Moontown

Written By: Alisha Ally

Bar Association president Andie George leads lawyers in an early morning protest around the courthouse.

They emerged from the Cathedral side of the High Court in Castries, black robes flowing in the wind and umbrellas tight in hand, leader at the forefront, silent as they made rounds on the compound. Clients sat upstairs, pacing, waiting for their cases to be called, initially unaware that the members of the Bar Association of St Lucia were circling the building downstairs, protesting the state of the justice system.Following the Chief Justice’s speech on Tuesday September 15 to open the New Law Year, the Bar Association held an impromptu meeting at the NIC Conference Centre; the venue used to mark the occasion. There was already unrest at the opening ceremony as members expressed dissatisfaction with the disorganization and break from tradition. This year saw the postponement of the formal proceedings to mark the opening of the new Law Year, until the situation at the High Court Registry has been rectified. No church service, no cases to be heard and no lawyers marching through the streets of Castries to commemorate with sister islands such a prestigious event.

One lawyer reported getting three emails about the opening, each just modified by a line or so and he was so confused as to what was going on and his role in it. It was only when he got there he discovered that the occasion was not formal and there was no need for the robe draped over his arm. He then realized he was supposed to sit, listen to the Chief Justice’s speech and then leave.

As the lawyers stood shoulder to shoulder behind the High Court building, Bar Association President, Andie George, spoke on the issues affecting his members.

A rare sight: Lawyers taking action against an even slower justice system as the problems of the courts are ignored by those in power.

“The closure of the High Court Registry, this grossly affects the administration of justice. This protest also marks the working conditions in totality. The lack of security in the courts, the lack of toilet facilities, the lack of facilities for persons that are physically impaired. It’s a whole lot of things. We want to make it known that we are tired with the inadequate facilities and the closure of the Registry which obviously affects the public and of course lawyers performing their duties.”In a media release sent on the afternoon of Wednesday September 15, George stated, “Access to justice cannot be treated as a collateral issue but as the pivot of democratic governance. Our legal institutions and the administration of justice must be strong and functional to avoid civil disobedience.”

Civil unrest breeds more civil unrest and the lawyers have not been the only ones protesting for this year and some groups have been successful. When asked his predictions on the outcome, George said: “I think the very fact that we are persons of some standing in society and it’s the first time we have taken this sort of action. I’ve spoken to more senior lawyers and lawyers have never had to resort to that sort of protest. I think it will send a strong message to persons who can make the changes.”

The Bar Association intends to pursue this form of protest until change is effected. A meeting was called for yesterday afternoon (September 16) by the Permanent Secretary in the Ministry of Justice, Glenda Polius, allowing the relevant agencies to air their concerns.

George vehemently denies any political swing to the situation and said this protest is strictly about working conditions. “Our professionalism as lawyers is being affected because when the public pay us to do work, they expect it to be done in a timely manner and the closure of the registry affects our ability to do so.”

Protest action is always the last resort after all other avenues have been exhausted. George tells of the efforts made to have the situation addressed, not only now, but during the industrial action of June and July.

“There have been a number of communications and meetings prior to this protest and in fact, the members were getting frustrated at the fact that we kept having meetings and writing and nothing was being done. We wrote to the Attorney General in relation to conditions generally, not just the closure of the Registry. After the closure on the last occasion, June and July, we had a meeting with the prime minister and certain things were suggested but as far as we understand, nothing much has been done so we felt it necessary to take this action to be able to get at least the matters attended to immediately.”

The relationship between the Bar Association and the Attorney General’s Office is a strained one to say the least. Is the Bar Association protesting against the stewardship of current AG Dr Nicholas Frederick? “It’s not just the Attorney General, it’s the whole process. We find that perhaps the red tape in government takes too long to deal with matters of that nature. The Attorney General, in relation to the matters that we have brought to his attention, we felt that he has not dealt with them sufficiently, expeditiously. It’s the entire process. This is not a protest against the Attorney General only, it is a protest against the various administrations that have ignored the judicial process.”

Executive members of the Civil Service Association showed up at the High Court to publicly support the lawyers’ efforts. Sister Lilia Auguste spoke on behalf of the membership. “The CSA is here to express solidarity with the attorneys because what affects them also affects the workers that we represent. As you are aware we have had issues at the Civil Status Registry, the High Court Registry, the Registry of Companies, all related to conditions of work that is not helpful to the functioning of our members. So now that the lawyers have demonstrated their dissatisfaction, it also vindicates the position of the CSA.”

On the sidelines, some were in favour of the protest action. Clients in the High Court, when informed on the matter swung two ways; some stood in unity with the lawyers while majority didn’t really care what was going on.

