Jamaica Observer http://www.jamaicaobserver.com/ JamaicaObserver.com, the most concise and in-depth website for news coverage on Jamaica and the Caribbean. Updated daily 7 days a week, 24 hours a day en-us copyright Jamaica Observer, 2011 Banking groups can buy up to 50 per cent of shares in each other ­&mdash; BOJ http://www.jamaicaobserver.com/business/Banking-groups-can-buy-up-to-50-per-cent-of-shares-in-each-other----BOJ_93471 Maurene Simms, Deputy Governor, Financial Institutions Supervisory Division at the Bank of Jamaica (BOJ), indicated this week that significant holdings by a group which holds deposit-taking licences in another is permissible within limits.<br /> <br /> Once a deposit-taking institution (DTI) observes its mandatory and prudential operating parameters, it is not restricted in its investment activities, she told the Jamaica Observer. <br /> <br /> Locally, there are 11 supervised deposit-taking institutions consisting of seven commercial banks, two building societies and two merchant banks. The BOJ also oversees credit unions, which number about 34.<br /> <br /> Local banks and near banks can invest as much as 50 per cent in other DTIs, Simms said . <br /> <br /> She told Caribbean Business Report that the Banking Services Act (BSA) does not prohibit investments in other DTIs. <br /> <br /> &ldquo;Notwithstanding, the BSA places certain restrictions on the amount a DTI can invest in the debt or equity of a company. Further, if an equity investment by a DTI results in an ownership stake greater than 50 per cent, the acquired entity becomes a member of the DTI&rsquo;s financial group and is supervised accordingly.&rdquo;<br /> <br /> In practice, banking groups which have taken this investment route have been toeing the 30 per cent line, mindful of considerations by the Financial Services Commission of a plan to reduce takeover trigger points to 30 per cent of shareholding.<br /> <br /> NCB Capital Markets Ltd (NCBCM), a subsidiary of National Commercial Bank Jamaica Ltd, which in 2012 acquired a 29 per cent stake in Jamaica Money Market Brokers Ltd (JMMB), has dialled this back to 26 per cent.<br /> <br /> Nevertheless, that purchase has resulted in NCBCM being the largest single shareholder in JMMB. <br /> <br /> Investment in other finance companies is a proven income stream for DTI-based groups. Sagicor Group, via a number of vehicles, owns abouta 2.5 per cent shareholding or 70 million shares in Scotia Jamaica Ltd.<br /> <br /> It earned dividends from a total pool of $5.3 billion paid out to shareholders by Scotia Jamaica for the year ended October 31, 2016.<br /> <br /> Sagicor Group, again via its subsidiaries, also owns about five per cent of National Commercial Bank stock, and took home about $111 million in dividends.<br /> <br /> Payout to all NCB shareholders for the year and in November 2016 totalled approximately $2.2 billion.<br /> <br /> NCB Insurance Company, a subsidiary of NCB group, has 26 million shares in Scotia Jamaica Group Ltd.<br /> <br /> NCBCM, from its shareholding in JMMB, took in $148 million in dividend payments or nearly one-third of returns made to shareholders at financial year end March 2016, close to income made in the previous year.<br /> <br /> Simms of the BOJ states, &ldquo;Once a DTI&rsquo;s investment in the equity of a company is in line with the BSA investment limits and does not result in the DTI gaining or exercising control over the operations of the company, that investment is treated similarly to other earning assets on the books of a DTI. <br /> <br /> &ldquo;Accordingly, once a DTI observes its mandatory and prudential operating parameters, it is not restricted in its investment activities,&rdquo; she concluded. <br /> <br /> The banking supervisor noted that the BSA also confers power on the Supervisor to deem a company that is not majority-owned (that is, less than 50 per cent of the share ownership) by a DTI or financial holding company (FHC), but over which the DIT/FHC has control or influence, as being a part of the financial group for supervisory purposes. http://www.jamaicaobserver.com/assets/13665837/260459_w300.jpg Local Business Friday, March 24, 2017 2:00 AM 1 Naturally Almond milk to be produced by Mussons http://www.jamaicaobserver.com/business/Naturally-Almond-milk-to-be-produced-by-Mussons_93426 US&ndash;based manufacturing company JEC Aseptics has inked a deal with the Musson Group of Companies for the manufacture and distribution of almond milk locally. <br /> <br /> The milk, branded Naturally Almond, had its first production run completed at the Serge Island facilities in St Thomas last November and was introduced into the local retail trade in January by T Geddes Grant. <br /> <br /> Both Serge Island and T Geddes Grant are owned by the Musson Group. Plans are that JEC Aseptics will manufacture almond milk in St Thomas for distribution locally and exportation to the United States before moving to Caribbean Community (Caricom) markets.<br /> <br /> &ldquo;Couple of things that we were looking for is the manufacturing capabilities &ndash; what companies were here that had the technology to capture the perfect blend of almond milk. We concluded that the best partner from a manufacture and distribution point of view was the Musson Group of Companies,&rdquo; JEC Aseptics Business Development Manager Jorge Figueras told the Jamaica Observer during the official launch of the product at Eden Gardens on Wednesday. <br /> <br /> &ldquo;We started our negotiations and it took us about six months to get the right taste profile that we were looking for,&rdquo; he continued. Already, the Musson Group has added roughly 35 new members of staff to carry out production and distribution processes. <br /> <br /> According to managing director of T Geddes Grant, Michael Subratie, Jamaica consumes roughly 1.4 million litres of almond milk per year, all of which is imported. He noted that the manufacture of almond milk in Jamaica will not only allow JEC Aseptics to save on freight, duties and various costs involved to import, but will also improve Jamaica&rsquo;s trade deficit. <br /> <br /> Ultimately, JEC Aseptics wants to cement its place in the local market before beginning exporting to Trinidad and Tobago, Barbados and Belize. <br /> <br /> &ldquo;Jamaica&rsquo;s proximity to the US makes it good for us to export. In phase two of our expansion, we are looking to export into Caricom. We already have a distribution facility in the FreeZone area ready to begin exporting the products,&rdquo; Figueras told the<br /> <br /> Caribbean Business Report. <br /> <br /> Naturally Almond is available in four flavours: original, vanilla, original unsweetened, and vanilla unsweetened. The products are being marketed as plant-based and dairy-free beverages geared towards the healthy lifestyle market. <br /> <br /> Already Naturally Almond has shown signs of its growth capabilities with an increase in unit sales by 24 per cent for February over the previous month. <br /> <br /> &ldquo;We have plans for a line extension in the third quarter of 2017 with the launch of a Naturally Almond chocolate variant,&rdquo; Subratie said. http://www.jamaicaobserver.com/assets/13731024/265833_92087_repro_w300.jpg Local Business Friday, March 24, 2017 12:00 AM Y http://www.jamaicaobserver.com/assets/13731028/265833_SLD.jpg 04 2 When second place feels just like first http://www.jamaicaobserver.com/business/When-second-place-feels-just-like-first_93213 It might be a squeeze to get it in but, perhaps for the first time, Gordon &lsquo;Butch&rsquo; Stewart&rsquo;s trophy room, already bursting at the seams, will accommodate a second place win in Britain&rsquo;s ultra prestigious The Travel Marketing Awards TTMAs) presented last week in London.<br /> <br /> To take the runner-up spot in the category &ndash; Best Integrated Campaign of the Year (over &Acirc;&pound;1m spend) &ndash; Stewart&rsquo;s Sandals Resorts International (SRI) had to beat out megabrands with names like Virgin, Hilton and, of all things, Tourism Australia, all of which have bigger budgets and far greater international reach.<br /> <br /> &ldquo;It&rsquo;s one of those second place wins that feel like a first place, because of the quality and depth of the competition,&rdquo; Stewart explained. &ldquo;We were the only nominees from the Caribbean and it was the first time that we were being nominated so you&rsquo;ll understand that we are extremely pleased and excited.&rdquo;<br /> <br /> &ldquo;I continue to be amazed by the consistently high level of performance by the team members of our organisation who make us proud and keep the Jamaican and Caribbean flag flying high,&rdquo; said Stewart, the SRI chairman and founder.<br /> <br /> The winner of the category was Visit Scotland with their &ldquo;Spirit of Scotland&rdquo; campaign.<br /> <br /> Karl Thompson, managing director of the United Kingdom office of Unique Vacations, worldwide representatives of Sandals Resorts, said Sandals&rsquo; entry was a technology-driven multimedia ad campaign that co-ordinated television, press and outdoor products involving the London Underground and bus side posters.<br /> <br /> &ldquo;The success of the campaign was judged in the end by sales. The TTMAs are based on the votes of a panel of judges with keen knowledge of the various travel marketing organisations across the UK so we regard this as a tremendous breakthrough. Naturally, we&rsquo;ll be doing everything to beat the entire field next year,&rdquo; said the upbeat Thompson, a 10-year staff member.