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Senator Don Wehby’s Contribution to The Debate on The Bill Shortly Entitled The Appropriations Act,2022

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MARCH 25, 2022

Mr. President, I rise in support of the Appropriations Bill, 2022, which when passed will approve the estimates of Heads of Expenditure in the 2022/2023 budget.
I would like to commend the Hon. Minister of Finance & the Public Service, Nigel Clarke, on the work he has put into preparing the budget. I think the Minister has lifted the level of budget debate to another level which sets a new standard. His budget presentation under the theme Recovery, Reform and Restoration was supported by empirical data and deep analysis of the issues and for me instilled confidence for the management of the economy now and going forward, by this Government.

I would also like to thank Ms Darlene Morrison, the Financial Secretary, and all the Deputy Financial Secretaries for the hard work they put into each year’s budget. My comment about the Minister of Finance & the Public Service is also a reflection of the professionalism and expertise of the staff at the Ministry. I also want to recognise the BOJ, PIOJ and STATIN, and all the technical staff at the various Ministries for their continued commitment to producing the budget.

I would like to congratulate the Most Hon. Prime Minister on a very comprehensive budget presentation which addressed the main issues facing our nation at this time, and setting out the plans for securing a better Jamaica, for all Jamaicans by Sowing S.E.E.D.S of Peace, Opportunity and Prosperity. S.E.E.D.S. meaning
Security
Environment and Energy
Education and Skills
Development of Infrastructure
Social Partnership & Unity

It was a brilliant presentation and very much prime ministerial and visionary. In terms of the Security aspect of his presentation, I was happy to hear the update that Plan Secure Jamaica is being systematically and strategically implemented through the provision of technological, telecommunications, training, and other resources.

Mr President, I recall for the last two fiscal years we have debated the Appropriations Bill in the context of dealing with the impact of the COVID-19 pandemic.
Countries around the world are opening their economies and easing COVID-19 restrictions. Jamaica has followed suit as the Hon. Prime Minister recently announced the lifting of the DRMA order. I am cautiously optimistic that we have passed the worst of the pandemic. However, this year we are debating the budget in the context of new challenges.

Economic Recovery
The economy has been recovering from the impact of COVID-19 well ahead of most of our neigbouring countries. Economic growth, job creation, debt reduction has all seen positive improvements.
• In the 1st quarter of 2021/2022 fiscal year, the economy grew by 14.2%-the highest ever recorded quarterly growth rate in Jamaica’s history. The economy is projected to continue to grow during the upcoming fiscal year at a rate of 7-9%.
• The Tourism sector is on the rebound to 70% of pre-pandemic levels and the majority of other sectors have also seen improvement.
• Unemployment reached an all-time low of 7.1% in October last year.
• Debt to GDP ratio has fallen to 96% and is on track to reduce even further.
• Business confidence increased by 24% in the quarter ended December 21; and
• Net International Reserves are now at pre-pandemic levels—US$3.6 Billion as at February this year.

These macro indicators have supported Fitch’s affirmation of the country’s B+ sovereign rating and our outlook remains stable. Fitch has highlighted Jamaica’s consistent fiscal policy effort to reduce our stock of debt as a key factor in the ratings.
Achieving these growth rates will firmly place the economy on a path towards pre-pandemic levels. The Government’s leadership through nearly three years of the worst crisis we have ever seen must be commended.

Budget 2022/2023
Mr. President, the budget for FY2022/23 is expected to support recovery, facilitate reform, and foster restoration of the Jamaican economy.
Total expenditure for the 2022/2023 fiscal year is set at J$912 billion, a 9.1% increase relative to the prior fiscal year. Total income estimates of J$906.4 billion, a 12.3% rise compared to FY2021/22.

A budget deficit of J$5.6billion will be funded by cash reserves from prior years’ budget surpluses. My understanding is that budget deficit should have limited impact on inflation and interest rates. I appreciate the Minister of Finance clarifying an unfortunate interpretation of the budget figures by the Opposition where it was suggested that the Government would collect J$99 billion more in taxes during 2022/2023. It is extremely important for the Jamaican people to get the facts.

