Moontown

Avia Collinder, Business Reporter

A lucrative marketing deal with elite United States-based coffee house Starbucks could serve as a cushion to the blow Jamaica’s high-end-earning coffee industry is expected to suffer from a US$12 million, or more than J$1 billion, plunge in sales, resulting from the extended drought conditions of the past several months.

The Coffee Industry Board (CIB), the government-run agency that regulates the local industry and manages the world-leading Jamaica Blue Mountain and Jamaica High Mountain Supreme brands, is bracing itself for an up to 33.6 per cent fall-off in sales in 2010, arising from the drought.

The CIB’s admittedly conservative estimate of the value of processed coffee coming off this year’s crop is US$23.7-US$25 million, a major decline on the US$35.7 million earned from coffee exports last year.

Director general of the CIB, Christopher Gentles, has not disclosed the value or other details of the suspected multi-million US dollar trademark agreement with Starbucks Corporation, but said the deal was part of the multinational chain’s planned roll-out of an “exotic single-origin coffee” programme at its more than 16,000 outlets in 50 countries worldwide.

On May 18, the listed Starbucks announced that it would be seeking to accelerate growth in its consumer products business with the introduction of new brands and products to more markets around the world. With 16,706 stores around the globe at December last year, the company is said to be the premier roaster and retailer of speciality coffee internationally, and grew net consolidated revenue by nine per cent in the quarter ending March 28, 2010.

Starbucks, according to the CIB, brews delicately balanced Arabica coffees, such as Jamaica Blue Mountain, the Hawaiian Kona and Ethiopian Harrar.

“Jamaica Blue Mountain coffee enjoys the highest premium price and the highest rave factor among coffee connoisseurs,” Gentles said.

Last year, the weighted average farm-gate price paid for Blue Mountain cherry coffee was $124,986.69 per tonne, with non-Blue Mountain coffee fetching $73,560.15 per tonne.

The Starbucks agreement follows producer Mavis Bank Coffee Factory’s recent contracts with the American Barnie’s coffee chain. At the same time, the coffee board said it is engaging traditional and non-traditional market experts in Europe to create a paradigm shift in the marketing programme, particularly in the area of consumer marketing in Europe.

The coffee board is said to be pushing an agenda of diversifying the markets for Jamaican coffee, especially in premium coffee-consuming Europe.

In pursuit of this strategy, the CIB has also signed a new trademark agreement with Tchibo’s, said to be one of the largest coffee shops and café chains in Germany, and has other agreements with companies in Russia.

This strengthening and diversifi-cation of markets for Jamaican coffee is at the top of the CIB’s agenda for 2010 and beyond, its director general told Sunday Business.

The strongest market for Jamaican coffee is Japan, which has purchased an average of 85 per cent of Jamaican coffee for the last 10 years.

WEAKNESSES

“This recession has heightened the weaknesses of an over-dependence on a single market,” said Gentles.

He added that the CIB, licensed coffee dealers organised as the Jamaica Coffee Exporters’ Association, and the Ministry of Agriculture have been engaged in a series of coordinated measures designed to alleviate the effects of the recession and push market diversification.

“The resulting strategic marketing committee has identified the United States, Canada, and Europe as the main targets of our efforts to diversify our coffee market over the next five years, and is currently looking at developing the profile of the possible strategic marketing partners, who have the marketing capability to undertake significant consumer marketing within the United States, Canada and Europe,” Gentles said.

The committee, he added, had identified critical brand charac-teristics, which will be the common thread running through marketing campaigns in these major locations.

“The CIB is determined to work with the licensed coffee dealers to diversify the sector such that no more than 40 per cent of our sales come from a single country after 10 years.”

While pressing ahead to open up new markets, the CIB must also halt the production decline. For 2010, the High Mountain region posted a production of 58,215 field boxes of cherry coffee, and the Blue Mountain reaped 241,819.75 field boxes up to the end of March 2010.

The CIB estimates that another 25,000 boxes will be produced by the end of July, when the crop year ends.