<br /> <br /> The annually presented award was received on behalf of Sandals by head of marketing for Unique Vacations UK Limited, Jenny Anderson.<br /> <br /> The Travel Marketing Awards is the only travel industry event of its kind. Now in its ninth year, the Awards, which aims to raise marketing standards across the travel industry, &ldquo;has evolved into one of the most credible events in the travel industry calendar, with agencies and travel companies alike eager to impress our esteemed panel of judges&rdquo;, said the organisers. http://www.jamaicaobserver.com/assets/13731197/265941_92030_repro_w300.jpg Local Business Friday, March 24, 2017 2:00 AM 3 Beet sugar, Brexit threaten cane sugar http://www.jamaicaobserver.com/business/Beet-sugar--Brexit-threaten-cane-sugar_93416 A recent article by Bloomberg is predicting that European demand for cane sugar exports from the Caribbean, including Jamaica, could soon be on the decline as the continent reverts to beet sugar.<br /> <br /> &ldquo;The European Union&rsquo;s decision to remove limits on its own beet sugar output from October (2017) means less demand for cane growers from Jamaica in the Caribbean, to the Pacific island of Fiji, and Swaziland in southern Africa,&rdquo; states the article &lsquo; Europe is waiving goodbye to sugar cane.&rsquo;<br /> <br /> Another article, posted by The Spectator &mdash; &lsquo; Brexit can benefit the poorest countries that produce sugar,&rsquo; by Phillip De Pass of ACP/LDC Sugar Industries Group &mdash; shares the same view. &ldquo;But a change to EU rules from October 2017, which will see the abolition of production quotas on beet sugar and isoglucose for EU-based farmers, will most likely increase EU beet sugar production and reduce demand on the continent for imported sugar (cane) by half, from 3.2 million tonnes to 1.6 million tonnes.&rdquo;<br /> <br /> Jamaica and Belize &ldquo;were among a group of more than 10 (African, Caribbean and Pacific or ACP) countries that benefited from quota- and duty-free access&hellip; of mostly raw sugar shipments to the EU in 2015-16&rdquo;, according to<br /> <br /> Bloomberg. Jamaica has shipped 60 per cent of its exports to Europe, while Guyana and Belize both shipped 80 per cent of theirs, based on a quoted report done by LMC International Ltd.<br /> <br /> Also, about a third of raw cane sugar from the Caribbean exported to Europe is to be refined, with a third going through the United Kingdom. However, tariffs are applied to exports from other countries, the LMC report says.<br /> <br /> &ldquo;It&rsquo;s not that we want to leave the suppliers behind. But if Europe has made the white sugar market really competitive, we have to have access to more competitive supplies,&rdquo; an executive from a London-based refiner of Jamaican sugar said in the<br /> <br /> Bloomberg story. <br /> <br /> Caribbean countries gained favourable relations when the UK joined the European Economic Community (precursor of the EU) in 1973. But while some countries in the Caribbean are nudging the UK to look after its former colonies and Commonwealth trade partners, other countries in the wider ACP have begun to diversify their markets and sugar products &mdash; refined, ethically produced or organically grown. <br /> <br /> Caribbean Community ministers and stakeholders in the sugar industry were to meet in Kingston yesterday and today to assess how changes to the sugar production quota and Brexit could impact the region.<br /> <br /> Even so, Agriculture and Fisheries Minister Karl Samuda is referred to in the Bloomberg article as saying that the Government is intent on finding new markets for and by-products from sugar cane. &ldquo;&hellip;we have to look to transitioning to value-added products such as ethanol and expansion of our rum industry. You know, Jamaica is famous for good Jamaican rum,&rdquo; he is quoted as saying.<br /> <br /> De Pass argues, though, in his article that there is still an &ldquo;opportunity [for the UK ] to support our goals on international development and promote international trade as the most important driver of economic growth&rdquo;. He further advocates that the current arrangement of quota- and tariff-free access for raw sugar be maintained, while retaining tariffs on supplies from other countries. http://www.jamaicaobserver.com/assets/13731023/266307_92085_repro_w300.jpg Local Business Friday, March 24, 2017 2:00 AM 3 Develop our intellectual capacity for growth http://www.jamaicaobserver.com/business/Develop-our-intellectual-capacity-for-growth_93448 Last week I made the point that the most important asset that Jamaica has is its three million residents, and that it is the underutilisation of this asset that has caused us to attain average growth of a mere 0.8 per cent per annum for the past 40 years. The fact is that our three million residents are also our most neglected, abused, and underutilised asset. <br /> <br /> One does not have to be a rocket scientist to understand that if you minimise the use of what can give you the greatest value, then obviously your value creation will be minimal. <br /> <br /> This can be extended in economic terms to say that an economy that does not focus on its areas of comparative advantage cannot be competitive and cannot optimise its development.<br /> <br /> Jamaica, for example, has a comparative advantage in tourism, sports, music, niche agricultural products, and more recently the BPO sector - which is primarily our human resources and geographic location. We have, however, done everything to restrict the development of these by not addressing crime, inadequate resources and planning, by tolerating praedial larceny, and year after year by seeking to &ldquo;kill&rdquo; any industry that does well through the imposition of draconian taxes. We therefore create policies to discourage industries from doing well, and then we wonder why we can't have sustainably high growth levels.<br /> <br /> This is the same thing we do with our human resources, as we encourage urban decay by creating disorderly communities; we ignore the productivity of people by allowing uncontrolled noise when people need to sleep; by not respecting the rights of people; by restricting the potential of people through the creation of labour laws that stymie their capacity; and by not insisting on the protection and schooling of children. <br /> <br /> The result of this is that Jamaica scores very poorly with respect to innovation, as shown in the<br /> <br /> Global Competitiveness Report, when it is well known that economies develop fastest when innovation is encouraged.<br /> <br /> A secret that many of our policy makers have never understood over the years - but which our private sector understands very well - is that the best way to build your business is to improve the intellectual capacity of the people who work there. <br /> <br /> The most progressive CEOs I know understand this; for example Don Wehby tells me that he is always on the lookout for good talent, even if there is no vacancy, as they will always add more value than their cost. And if he cannot place them within the company, then he puts them on boards. It is therefore no surprise that under his leadership, GraceKennedy has become a much larger global brand and is always improving its profitability.<br /> <br /> This importance of intellectual capacity is something our policy makers have never understood. So even while they always seem amazed at the development of a country like Singapore, they don't understand that one of the things that has led to Singapore's success is the focus on building human capacity through education and creating an environment for the population to be productive.<br /> <br /> The creation of this environment is necessary for improved productivity and human capacity. If we continue to support an environment of disorder, such as road indiscipline and night noise, discourage productivity and improved compensation, through archaic labour laws and mechanisms such as collective bargaining, and discourage investment and value creation with taxes, then we cannot be surprised to see our labour and total productivity factor falling since the 1970s. <br /> <br /> Can we further be surprised, as I mentioned last week, that little Antigua has GDP per capita at US$18,300 per annum, while we are just over US$4,000 per annum? Can we be surprised when we have approximately 20 per cent of our people living below the poverty line, unemployment at 13 per cent, and more than 300,000 peopler on welfare (PATH), with another 200,000 in need of welfare?<br /> <br /> The only way for us to achieve Vision 2030, and experience real development, is to improve the intellectual capacity of our people. <br /> <br /> This means creating an environment that encourages learning and disciplined living. It means educating our people and preparing them for higher value jobs, as it is not just about the quantity of jobs (such as low-paying factory or BPO jobs) but the quality of jobs. The fact also is that industry, such as BPO, is restricted by the intellectual capacity of the human resources available; therefore the BPO sector cannot move readily to high value jobs, such as programming, because we don't have the skills necessary.