To compute how much more the Government plans to collect in taxes this coming year, one would have to subtract the latest estimated amount of taxes to be collected this year (2021/22) from the projected amount of taxes to be collected next year (2022/23).

The former figure is contained in the Second Supplementary Estimates tabled and passed in the House of Representatives in January 2022 which shows that estimated tax revenues for 2021/22 is approximately J$606 billion. This figure is included on Page 6 of the 2022/23 Fiscal Policy Paper. In addition, the Page 34 of the Fiscal Policy Paper summarizes the Second and Third Supplementary Estimates, inclusive of the expected revenue for 2021/22 of J$606 billion.
This compares with projected tax collection for 2022/23 of J$671 billion as contained in recently tabled budgetary documents. Tax revenues are therefore expected to grow by the difference between these two numbers, that is, J$65 billion.
So, in summary, the Government plans to collect J$65 billion more in taxes next fiscal year 2022/23 as compared with the current fiscal year 2021/22, without the imposition of any new taxes or tax increases.
The strong fiscal management performance of the government has resulted in the fifth year in a row that there will be NO new taxes.

Headwinds- Rise in Inflation and Commodity Prices
Mr. President, one of the main headwinds that in my opinion is a risk to reaching full pre-pandemic levels of growth is the increase in inflation globally and the uncertainty around the duration of global inflationary pressures.

The Governor of the BOJ and his team have been doing a good job in managing these pressures and I want to recognize him in this regard. Our situation is not dissimilar to developed economies such as the United States. The Federal Reserve launched a high-risk effort to tame the worst inflation since the 1970s, raising its benchmark short-term interest rate.

Proper fiscal management is key for us to navigate the choppy financial seas this year.

Mr President, I heard the opposition speak about the cost of living increase. But we have to place the rise in food prices in context of commodity prices. Global inflation is the highest it has ever been. United States’ inflation reached a 40-year high at 7.5%. The Russia/Ukraine war also has a significant impact on commodity prices.

Based on data I compiled from Business Insider and the World Bank, YOY 2020/2021 commodity price increases were as follows:

*Commodity 2020 2021
Corn (Maize) -3% 57%
Natural gas (US) -22% 92%
Soybeans 10% 43%
WTI Crude Oil -31% 73%
Brent Crude Oil -34% 67%
Wheat 8% 24%

These increases have gotten worse in 2022.
Russia and Ukraine are suppliers of about one third (1/3) of the global demand for wheat which has resulted in an increase in the cost of food items such as bread.

Mr President, when we are speaking to our nation, it is unfair to speak about increase in prices without putting in context why the prices are increasing, so Jamaicans can get a better understanding of the issues we are facing. I will speak to this later in my presentation, hopefully with some solutions.
As I listened to the proposal by the Opposition, I didn’t hear the analytics and empirical data to support what was being proposed.
Mr. President, today I refer to that as the “politics of promises” which is a knee jerk reaction to gain political popularity which has previously gotten us into trouble. For example, the Opposition’s proposal would cost 2% of GDP or J$40 Billion. The question that I must ask is how it is going to be financed. I would suggest that the only way to do so is to raise taxes or increase our debt stock which would spiral us into a bigger problem. Either way the most vulnerable will suffer the most.

So, Mr President, in my opinion, based on all that is happening in the global economy, the tensions in Europe, the discussion we should be having is around how we can become more self-sufficient as a country. I have said many times that we have to grow our way out of our debt problem. In crisis there is opportunity. With the rise in food prices we need to strategically focus our efforts on production to improve food security, raise productivity and create sustainable value-added food products. I have said it over and over that we need to set ourselves a target to cut our import bill from US$1Billion to US$500M by 2030. This is how we are going to cushion the effects of the rise in global food prices. We need to invest significantly more in agriculture, both for local consumption and export.

Debt to GDP Ratio
So, Mr President, earlier I raised the issue about increasing the stock of debt, I will say again, we cannot spend more than we earn and borrow our way to economic recovery. The future is too uncertain to take on more debt. We cannot afford another Jamaica Debt Exchange (JDX) or National Debt Exchange (NDX) restructuring. Our peers have Debt to GDP ratios that are still 10, 20, 30 and some even as high as 60 percentage points higher than their pre-
COVID levels.

