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Trinidad And Tobago Economic Review 2018 -2019

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Overview

Provisional estimates of economic activity in Trinidad and Tobago (T&T) point to a turnaround, with growth estimated at 1.9% in 2018. The reinvigoration was largely underpinned by recovery in the manufacturing sector (mainly energy and energy-related). Headline inflation slowed. Sustained fiscal consolidation efforts resulted in a smaller fiscal deficit. Net public debt contracted as a percentage of gross domestic product (GDP). Commercial bank credit to the private sector continued to grow.

The Central Bank of Trinidad and Tobago (CBTT) raised the repo rate by 25 basis points to 5.0% in June. Transactions with the rest of the world resulted in an external current account surplus; but the gross reserves recorded further contraction.

Economic outlook is cautiously upbeat. Output growth is projected to tick up to 2.0% in 2019; and the improvement in fiscal conditions is expected to be sustained.

However, risks to the outlook are mainly tilted to the downside.

Key Developments in 2018

According to the Central Statistical Office (CSO), GDP is estimated to have expanded by 1.9% in 2018. Preliminary data show that manufacturing was the lead growth sector. Following two consecutive years of contraction, manufacturing expanded by 7.3%. Production of petroleum and chemical products recorded the strongest growth (9.0%) in the sector.

The other notable increase came from the manufacturing of food, beverages and tobacco, which expanded by 5.6%. The reversal was a consequence of increased production and slightly higher average global prices for petroleum products in 2018. The non-energy sector recorded a marginal uptick of 0.1%.

Data to September 2018 indicate that headline inflation (period average) was contained at 1.0% year-on-year. In September, food inflation was zero, after declining for the first time in seven years in August (-0.1%). Core inflation rose by 1.4% in September, from 0.8% in April, reflecting increased costs of home ownership and higher prices for fast food meals.

Over the same review period, the Producer Prices Index fell by 0.9%, following a slightly steeper fall in June, lending further support to the low inflationary environment at the retail level.

Weak economic conditions compromised employment performance prior to 2018. No data is yet available for 2018. Data for 2017 point to an increase in the unemployment rate to 4.4% in the fourth quarter, from 3.6% in the corresponding period of 2016.

Ongoing fiscal consolidation efforts led to improved fiscal balances. Preliminary estimates indicate that the overall deficit reached 4.0% of GDP in fiscal year (FY) 2018, compared with 9.1% in FY 2017, while the primary deficit narrowed to 1.2% of GDP from 6.0% over the same period.

The Government achieved an overall reduction in expenditure of 1.7%, with cuts across most categories ‒ most notably, an 8.2% decrease in wages and salaries, and a 5.9% reduction in transfers and subsidies.

Meanwhile, total revenues increased by 17.8%, mainly based on the introduction of a 35.0% tax bracket for commercial banks; increased receipts from oil companies; and goods and services taxes. Most of the deficit was financed domestically.

Net public sector debt was estimated at 62.2% of GDP at the end of FY 2018, down from 62.7% a year earlier. The improvement in the debt position is consistent with better fiscal outturns, and the resulting reduction in borrowing requirements for FY 2018.

Monetary conditions tightened somewhat during the course of 2018. Citing a positive economic outturn during the first half of the year, as well as credit growth, low inflation and higher external interest rates, CBTT raised the repo rate by 25 basis points to 5.0% in June. The median prime lending rate also increased by 25 basis points to 9.3%.

Outcomes in the financial sector were mixed in 2018. Provisional data as at October indicate that net credit from the banking system continued its upward trend, although nonperforming loans (NPLs) also increased.

Lending to the private sector grew by 3.4% on account of an expansion in credit extended to businesses, and relatively buoyant consumer lending throughout the year. The ratio of gross NPLs to total loans, still one of the lowest in the Region, rose to 3.3% from 2.9% at the end of 2017. The reported capital adequacy ratio remained relatively stable at 24.3%.