BLACK EYE PEAS AND RICE; GARLIC POTATOES

MACARONI PIE; VEGETABLE CHOWMEIN

BAKED CHICKEN; BBQ PORK

FRIED SNAPPER; GRILLED KING FISH

FRIED PLANTAIN

TURKEY STEW; PLAIN GRAVY

TOSSED SALAD; PICKLED CUCUMBER

Golding … ordered budget cuts. In its fourth reduction in less than six weeks, Jamaica’s central bank yesterday clipped one percentage point from its benchmark interest rates, bringing its six-month certificates of deposit (CD) to 17 per cent.

“The adjustment to policy rates follows the better-than-expected inflation out-turn for August, which showed a further drop in the 12-month point-to-point inflation to 6.1 per cent from seven per cent in August,” the Bank of Jamaica (BOJ) said.

The BOJ also cited stability in the foreign-exchange market, improvement in domestic agricultural output, a moderate growth in money supply - all pointing to the likelihood of single-digit inflation this fiscal year - as contributing to its decision.

Aggressive cutter

The central bank, which had faced criticism from businesses and caused tension with the finance ministry for holding interests rates, has been somewhat of an aggressive cutter recently.

On July 24, having previously removed one-year instruments from the market, the BOJ cut the benchmark 180-day CD by one percentage point to 20.5 per cent, then followed a week later with another 1.5 percentage point reduction,

On August 20, another point was sliced from the rates before yesterday’s movement.

As it did yesterday, the central bank had posited the easing of inflationary impulses and exchangerate stability as the reason for the start of the latest round of cuts - rather than a response to government fiat.

However, the BOJ’s governor, Derick Latibeaudiere, would have also had the fillip of an additional US$320 million in special drawing rights (SDRs) at the International Monetary Fund (IMF), under a programme backed by G-20 nations earlier this year.

His confidence would have been further bolstered by Jamaica’s imminent agreement with the IMF for US$1.2 million in loans under an adjustment programme now being negotiated. That pact is expected to be finalised in October, but the Government is already preparing by adjusting its budget to bring the fiscal deficit in line with the original 5.5 per cent of GDP.

The revised budget is expected to be tabled in Parliament next week, but Prime Minister Golding had told ministries to slash by 20 per cent, or $16.8 billion, their projected spending in programmes.

Public-sector burden

Golding has resisted calls for a cut in the public sector, whose wage bill of $127 billion accounted for nearly 23 per cent of the original Budget or approximate 11 per cent of GDP. He, however, has frozen public sector wages.

The IMF has told the Government to lower the public-sector wage bill to around nine per cent of GDP.

In yesterday’s statement, the central bank said that improved prospects for inflation and the accompanying macroeconomic stability were “being reflected in market rates, with the downward trend in Treasury bill yields and other short-term rates.

“The easing of monetary policy is supported by the relatively strong position of the net international reserves of the Bank of Jamaica, which currently stand at US$1.95 billion,” the central bank said.

business@gleanerjm

Left: Shaw … criticised the BOJ’s earlier stance on rates. Right: Latibeaudiere … had held tough on rates before recent reductions. - File

Schedule of BOJ rates

Marlene Street-Forrest - File This week’s delisting of Barbados-based Sagicor Financial Corporation (SFC) from the Jamaica Stock Exchange (JSE) could translate to a significant depreciation of up to 40 per cent in the portfolio value of investors holding the stock, one analyst has said, even as JSE spokespersons express concern that other foreign firms could quit the Jamaican equities market.

“Clients currently holding the stock have the option of selling in Trinidad or Barbados where it traded at TT$11.11 or BDS$3.55, respectively, on September 14. This is expected to generate a loss of between 40.09 per cent and 25.06 per cent - gains from dividends excluded - if clients who had acquired this stock on our local market since it was listed in 2008 were to sell these in Trinidad or Barbados,” Tyrone Brown, research analyst at Barita Investments Limited, told the Financial Gleaner this week.

The stock is believed to be held largely by corporate clients.

Sagicor Financial, one of the region’s oldest insurance companies, on September 4 announced its decision to delist from the Jamaica Stock Exchange, citing insignificant trading activity in the company’s shares. The delisting took effect on Wednesday.

The shares last traded at $260 in January, up $15.89 from its $244.11 price when it was first cross-listed in June last year, joining its local subsidiaries, Sagicor Life Jamaica and Pan Caribbean Financial Services.

July trade

Its highest traded volume was recorded at 501,000 in July last year.

“The JSE was disappointed by Sagicor Financial’s decision to delist, having been on the exchange for just over one year,” Marlene Street-Forrest, the JSE general manager, said this week.

There is some concern in the market, she noted, that other listed foreign companies may follow.

