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KINGSTON, Jamaica (JIS) — The Ministry of Tourism has signed an agreement with US Airways, which will provide for an increase in airlift out of the United States to Jamaica. Jamaican Minister of Tourism, Edmund Bartlett “An arrangement has been concluded with US Airways to commence some 64 rotations over a 17-week period out of Phoenix (Arizona). We start on the 17th of December and we conclude in April, 2010,” informed Portfolio Minister Edmund Bartlett, at a press briefing held recently. He informed that the Phoenix hub “provides for connection or connectivity through 31 gateways in the west of the United States. That is a very significant connection”. The arrangement with US Airways, he said, will ensure that the level of connectivity between Jamaica and the US, which is the island’s largest tourism market, is restored. In the meantime, Minister Bartlett pointed out that despite the economic downturn, visitor arrivals from the United States since the start of the year, is similar to the same period in 2008. “The projections were that we would be down out of the US. In fact, up to the month of March we were down, but we have progressively increased our share of the US market and today, as of the end of July, we are at the same level that we were last year,” the Tourism Minister said. He noted that high numbers from the US, and the strong performance of the Canadian market, have enabled the country to “be leaders in the Caribbean in terms of stopover arrivals.”

FIELD PEAS AND RICE; COU COU

BREAD FRUIT AND SALT FISH; PUDDING AND SOUSE

BBQ CHICKEN; FRIED PORK; MACARONI PIE

GRILLED BARRACUDA; FRIED SNAPPER

LAMB STEW; PLAIN GRAVY

TOSSED SALAD; COLE SLAW

The approval by International Monetary Fund (IMF) to Saint Lucia of US$10.7 million available under the rapid-access component of the Exogenous Shock Facility(ESF), formed part of Prime Minister Stephenson King’s core budget presentation when he address matters of finance, in the House of Assembly.

The Minister of Finance meticulously explained that the engagement with the IMF was on special terms of a soft loan component and not the usual austerity measures infamously known as structural adjustment.

Structural Adjustment Policies (SAPs) have bee imposed by the IMF and the World Bank to ensure debt repayment and economic restructuring. Lamentably, the way it has happened has required poor countries to reduce spending on things like health, education and development, while debt repayment and other economic policies have been made the priority. In effect, the IMF and World Bank have demanded that poor nations lower the standard of living of their people.

It is therefore understandable that with such an unforgettable historical approach and trend much concern about dealing with the IMF will trigger concerns of fear, trepidation and involuntary trembling by the public. It is to be noted that such misgivings are well placed and understood with the historical context of the IMF and the World Bank.

However the good news is that there is no need for such misgivings, anxiety or apprehension. The terms of the IMF loan are highly concessionary and are not at all a structural adjustment Programme and as such there is nothing to fear.

When the context for which the IMF loan was sort is examined it will be realized that St Lucia is merely utilizing its privilege as a member of the IMF Club and that is perhaps that’s how Dwight Venner would probably put it. The facts on the global economic down turn which our island is not at all immune to, tells us explicitly that there has been negative impacts from the financial crisis.

This has resulted in a lackluster performance of the tourism sector in the fourth quarter of 2008; there was a further sharp decline in visitor arrivals in the first quarter of 2009. Falling visitor and spending levels have led to job losses in the tourism sector, and are affecting plans for the construction of new (and expansion of existing) hotels and resorts. Given that government tax revenues, foreign exchange reserves, and employment levels are inextricably linked with the performance of the tourism sector, the damage to the economy from the crisis has been widespread.

Consequently, the authorities have requested a disbursement under the Fund’s Rapid-Access Component of the Exogenous Shocks Facility (RAC-ESF) to help mitigate the impact of the crisis on the economy.
• The annual interest rate is 0.5 percent
• The payments are semi annual
• The grace period is 5.5 years
• The full payment in ten years

Naturally government will seek the necessary approval for the use of this loan facility at the next sitting of Parliament.