Net official international reserves, although still well above the standard three-month threshold, continued to decline in 2018. Compared with the end of 2017, reserves fell by 9.5% to US$7.6 billion at the end of 2018, the equivalent of eight months of imports. Data to June show that there was a marked improvement in the external current account surplus, which climbed to 17.2% of GDP from 7.4% of GDP in 2017. This outturn was aided by a combination of higher exports and slightly lower imports.

Outlook

The economic outlook for T&T is one of cautious optimism. Real GDP is projected to grow by 2.0% in 2019. Despite the restructuring at Petrotrin, the energy sector is expected to drive growth, particularly in light of increased natural gas output as the Angelin project comes on stream. The performance of the energy sector will likely result in positive spillover effects into the non-˗energy sector.

In the near-term, fiscal and debt conditions will continue to improve as energy-related revenues strengthen, and efforts to contain expenditures are maintained. Credit growth is likely to rise, creating positive feedback loops to economic activity. Increased output from the energy sector is expected to also lead to improvements in the external current account and foreign reserve positions.

However, with the energy industry still dominant, the country is vulnerable to a downturn in energy prices.

Source Caribbean Development Bank Regional Economic Summary 2018

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India’s 10-Minute Delivery Boom: A Blueprint for Disruption—and a Wake-Up Call for Caribbean Courier Companies

While the Caribbean market differs significantly in terms of geography, population density, and infrastructure, India’s 10-minute delivery trend signals a major shift in consumer expectations and service standards that cannot be ignored. Caribbean courier and logistics companies must take this as a call to evolve or risk irrelevance.

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India is currently experiencing a radical transformation in its retail and logistics sectors, driven by the explosive rise of quick-commerce (q-commerce) and the 10-minute delivery promise. Platforms like Blinkit (Zomato), Zepto, Swiggy Instamart, and Flipkart Minutes are reshaping consumer expectations, retail operations, and supply chains through hyperlocal fulfillment and lightning-fast logistics. As the trend spreads across urban and tier-2 Indian cities, it offers both a glimpse into the future of delivery and a warning for other regions—including the Caribbean.

Inside India’s 10-Minute Delivery Revolution

The delivery model hinges on speed, convenience, and proximity:

  • Companies now offer a growing range of products—from groceries and snacks to electronics and pharmaceuticals—delivered in under 10 minutes.

  • Consumers, especially Gen Z and millennials, are driving demand for instant gratification, backed by digital platforms and mobile-first lifestyles.

  • The rise of micro-fulfillment centers or “dark stores”—small warehouses strategically placed within dense neighborhoods—makes this model viable and scalable.

  • AI-driven inventory management, smart rider dispatching, and urban logistics innovation are pushing the boundaries of traditional supply chains.

As a result, India’s urban logistics infrastructure is being reshaped, and tier-2 and tier-3 cities are becoming growth frontiers for quick-commerce and smart warehousing.

Implications for Caribbean Courier and Delivery Companies

While the Caribbean market differs significantly in terms of geography, population density, and infrastructure, India’s 10-minute delivery trend signals a major shift in consumer expectations and service standards that cannot be ignored. Caribbean courier and logistics companies must take this as a call to evolve or risk irrelevance.

1. Rising Expectations for Speed and Convenience

Consumers across the Caribbean—particularly in urban areas and among younger demographics—are becoming accustomed to same-day or next-day delivery through global platforms like Amazon, Shein, and even regional players. As q-commerce normalizes faster fulfillment, local consumers will begin demanding shorter delivery windows, even for basic items.

Action: Caribbean courier companies must optimize last-mile delivery using routing software, rider apps, and hyperlocal delivery hubs to reduce travel time and improve efficiency.

2. Opportunity for Micro-Fulfillment and Smart Warehousing

The Indian model shows the power of small-scale, decentralized warehousing. In Caribbean cities like Kingston, Port of Spain, Bridgetown, and Nassau, underutilized retail spaces and urban properties can be converted into dark stores or inventory depots to support fast local fulfillment.