The drought conditions are expected to return earnings to just shy of the 2008 levels, when US$26.5 million worth of coffee was exported. In 2009, better weather conditions permitted the volume of coffee berries delivered to processing plants during the 2008-09 crop year, which runs from August to July, to increase by 37.9 per cent to 12,456 tonnes, compared with the 2007-2008 year.

The 2007-2008 year saw a 40.2 per cent decline in production, attributed to Hurricane Dean, which caused some $855 million in damage to the coffee industry.

In 2009, deliveries of Blue Mountain cherry coffee increased by 28.7 per cent to 10,042 tonnes, while non-Blue Mountain coffee production was up 95.8 per cent, to 2, 414 tonnes. (Jamaica Gleaner)

avia.collinder@gleanerjm.com

Coffee berries in the Blue Mountains. Jamaica plans to build out new coffee markets in places such as China. - File

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While the governing body for the local coffee industry, the Coffee Industry Board (CIB), has embarked on a programme to cultivate other markets apart from Japan, the predominant destination for Jamaican premium coffee, the board and its main trading partners in that Asian market, have come up with a scheme to improve the profile of the product there. A deal between the Japanese coffee importers and the Jamaica Coffee Exporters’ Association (JCEA), which will see US$0.10 per kilogramme of the product sold being put up by Jamaican exporters, with a matching amount from their counterpart importers in Japan to be used to burnish the image of the elite Jamaica Blue Mountain coffee brand in Japan.

The public relations fund is expected to amount to approximately US$160,000, or some J$14.2 million per year and is to be used to reposition the Jamaica Blue Mountain brand in the Japanese market.

Japan is the strongest market for Jamaican coffee and has purchased an average of 85 per cent of the island’s coffee for the last 10 years.

In addition to the joint marketing fund, for 2010, the Japanese Ueshima Coffee Company (UCC), a major buyer, has also launched a special marketing programme for Blue Mountain coffee.

UCC engages in the manufacture and sale of canned coffee and other beverages. It is also involved in the import, processing and sale of coffee.

Long-term commitment

Meanwhile, as part of its market-diversification plans, the Ministry of Agriculture, the local coffee board and related parties have been holding talks with officials in China about the possibility of long-term commitments for development financing for Jamaica’s coffee sector.

The CIB expects that China will represent a significant consumer of Jamaican coffee in the next 10 years, according to Director General Christopher Gentles.

Agriculture Minister Christopher Tufton, along with CIB chairman, Howard Mitchell, and other board and ministry representatives, recently travelled to China, where they visited the resort city of Hangzhou, for talks with Hangzhou Coffee and Western Foods Association.

“This city has a culture associated with the finest teas in China, and the heavy tourist traffic ensures that there is significant demand for a world-class premium coffee that defines Jamaica Blue Mountain coffee,” the CIB’s Gentles said.

He stated that the CIB is engaging both government and private groups in China. Consideration, he said, is also being given to the quality and market-policing requirements for premium Blue Mountain brand, which will be necessary with greater market penetration. (Jamaica Gleaner)

avia.collinder@gleanerjm.com

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A former member of the security forces trained as an explosive expert is the suspected mastermind behind the elaborate defence system established around Tivoli Gardens last week.

He was supported by other persons who had been kicked out of the police force or the Jamaica Defence Force for varying reasons.

The explosives expert could be slapped with several charges after soldiers, who entered Tivoli Gardens on Monday, faced elaborate booby traps and explosive devices never before seen in Jamaica

In the week leading up to the retake of Tivoli Gardens by the security forces, the thugs - it is believed, under the guidance of the former member of the security forces - managed to build and test explosive devices from scratch, using available local material.

According to Sunday Gleaner sources, the devices were similar to those which have been seen on the ground in Afghanistan.

They included bits of steel used as part of a lethal bombing system, LPG cylinders laced with explosives carefully set up as booby traps, Molotov cocktails used as firebombs, and sharpened scrap metals set to mangle the unsuspecting.

Many of these were wired electrically so that they could be triggered with the slightest touch.

Hundreds of gallons of petrol had also been purchased to fuel the resistance.

army of thugs

In addition to the security system, Tivoli Gardens was defended by a small army of thugs. More than 400 of them were reportedly enlisted to the cause.