The management of the exchange says talks will be held with the leadership of other cross-listed firms to ascertain their thinking.

“It all depends on the value added that they see from continuing to list on the exchange,” said Street-Forrest.

The Barita analyst agrees.

SFC, which operates in the life, property and casualty insurance market, as well as in banking, asset management and property development, is one of four foreign companies listed on the Jamaica Stock Exchange.

The others are FirstCaribbean International Bank, Guardian Holdings Limited and Trinidad Cement Limited.

Barita’s Brown speculates that there is more reason to believe FirstCaribbean Jamaica, rather than its Barbadian parent, could delist, but did not elaborate on this scenario.

The analyst is of the view that Guardian may place a high value on its presence in the Jamaican equities market, though he is not so convinced about Trinidad Cement.

“Trinidad Cement doesn’t really have active operations here, although there is Carib Cement.”

Another market expert, Johann Heaven, vice-president of Scotia DBG Investments, said the cost of listing may be a factor in any decision by these firms.

“I don’t expect any other foreign companies to delist from the JSE, although it may be something they may consider, especially given the ongoing costs of being listed. Most companies are currently looking to cut costs wherever they can.”

Annual listing fees

It costs a company such as Sagicor Financial, with market capitalisation of over $10 billion, $1.4 million in annual listing fees. There are supplemental fees and the cost of human resources necessary to meet JSE reporting requirements, which listed companies also bear.

The JSE’s Street-Forrest concedes that the Jamaican exchange’s reporting requirements are far more rigorous than other exchanges in the region, an issue she said Sagicor Financial raised with the exchange in coming to its decision to delist.

The JSE requires quarterly submission of financials within 45 days of the close of each three-month period and the audited annual financials within 60 days of year end.

“We are encouraging our regional partners to adopt the JSE model for the benefit of the market and in respect to harmonisation,” the JSE manager recommended.

Huntley Medley, Contributing Editor
The Heroes Circle offices of the Ministry of Finance.

A US$300 million (J$26.7 billion) Inter-American Development Bank (IDB) loan, which the Government unveiled with much fanfare earlier this year as a source of dedicated capital for the Jamaican private sector, has been opened to government entities, which have borrowed nearly 30 per cent of the US$90 million disbursed under the scheme.

At the same time, commercial banks suggest mixed results in the take-up by firms, although it remains unclear whether knowledge of the scheme is widely available and the range of issues that may be influencing private responses.

When the facility was announced in January, Finance Minister Audley Shaw hailed it as a critical cushion for the Jamaican private sector in the face of a global credit crisis that had dried up capital, making it difficult and expensive for emerging market firms to borrow.

But this week, finance ministry officialsconfirmed that the scheme was no longer geared solely to private-sector borrowers.

“The US$300 million was devoted solely to the private sector but after in-depth reviews and discussions about the desired impact on the economy as a whole, the GOJ (Government of Jamaica) and IDB made a decision to include public-sector companies which do not require a government guarantee to access the funds,” Pamela McLean, the finance ministry’s senior director for debt management, told the Financial Gleaner in emailed responses to questions.

“The public sector is limited to 20 per cent of the funds,” she said.

Existing loans

From left: Luis Alberto Moreno, president of the IDB; Prime Minister Bruce Golding; Audley Shaw, minister of finance and the public service; and Don Wehby, former minister without portfolio in the Ministry of Finance, at the January signing for the IDB loan. - file photos

According to McLean, US$89.7 million, or approximately J$8 billion, has already been loaned, with 71 per cent going to the private sector.

It was not clear which government entities have already borrowed under the scheme and for what projects.

By the finance ministry’s count, 70 projects have already been funded from the IDB cash, with 24 or 34 per cent of them being in manufacturing. Services was next with 13 projects, followed by tourism with 10.

There was no immediate breakdown of the outlay by sector.

But based on the available numbers, it appears that National Commercial Bank (NCB) is so far the major lender in the scheme. According to the bank, it has already disbursed US$43.93 million, or around 49 per cent of the loans reported by the finance ministry. NCB said it expects a further drawdowns this month, totalling US$4 million.

23 per cent to gov’t

But NCB’s spokesperson Sheree Martin indicated that US$10 million, 23 per cent of its loans, has already gone to government entities.

“The take-up of the funds has been very good,” said Martin, explaining the adjustment of terms negotiated with the IDB, including longer tenor of the loans, expansion of the range of activities to be funded and the cover of government entities, had made the scheme more attractive,

“With these amendments, the line of credit provided, we believe, a more viable and lower-cost financing solution, especially due to the effect of the global economic downturn and Jamaica’s access to the capital markets,” she said.