Action: Logistics players and even supermarkets or pharmacies should collaborate to build shared micro-warehousing infrastructure, possibly using a cooperative model to manage costs and logistics.

3. Platformization and Tech Partnerships

Q-commerce in India is driven by advanced tech platforms, real-time inventory systems, and intelligent dispatching. Many Caribbean companies are still operating on legacy systems with little digital integration.

Action: Courier services must invest in tech-enabled platforms—either by building in-house apps or partnering with regional tech startups—to offer app-based ordering, real-time tracking, and integrated payment solutions.

4. Gig Economy and Flexible Workforce Models

India’s delivery model depends on a mix of full-time and gig delivery riders, supported by incentives and flexible shifts. The Caribbean’s informal workforce presents a similar opportunity.

Action: Embrace a gig workforce model with structured onboarding, safety protocols, and performance incentives—without compromising rider well-being.

5. Regional Logistics Integration

Small market sizes and geographic fragmentation in the Caribbean make it difficult to achieve India-style scale. However, regional integration—via a Caribbean logistics alliance or digital fulfillment network—could increase efficiency and reduce cross-border delivery costs.

Action: Policymakers and private players should explore multi-island logistics hubs, shared air/sea freight routes, and cross-border fulfillment platforms.

Challenges and Considerations

  • Urban infrastructure in Caribbean cities is often unprepared for high-frequency delivery services; road congestion and informal address systems remain issues.

  • High import dependency makes local warehousing more complex; inventory planning needs to factor in shipping times and customs clearance.

  • Worker rights and labor protections must be addressed early to avoid India’s growing criticism over gig worker exploitation.

  • Sustainability and profitability need to be prioritized; Caribbean companies cannot afford long-term losses in pursuit of unsustainable speed.

Conclusion: Learn, Localize, Lead

India’s 10-minute delivery boom presents a compelling case study in innovation under pressure. For Caribbean courier companies, the key takeaway is clear: consumer behavior is changing fast—and local businesses must move faster.

Rather than trying to replicate India’s model exactly, Caribbean firms should localize quick-commerce strategies, leverage technology, and reimagine urban logistics in ways that reflect the region’s unique strengths and constraints.

The companies that act now to digitize, decentralize, and adapt will not only survive but could lead a Caribbean logistics transformation—setting new regional benchmarks for speed, service, and customer satisfaction.

India’s 10-Minute Delivery Boom: Reshaping Retail, Logistics, and Urban Spaces

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Corporate Movements – June 2025

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ANSA McAL Limited (“ANSA McAL”) wishes to announce that with effect from 16th June 2025, Mr. Adam Sabga was appointed as Group Chief Operating Officer of ANSA McAL. As a key member of the Executive Leadership Team, Mr. Sabga will drive enterprise-wide operational excellence and support the execution of the Group’s diversified strategy across sectors. He will also be responsible for ensuring that all operational pillars are robust, agile and aligned with the Group’s corporate Vision and Values, and delivering value to shareholders, customers, employees and communities across the region.

Trinidad Cement Limited (“TCL” or “the Company”) hereby advises that Mr. Rafael Orlando Martinez Vela has resigned as Group Procurement Manager effective June 13, 2025. undertakings. Mr. Jesus Alejandro Arenas Mosos will assume the role of Procurement Manager effective June 15, 2025. TCL thanks Mr. Martinez Vela for his contribution during his tenure and extends best wishes to him in his future.

Supreme Ventures Limited (SVL) is pleased to announce the appointment of Mr. Don Mark Smith as the General Manager of Supreme Route Limited effective June 16, 2025.

Supreme Ventures Limited is pleased to announce the appointment of Mrs. Tanya Smith Anderson to the post of Senior Vice President, People and Corporate Services, Supreme Ventures Services Limited effective June 2, 2025. Tanya comes to us with more than 20 years experience in people management, culture and industrial relations. Holding several senior human resource management positions, Tanya has worked across numerous industries to include finance, aviation, logistics, insurance and media.