Much has been said of the statement I made during the budget address regarding access 25 percent of St Lucia’s quota of the exogenous shock facility. It must be laid straight that at the time of budget preparation details of the IMF rapid access funding mechanism had not reached final negotiations and wisdom dictated that I adopted a conservative and cautious approach. Subsequently when negotiations were advance it became known that St. Lucia would be eligible to 45 percent of its quota, and naturally I opted to do so.

Is important to examine what are the minimal conditionalties of the IMF loan facility? These are based on policy discussions which focused on: Preserving recent gains in fiscal consolidation while addressing the impact of the shock. Allowing automatic fiscal stabilizers to work during the downturn and streamlining existing blanket subsidies (including on energy prices) to create the fiscal space for additional spending on social safety nets and infrastructure.

Achieving medium-term debt sustainability. Continue implementing sound macroeconomic policies, including revenue and expenditure measures, aimed at entrenching fiscal consolidation and securing the debt-to-GDP ratio on a solid downward trajectory.

Strengthening financial-sector regulatory oversight.

Overhauling regulation and supervision of nonbank financial institutions in collaboration with regional counterparts to help prevent future problems such as those associated with the collapse of the CL Financial Group.
Access under the RAC-ESF. On the basis of the authorities’ commitment to sound macroeconomic policies, staff supports the request for access of SDR 6.89 million, equivalent to 45 percent of quota.

Fund relations. St Lucia has not had a financial arrangement with the Fund for decades. Access to Fund financing amid the current global downturn would signal endorsement of the authorities’ policy agenda, catalyze financing from other international partners, and mitigate the loss of reserves.

RAC-ESF. Staff’s support is based on the severe effects of the sudden shock on the economy, the associated large balance of payments needs, and the authorities’ commitment to push ahead with a sound fiscal policy stance, aimed at placing debt on a firm downward path over the medium term, as outlined in the authorities’ letter of intent. While downside risks remain, these risks are mitigated considerably by the authorities’ resolve
to maintain prudent fiscal policies and bolster private sector-led growth, and their commitment to continued close cooperation with the Fund.

From L-R: Castries South MP Robert Lewis, Acting Governor General Cornelius Lubin, Prime Minister Stephenson King, SSDF’s Joaquin Henry, Youth and Sport Minister Lenard Montoute and Security Minister Guy Mayers.

In 1996 Saint Lucia’s unemployment figures ranged between 18-19 percent, the majority of which were young persons between 16 and 34. In 1999 a GIS report which quoted the then director of statistics, Edwin St Catherine, noted that the year 1997 had seen a significant increase in unemployment. In the last half of that year the unemployment rate increased to 22 percent, it went on to say. However according to the report, the year 1998 saw a contraction in unemployment rates reducing it to 20.7 percent in the latter half. This was attributed to employment generated by the Short Term Employment Program-STEP.The initiative was one formulated by the Labour Party government when they took office in 2007, to address rising unemployment figures, particularly among the youth. Along with an NCA “greening” project, STEP was seen as a way of stemming the rising figures of unemployment here in Saint Lucia. However, the initiatives were heavily criticised by the opposition and other sectors here, principally on the grounds that the government was borrowing money to pay the unemployed for performing menial tasks which were not sustainable.

From L-R: Castries South MP Robert Lewis, Acting Governor General Cornelius Lubin, Prime Minister Stephenson King, SSDF’s Joaquin Henry, Youth and Sport Minister Lenard Montoute and Security Minister Guy Mayers.

The fact that the NCA also became embroiled in controversy over mismanagement did not help Labour’s red realise their green dream. And so with the election of a new Government into office in 2006, the program was scrapped.The new United Workers Party government was still faced with the old problems of unemployment. Just this week the Director of finance disclosed to a regional news agency that the figures which now stand at seventeen percent may continue to rise.
During his budget address in April, Prime Minister Stephenson King announced a not so “new” initiative called HOPE. Unlike STEP, the program was seen as having long term sustainability by offering young persons skills and training. Additionally, “HOPE” which stands for Holistic Opportunities for Personal Empowerment, has a more varied program structure. These include community/public infrastructural projects and beautification projects, public sector efficiency assignments, private sector job placement partnerships, youth and sports services and self-employment. It will be guided by SSDF (Saint Lucia Social Development Fund) to benefit in the first cycle at least 2,000 persons.