A high level of debt results in tremendous debt servicing costs which makes the country susceptible to adverse shocks. A high level of debt increases macroeconomic uncertainty and lowers our ability to engender long term growth as public investment capacity is crowded out by debt service obligations. We have been on the precipice of disaster with respect to our debt to GDP—we cannot go back there.
The former Minister of Finance, Dr Peter Phillips’ did an excellent job in running the first leg of fiscal reform. Audley Shaw took the baton from Dr Phillips and passed it to Nigel Clarke who is doing and excellent job. We must continue to build on those wins, otherwise we will end up in a virtuous cycle of debt.
The key is to find the right balance between fiscal austerity and protecting the most vulnerable in our society. I commend the Minister of Finance for finding this balance with the budget.

Fiscal Commission
Mr President, on a previous occasion, in this House I indicated my support for the establishment of the Fiscal Commission, so that we can have in place a body that will provide the level of oversight and hold the Government accountable to staying on track to achieving the debt to GDP target. This will take away the temptation of “politics of promises” that has gotten us into significant trouble since independence. I noted the update from the Minister of Finance that plans are underway to appoint the Fiscal Commissioner within the 2022/2023 fiscal year. The Commission is not a “nice to have” it is an imperative to enhance the governance structure so that we can continue our path to economic independence.

Renewable Energy
Mr President, another important factor in building our country’s resilience, is reducing our dependence on Crude Oil which I just mentioned increased by 67% YOY 20/21. This significant increase has impacted electricity costs. I want to highlight the efforts of the Government to cover 20% of the JPS Bill for households that consume 200Kwh of electricity or less. This is an example of timely welfare targeting so that only those who are most vulnerable will benefit and the assistance is time bound. Mr President, we also need to incentivize a cultural change towards more renewable sources of energy and put the polices in place to effect the change.

Jamaica’s current usage rate for renewables is 13% and the Government’s target is to reach 30% by 2030 with possibility to formalize a 50% target. It is an ambitious target, but it can be done if we create the right policies the environment and incentives to achieve this objective. In Barbados for example businesses and homeowners engaged in the renewable energy and energy efficiency sectors benefit from energy tax incentives.
The Minister responsible for energy should report to the Parliament on an annual basis of how we are doing against the target and the actions being taken to stay on track.

Social Protection Initiatives
Mr President, I also wanted to note my support for the allocation of J$16.9 billion to the PATH Programme, to support the vulnerable sectors. This support will be provided through the PATH cash grant, Social Pension for the Elderly, Rehabilitation Grants, the Social Intervention/Youth Empowerment Strategy and the support for needy students. We care for all Jamaicans.

Capital Expenditure
Capital expenditure initiatives will stimulate economic activity by providing jobs and creating capital capacity earnings to fuel economic recovery. The total projected spend on capital expenditure for the upcoming fiscal year is J$65.1billion an increase of 20% YOY. Some of the major projects announced which I am pleased about include:
• Southern Coastal Highway Improvement Project
• Montego Bay Perimeter Road; and the
• Northern Coastal Highway

Mr President, in closing, I would like to again offer my support for the Bill and say that, our resilience as a country has been tested more than ever before but we have shown that we can get through this together and we will recover stronger.

Thank you, Mr. President

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Leadership Conversations

Jeffrey Hall Is Set To Be One Of The Most Powerful Men In Corporate Jamaica And The Caribbean. So, Who Is He?

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Businessuite has not yet secured an interview with Jeffrey Hall, but we’re keeping our fingers crossed for early in the new year. But as one former school mate remarked to Businessuite, “Jeffrey was always a bit ahead of his time from high school days”

The big question now is what is Hall’s next move, how far will he go and what’s his end game.

As noted in an earlier article we suspect that Hall and Joanna A. Banks, who is set to become the youngest and most powerful woman in corporate Jamaica, will have their hands full for the next couple of years with Pan Jamaica Group. But who knows, who saw the Jamaica Producers Group Limited and PanJam Investment Limited deal coming. We think the story is just developing.

So, who is Jeffrey Hall?