VM Investments Limited (VMIL) has announced strategic leadership appointments and structural updates. These changes align with the company’s long-term strategy for operational excellence, innovation, and sustainable growth. Executive Appointment: Chief Operating Officer Allison Mais has been promoted to the role of Chief Operating Officer (COO) for VM Investments Limited and VM Wealth Management Limited effective April 1, 2025. In this expanded role, Ms. Mais reports directly to the Chief Executive Officer and assumes strategic oversight of critical operational areas across the business. This appointment underscores the organisation’s focus on operational agility and execution, with Ms. Mais’ leadership pivotal to scaling service delivery, improving internal processes, and supporting enterprise-wide efficiency.

Promotion: Assistant Vice President – Global Markets & Digital Asset Trading Denise Marshall Miller’s portfolio has been upgraded to the role of Assistant Vice President – Global Markets & Digital Asset Trading effective April 1, 2025. This change reflects the expanded mandate of the unit, which now includes a sharper focus on digital financial instruments and global trading. This role is critical to VMIL’s strategy of broadening its investment capabilities and capitalising on emerging opportunities in global and digital markets.

Role Realignment: Assistant Vice President – Treasury Operations and Brokerage Services Evette Bryan has been appointed Assistant Vice President – Treasury Operations and Brokerage Services, effective April 1, 2025, having previously served as Assistant Vice President – Treasury & Asset Management. In her enhanced role, Mrs. Bryan will focus on strengthening the operational framework of VMIL’s brokerage services and improving payment processing systems. Her leadership will enhance operational stability and ensure that the brokerage business is responsive, resilient, and client-focused. New Appointments

In further support of its strategic direction, VMIL is pleased to announce the following new leadership roles: • Sitarah Smith – Appointed Assistant Vice President – Investment Management & Structured Solutions effective February 10, 2025. Ms. Smith’s appointment reflects VMIL’s deepened commitment to providing tailored investment strategies and bespoke structured products aligned to client needs. • Stuart Andrade – Assistant Vice President – Finance effective April 17, 2025. Mr. Andrade’s appointment supports VMIL’s focus on financial discipline, strategic resource allocation, and enhanced reporting as the company continues to scale and evolve. • Strycen Williams – Appointed Senior Manager with responsibility for Transformation effective January 20, 2025. Her expertise will drive transformation initiatives across business lines, reinforcing VMIL’s focus on innovation, client-centricity, and market relevance. • Mikhail McLeod – Appointed Manager with responsibility for Legal, Compliance, Investor Relations and Corporate Governance effective February 3, 2025. This addition strengthens VMIL’s governance framework, ensuring robust regulatory compliance and legal oversight in a complex financial landscape. These changes reflect VM Investments Limited’s strategic focus on leadership development, business diversification, and operational excellence. The organisation remains committed to delivering value to clients, shareholders, and stakeholders through a forward-looking and performance-driven culture.

Salada Foods Jamaica Limited (SALF) wishes to advise that Mr. Zayous Hamilton, Financial Controller, separated from the Company effective June 2, 2025. The Company thanks Mr. Hamilton for his contributions and extends best wishes for his future endeavours. Efforts are ongoing to appoint a new Financial Controller. In the interim, the key responsibilities of the role will be assumed by the Chief Accountant, Mr. Richard Thomas, to ensure continuity in the Company’s financial operations.

Everything Fresh Limited wishes to advise that Mr. Errol Grant has been appointed the Group Chief Financial Officer for the company effective May 12, 2025.

 

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MSMEs Encouraged to Create Business Continuity Plans

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Entrepreneurs in the micro, small and medium-sized enterprise (MSME) sector are being encouraged to create business continuity plans to boost their resilience to a major storm or hurricane.

The advice came from Acting Director General at the Office of Disaster Preparedness and Emergency Management (ODPEM), Richard Thompson, who was a panelist at the United Nations Development Programme (UNDP) Hurricane Ready & Resilient forum on Tuesday (June 10).

The event, held at the UNDP’s Multi Country Office in Kingston, engaged MSMEs on the topic of hurricane loss and damage.