<br /> <br /> The first step, of course, is that our policy makers need to fully appreciate the need to develop our human resources if we want to see true development. <br /> <br /> The EGC's Call to Action has understood this by focusing firstly on &ldquo;Citizen Security&rdquo; as the foundation for growth. The next step, however, is for it to be intertwined with the fabric of our fiscal and other government policies. <br /> <br /> This to me is still not evident, as our discussions are still focused around the mathematics of the budget, and who did what when they were in office since independence. <br /> <br /> So essentially, our conversations are focused on immediate needs and the distant past. There is very little discussion about the future. If we are to get to Vision 2030 we must change this way of thinking, and we must start to lay out and discuss plans for the future.<br /> <br /> We also need to understand that the future of any country depends mainly on the children and those yet unborn. Therefore we need to ensure that focus is placed on improving our education system in terms of access and quality. This does not mean building a school at every corner, but using innovative ways such as distance learning.<br /> <br /> The future of our country depends on creating exceptional human resources. This means that our focus must be on creating an environment for our people to realise their full potential. This must not be confused with the politics we have practised over the years, which consists of giving people handouts. That approach simply brings everyone down to a lower standard instead of helping them to be the best they can be.<br /> <br /> This is going to require visionary leadership, which chooses to take action for developing the potential of our people. In other words, leadership must take steps similar to those taken by Jesus when he fed 5,000 people from a basket of fish and loaves, instead of trying to share up the single basket among the 5,000 people.<br /> <br /> <br /> <br /> Dennis Chung is the author of Charting Jamaica's Economic and Social Development AND Achieving Life's Equilibrium. His blog is dcjottings.blogspot.com.<br /> <br /> Email: drachung@gmail.com<br /> <br /> http://www.jamaicaobserver.com/assets/12891529/198382_w300.jpg Local Business Friday, March 24, 2017 2:00 AM 4 The Caribbean is virgin territory for mobile money &mdash; Wehby http://www.jamaicaobserver.com/business/The-Caribbean-is-virgin-territory-for-mobile-money---Wehby_93427 With the Caribbean having low levels of penetration for mobile money products, GraceKennedy Money Services Ltd (GKMS) is still mulling over the next market it will choose to launch its digital currency product, GK MPay.<br /> <br /> The company is not ruling out countries in the Latin American region. Group CEO Don Wehby told the<br /> <br /> Caribbean Business Report. &ldquo;GK is open to every and all markets where business opportunities exist.&rdquo;<br /> <br /> The digital money product is currently operating in 10 other Caribbean markets. Launched in February of this year, it permits the transfer of cash, remittances and bill payment, and is one of three such products which have been rolled out locally.<br /> <br /> The others are CONEC, launched by the Jamaica Cooperative Credit Union League, and Quisk, which is used by the National Commercial Bank.<br /> <br /> According to Michelle Allen, chief executive officer of GKMS, the subsidiary is currently examining which market will be the best fit to roll out GK MPay next.<br /> <br /> The company is targeting a buildout of bill payment services via the digital currency product, a model also being followed in the region.<br /> <br /> In its publication The Mobile Economy Latin America and the Caribbean 2016, GSMA Intelligence says that mobile money is used not just for remittances, but is also used by institutions and organisations to digitise their client payments.<br /> <br /> Another characteristic of mobile money in Latin America and the Caribbean, it adds, is that average customer activity rates are higher than in other regions like sub-Saharan Africa and South Asia.<br /> <br /> GSMA indicates that there are 37 live mobile money services across 17 countries in Latin America and the Caribbean.<br /> <br /> GSMA, the association of mobile network operators, in its 2016 review of the digital economy said that as of December 2015, there were 17.3 million registered mobile money accounts in the region. <br /> <br /> Both El Salvador and Honduras feature in the top 20 markets globally for mobile money account penetration amongst the adult population. <br /> <br /> GSMA said that the shift of consumer engagement in Latin America to mobile devices is driving significant growth in mobile commerce and mobile advertising.<br /> <br /> Meanwhile, in their publication &ldquo;Mobile money &mdash; the next wave of growth,&rdquo; Ernst & Young says the number of mobile payment users, which formed only seven per cent of mobile phone subscribers worldwide in 2013, was expected to rise to 450 million by 2017.<br /> <br /> Wehby stated, &ldquo;The mobile wallet concept is fairly new in the Jamaican and Caribbean markets, so the penetration level is quite low at this time.<br /> <br /> &ldquo;However, we expect that over time this will change, and the mobile wallet will become the way of the future; especially after customers get exposed to the myriad of services we offer: from paying over 50 bills, including all major utilities; ability to send money to any other phone user, whether they have the service or not; collect Western Union remittances; top up any pre-paid mobile phone, and pay for goods and services.&rdquo;<br /> <br /> Total digital commerce in Latin America is forecast to double from its 2015 level to reach US$80 billion by 2020, with Brazil accounting for just below 40 per cent of this.<br /> <br /> The majority of countries now have two or more live services, while several markets now have three. Three mobile money deployments in Latin America have more than one million active customers, GSMA said. http://www.jamaicaobserver.com/assets/13105782/212732_68157_repro_w300.jpg Local Business Friday, March 24, 2017 2:00 AM 4 PHOTO: Shell and Sol http://www.jamaicaobserver.com/business/Shell-and-Sol_93434 Bindley Sangster from Ministry of Transport and Mining (2 right) greets Regional Marketing Manager of Shell Sergio Roldan (left) to the Shell Lubricants Fleet Forum on Tuesday at the Spainsh Court Hotel. Karoline Smith, marketing implementer Western Caribbean and Robert Jackson general manager of Sol Petroleum Jamaica look on.<br /> <br />   http://www.jamaicaobserver.com/assets/13732105/266239_92028_repro_w300.jpg Local Business Friday, March 24, 2017 2:00 AM 5 Cubans still trying to reach US by sea despite rule change http://www.jamaicaobserver.com/business/Cubans-still-trying-to-reach-US-by-sea-despite-rule-change_93324 MIAMI, USA (AP) &mdash; Cubans are still making risky sea journeys to the US despite the end of a policy that allowed them to stay if they made it to American soil, officials said Monday.<br /> <br /> The US Coast Guard said it intercepted 65 Cubans trying to reach Florida or Puerto Rico since January 12. That&rsquo;s when former President Barack Obama ended the so-called &ldquo;wet foot, dry foot&rdquo; policy as part of the normalisation of relations with Cuba.<br /> <br /> The change means Cubans are no longer generally granted the right to stay upon reaching the US. Now they must have a visa or prove a credible fear of persecution like migrants from other countries.<br /> <br /> The Coast Guard had no statistics Monday for the same period in 2016. The agency caught nearly 2,000 in the three months before the change, suggesting that far fewer are attempting what can be a dangerous voyage across the Florida Straits or through the Mona Passage to Puerto Rico.<br /> <br /> &ldquo;We discourage anyone from taking to the sea and attempting to reach US soil illegally,&rdquo; said Captain Aldante Vinciguerra, chief of response for the Coast Guard 7th District. &ldquo;They are risking their lives with very little chance of success.&rdquo;<br /> <br /> At least some may believe that the long-standing preferential immigration policy didn&rsquo;t really end in January or they want to test it, said Sebastian Arcos, associate director of the Cuban Research Institute at Florida International University.<br /> <br /> &ldquo;Others are simply taking a risk to live in the US illegally,&rdquo; Arcos said.<br /> <br /> Cuba&rsquo;s government had long sought the repeal of the &ldquo;wet foot, dry foot&rdquo; policy, which it said encouraged its citizens to risk crossing by sea and contributed to a brain drain of professionals.<br /> <br /> The January 12 decision by Washington to end it was part of the restoration of relations that began in December 2014 and followed months of negotiations focused in part on getting Havana to agree to take back people who had arrived in the United States. http://www.jamaicaobserver.com/assets/13730988/265915_92026_repro_w300.jpg Local Business Friday, March 24, 2017 2:00 AM 5 IMF says Grenada records near four per cent economic growth http://www.jamaicaobserver.com/business/IMF-says-Grenada-records-near-four-per-cent-economic-growth_93335 ST GEORGE&rsquo;S, Grenada (CMC) &ndash; Grenada&rsquo;s performance during the last phase of the International Monetary Fund (IMF) Extended Credit Facility (ECF) supported home-grown programme has been strong with the island recording economic growth of just under four per cent last year, the IMF said Wednesday.<br /> <br /> An IMF delegation, headed by Nicole Laframboise, has ended a one-week visit here undertaking a sixth review of Grenada&rsquo;s IMF-supported ECF programme of US$19.4 million that was approved in 2014.<br /> <br /> Laframboise said overall performance during this last phase of the ECF-supported Home Grown programme has been strong and that the government has made progress toward achieving the key programme goals of restoring fiscal sustainability, strengthening the financial sector, and setting the stage for durable growth.