Jeffrey Hall CD, BA, MPP, JD was appointed Group Managing Director of JP in 2007 after joining the Board in 2004 and JP in 2002. He currently serves on JP’s Audit, Executive and Corporate Governance Committees. Hall is also Chairman of Kingston Wharves Limited, Blue Power Group Limited, and Lumber Depot Limited, a director of Geest Line Limited, Scotia Jamaica Life Insurance Co. Limited, SAJE Logistics Infrastructure Limited, and Eppley Caribbean Property Fund Limited.

This will all change in the coming days.

Hall has served as Chairman of the Boards of Scotia Group Jamaica Limited, The Bank of Nova Scotia Jamaica Limited, Scotia Investments Jamaica Limited, and has served as a director on the Boards of the Jamaica Stock Exchange and the Bank of Jamaica.

He received his Bachelor of Arts degree in Economics from Washington University, and his Master of Arts degree in Public Policy from Harvard University and his Juris Doctorate from Harvard Law School.

In 2022, he was awarded the Officer of Distinction in the rank of Commander by the Government of Jamaica.

His Sphere Of Power And Influence From Pan Jamaica Group

From all accounts Pan Jamaica Group represents the creation of the quintessential Jamaican conglomerate, a geographically and operationally diversified company focused on value creation for all stakeholders through investment in key sectors of the global economy.

With his final move Jeffrey Hall and Pan Jamaica Group will have JA$112 billion in combined assets and other resources at his disposal. What will he do with it, or better yet what can he do with it?

The transaction as an all-shares transaction, allowed Hall to leverage the JP shares in JP Global to acquire the equity position in PanJam. As a result of this JP will emerge as the largest shareholder with a 34.5 per cent stake in Pan Jamaica Group Limited.

Although Pan Jamaica Group will initially be chaired by Stephen Facey, Hall as executive vice-chairman and CEO combined with his shareholding wields far more power, influence and control on the board and company. He is further supported and strengthen with JP Chairman Charles Johnston, and Chief Financial Officer Alan Buckland who are both expected to join him on the Pan Jamaica Group board.

Note: The transaction will also see the amending of the Articles of Incorporation of PanJam to grant persons who qualify as having a Significant Shareholding the right to appoint three (3) directors to the Board of Directors and to remove and replace the directors so appointed without the approval of the directors or shareholders of the Company. At the Completion Date there will be two Significant Shareholdings entitled to appoint three (3) directors to the Board, JP and members of the Facey Family who are shareholders of PanJam.

Post Deal Jamaica Producers (JP)

Hall will still have oversight and control over JP, and as a separate entity JP will continue to operate outside the new group. The primary business of JP would become the investment management of its shares in, and proceeds from, the new Pan Jamaica Group. JP business model would change somewhat into an investment company that buys ownership stake in other companies without dealing with the day to day operation each business. As a result, JP is to designate a small team of professionals to manage its portfolio of investments and arrange for ongoing governance.

Post deal JP balance sheet will include the following Assets
• Investment Security 34.5% of PanJam
• Real Property (3 Jamaica and 1 UK)
• Agualta Vale Ltd (Land in St Mary)
• Cash and marketable securities ($1.4bil)
• Along with some liabilities that it will retain

It might be in the best interest of JP shareholders to remove Hall as head of JP so as to avoid potential conflict of interest.

To be updated.

How Jamaica Producers Group Has Been Organised To Generate Revenues From A Diverse Range Of Business Lines

 

Where Will Pan Jamaica Group Rank On The Businessuite Caribbean Top 100?

 

In A Classic Case of Global Gamesmanship Jeffrey Hall Reverse Engineered A Takeover Of PanJam To Create Pan Jamaica Group and Secure a 30% Stake In Sagicor Group Jamaica In One Move.

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Leadership Conversations

In A Classic Case of Global Gamesmanship Jeffrey Hall Reverse Engineered A Takeover Of PanJam To Create Pan Jamaica Group and Secure a 30% Stake In Sagicor Group Jamaica In One Move.

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The following is a strategic and creative editorial opinion piece relying on published reports on the transaction.