Mr. Thompson pointed out that MSMEs account for approximately 97 per cent of businesses in the country and provide nearly 80 per cent of employment for the Jamaican workforce, making them an extremely important part of the economy.

At the same time, MSMEs are disproportionately vulnerable to hurricane impacts because of their informality, size, limited resources and inadequate access to financing, insurance and disaster preparedness, making business continuity planning even more essential.

“So, in terms of business continuity planning, it’s really a strategy that focuses on or ensures that the businesses are able to operate or to continue during or after any kind of disruptive event,” the ODPEM Acting Director General explained.

He outlined that effective business continuity planning should concentrate on the procedures necessary for maintaining business function, protecting business assets, safeguarding overall employment procedures, and ensuring that there is effective communication with customers.

This is important in minimising business downtime and improves the ability to restore normal function in the shortest possible time.

“It’s really a deliberate process to ensure that the businesses are anticipating, they are mitigating against issues, they are resolving issues regarding the effects of disasters that will impact the business,” he pointed out.

Mr. Thompson noted that one critical aspect of business continuity is ensuring that businesses plan their recovery process.

As such, owners and operators should make sure that all important documents, plans and business concepts are stored securely in the event of a natural disaster.

“One other thing as well that businesses have to pay critical attention to is what is called single point of failure. One of the things that we have noticed for a very long time and it was highlighted during [Hurricane] Beryl, is that energy generation, especially around electricity, is the critical point of failure for a lot of businesses,” he pointed out.

The ODPEM Director said it is, therefore, important that businesses, especially those that rely heavily on electricity, have a back-up plan for power generation.

Another crucial element that is often overlooked by small entrepreneurs, he noted, is ensuring that businesses are registered so they can receive benefits from the State.

“A lot of small farmers are not registered. So, because they are not registered, it becomes difficult after a disaster for them to get grants coming out of RADA (Rural Agricultural Development Authority) and the Ministry of Agriculture, Fisheries and Mining” Mr. Thompson said.

In her remarks, Permanent Secretary in the Ministry of Local Government and Community Development, Marsha Henry-Martin, emphasised the importance of providing support for MSMEs to navigate disasters.

Permanent Secretary in the Ministry of Local Government and Community Development, Marsha Henry-Martin, addresses stakeholders during a Hurricane Ready & Resilient forum held on Tuesday (June 10), at the UNDP’s Multi Country Office in Kingston.

She pointed out that it is also important to understand the individual realities and unique characteristics of each business, their locations and their vulnerabilities.

“As a Local Government Ministry, with responsibility for local communities, one of our mantras is that we’re not leaving anybody behind… every community matters, every district matters… every individual matters. Their quality of life must always be at the forefront, and whatever it is that they do to sustain themselves is what we should nurture,” the Permanent Secretary said.

She noted that the Ministry must ensure that the Comprehensive Disaster Risk Management Policy, which is being finalised, sufficiently considers MSMEs and their sustainability.

By: Donique Weston, JIA

Photo; Donna De la Hay

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Private Sector Urged to Champion Productivity

“Equity means ensuring access to financing, financial inclusion, fair treatment under regulation, and a level playing field for all, including women, youth, and marginalised communities,” she said.

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Minister without Portfolio in the Office of the Prime Minister with Responsibility for Efficiency, Innovation and Digital Transformation, Senator the Hon. Ambassador Audrey Marks, delivers the main address during the Jamaica Chamber of Commerce (JCC) 40th Annual Awards Banquet at The Jamaica Pegasus hotel in New Kingston on June 12.

 

The private sector is being urged to lead the charge in boosting productivity, driving growth, and accelerating national development.

This was the charge from Minister without Portfolio in the Office of the Prime Minister with Responsibility for Efficiency, Innovation and Digital Transformation, Senator the Hon. Ambassador Audrey Marks.

She was speaking during the Jamaica Chamber of Commerce (JCC) 40th Annual Awards Banquet on June 12, at The Jamaica Pegasus hotel in New Kingston.