On Wednesday August 12, 2009 HOPE was launched at the Vigie Playing Field, which incidentally will be one of the projects to be undertaken. The grounds will be rehabilitated to make it more user friendly to young people and will in the process employ several persons in the community among them, many unemployed sportsmen and women.

In speaking at Wednesday’s launch, Joachim Henry, executive Director of the SSDF, said that his agency was proud to be the premiere agency designed to respond to the ills of poverty and welcomed the opportunity to bring “hope” to Saint Lucia. He went on to indicate that at present fifteen persons were employed as enumerators to register the unemployed and create a data base. He also stated that 220 persons were employed under the HOPE project so far with 71 subprojects to be implemented. The rehabilitation of the Vigie playing field will form part of a wider project for the development of parks and playgrounds under the NCA. In closing Henry told the gathering, “we will not discriminate, not by religion or gender—hope is an open door and all you need to do is step right in.”

Dr Robert Lewis, Parliamentary Representative for Castries South, picking up where Henry left off said, “I trust there will be equity in delivery of the goods and services that the project intends to deliver.” He also requested more details on the procedural, technical and functional aspects of the program.

In his address Minister of Social transformation, Leonard Montoute noted the skepticism in Lewis’ tone and assured, “this was an apolitical program strictly based on the needs of the community.” He went on to appeal for the cooperation of the opposition, saying “a lot more is achieved when we unite.”

“It (HOPE) will impact mainly the youth and we have about
20,000 young people in Saint Lucia that are considered poor,” Montoute added. The minister also noted with pleasure, two of the four pillars of the program dealing with personal development and health. The other two are employment and training. “Hope will augment other social programs and its impact will be felt by the most needed the poor and vulnerable,” Montoute ended by saying.

The final speaker for the morning Prime Minster Stephenson King pronounced that “Hope is an open door to step out into the vista of possibilities and opportunities,” adding “it is not one intended to provide handouts.” The prime minister says that the program will offer another opportunity for those who seem to have given up. “It is an exit out of darkness into light . . . if we can simply implement (this) successfully I believe that what we will see in the future is a country which I believe calls for social reengineering,” King said. His final call; “let us hope therefore that with hope and participation from all that we will find a hopeful place to rebuild a sound and developing society.”

A billboard which will be replicated and placed across the island was then unveiled bearing the HOPE logo and taglines after which Francis Daniel, chairman of the Castries Football Club, gave the vote of thanks. The HOPE Jingle which is performed by Soca artiste Ilaman was then played.

Wednesday’s launch also featured performances by the youth players of LIME Diamond Steel and
Shirley-Ann Cyril Mayers with young persons from a summer camp called Smart an acronym for Summer, Music, Adventure, Recreation, Talent and Tours.

St. Lucia Star
Written By: Star Reporter 

Is parliament considering a law that will allow foreigners who invest $350,000 to become citizens?

New direct flights from the US and UK to St Lucia combined with the country’s tax friendly regime could potential boost demand for property in St Lucia to both buy and rent.In the UK, British Airways are increasing their direct flights to St Lucia from three to five times per week from October 2009. There is also a new service from Frankfurt, operated by Condor from 1 November of this year.

In the US, Jet Blue has announced a new service from New York to St Lucia with three weekly flights from 26 October.

The increase in the number of flights from the US and UK is likely to increase the number of tourists visiting the island and is a boost to the tourism industry and is great news for investors who rent out their second homes in St Lucia.

In an effort to accelerate tourism projects after the decline of its banana trade, the St Lucian government stepped in to provide a rental income ‘tax holiday’ to St Lucia property investors, who let out their properties.

Also attractive for property investors on the island is the fact that there is no VAT charge on St Lucia property, no capital gains tax and no inheritance tax.

Currently going through Parliament are changes to the immigration law that will allow foreigners who invest in St Lucian property over $350,000 (£213,000) to become a resident of St Lucia, which will bring with it further tax benefits.