Jamaican conglomerates Jamaica Producers Group Limited (JP) led by Jeffrey Hall and PanJam Investment Limited (PanJam) led by Stephen Facey announced recently that they will merge their operations creating the Pan Jamaica Group Limited. The transaction is expected to be completed within the first quarter of 2023 with both the renamed Pan Jamaica Group and JP remain listed on the main market of the Jamaica Stock Exchange.

Question? Did Stephen Facey’s PanJam acquire Jamaica Producers Group’s sprawling global food, beverage, shipping and logistics operations or did Jeffrey Hall engineer a strategic takeover of PanJam’s global services network of interests in hotels and attractions, business process outsourcing?

Global Gamesmanship

Other media outlets and the entities themselves have described the pending transaction as a “Business Combination”.

That’s what it looks like on the surface, but a closer look will reveal what we at Businessuite are calling a strategically engineered global gamesmanship move, involving the takeover of PanJam, and securing control of a 30% stake in Sagicor Group Jamaica by Jeffrey Hall at Jamaica Producers in one move.

To better understand this position, we need to look closer at the deal structure and a term called Global Gamesmanship or what HBR calls “competing under strategic interdependence,” or CSI.
(https://hbr.org/2003/05/global-gamesmanship)

In an article titled Global Gamesmanship published by Ian MacMillan, Alexander B. van Putten, and Rita McGrath in HBR, they note that “competition among multinationals these days is likely to be a three-dimensional game of global chess: The moves an organization makes in one market are designed to achieve goals in another market in ways that aren’t immediately apparent to its rivals. We call this approach “competing under strategic interdependence,” or CSI. And where this strategic interdependence exists, the complexity of the competitive situation can quickly overwhelm ordinary analysis.”

So how did Jeffrey Hall pull of this chess move?

The Opening – Preparation To Financing The Move.

The amalgamation agreement contemplates two sets of transactions that ultimately give effect to the combination of the major operating businesses of JP with the businesses of PanJam under a single legal entity.

The first set of transactions involves transferring the JP Business to a recently formed entity called JP Global, pursuant to a Scheme of Reconstruction.

International assets and listed securities will be transferred from JP to JP Global in exchange for shares in JP Global such that, upon completion of these transfers, JP Global will have 561,565,133 issued and outstanding ordinary shares.

The Middle Game – Acquisition and Check Mate

The second set of transactions or series of moves involves the transfer of the JP Global Shares by JP to PanJam.

This move involves JP transferring the JP Global Shares to PanJam in exchange for the issue and allotment to JP of the PanJam Exchange Shares. In other words, Hall leverages the value in JP Global to acquire the Shares in PanJam.

This transfer is conducted in accordance with the Amalgamation Agreement where the end result is the combination of the material businesses of PanJam and JP effected by way of an exchange of shares.

To execute the move Hall then allows PanJam to acquire all of the issued share capital of JP Global, and in exchange PanJam issues and allot the PanJam Exchange Shares to JP as consideration for the acquisition of the JP Global Shares.

To facilitate this there was an increase in the share capital of PanJam by the creation of an unlimited number of new ordinary shares, from which the PanJam Exchange Shares will be allotted as a part of the Amalgamation.

Hall’s Check Mate

With this move Hall and JP will become the largest shareholder in PanJam holding 34.5% of the issued ordinary shares. It should be noted that Hall still has control of the stake in JP Global as PanJam would become the sole shareholder of the company. So, what did he really give up?

On completion Jeffrey Hall now in effective control of Pan Jamaica Group will now have JA$112 billion in combined assets and other resources at his disposal.

Although Pan Jamaica Group will initially be chaired by Stephen Facey, Hall as executive vice-chairman and CEO wields far more power, influence and control on the board and his shareholding. He is further supported and strengthen with JP Chairman Charles Johnston and Chief Financial Officer Alan Buckland who are expected to join him on the Pan Jamaica Group board.

But there’s more!

The Endgame – Sagicor Group Jamaica

A major benefit of the merger and transaction is that from Sector Diversification. The combined portfolio of enterprises and interests that will form part of the Pan Jamaica Group (PJG) will straddle four main overlapping business activities of which Financial Services is one.

The portfolio of financial services interests will include associated companies in life insurance, health insurance, pension management, investment management, general insurance, foreign exchange trading, money services, investment banking, commercial banking and micro-finance.