The banquet was held under the theme ‘Shaping the Future: Driving Productivity, Championing Equity, Inspiring Entrepreneurship’.

Senator Marks pointed out that, “The theme is a call to action and a blueprint for building a Jamaica that thrives locally and competes globally.”

She noted that productivity challenges remain a “stubborn barrier” to unlocking the country’s full potential.

The Minister explained that, over the past decade, the Government has prioritised debt reduction, inflation control and broader socioeconomic stabilisation—creating an enabling environment for businesses to operate and thrive.

She said these efforts have yielded tangible results, including a debt-to-GDP ratio of 68.7 per cent, inflation falling within the Bank of Jamaica’s four to six per cent target range, and a 43.3 per cent decline in murders between January and May 2025, compared to the same period last year.

Senator Marks assured that Jamaica has reached a stable socioeconomic position, one poised to unlock exponential growth and national development.

“To achieve that growth, the Government will now have to pivot from stabilisation to GDP growth strategies. We must boost productivity, not by working harder but by working smarter. It’s about integrating technology, upskilling our workforce, streamlining operations, and investing in innovation. This is where the private sector can lead the charge,” the Minister outlined.

Senator Marks noted that the second pillar of the theme, ‘championing equity’, challenges stakeholders to confront the entrenched issue of unequal access to opportunities.

“Equity means ensuring access to financing, financial inclusion, fair treatment under regulation, and a level playing field for all, including women, youth, and marginalised communities,” she said.

The Minister pointed out that the JCC has been playing a key role in levelling the playing field for micro, small and medium-sized enterprises (MSMEs).

“The President of the Chamber of Commerce has placed a spotlight squarely on ensuring that MSMEs are not left behind, because it’s these businesses that are the backbone of the economy. They are the creative and entrepreneurial engine in every community, in every parish, that keep our economy going, and they must be empowered, not as an afterthought but as a priority,” Senator Marks stated.

She noted that the JCC has spearheaded several initiatives over the years to bridge opportunity gaps for citizens and entrepreneurs – from redevelopment projects in downtown Kingston to partnerships aimed at tackling crime and advancing technology.

Meanwhile, Ambassador Marks underscored the importance of inspiring entrepreneurship, the third pillar of the JCC event’s theme.

She highlighted that Jamaicans are natural innovators, excelling as creators in music, cuisine, logistics, fintech, and other dynamic sectors.

“But there needs to be developed, locally, a culture that celebrates and encourages young innovators to start, and if you fail, to continue… and you can fail again, we will still be here to support you. That is my primary purpose in this position in the Government, to create that culture that celebrates innovation and supports entrepreneurship,” Senator Marks affirmed.

She urged the JCC to continue supporting Jamaica’s boldest thinkers, noting that the awardees are “examples of what is possible”.

“Please continue to nurture that spirit. Let us invest in it, educate it, mentor it, and showcase it, because the next tech genius could be a young Jamaican right now with nothing but a laptop and a dream,” Senator Marks said.

The JCC annual awards banquet celebrated outstanding businesses and individuals across categories, including the best in business performance, sustainability and marketing.

By: Donique Weston, JIS

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Artificial Intelligence

Meta’s AI Ad Revolution Is A Seismic Shift in the Media Landscape – Its Impact On Caribbean Agencies

Meta’s “infinite creative” ad ambition is a disruptive force—reshaping the contours of advertising from production to pricing. For traditional agencies, the future isn’t erased—it’s redefined, demanding agility, technological foresight, and narrative excellence. Investors should scrutinize which players can transcend production to become indispensable strategic storytellers in the AI era.

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Meta Platforms, owner of Facebook and Instagram, has announced plans to launch a fully AI-driven ad-creation platform by the end of next year. This system will enable advertisers—especially small and medium-sized businesses—to input a product URL or image, set a budget, and have Meta autonomously generate, target, and optimize complete campaigns across formats—including image, video, text, and placement.