<br /> <br /> She said that the government has met all of the performance criteria and structural benchmarks due at end December 2016.<br /> <br /> &ldquo;All the indicative targets were met, except for a minor underspending on the World Bank-supported SEED programme because of extra time needed to process candidates under the new eligibility system. <br /> <br /> &ldquo;Nonetheless, it is worth noting that the results so far point to an improvement in the effectiveness and targeting of programmes to those most in need,&rdquo; she said.<br /> <br /> The IMF official said that real gross domestic product (GDP) is estimated to have expanded by 3.9 per cent in 2016, implying annual real GDP growth of 5.8 per cent on average from 2014-2016.<br /> <br /> She said activity in 2016 was driven by tourism, construction, and some pickup in domestic demand, while agriculture experienced weather-related contraction.<br /> <br /> &ldquo;Growth is expected to moderate to 2.5 per cent in 2017, near its estimated potential. Average consumer price index (CPI) inflation rose to 1.7 per cent in 2016 and is forecast at 2.6 per cent in 2017 as oil and food prices start to rise. With steady tourism momentum, the external position remains stable.&rdquo;<br /> <br /> She said the government achieved a primary surplus &ndash; fiscal balance excluding interest payments &ndash; in 2016 of 5.3 per cent of GDP and that expenditures were kept under firm control, and tax revenues performed well across all categories, driven by improvements in compliance and administration as well as robust activity.<br /> <br /> &ldquo;Grenada has also taken important steps towards completing the comprehensive debt restructuring started in 2014. Of the stock outstanding at programme inception, over 90 per cent has been restructured.<br /> <br /> &ldquo;Public debt is forecast to fall to 72 per cent at end 2017, a drop of 36 percentage points from its peak of 108 per cent in 2013. This sizeable decline in the debt-to-GDP ratio is attributed to all three key factors: debt relief and restructuring, fiscal adjustment, and strong GDP growth.&rdquo;<br /> <br /> She said employment has grown on average by about four per cent annually since 2014, but unemployment in Grenada is high, particularly for the youth.<br /> <br /> &ldquo;Labour force statistics suggest an important skills mismatch in the economy. A review of education curriculums and new labour market programmes to improve training and job search tools, in collaboration with the private sector, would help address this mismatch,&rdquo; she added.<br /> <br /> Laframboise said to achieve broader-based growth, the government is focusing on structural reforms to improve the supply response.<br /> <br /> &ldquo;Based on the natural endowments and market brand, the agriculture sector could be a more important source of growth and employment in Grenada. The authorities are moving toward some liberalisation in the sector and staff urge them to continue in that direction.<br /> <br /> &ldquo;The government is also taking steps to remove impediments to doing business, including streamlining property registration processes and customs procedures, and strengthening building quality control and regulation. Further consultations with the private sector in these areas could help identify pressure points to be addressed,&rdquo; she said.<br /> <br /> &ldquo;Grenada is a small open economy susceptible to external shocks, including from natural disasters, swings in key tourism markets, commodity price shocks, as well as potential volatility of Citizen-by-Investment revenues.<br /> <br /> &ldquo;With these types of vulnerabilities, lower debt and higher reserve buffers will help the country mitigate the impact of external shocks to avoid output losses and setbacks in income and social progress.&rdquo; http://www.jamaicaobserver.com/assets/12697604/187973_w300.jpg Local Business Friday, March 24, 2017 12:00 AM 6 Price to head FLOW Jamaica; says building on agreed 2017 strategy a major focus http://www.jamaicaobserver.com/business/Price-to-head-FLOW-Jamaica--says-building-on-agreed-2017-strategy-a-major-focus_93327 Stephen Price, whose appointment as managing director of Flow Jamaica was announced by the company yesterday, said his immediate focus will be to build on the company&rsquo;s current agreed 2017 strategy.<br /> <br /> &ldquo;We have some significant focus on mobile growth,&rdquo; Price told the Jamaica Observer yesterday evening. &ldquo;We have significant growth expected in IPTV... really landing those key projects to ensure that we bring faster speeds across the island in terms of faster broadband and mobile speeds and really bring paid TV to more homes than we&rsquo;ve ever done before using the copper services that we have.&rdquo;<br /> <br /> Price, Flow Jamaica&rsquo;s current vice-president of retail sales and distribution, will assume his new job on June 1. His promotion follows the appointment of current country head Garfield &ldquo;Garry&rdquo; Sinclair to president, Caribbean, Cable & Wireless Communications (CWC) earlier this year.<br /> <br /> In a news release yesterday, Flow said that Price will lead Jamaica&rsquo;s 800-plus team and will have the responsibility of leading and executing the strategy for both the consumer line (Flow) as well as the business line (C&W Business). <br /> <br /> &ldquo;He will also own the financial performance, customer experience and reputation of the business,&rdquo; the communications giant explained.<br /> <br /> &ldquo;CWC is at a defining time in its history and Jamaica is a key part of that story. I am very excited about Stephen&rsquo;s appointment as he has some great ideas that I believe will continue to grow our Jamaica business and take it to the next level,&rdquo; the release quoted Sinclair. <br /> <br /> &ldquo;Stephen and I will immediately embark on a programme to ensure a smooth leadership transition which will culminate in his fully taking over the reins in June,&rdquo; he added.<br /> <br /> Price, in his discussion with the Observer, was full of praise for Sinclair and noted that the company has &ldquo;an extremely strong senior leadership team&rdquo; that Sinclair has &ldquo;guided, coached and mentored&rdquo; through the transition process.<br /> <br /> &ldquo;Garry himself is so happy that this was a totally local process which was made up of members of the senior leadership team,&rdquo; Price said. &ldquo;Really, all credit is due to Garry&rsquo;s leadership. We have a structure and a process that we have come together as a management team to ensure that we execute.&rdquo; <br /> <br /> In its news release, Flow said that Price comes to the role with a wealth of experience in the telecommunications industry, progressing through areas spanning commercial, customer care, operations and marketing and having spent over 10 years with the Cable & Wireless team. <br /> <br /> &ldquo;In his current role, he manages the sales and distribution strategy for residential consumers, with direct accountability for 86 Flow retail outlets and over 21,000 recharge points-of-sale islandwide,&rdquo; the company said, adding that he was instrumental in Flow&rsquo;s development and strategic evolution over the years and successfully led the critical aggressive process of consolidating the company&rsquo;s retail footprint across the country following the merger of C&W and Columbus businesses.<br /> <br /> &ldquo;He is also an experienced operations director and sales distribution strategist with big picture vision, leadership, and resolve to successfully penetrate new markets, capture market share, and deliver top/bottom-line goal,&rdquo; the company said. http://www.jamaicaobserver.com/assets/13728556/265955_91981_repro_w300.jpg Local News Thursday, March 23, 2017 12:00 AM 4 http://www.jamaicaobserver.com/assets/13728557/265955_ld.jpg MailPac parent company mulls listing on stock exchange http://www.jamaicaobserver.com/business/MailPac-parent-company-mulls-listing-on-stock-exchange KINGSTON, Jamaica &mdash; Khary Robinson, executive chairman of Norbrook Equity Partners (NEP), which recently raised $677.25 million via a preference share issue, says the company is considering listing in the medium term.<br /> <br /> Norbrook, a St Lucia-based holding company with operations in Jamaica and the United States, announced on Monday that it had successfully closed private placement of US$5,250,000 ($677.25 million) indexed redeemable preference shares in the capital of the company to a group of accredited institutional investors.<br /> <br /> The placement &mdash; the first offer to outside investors &mdash; was arranged by NCB Capital Markets Ltd.<br /> <br /> Robinson told OBSERVER ONLINE that the rate offered on the issue is "under confidentiality with the institutional investor base as per the preference share agreement".<br /> <br /> Otherwise, investors agreed to pay a price of US$1.00 or the Jamaican dollar equivalent for each preference share.<br /> <br /> The shares are cumulative, non-voting and non-convertible to common shares in the capital of the company, and are redeemable at the end of five years.<br /> <br /> Norbrook indicates that it will use the net proceeds to fund additional acquisition opportunities, refinance existing debt, and for general corporate and working capital purposes.<br /> <br /> Robinson told OBSERVER ONLINE, in relation to debt to be retired, that the company is "in late-stage negotiations with a couple opportunities". He also noted that NEP is in discussions regarding "a potential listing in the near to medium term".