Travelling from as far away as Montego Bay, St James, Clarendon, St Catherine and St Thomas, they headed to west Kingston.

They were joined by others from neighbouring enclaves who came out to support the man who had risen to the most prominent position in Jamaica’s seedy underworld - Christopher ‘Dudus’ Coke.

He had pulled together an army of hardened criminals, some of whom he had to pay thousands of dollars, to take on the armed forces.

The mission was to prevent the execution of an arrest warrant that would begin the process of his extradition to the United States to face drugs and gun charges. Ultimately, Coke wanted to pull

more inner-city communities under the rule of his ‘Presidential Click’ empire and strengthen his reach across Jamaica.

Among the recruits that were brought to west Kingston were known murderers, petty thieves, gangsters, and persons skilled in military tactics.

The recruits also included persons with computer skills who could download critical information on explosive gadgets and guerilla warfare, as well as individuals with electrical engineering skills who could rig up and operate major explosive apparatus.

Many of the foot soldiers had spent time in prison and were fearless in the face of the law.

As Monday, May 24, drew closer, and it became clearer that an invasion was at hand, the barricades to the community became more extensive.

Old cars, scrap metal, crates, sandbags, barrels and discarded household items were brought in to thicken the blockades, despite appeals from the police for them to be removed.

Sandbags camouflaged concrete slabs with peepholes and the high-rise buildings were prepared as lookout points and fixed with truck tyres to be lit to create smoke screens against helicopter assaults.

Coke, it was believed, had embedded himself in the community, surrounded by his thugs, confident of his safety.

On the outskirts of the community, the Tivoli forces ordered first strike on 14 police stations, two of which were burnt to the ground.

The cops were kept at bay, physically and psychologically, as the thugs seemingly declared ‘the Republic of Tivoli’ theirs.

For four decades, Tivoli had grown as an adjunct to Jamaica, existing under a different rule of law, defying efforts to bring it in line with the rest of the society.

In the past, efforts to bring Tivoli under control did not get past the periphery.

The move against the lawmen and their facilities was a new dimension in the struggle between Jamaica and the Corporate Area’s western belt.

Tempers boiled and steamed as the soldiers moved in.

Faced with insurmountable fire power and a well-thought-out strategy from the security forces, Coke and his inner circle abandoned the men he had recruited, and the women and children who had demonstrated for him. They were to face the onslaught without the leader.

When Tivoli fell, Coke and his inner circle were on the run, over 700 hundred men were detained, 400 of whom had no addresses in Tivoli Gardens.

More than 50 of these men were wanted by the police for various crimes, and a large number of them were listed as persons of interest and under police watch.

So far, some 8,800 rounds of ammunition and 28 guns have been seized by the security forces and 73 civilians confirmed dead.

Among the dead were at least two women, and a few of the bodies were men wearing dresses. (Jamaica Gleaner)

Ria Taitt Political Editor

Diego Martin West MP Dr Keith Rowley has acquired the support of the requisite number of Opposition (People’s National Movement) Members of Parliament that would enable President George Maxwell Richards to make an appointment of an opposition leader.

Sources said yesterday that among those who have given a commitment to sign the document endorsing Rowley as opposition leader, to be sent to Richards, is former prime minister and political leader of the PNM Patrick Manning.

The PNM general council, on Thursday, had passed a motion recommending its 12 MPs in the House of Representatives support Rowley for the position of Opposition Leader. That was taken in the wake of the decision of the council to accept the resignation of Manning as political leader.

Under the Constitution, the president appoints as opposition leader the person who, in his judgment, is best able to command the support of the greatest number of members of the House of Representatives who do not support the Government.

It is understood MPs met on Friday and yesterday to discuss the matter of Rowley being selected as opposition leader.

Yesterday, Laventille West MP Nileung Hypolite said:

’At this point in time, I believe strength and experience is what we need to go into Parliament and regroup as a People’s National Movement.’ He said the parliamentarians had received a recommendation from the general council.

Diego Martin Central MP Amery Browne said he would make a decision by today but stressed any decision he makes would be in the best interest of the PNM rebuilding to serve Trinidad and Tobago.