What the Platform Can Do
Creative generation: Builds ads from scratch—images, multi-scene videos, copywriting, and branding—using tools like Advantage+ and image-to-video converters

Advanced targeting: Employs Meta’s Lattice engine to allocate ad spend, refine audience targeting, and adjust pacing in real time

Automated budgeting: Balances campaign efforts across goals such as ROAS, profit, and conversion, with minimal human oversight

Industry Disruption & Agency Threats
Meta battles entrenched ad agency models—storyboarding, media buying, client liaisons—by offering a sleek, end-to-end AI solution. This has triggered market jitters: shares of global ad giants (WPP, Publicis, Havas) tumbled ~3–4% upon announcement

Agencies are concerned about “black box” AI with little creative uniqueness and limited transparency. A creative director warned that agencies risk becoming obsolete unless they champion human storytelling and strategy .

Meta insists it sees agencies as strategic partners—not casualties—enabling them to offload production and focus on high-level creativity

“We believe in the future of agencies. We believe AI will enable agencies and advertisers to focus precious time and resources on the creativity that matters. While we think there will ultimately be more automation in marketing, the role that agencies play is going to become ever more important through their ability to plan, execute and measure across platforms.” Alex Schultz, chief marketing officer and vice-president of analytics at Meta, in a recent post on LinkedIn.

Impact on Traditional Media Models
Democratization of ad creation: Millions of small business advertisers gain direct access to high-quality campaign tools previously available only to agency clients

Pressure on margins: Agencies built on hourly fees and creative production face erosion as automation slashes costs and time-to-market

Shift to consultancy: Agencies pivot toward brand narrative, measurement, and cross-channel attribution—areas where AI still struggles

Rise of performance pricing: Industry compensation models may prioritize outcomes over effort, accelerated by Meta’s technology

Investor Watch: Jamaican Ad Agencies on JSE Junior Market

The Limners And Bards Limited and One Great Studio, local creative houses listed on the JSE’s Junior Market, face both risks and opportunities.

Risks:
Client loss to self-serve AI tools on Meta.

Margin compression as SMEs opt for in-platform solutions over agency retainers.

Need for rapid adoption of AI to stay relevant.

Opportunities:
Local agencies could offer premium services—creative consulting, storytelling, campaign analysis—that AI can’t fully replicate.

They can act as intermediaries, bridging the gap for brands that need personalized strategy and regional expertise.

Possible strategic partnerships to deploy Meta’s tools with bespoke oversight and local flavour.

“AI tools would help “level the playing field” for small and medium-sized businesses that do not have the time or financial scale to use agencies. Millions of small businesses rely upon our platform to grow. For these businesses who aren’t able to work with an agency, or don’t have time during their busy days to think about their creative or targeting, that’s where AI can help level the playing field.” Alex Schultz, chief marketing officer and vice-president of analytics at Meta

Strategic Playbook for Agencies
AI integration: Adopt platforms like Meta Advantage+ or Omneky to streamline production.

Human centricity: Focus on brand voice, emotional resonance, and formats requiring high-touch creative input.

Outcome-based offerings: Transition to performance-driven fee models, aligned with client ROI.

Niche differentiation: Leverage cultural understanding, regional targeting, and deep local networks to stay competitive.

“Investors quickly sold off some of the world’s largest marketing services as news of Meta’s planned AI rollout, which could significantly swell the $160bn (£118bn) the company already makes annually from advertising.”

Investors in Context
Meta’s AI push secures its ad dominance, potentially lifting platform ad revenues 15–20% by 2026 via SME market expansion

Junior Market agencies face an inflection point: failure to adapt could erode valuation; proactive transformation may present attractive long-term upside.

Investment signal: Look for agencies investing in AI, offering high-value services, and embedding performance-based revenue models.

Meta’s “infinite creative” ad ambition is a disruptive force—reshaping the contours of advertising from production to pricing. For traditional agencies, the future isn’t erased—it’s redefined, demanding agility, technological foresight, and narrative excellence. Investors should scrutinize which players can transcend production to become indispensable strategic storytellers in the AI era.

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