<br /> <br /> The company's current portfolio, consisting of seven companies in logistics, pest control and other areas, is not predictive of future targets.<br /> <br /> Robinson asserted: "We are agnostic as seen by our portfolio. We simply look for companies that are in growing industries and that we can add value to through a mix of strategic guidance, operating excellence, capital support, and transactional expertise (add-on acquisitions)."<br /> <br /> Norbrook has 240 employees in its operations in the Caribbean and the United States.<br /> <br /> Subsidiary Mailpac Services Ltd is an e-commerce logistics provider in Jamaica, which provides e-commerce solutions and package delivery services through a sorting and shipment facility in Miami, Florida, and pickup locations in Jamaica.<br /> <br /> In August 2016, Norbrook acquired the Jamaican franchise for Hertz Car Rental through its wholly owned subsidiary Norbrook Car Rental Ltd (NCR), which also became the first Caribbean franchisee to operate Firefly Car Rental, a 'value' rental car brand owned by Hertz International.<br /> <br /> The company indicates that since acquiring the Hertz franchise, NCR has grown the fleet to more than 330 vehicles and currently operates from two on-airport and two off-airport locations:  Norman Manley International Airport, Sangster International Airport, 28 Sunset Boulevard in Montego Bay, and 109 Old Hope Road in Kingston.<br /> <br /> Norbrook's other subsidiaries include the 4-Evergreen Group, a provider of lawn care and pest control solutions in South Florida, and landscaping provider to "Office Spaces", a TV show syndicated to FOX and Lifetime.<br /> <br /> It also operates Caddiz.com, an online grocery and office supplies delivery service with shop-and-deliver partnerships with Pricesmart and Hi-Lo.<br /> <br /> Subsidiary Norbrook Home Delivery offers delivery of five-gallon containers of purified drinking water to homes and offices under the Jam Agua and Blue Mountain Peak Spring Water brands.<br /> <br /> Norbrook Trucking Solutions is a less-than-truckload (LTL) transportation and freight delivery service. Norbrook is also a minority investor in various other companies locally and internationally, Robinson said.<br /> <br /> The executive declined to reveal company revenues and the performance of business lines, indicating that such information will be made available "if and when" the company lists on an exchange.<br /> <br /> He told OBSERVER ONLINE, "We have a strong business and income balance across our group. Our companies are all at various stages of life &mdash; from steady state cash generators to high-growth sector leaders."<br /> <br /> NEP was started in 2008 and operates alongside Norbrook Caribbean Investment Company, of which Robinson is also head.<br /> <br /> Avia Collinder<br /> <br /> http://www.jamaicaobserver.com/assets/13730425/KharyRobinson-_w300.jpg Local Business Thursday, March 23, 2017 11:58 AM 5 Itelbpo donates playground to Blossom Gardens http://www.jamaicaobserver.com/business/Itelbpo-donates-playground-to-Blossom-Gardens--------_93308 MONTEGO BAY, St James - A playground may seem like an ordinary, insignificant structure merely to occupy the time of children for a few hours.<br /> <br /> But for wards of the state at the Blossom Gardens Child Care Facility in St James, a playground is a place that brings joy, smiles and laughter for many of them who have very little. <br /> <br /> On a visit to the facility you will notice that there was a recent facelift of the space. With this facelift came the construction of a new playground complete with a gazebo, walkway, monkeybars and a new seesaw, for the close to 41 wards of the state who find a home at the facility. <br /> <br /> This project was the effort of itelbpo Smart Solutions, which last year received a $1 million grant from the Digicel Foundation for its execution. <br /> <br /> &ldquo;One of the greatest feelings as an employer is to be able to give back to the community where we operate. It's an even better feeling, one of hope, when your team members are excited and energised to do so on behalf of the company. It speaks to the culture of our work environment and it tells me that we're doing something right,&rdquo; said Yoni Epstein, chairman and CEO of itelbpo Smart Solutions. <br /> <br /> Last year, itelbpo Smart Solutions carried out several employee-led initiatives geared towards assisting the childcare facility with much-needed supplies, and possibly the most appreciated gift &mdash; their many visits. <br /> <br /> &ldquo;Our children are certainly benefitting from the new equipment and the improved grounds, additionally, a gazebo was constructed, which both children and staff utilise on a daily basis. We are indeed thankful to Mr Yoni Epstein and his team for the deep interest they have shown in our home,&rdquo; said manager of the child care facility, Ameria Munroe. <br /> <br /> &ldquo;Over the past two years they not only donated to the home, but they have taken the time to visit and interact with our children, thereby adding that personal touch.<br /> <br /> We sincerely appreciate those times and the completion of this recent project.&rdquo; <br /> <br /> http://www.jamaicaobserver.com/assets/13729473/265909_91959_repro_w300.jpg Observer West Thursday, March 23, 2017 2:00 AM 6 Scotiabank confirms upcoming job losses http://www.jamaicaobserver.com/business/Scotiabank-confirms-upcoming-job-losses_93217 Scotiabank has confirmed reports that it will cut Jamaican staff as part of its restructuring exercise, but says it is unable to state the exact number at this time. <br /> <br /> The news comes at a time when the bank has been receiving heavy public critisim for the extent of some of its service charges.<br /> <br /> Yesterday, president general of the Bustamante Industrial Trade Union (BITU), Kavan Gayle, indicated that close to 100 jobs would be made redundant by the Canadian bank. Reports are that the jobs are being transferred from Jamaica to Trinidad and Tobago.<br /> <br /> According to Gayle, the workers to be affected in Jamaica are &ldquo;support staff that deal with certain shared services right across the region&rdquo;.<br /> <br /> In response to the report, Scotiabank reasoned that it had announced to employees plans to consolidate some of its back-office support functions. <br /> <br /> The bank noted that the plans were in keeping with its focus to develop centres of excellence to establish best practices, standards, and increase efficiency of processing and support services.<br /> <br /> &ldquo;These centres are located in countries across the Caribbean, including Jamaica. This consolidation supports the bank&rsquo;s objective of being better organised to serve our customers while reducing structural costs,&rdquo; Scotiabank said. <br /> <br /> &ldquo;These proposed changes are not being taken lightly, and are being considered with a view to ensuring that the bank operates effectively and efficiently to serve its clients and meet their changing needs,&rdquo; it continued. <br /> <br /> Gayle, however, expressed concern about a reported thrust by the bank to establish &ldquo;what they consider centres of excellence&rdquo; in other territories in the region where the bank&rsquo;s staff members are not unionised.<br /> <br /> He cited that the move has included The Bahamas, with a number of jobs in that country being reportedly transferred to the Dominican Republic.<br /> <br /> Scotiabank said it is engaging in a consultative process with the BITU, which represents the majority of the affected employees in the units to be consolidated. It added that it is doing all it can to minimise impact on employees, and remains committed to treating all employees who are impacted by this process fairly and with respect. <br /> <br /> &ldquo;Where positions are impacted, the Bank would seek to place as many employees as possible in available positions within the organisation,&rdquo; it said. <br /> <br /> In November 2014, Scotiabank announced plans to conduct a US$451-million restructuring, which included closures and job losses in the Caribbean. Scotiabank said it plans to close or downsize 120 branches outside Canada, largely in Mexico and the Caribbean, in a bid to save CAN$120 million annually.<br /> <br /> The bank said it would close down 35 of its 200 branches in the Caribbean and would sever 1,500 full-time employees, including 500 from its international operations. http://www.jamaicaobserver.com/assets/13289488/228889_87885_repro_w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 1 http://www.jamaicaobserver.com/assets/13725824/228889_87885_repro_bzsecld.jpg US dollar investment limits need review &mdash; securities dealers http://www.jamaicaobserver.com/business/US-dollar-investment-limits-need-review---securities-dealers_93175 The Jamaica Securities Dealers Association (JSDA) is calling for dialogue around the issue of permissible holdings of US dollar investments.<br /> <br /> With the central bank indicating last week that it is not ready to lift the five per cent limit placed on insurance companies and pension funds for holdings of foreign-denominated assets, head of the JSDA Steven Gooden told the Jamaica Observer that the problem curtails opportunities to maximise returns.<br /> <br /> Meanwhile, he is also concerned about the new requirement of the Financial Services Commission (FSC) that dealers submit to the BOJ for approval any new US dollar product, stating that it places the sector at a competitive disadvantage.