The PNM is in Opposition and, therefore, is required to produce an opposition leader. The position of the leader of the Opposition became vacant when Kamla Persad-Bissessar was appointed prime minister. Under the Constitution, the president also appoints six senators acting in accordance with the advice of the leader of the Opposition. (Trinidad Express)

by TONY BEST

NO “VIRTUAL HOLLYWOOD” for Barbados’ court system, meaning no seemingly never-ending acting judicial appointments.

That pledge has come from Deputy Prime Minister, Freundel Stuart, the Attorney-General,who said in Washington that the Government intended to fill several vacant judicial positions by the end of the yearor in early 2011,and one such permanent appointment wouldbe that of the nextchief justice.

“We do not contemplate a situation in which people are actingin these positions indefinitely. That is why we set a kind of deadline of the end of the yearfor the acting Chief Justice’s (Sherman Moore) appointment,” Stuart told the SUNDAY SUN.

“We do not contemplate that would be a never-ending situation,and that we would havea virtual Hollywoodin the court system.”

In addition to Moore’s temporary appointment, Government has made two acting appointments - both female judges,to serve at theappellate level.

Stuart was alsoquick to say thatPrime MinisterDavid Thompson, himself an attorney, “intendsto settle the issueof judicial appointmentsin the very near future”.

As a matter of fact,he added, Thompsonhad some “clear thinking” on who shouldbecome the next chief justice, succeedingSir David Simmons,and who should fillthe judicial vacancies.

“The court system is functioning, both administered and dispensed - and that situation will continueto exist, whether thereis, by the end of the year or at the beginningof next year, a permanent chief justice or not,”Stuart said afterattending a one-day United States-Caribbean security conferencein Washington.

“We have a historyof responsibilityin that area andI do not think the present situation threatens thatin any way. The [court] system is functioningand we are determinedto ensure that it continues to function.”  (Nation News)

St James Central MP George Hutson and MP for St George South Dr Esther Byer-Suckoo sharing a laugh with resident Olga Gibson.

MAJOR ROADWORKS, new housing developments, a playing field and a new pavilion are among the things that representative for St George South Dr Esther Byer-Suckoo will be boasting of today.

Yesterday, during a walk-through of the Greens and Ellerton community to welcome residents to today’s Constituency Conference at St George Secondary School, Byer-Suckoo told the media she was pleased with the transformation in the community.

Joined by other members of the Democratic Labour Party, including St James Central MP George Hutson, Minister of Tourism Richard Sealy, Undene Whittaker and parliamentary in the PM’s Office Senator Harry Husbands, Byer-Suckoo greeted eager residents who gave assurances they would attend the conference.

The minister, speaking of the new 51-house development in Greens, revealed that they had also recently acquired land at Brighton for the $5a square foot programme, as well as land at Todds,which would offer more improvement in the number of housing solutions.

Byer-Suckoo, who expressed her gratitude to the Ministry of Transport and Works for the work that had been undertaken at the Boarded Hall junction, along Constant Roadand at Possums Bridge, said there was still some work to be done on the minor roads throughout rural St George.

The MP said while she was pleased that the Constituency Councils got off to a good start, her main concern was that she wanted to see more positive mindsets within the community, instead of the laid-back approach.

“I want to see people start to make things work; and we have been seeing it, we have been seeing some groups formed;we have been seeing people taking the initiative to get things done; the Constituency Councils have been dealing with that and we are staring to get that energy, to see them improving themselves, the household, and their communities

She said the Constituency Council had already responded to eight house fires and as such had taken the initiative to get representatives of insurance, police and fire officials, to educate residents on how to take precautions against fires.

This evening’s conference will see Dr David Estwick, Minister of Economic Affairs, Empowerment, Innovation, Trade, Industry and Commerce addressing constituents, as will acting Prime Minister Freundel Stuart, Attorney General and Minister of Home Affairs. (CT) (Nation News)

William Layne, chairman of the Oversight Committee.

by WADE GIBBONS

OUTGOING CLICO HOLDINGS (BARBADOS) EXECUTIVE CHAIRMAN Leroy Parris must return all monies paid him by subsidiary company CLICO International Life Insurance Limited (CIL).