Oil equipment at the Petrotrin refinery in Trinidad. Linda Hutchinson-Jafar, Business Writer

Trinidad and Tobago’s energy sector has lost three investors who were to pump an estimated US$185 million combined in energy projects that include drilling programmes spread over a four-year period.

Energy Minister Conrad Enill said the withdrawals were in line with international trends, marked by cutbacks.

The International Energy Agency (IEA) reports that the global upstream oil and gas investment budgets, through cutbacks in spending, project delays or cancellations have been cut by 21 per cent or US$100 billion during 2008.

Energy companies operating in Trinidad are also reporting declines in their profitability during the second quarter while the outlook for rig activity for the rest of the year remains uncertain, according to a recent industry survey.

Trinidad’s biggest loss is OMEL Energy, a subsidiary of ONGC Mittal Energy which along with state-owned oil company, Petrotrin signed a production sharing contract last December to carry out exploration on the North Coast Marine Area (NCMA), Block 2 which comprises 98,669 hectares.

The NCMA Block 2 is within a prolific dry gas province in which a productive hydrocarbon system has been established and is on trend with the Northern Venezuelan Dragon gas field and gas discoveries made in 2008. The block will now be included in the country’s next bid round.

Energy blocks awarded

The Trinidad Exploration and Development Company (TED) which was awarded two energy blocks from an earlier 2005/2006 bid round also withdrew earlier this year, followed by London-based Tullow.

Tullow pulled out from a consortium involving another UK company, Centrica Energy, and Petrotrin, which was granted approval for the award of a production sharing contract to explore and develop Block 2(ab) located off Trinidad’s east coast.

In July, Centrica Energy signed an agreement with the government for the exploration of the offshore energy block which Upstream Business Director Richard Mew described as highly prospective.

The company also plans to establish a partnership with Canada-based NIKO Resources Limited which would hold a 26 per cent stake in the block and another Canadian company, Voyager, with 9.75 per cent.

Centrica said it will spend US$48 million on the 1,600 square kilometre block which will include the drilling of three wells.

Also last month, Canadian company Voyager Energy and its joint venture partner Petrotrin signed a production sharing contract with the government to carry out onshore and offshore exploration in the Guayaguayare Blocks in the south-eastern region over the next four years, costing US$40 million.

Joint-venture agreement

In September 2008, Voyager also secured the exploration rights for two central range blocks onshore and has since entered into a joint venture agreement with Petro Andina Resources to explore the acreage.

But while the government continues to sign energy contracts, a number of service companies in the sector complain that business is slow.

The South Trinidad Chamber of Industry and Commerce which monitors the energy sector said 85 per cent of respondents reported a drop in their overall profitability, compared to over 80 per cent of respondents during the first quarter survey.

“The global economic downturn has changed the financial climate, leading to declining energy commodity prices and uncertainty over access to credit,” the chamber said.

“As a result, investments into the local energy sector are being cancelled or postponed even as prices rebound slightly.”

Rig activity, one indicator of economic buoyancy, has declined relative to 2008, it added.

Little or no growth is expected in the energy sector in 2009 following on a marginal 0.4 per cent growth last year.

Trinidad whose economy is pegged to the performance of energy, experienced a 3.3 per cent decline in GDP in the first quarter of this year as activity in the oil and gas sub-sectors contracted by 2.0 per cent, according to the central bank’s latest report.

GDP growth

Real GDP grew by an annual 3.5 per cent in 2008, but is expected to show zero to one per cent growth at the end of this year.

Despite the downturns, new bid rounds are scheduled for 2010 for acreages located in shallow and average water depths and comprising at least five offshore blocks - two in the East Coast Marine Area (ECMA), and three in the North Coast Marine Area (NCMA).

And Trinidad has reportedly resumed talks with Venezuela over the shared Loran-Manatee gas fields whose 10 trillion cubic feet of reserves are shared 74:26 in favour of Venezuela.

Another bid round comprising acreages in the deep water depths will follow.

Enill defined deep water exploration as “the new frontier”.