This network of enterprises, has Sagicor Group Jamaica Limited at its core, with a very significant and valuable reach across Jamaican financial markets.

This we believe is the real prize for Jeffrey Hall and Pan Jamaica Group. Hall through Pan Jamaica Group will now own and control a significant 30.2 per cent stake in Sagicor Group Jamaica further boosting his power and influence.

Sagicor Group Jamaica listed on the Main Market of the JSE, will be the largest investment by assets for PJG, with operations in Jamaica, Cayman Islands and Costa Rica. Sagicor is the leading life and health insurer and pension fund manager in Jamaica. It also has operations in investment banking and operates the largest local unit trust.

It owns the fourth largest Jamaican commercial bank by assets, and recently ventured into general insurance and remittances with the acquisitions of Advantage General Insurance Company Limited and Alliance Financial Services Limited, respectively.

Pan Jamaica Group will derive much of its income from its 30% stake in Sagicor Group Jamaica. To secure this revenue stream going into the future Hall will want to have a closer relationship with this company, and will no doubt demand his fair share of the seats on the Sagicor Group Jamaica board of directors.

Hall’s Next Move?

The big question now is what is Hall’s next move and how far will he go. If he can engineer a takeover of PanJam, rolling up his JP into Pan Jamaica Group, why not execute the same strategy, rollup Pan Jamaica Group into Sagicor Group Jamaica?

To do this however he will have to go through Sagicor Financial Company Ltd.

Sagicor Financial Company is a financial services conglomerate operating in the USA, Latin America and the Caribbean region, and importantly is the sole owner of Sagicor Life Inc, which holds 49.11% of Sagicor Group Jamaica.

Given that he already has control over a significant 30.2 per cent stake in Sagicor Group Jamaica Limited, Hall could pick up some more from other smaller holders.

Sagicor Pooled Equity Fund is a connected company, which control another 2.34% of Sagicor Jamaica. Together with Sagicor Life Inc these two parties haves over 51% of Sagicor Jamaica, which would make any move by Hall to take over Sagicor Jamaica highly difficult, but not impossible.

We suspect however, that Hall and Joanna A. Banks, who is set to become the youngest and most powerful woman in corporate Jamaica, will have their hands full for the next couple of years with Pan Jamaica Group. But who knows, who saw the Jamaica Producers Group Limited and PanJam Investment Limited deal coming.

One thing is however clear Jeffrey Hall, CEO and Executive Vice Chairman of the Board of Directors Pan Jamaica Group is arguably one of the most powerful men in corporate Jamaica and the Caribbean.

So Did Stephen Facey’s PanJam acquire Jamaica Producers Group’s sprawling global food, beverage, shipping and logistics operations or did Jeffrey Hall engineer a strategic takeover of PanJam’s global services network of interests in hotels and attractions, business process outsourcing?

To be updated.

 

How Jamaica Producers Group Has Been Organised To Generate Revenues From A Diverse Range Of Business Lines

 

Jeffrey Hall Is Set To Be One Of The Most Powerful Men In Corporate Jamaica And The Caribbean. So, Who Is He?

 

 

Where Will Pan Jamaica Group Rank On The Businessuite Caribbean Top 100?

PanJam Investment And Jamaica Producers Group Join Forces To Form Pan Jamaica Group

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A Sector-Specific Mechanism To identify And Develop New Tourism Businesses And New Tourism Ideas.

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With the onslaught of the novel Coronavirus (COVID-19), the Ministry of Tourism, has been strategizing the recovery of Jamaica’s tourism industry. The goal of this recovery, however, is not to resume the traditional way of doing business, but to use this opportunity to re-imagine and re-invent our tourism product and value chains.

By doing so, we have championed the Blue Ocean Strategy as the theoretical underpinning of this plan of action. This strategy can be defined as the simultaneous pursuit of differentiation and low cost to open new market spaces and create new demand. It is about creating and capturing uncontested market space, thereby rendering competition irrelevant.

It is based on the view that market boundaries and industry structure are not set in cement and can be reconstructed by the actions and beliefs of industry players. To implement a Blue Ocean Strategy, we must re-evaluate the premises that inform our understanding of the industry’s assumptions and shape new business models. We must re-evaluate our understanding of the tourism industry, re-assess what we think our customers need and what we offer them. The goal is to expand the value chain and identify completely new products and markets.