And pressing for the repayment is chairman of the Oversight Committee William Layne.

SUNDAY SUN investigations have revealed that Layne wrote CLICO Holdings president Terrence Thornhill on May 18 requesting that “all money” forwarded by CIL to Parris and his private company Professional Financial Services (PFS) for “management services” be repaid with interest.

“Interest is to be calculated using the prevailing interest rate for the Government of Barbados 91-day treasury bills. The amount due to the Life Insurance Company must be verified by its auditors,” Layne wrote.

The advice from Layne followed correspondence from Thornhill on April 19 outlining the future relationship between CIL and PFS.

Thornhill’s letter had stated, inter alia: “The board has therefore agreed that for the future, the payment of remuneration will only be made by those companies with which a direct employment/services contract exists. In this regard, CLICO International Life Insurance Limited will no longer be paying management fees to PFS.”

Layne’s call

Layne also instructed Thornhill that any money given to Parris by CIL as vacation pay “must be repaid” with interest calculated in a similar manner as for money received in his capacity as head of PFS.

Professional Financial Services was incorporated in 1986, and Parris, in his capacity as a director of the company, had offered management services to CLICO. His company also carried out transactions involving insurance coverage of properties for which he received commissions from CLICO.

Parris also recently came under the Oversight Committee’s radar after he withdrew deposits totalling over a quarter million dollars from CLICO Mortgage & Financial Corporation (CMFC).

Layne, who is also permanent secretary in the Ministry of Finance, heads an Oversight Committee set up through a memorandum of understanding between Government and CLICO Holdings (Barbados) Limited to manage the sale of three of the latter’s regulated subsidiaries, namely CIL, CLICO International General Insurance Limited (CIG) and CMFC.

A sale agreement with the Barbados Public Workers’ Co-operative Credit Union for the acquisition of CMFC has been virtually concluded, but Consumers Guarantee Insurance recently pulled out of an agreement to purchase CIG. The committee has had difficulty attracting a purchaser for CIL because of the liquidity gap and the deficit in its statutory fund.

The committee has just under 19 months to sell CIL before a $300 million demand on the company is made as a result of the company’s matured Life Executive Flexible Premium Annuities (EFPAs). Layne has previously said if his committee cannot find a buyer for CIL by 2012, CLICO’s assets would have to be sold.

Last month Layne said CIL had been unable to meet payments to EFPA investors in a timely manner for either surrenders or maturities. He said at the end of November 2009 the unpaid liability for EFPAs was about$108 million.

But Parris countered Layne’s suggestion, saying the latter’s figure referred to both Barbados and the Eastern Caribbean. He explained CLICO had already paid out $108 million in EFPAs and the unpaid amount in Barbados was about $20 million in maturities and surrenders.

Efforts to reach Thornhill, who has also served as a director of PFS, were unsuccessful. (Nation News)

PRIME MINISTER David Thompson

RELATIONS BETWEEN BARBADOS and Trinidad and Tobago as well as those with Britain should be further enhanced with the recent changes in governments in those respective countries.

That’s the word from Prime Minister David Thompson who is in New York where he and wife Mara have been waiting out his period of medical observation since complaining of severe stomach pains.

“Barbados and the region are fortunate to have two new prime ministers, both of whom were on record as expressing a level of commitment to, and interest in, seeing the islands of the Caribbean develop and progress,”he said.

“In the case of Trinidad and Tobago the new Cabinet there comprises individuals who have been part of the regional economic and political scene for many years.

“Certainly you would recall that in the middle of the campaign, new Finance Minister Winston Dookeran said one of his top priorities would be to work to assist CARICOM in realising several of its outstanding goals of economic and social integration,” Thompson said.

He added: “I am confident leaders of the coalition government in Britain can be expected to do the same.The West Indian lobby in Great Britain is too influential at this point for any new British administration to do anything less.”

With respect to national concerns about his health complaints, Thompson said a formal update would be issued,as promised, in another week - but for now he was “obediently” following the advice of doctors and his dietitian and looks forward to returning to Barbados on Tuesday, albeit to conduct a much reduced work programme.(CG) (Nation News)