<br /> <br /> &ldquo;In recent times, the FSC, as a part of its registration process for exempt distribution, has apparently included an approval from the Central Bank as a requirement for instruments that are denominated in hard currency.<br /> <br /> &ldquo;This reduces the efficiency of the capital markets and places the securities dealers at a serious disadvantage versus the banking sector when competing to provide funding solutions to issuers of USD debt.&rdquo;<br /> <br /> Gooden said the JSDA is in dialogue with the FSC regulator &ldquo;to seek clarity on this matter, as such a move could significantly reduce the supply of USD securities available to investors both privately and via the Stock Exchange, and at the same time reduce viable funding alternatives for the private sector&rdquo;.<br /> <br /> In relation to limits placed on institutional investors, Gooden noted that Section 22 of the Bank of Jamaica Act limits pension funds and insurance companies, which represent a large segment of the market, from participating in USD equity or debt listings.<br /> <br /> It also restricts the type of securities which can be bought to those with an investment-grade credit rating.<br /> <br /> The JSDA head pointed out: &ldquo;With Jamaica having a sovereign credit rating that is five notches below investment grade, it is very unlikely that a Jamaican corporate would have an investment grade rating from an international rating agency.<br /> <br /> &ldquo;Our position is that Jamaican corporates should be exempt from the application of Section 22. The reality is that Jamaican entities seeking USD financing are more than likely net earners of hard currency and contribute in a meaningful way to the Jamaican economy.&rdquo;<br /> <br /> Gooden noted as well that the interpretation utilised by the BOJ &ldquo;appears to expand the impact of section 22 to apply to listed Jamaican dollar-denominated equities that provide investors with exposure to hard currency assets&rdquo;.<br /> <br /> &ldquo;Hence,&rdquo; he added, &ldquo;the Jamaican Depository Receipt (JDR) market, which was recently launched by the Jamaica Stock Exchange (JSE), is yet to have a listing, due to BOJ&rsquo;s interpretation of the regulation. <br /> <br /> &ldquo;The Central Bank views such securities as hard currency instruments, and as such, participation is limited primarily to retail investors, rendering the initiative non-viable at this time due to the inability to scale.&rdquo;<br /> <br /> Indeed, senior deputy governor of the BOJ, John Robinson, said last week that pension funds and insurance companies would continue to be restricted from participation in the depository receipt market, as while they might buy in J-dollars, the broker purchasing shares abroad would have to use foreign currency to secure them.<br /> <br /> The BOJ&rsquo;s aim is to minimise the impact of large new sources of demand for US dollars on the value of the Jamaican dollar. Robinson said the bank&rsquo;s aim was to maintain order.<br /> <br /> Gooden, who submitted the views of the JSDA last week, said, &ldquo;We believe there needs to be dialogue among the key stakeholders to make the JDR market a viable one within the context of the hard currency concerns. The development of the JDR market would go a far way in increasing the menu of assets available to investors while enhancing the breadth and profile of our local capital markets.&rdquo; http://www.jamaicaobserver.com/assets/13725803/213682__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM Y http://www.jamaicaobserver.com/assets/13725805/213682_sld4.jpg 04 2 Jamaican happiness slips for 2015-2016 period http://www.jamaicaobserver.com/business/Jamaican-happiness-slips-for-2015-2016-period_93064 As the world celebrated the International Day of Happiness on Monday, it was revealed that the level of happiness fell in Jamaica over the 2014-2016 period, according to the United Nations&rsquo; World Happiness Report 2017.<br /> <br /> Jamaica now ranks 76th out of 155 listed countries, between the eastern European nations of Hungary at 75 and Croatia at 77.<br /> <br /> The country has slipped three spaces since the 2013-2015 period, when Jamaica ranked 73rd in happiness.<br /> <br /> Meanwhile, the happiest country on Earth is now Norway, with last year&rsquo;s highest scorer, Denmark now second, and Iceland third.<br /> <br /> The unhappiest country is the Central African Republic, preceded by Burundi, Tanzania and Syria. <br /> <br /> &ldquo;Happiness is increasingly considered the proper measure of social progress and the goal of public policy,&rdquo; acording to the 2017 report. The report considers happiness in each country to be affected by the two most important variables of GDP per capita and healthy life expectancy, as well as social support, social freedom, generosity, and absence of corruption. <br /> <br /> Within the Caribbean region, Jamaica&rsquo;s level of happiness was below Costa Rica (12), Panama (30), Trinidad and Tobago (38) and Belize (50). <br /> <br /> But the country was happier than Venezuela at 82, and the nearby island of Hispaniola, with the Dominican Republic ranking 86th and Haiti 145th. Several other regional countries such as Guyana, Suriname and Barbados were not included. <br /> <br /> Meanwhile, Canada ranked 7th in global happiness, the United States 14th and the United Kingdom 19th. <br /> <br /> Further afield, Israel ranked as the 11th happiest country, Singapore ranked 26th, war-torn Libya 68th, China just below Jamaica at 79th, Nigeria 95th, South Africa 101st, India 122nd and Ghana 131st.<br /> <br /> Overall, Jamaica has seen one of the greatest falls in happiness since 2007 &mdash; the year before the 2008 global recession &mdash; according to the index. <br /> <br /> The extent of the country&rsquo;s change in happiness ranked it among the bottom 10 countries &ndash; at 121 out of 126 &mdash; between two countries currently at war, Yemen at 120 and Ukraine at 122.<br /> <br /> Countries with even greater declines than Jamaica included Botswana (123), Greece (124), the Central African Republic (125) and Venezuela last at 126.<br /> <br /> Conversely, the countries which saw the largest increases in happiness were Nicaragua (first), Latvia (second) and Sierra Leone (third). http://www.jamaicaobserver.com/assets/13725794/265727__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 3 Build Expo & Conference 2017 for MoBay in June http://www.jamaicaobserver.com/business/Build-Expo---Conference-2017-for-MoBay-in-June A first of its kind, Build Expo and Conference is to be held in Montego Bay June 9-11 to promote the local construction industry and encourage homeownership and property development.<br /> <br /> The expo, which will emphasise clean, alternative energy solutions and environmentally friendly practices, is the brainchild of Dwight Crawford and will feature keynote speakers from senior levels of the Jamaican Government and celebrated global business leaders, along with presentations on innovative building and development strategies. <br /> <br /> Days two and three will feature presentations from regional and international exhibitors and their product/ service offerings within industries connected to the building and property development sectors. <br /> <br /> This as the conference presents a coveted opportunity for industry leaders regionally and globally to network and find ways of doing business. <br /> <br /> Montego Bay has been selected as the host city because of its internationally connected air and sea ports and domestically connected network of roadways to Kingston and all other major population centres in Jamaica, along with the enchanting abundance of hotel accommodations. <br /> <br /> Over the coming weeks, the organisers are promising to gradually introduce the expo&rsquo;s contingent of local and international speakers and presenters.<br /> <br /> Among the speakers will be: minister without portfolio in the Ministry of Economic Growth and Job Creation with responsibility for water, works and housing, Dr Horace Chang, and architect and project manager, Julie Sullivan Jones.<br /> <br /> &ldquo;It is clear that new thinking, new initiatives, and new approaches have to be engaged to meet this important need of providing adequate housing for our people,&rdquo; Dr Chang said about the event. <br /> <br /> Sullivan Jones is trained as an architect and served the architecture and construction industries in the areas of urban design, transportation architecture, multi-family housing and urban development. <br /> <br /> Her management experience ranges from US$5 million to $3.6 billion in assets. She practised professionally in the Boston area for 20 years, and then relocated to Kingston for 10 years. <br /> <br /> More recently, she worked as an OPM (owner&rsquo;s project manager) for multi-family housing and business process outsourcing clients, and taught design courses in architecture and urban design at the University of Technology&rsquo;s Caribbean School of Architecture. <br /> <br /> The main speakers will concentrate on development potential in Jamaica and the region, focusing on environmentally friendly solutions that can protect destinations like Jamaica from fossil fuel dependency, as it grapples with the threat of climate change even while expanding its main industries such as construction. <br /> <br /> The build and development sectors are attractive and dynamic and, by international precedence, produce some very impressive numbers for expos organised around them, both in terms of numbers of exhibitors and numbers of attendees. <br /> <br /> The event is expected to attract thousands of industry leaders locally and from abroad. Architecture, decor and landscaping are glamorous and entertaining; the Build Expo & Conference 2017 will complement this natural extravaganza with hourly giveaways and surprises, with a grand gate prize at the end. http://www.jamaicaobserver.com/assets/13726838/ZZ76F2A025_w300.jpg Local Business Wednesday, March 22, 2017 2:50 AM 4 Renfrew&rsquo;s &lsquo;topping out&rsquo; signals final stage of New Kingston hotel http://www.jamaicaobserver.com/business/Renfrew-s--topping-out--signals-final-stage-of-New-Kingston-hotel_92834 The practice of &ldquo;topping out&rdquo; may be something new to Jamaicans, but certainly not to Josef Bogdanovich, whose cognitive loyalty to the island makes him a genuine hero of local culture.