“The proposals being considered seek to minimise the upfront risks to investors while ensuring equitable returns to both the investor and the government,” the energy minister said.

File
Michelle English, chief executive officer of Flow Jamaica. Flow is fully digital. Mark Titus, Business Reporter

Jamaica has begun the process to go fully digital in radio and television broadcasting, but with no national digital switchover (DSO) policy in place and the necessary research yet to be done, broadcasting regulator, the Broadcasting Commission says no timeline has been set to switch off analogue signals still being used.

A steering committee set up by the commission to plan the way forward has met only twice, but has already decided to focus on the switchover to digital television, with radio to be treated as a separate project after a feasibility study has been completed.

“It is expected that switchover will be carried out in a phased manner,” said the Broadcasting Commission’s information and public relations officer, Nicole Morrison.

“This will give the relevant parties adequate time to make the necessary changes and adjustments for transition.”

Around the world, the use of set top and rooftop antennae to receive broadcasting signals has been coming to an end as DSO picks up pace.

European countries such as Germany, Finland, Luxembourg, Sweden, the Netherlands, Belgium and much of Austria have already built out their digital networks, and the United Kingdom is now doing a region-by-region switch over, scheduled to be completed by 2012.

The United States went digital in June, pulling the plug on its old analogue system.

Study pending

But Jamaica’s move in this direction is still in the early stages, with the study to be undertaken being the first of four stages of implementation identified in March by representatives of broadcasting, cable TV, telecommunications, transmission, retail and consumer advocacy groups.

A report on the Broadcasting Commission’s website lists the other stages as technology selection, digital switch-on and analogue switch-off.

Players in the cable industry have so far been tight-lipped on the moves being made to go digital. Winsome Witter, president of the Jamaica Association of Community Cable Operators (JACCO), which represents the 38 cable operators islandwide, would not comment.

The group’s representative on the national steering committee, Wesley Anderson, who heads the May Pen, Clarendon-based General Satellite Network, was equally mum when contacted by the Financial Gleaner.

However, Dennis Darby, general manager of Telstar Cable, which operates in Kingston said company officials were now informing themselves of the DSO process.

“We are researching the matter, looking at the whole scenario and seeing how it will impact on what we do, as well as how we will utilise the new technology,” he said.

Columbus Communications, the parent company of Jamaica’s largest cable operator, Flow, has been offering a digital service since it entered the local market three years ago.

The company has invested, it says, some US$200 million (approximately $15 billion to $17 billion) in this market, including six or seven cable company acquisitions.

Flow entered the market willing to buy up operators willing to sell, but is now backing off of that programme.

“There are still quite a number of companies that are approaching us to buy their systems but we are just concentrating on our greenfield (operations) - building out in new areas, putting our network in place, rather than acquiring and overbuilding,” Chief Executive Officer Michelle English told the Financial Gleaner.

FLOW behind

The company, under its licence, is committed to building out a nationwide network, but now says it would not have achieved blanket coverage at its initial deadline.

Said English: “2011 has been pushed out a little, but it is tough to say right now when we will be completed. We are a bit behind, but trying to look at ways that we can make that up, so I would not want to give a hard and fast time.”

Flow’s cable company acquisitions that operated analogue systems have been converted.

“What we have done is acquire some analogue companies as in Portmore and Mandeville and have gone in and replaced the analogue structure with digital,” Sharon Roper, head of marketing at Flow told the Financial Gleaner.

“What we will do as short term - that people don’t miss out on their cable - is keep the analogue service in place while we upgrade the existing infrastructure, after which they are required to switch over to the digital service,” the Flow representative said.

Flow, with is core retail business of cable-television, high-speed Internet and landline telephone service predicated on a digital backbone, has resisted calls from some of its cable TV clients to retain the analogue systems they buy in order to keep down the cost of the service.

But English is against that, saying it would compromise the core standards that come with Flow’s digital infrastructure.

“That would mean an inferior network offering outdated products,” English said.

“I don’t see us going down that road. The whole world is trying to move to digital, and certainly would be a real step back to offer anything less than the type of service that we are offering today.”