To that end the Tourism Enhancement Fund (TEF) is tasked with establishing a sector-specific, mechanism to support the identification and development of new tourism businesses and new tourism ideas. We are moving to establish the TEF’s Tourism Innovation Incubator.

This Tourism Innovation Incubator is a business development centre for individuals or entrepreneurs who have innovative ideas that can impact the tourism sector. This Incubator will provide a unique and highly flexible combination of services, including business support services, infrastructure; this Incubator will also nurture these entrepreneurs and support them through early stages of development and execution.

I look forward to the successful establishment of this key initiative and the impact that it will have on the future of our local tourism industry.

Tourism Minister, Hon. Edmund Bartlett

Click for more information on the Tourism Innovation Incubator

BLUE OCEAN STRATEGY is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. It is about creating and capturing uncontested market space, thereby making the competition irrelevant. It is based on the view that market boundaries and industry structure are not a given and can be reconstructed by the actions and beliefs of industry players.

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Leadership Voices

Keith Duncan and Christopher Williams have two different views on opportunities in the Caribbean. Which one is correct or are they both correct?

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“The Dominican Republic is firing, and now Trinidad is firing up. The Trinidad economy has been recovering very nicely and JMMB Bank T&T continues to grow at a faster rate than market. We are really confident that we have a good team in place to drive that growth. We continue to look at opportunities in Central America and the Caribbean; that’s a pipeline that we continue to actively work, and we are hoping for good things,”
JMMB Group CEO Keith Duncan

 

 

 

Proven Group Limited plans to avoid acquisitions this year due to global uncertainty, but will continue to develop real estate projects. It’s the second time since the onset of the pandemic that the firm has adopted a passive approach.

“We want to preserve capital. We operate throughout the Caribbean and there are varying levels of downturn. None has been significant as a percentage, nothing greater than three or four per cent, but there is definitely a slowdown right across the Caribbean, interest rate hikes, inflation and supply chain challenges. So we are not looking for any acquisitions as a result; we are just sitting tight and making the best of our existing portfolio.”
Proven CEO Christopher Williams

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How Jamaica Producers Group Has Been Organised To Generate Revenues From A Diverse Range Of Business Lines

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Jamaica Producers Group Limited has been organised to generate revenues from a diverse range of business lines and, importantly, a diverse range of markets.

We see the diversity of our business as a strength.

Our Food & Drink business includes premium and travel retail products, as well as everyday snacks and basic food items. These businesses are aligned to general consumer trends such as the focus on health, convenience and provenance, and they serve markets as diverse as the Caribbean and Caribbean diaspora, Northern Europe, North America and Caribbean travel retail and hospitality.

Our logistics businesses, also operating in Europe, the USA and the Caribbean, handle a wide range of commodities, and service a large number of origin and destination markets. Services provided range from shipping and freight forwarding to stevedoring, terminal operations, cold storage and logistics.

We see the diversity of our business as a strength. We are of the view, however, that inflation, supply chain shocks and disruptions to business confidence arising out of war, health-related restrictions, logistics challenges and adverse macroeconomic conditions all present general business challenges in the short term.

Our strategy is to build on our core business capabilities in Food & Drink and Logistics & Infrastructure through active engagement and strategic alignment with key customers, efficiency enhancing capital investment projects and selective acquisitions. Core capital investments in our terminal, cranes and warehousing at Kingston Wharves are designed to expand capacity, gain market share and drive efficiency in our logistics businesses.

Investment in food grade packaging lines, information technology systems, efficiency and hygiene, and health and safety are all expected to bolster the Food & Drink Division in the months ahead.

Based on our acquisition strategy, we will continue to identify other logistics services that support trade with the Caribbean, and Food & Drink businesses in markets that present definite new growth opportunities for the Group.

With shareholders’ equity of $18.4 billion (an increase of 9% relative to the prior year) and cash and investments of $10.9 billion, we believe that the JP Group has the balance sheet strength to support this strategy.

C.H. Johnston Chairman Jamaica Producers Group Limited

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