knutsford Boulevard, Kingston Kiwanis Club of New Kingston Venue: Institute of Chartered Accountants, 8 Ruthven Avenue, Kingston 10

September 24 KPMG Common Tax and Corporate Compliance Matters for Businesses & Charities Venue: Secrets Resorts, Montego Bay, St.James Email: [email protected] JCC Annual Customs Seminar Venue: The Jamaica Pegasus Hotel, 81 Knutsford Boulevard, Kingston

September 25 Synergy Communications “ Mastering Strategic Selling Workshop Venue: Courtleigh Hotel and Suites, Knutsford Boulevard Email: [email protected] Alcoa Minerals General Meeting Venue: Jamalco Employees’ Sport Club, Halse Hall, Clarendon

Businessuite Event Calendar5

The Week Ahead


Business sector gets boost with passage of new Trade and Business Law

Cayman Islands

The business environment in the Cayman Islands is expected to see a big boost following the recent passage of the new Trade and Business Law (TBL). Minister of commerce Wayne Panton says the law, which takes effect

this fall, focuses on creating a level local playing field for businesses Panton says TBL’s framework is intended to lead to greater efficiencies in the overall business licensing system. He says it will improve the governance structure and processes for the TBL Board, and allows them to delegate certain functions to the Department of Commerce and Investment. He says this will reduce TBL approval times, which goes a far way to support business across the board, from micro to larger, international firms. Panton says the TBL will also clarify business licensing categories, create an appeals tribunal, improve DCI’s enforcement powers, and allow Cabinet to provide business incentives, such as the micro- and small-business incentives that have been extended until 30 June 2016. Director of the Department of Commerce and Investment (DCI), Ryan Rajkumarsingh, who is responsible for enforcing the law says the DCI has been working steadily on its internal processes, in order to implement the law this fall. He says the staff has undergone a number of training sessions to become familiar with the legislation and capable of offering quick and accurate licensing advice. Rajkumarsingh says the DCI has also met with various government agencies to encourage more collaboration and efficiency in handling public queries. BM

Regional


Hovensa LLC refinery owner files for bankruptcy

US Virgin Islands

Owner of the Hovensa LLC refinery on St Croix in the US Virgin Islands has filed for chapter 11 bankruptcy protection as part of a plan to sell its assets for $184 million to an affiliate of Boston private-equity firm.

The refinery which is owned by Hovensa LLC, a joint venture between Hess Corp. and Petróleos de Venezuela SA (PDVSA), the national oil company of Venezuela had initially warned of the move last Monday when joint-owner Hess Corp. was sued by the USVI government, claiming more than US$1 billion in damages over its closing of the refinery. The suit alleges a “pattern of misconduct” by Hess, saying the company stripped assets, and was brought under the USVI’s Criminally Influenced and Corrupt Organizations (CICO) Act, which allows for triple damages. This latest move follows last year’s failed attempt by Hovensa to sell the refinery last year. That deal was rejected by the USVI legislature, which refused to pass the necessary legislation. The company now says that the bankruptcy filing and sale of assets at an auction overseen by a federal court would allow the refinery to reopen “under the ownership of a proven and well-capitalized operator.” The company listed more than $1 billion in debt in its filing, including an unknown amount demanded by environmental regulators in the US, the USVI and Puerto Rico. BM


Commentary

Economic growth and the dense political fog Mark

,s Laas Lick

It is not unusual for politicians in opposition to be suddenly endowed with all of the answers and ‘perfect’ solutions to our economic ills. Just ask Audley Shaw, the JLP spokesman on Finance.

Writing in the Gleaner of September 13, 2015 he outlined his party’s growth inducement strategies. ‘... a revitalisation of JAMPRO, financial-sector reform to sharply reduce the cost of money to the productive sector, a recapitalisation of the EXIM Bank, reinstatement of original conditions of the Junior Stock Exchange, reduction of transfer taxes and stamp duties, review of the fiscal incentives regime to be more competitive, offering of investment tax credits to foreign investors to retain a portion of their profits for reinvestment in Jamaica, development of downtown Kingston as a nearshore financial centre, development of the Caymanas Economic Zone, establishment of an expanded formal overseas employment programme, and ramping up of skills training at the HEART/NTA.’ On the other side of the political fence Minister of Finance, Dr. Peter Phillips is in charge of the PNP’s most celebrated policy success, that of passing IMF tests as part of the ongoing conditions of Jamaica receiving support under the Extended Fund Facility. Even though the IMF may be considering a ‘relaxation’ of the tight noose around our collective necks, I am certain that Peter Phillips must have read Shaw’s piece, pursed his lips, thought the ideas worthy of consideration then resumed liaising with his technocrats for ensuring that the next test a few months down the road gets a passing grade. Shaw’s solution is simple. Get his party elected and the country will return to six percent growth. Say what! The last time Jamaica had anything near that in a sustainable fashion was in the two decades of the 1950’s and 1960’s when the country experienced annual growth rates of 4.5% GDP and the bauxite industry was growing and booming.

Caught up in the middle of a politics with two disparate faces and a blurred economic philosophy between the PNP and the JLP, the real boss of our daily lives is the IMF and the man and woman at street level are totally confused. “Elect me,” says the JLP. “I will take you from poverty to prosperity.” Meanwhile Peter Phillips hunkers down and hopes that Portia can carry another version of the over-worn PNP mantra, “Don’t stop the progress.” Worthy of consideration is this said by Audley Shaw in the Gleaner piece. ‘The growth in the stock of commercial bank loans to the private sector slowed last year to 4%, down from 11.1% in the previous year and down from an 8.4% average growth over the past five years. ‘The share of commercial bank loans to the productive sector has sharply fallen between 2010 and 2015, falling from 65% in 2010 to 52% today, while the share of personal loans by commercial banks has increased from 35% in 2010 to 48% today. ‘… while total private-sector credit is 30% of GDP in Jamaica, it is 196% of GDP in the United States.’ These are crucial points to consider not just for JLP and the PNP but for the voters and non- voters caught up in the political fog. It may be all a little too much for Peter in terms of timing as there is the added confusion of the sounds of an election train coming full steam ahead. *The views expressed in this article are not those of Blackslate Holdings, Businessuite Magazine or any of its subsidiaries.

By Mark Wignall


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businessuite weekly digital issue september 21st 2015

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