<br /> <br /> So last Wednesday, despite the distraction of the annual budget debate, Bogdanovich and his partner, the well-known architect Evan Williams, staged a topping out for the new Renfrew Hotel, situated on Renfrew Road, New Kingston, which was probably the first time most Jamaicans were hearing of such a party.<br /> <br /> It may be traditionally a social event, considering that the practice of topping out a new building can be traced to the ancient Scandinavian religious rite of placing a tree atop a new building to appease the tree-dwelling spirits displaced in its construction.<br /> <br /> However, it turned out to be a cultural event with a number of tourism interests, including Minister of Tourism Edmund Bartlett, Mexico&rsquo;s Ambassador Martha Cecilia Jaber, and head of the consular section of the Embassy of Russia, Andrey Dryakin among the guests.<br /> <br /> The event took place on March 15, commonly referred to as the Ides of March, the day when Julius Caesar was assassinated, but the interests of the guests were basically focused on how far the project had reached, and when it would finally open.<br /> <br /> In Jamaica&rsquo;s construction sector the topping out of a building represents the placement of the roof structure; a symbolic gesture of completion. So, the ceremony marked a landmark moment in the construction of the R Hotel, which is poised to become Kingston&rsquo;s first Business &lsquo;extended stay&rsquo; hotel.<br /> <br /> It is the result of collaboration between the noted architect Williams and the investor Bogdanovich, a boutique property offering exclusive rooms and apartments, and will be representative of the five-star brand within the &lsquo;Exclusive Business Hotels of the World&rsquo; group.<br /> <br /> The R Hotel&rsquo;, is the sexy name for the project which is being developed within the New Kingston area.<br /> <br /> It distinguishes itself through high levels of personal service and the business facilities offered, all in a luxurious setting. The property will consist of 32 exclusive rooms as well as eight two-bedroom duplex apartments.<br /> <br /> The target market includes corporate guests with long-stay requirements from the banking, information technology, auto, entertainment and insurance sectors, due to the proximity of the New Kingston business district. Additionally, the hotel will appeal to business executives attending national and international travel and trade fairs. <br /> <br /> Unique offerings &mdash; such as a complete 24-hour IP video surveillance coverage, a state of the art high-speed fibre- optic network, voice, video and teleconferencing services, integrated messaging, telephones with VoIP functionality, wireless access points throughout the hotel, and more &mdash; differentiate the R Hotel from any other in New Kingston.<br /> <br /> Commenting on the holistic approach to high-level personal service to be offered by the R Hotel, Williams stated, &ldquo;In conceptualising this project I was responding to a clear and unfulfilled demand for a hotel like the R Hotel in New Kingston; one that was specifically designed to provide the comforts, conveniences and luxuries required by travelling business executives.<br /> <br /> &ldquo;It overwhelms me with pleasure that this project has reached the landmark topping -out stage, and I am excited that very soon all will be able to share in my vision,&rdquo; Williams said.<br /> <br /> &ldquo;As a businessman who often operates in Kingston, I have often wished there was a facility like the R Hotel,&rdquo; Bogdanovich added.<br /> <br /> &ldquo;It was an obvious investment for me. Jamaica is on a path to growth and economic development, which will bring an influx of international business people to the capital.<br /> <br /> By providing the luxury services they need, the R Hotel is expected to help ensure that guests will always want to return to Kingston,&rdquo; he stated.<br /> <br /> Bartlett, who welcomed the R Hotel to Kingston, commended Williams and Bogdanovich for coming together to create a &ldquo;welcome offering&rdquo; to the development of the hotel.<br /> <br /> The minister noted that the project involves a Jamaican and an American who has made Jamaica his home, sharing their commitment to the development of the country in a very tangible way.<br /> <br /> &ldquo;These are elements of the five pillars on which we are growing our tourism industry, as we develop Jamaica as a world-class destination,&rdquo; Bartlett added.<br /> <br /> It was announced that due to an advanced pace of construction, the hotel may be opened by August, as against the scheduled October 2017 date. http://www.jamaicaobserver.com/assets/13725827/265052__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 4 Corned beef distributors to investigate Brazilian meat http://www.jamaicaobserver.com/business/Corned-beef-distributors-to-investigate-Brazilian-meat_93227 A least two corned beef distributors, GraceKennedy and Lasco Distributors, are conducting their own investigations following directives from the Government to suspend sales of corned beef originating from Brazil. <br /> <br /> Yesterday the distributors, in responding to the Brazil corned beef temporary ban, said they are in full compliance with directives to immediately withdraw the product from the Jamaican market, but are also sending their quality control team to Brazil to conduct its own investigations. <br /> <br /> &ldquo;Lasco will be sending the head of its quality control team to Brazil along with a representative from the Ministry of Agriculture to meet with Brazilian Government officials and conduct an audit of our supplier&rsquo;s facilities,&rdquo; Kelia-Gaye Dunbar, marketing manager of Lasco Distributors Ltd, told the Jamaica Observer in response to queries yesterday. <br /> <br /> On Monday the Ministry of Industry, Commerce, Agriculture and Fisheries imposed an immediate import ban on corned beef from Brazil following reports from Brazilian authorities that several major Brazilian meat processors have been &ldquo;selling rotten beef and poultry&rdquo;. The companies are also alleged to have paid hefty bribes to auditors in exchange for fraudulent sanitary licences.<br /> <br /> Attempts by the Business Observer to get a response from Facey Commodity, which distributes NuPak and Eve corned beef, proved futile.<br /> <br /> Nonetheless, Lasco and GraceKennedy in press releases outlined that the companies will be recalling its corned beef products from the warehouse and shelves of its customers in accordance with the terms of the ban from the Ministry of Agriculture. <br /> <br /> The companies are also encouraging consumers to return corned beefs to the point of purchase.<br /> <br /> The imposed ban on corned beef is expected to place a dent in the revenues of the local distributors. However, Lasco stated that it expects the situation to be normalised once the Ministry of Agriculture&rsquo;s investigation has been completed.<br /> <br /> &ldquo;The company has a standard operating procedure for such eventualities and this has already been activated. The necessary arrangements are in progress for the corned beef to be collected from customers islandwide,&rdquo; Lasco said. <br /> <br /> It added that the results of the two-week investigation period by the ministry will guide the company&rsquo;s next steps as it relates to its supply chain. http://www.jamaicaobserver.com/assets/13725822/265787__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 4 Engineer makes case for building up construction training http://www.jamaicaobserver.com/business/Engineer-makes-case-for-building-up-construction-training_93156 Anthony Warner of Canadian-based Virtual Engineers is advocating for the early inclusion of construction work training in the local school curriculum.<br /> <br /> &ldquo;...So the training should begin at an early stage and family members, primarily, should be aware that this training is very valuable to the children/students,&rdquo; the veteran engineer argued.<br /> <br /> The Jamaican native advised that for the future, instead of perpetuating &ldquo;the engineers, doctors, lawyers syndrome&rdquo;, students should be swayed into the in- demand professions such as which exist in the expanding building sector.<br /> <br /> &ldquo;The building industry, which is actually quite good to be growing in Jamaica, is at a stage now where it needs highly trained people in that industry,&rdquo; Warner pointed out.<br /> <br /> He argued that &ldquo;engineers are the only ones in that (building) space&rdquo; but &ldquo;engineers are not actually doing the real work&rdquo;.<br /> <br /> In the meantime, he noted that currently the education system provides for graduates to migrate with their skills overseas, instead of positioning them to build the economy.<br /> <br /> &ldquo;I have a very strong opinion about education in Jamaica. I believe that the education system does not sustain itself in terms of the graduates having places to go. The system is more like an export business where you educate individuals and they are well prepped for export, so it&rsquo;s an export market in some sense,&rdquo; he posited.<br /> <br /> Warner, who is a past student of St Jago High in St Catherine, wants Government to provide financial support for the training of construction workers, similar to what &ldquo;other institutions get&rdquo;.<br /> <br /> &ldquo;This has been a long-term thing, from the early days of having apprentices. In the different industries you will find that if you go back several years in Jamaica, the apprentices were some of the best-qualified people after finishing their programmes, versus people who were in an academic situation where they got highly educated but not any skill that is needed for the country. It&rsquo;s a very special situation,&rdquo; he reasoned.<br /> <br /> The seasoned engineer, who will be a speaker at the upcoming expo and conference to be held at the Montego Bay Convention Centre June 9-11, was speaking to members of the media in Montego Bay late last week.<br /> <br /> He is currently in his native island on business.<br /> <br /> According to Dwight Crawford, conceptualiser of the conference, it will offer state-of-the-art building solutions.<br /> <br /> &ldquo;The building industry in Jamaica leaves a lot to be desired and, through our research and experience, we have realised that the world has moved far beyond what Jamaica has to offer,&rdquo; Crawford said.<br /> <br /> Build Expo and Conference will be directed towards local, regional and international exhibitors of products and services aimed at modernising the construction industry locally. http://www.jamaicaobserver.com/assets/13725753/265769__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 4 Case up and Barclay out at First Global http://www.jamaicaobserver.com/business/Case-up-and-Barclay-out-at-First-Global_93165 GraceKennedy Group has created three job positions as part of a restructuring exercise of First Global Bank (FGB). <br /> <br /> In a report to shareholders, GraceKennedy noted that FGB appointed employees for the post of senior vice-president of technology, assistant vice-president of strategy and project management office, and vice-president of digital marketing and communications. Nichole Case has been appointed to act in the role of senior vice-president of technology.<br /> <br /> GraceKennedy Group began the restructuring of FGB back in 2015, which saw President of First Global Bank Maureen Hayden-Cater tendering her resignation. <br /> <br /> Group CEO Don Wehby said the changes were in keeping with the company&rsquo;s strategic goals and its vision to become a global consumer group. Its focus is to become a consumer-centric company which incorporates digitisation in line with global trends.<br /> <br /> Previously GraceKennedy said that it ultimately wants to optimise the structure of the group in keeping with best practices, making the company more efficient, nimble and productive. Wehby noted that the changes will ensure that senior leadership is strategically placed within the businesses as the company poises itself to compete effectively on a global scale. <br /> <br /> FGB&rsquo;s technology department will be responsible for core IT infrastructure and capabilities as well as e-business, including e-channels, innovation and technology. <br /> <br /> &ldquo;As part of the restructuring exercise, the post of general manager was made redundant and Mrs Paula Barclay will demit office effective March 31, 2017. FGB thanks Mrs Barclay for her notable contribution to the GraceKennedy Group over the past 18 years,&rdquo; GraceKennedy said. <br /> <br /> Already the company has formally terminated the titles of CEO for the Foods and Financial Services divisional offices, as well as the titles of divisional CEOs, to minimise what it said were duplication of efforts and costs across the corporate offices within the group. <br /> <br /> FGB&rsquo;s latest move is to add at least 20 First Global Bank branch networks across its Western Union locations in Jamaica later this year, using the agency banking model. With the agency banking regulations approved by the Bank of Jamaica, Wehby anticipates that the initiative will be a game changer for FGB and will also bring greater support for financial inclusion across the island. http://www.jamaicaobserver.com/assets/13725832/265779__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 5 Yes, you can you measure marketing communications results! http://www.jamaicaobserver.com/business/Yes--you-can-you-measure-marketing-communications-results-_93189 Many Jamaican companies spend countless millions of dollars on marketing communications every year. <br /> <br /> Hey! Can you guess how much the title sponsor will spend on the ISSA Boys and Girls Championship Sports in Jamaica this year? More than most of us will earn in a lifetime! But when you ask marketing or communications managers what they will get in return for their money, very few, if any, can tell you. <br /> <br /> Well, here is our position on that matter.<br /> <br /> If your marketer tells you that he can&rsquo;t quantify the return on your investment in marketing communications, send him back to marketing school!<br /> <br /> ESTABLISHING COMMUNICATION OBJECTIVES<br /> <br /> Senior managers, especially the CEO and CFO, want to know the outcomes and revenues resulting from their communications investments. <br /> <br /> Too often, however, their marketing/communications directors supply only inputs and expenses: press clipping counts, numbers of ads placed, or media costs. <br /> <br /> In fairness, marketing/communications directors try to translate inputs into intermediate outputs such as reach and frequency (the percentage of target market exposed to a communication and the number of exposures), recall and recognition scores, persuasion changes, Facebook likes, and cost-per-thousand calculations. But is that enough in the current era? We think not!<br /> <br /> Ultimately, behaviour-change measures capture the real payoff. But first you must establish a reasonable set of marketing communications objectives. <br /> <br /> What might these objectives be? They are probably dependent on the product life cycle stage. But let us assume that you have implemented a set of carefully considered marketing communication activities to meet these objectives. At the end of it, the impact must be measured. <br /> <br /> MEASURING COMMUNICATIONS RESULTS<br /> <br /> Members of the target audience from your communications should be asked whether they recognise or recall the message, how many times they saw it, what points they recall, how they felt about the message, and what are their previous and current attitudes toward the product and the company. <br /> <br /> The communicator should also collect behavioural measures of audience response, such as how many people bought the product, liked it, and talked to others about it.<br /> <br /> Let us imagine that our favourite Jamaican food company, GraSco, just launched two new flavours of coolers: brand A and brand B, and having invested heavily in marketing communications, want to know the result. Here is an example of good feedback measurement, but you may not like the results.<br /> <br /> Feedback on brand A:<br /> <br /> &bull; 80 per cent of the consumers in the total market are aware of brand A<br /> <br /> &bull; 60 per cent have tried it<br /> <br /> &bull; 20 per cent who tried it are satisfied and will buy again.<br /> <br /> This indicates that the communications programme is effective in creating awareness, but the product fails to meet consumer expectations. Not good. Flogging a dead horse? Who knows? Time for further analysis.<br /> <br /> Feedback on brand B<br /> <br /> In contrast, feedback from the second communications campaign was quite different.<br /> <br /> &bull; 40 per cent of the consumers in the total market are aware of brand B <br /> <br /> &bull; 30 per cent have tried it<br /> <br /> &bull; 80 per cent of them are satisfied and will buy again. <br /> <br /> In this case, the communications programme needs to be strengthened to take advantage of the brand&rsquo;s potential power. <br /> <br /> Admittedly this was just a primer on measuring communication effectiveness. But one thing is certain, you will never again accept the argument that you cannot measure the result of a marketing communications activity or campaign. Those days are long gone.<br /> <br /> Herman D Alvaranga FCIM, MBA, is president of the Caribbean School of Sales Management (CSSM), the region&rsquo;s first Public Training College specialising in sales and marketing education, training, consulting and research. E-mail <br /> <br /> hdalvaranga@cssm.edu.jm<br /> <br /> .<br /> <br /> http://www.jamaicaobserver.com/assets/13725767/265734__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 5 The DOs and DON&rsquo;Ts of investing in the financial markets http://www.jamaicaobserver.com/business/The-DOs-and-DON-Ts-of-investing-in-the-financial-markets_93167 There are no guarantees when it comes to investing, as nothing is set in stone. However, with a disciplined mindset, the gains that one can realise from investing in the financial markets can be quite substantial. <br /> <br /> Below are a few dos and don&rsquo;ts which should be considered when investing in the financial markets:<br /> <br /> DO &ldquo;START EARLY&rdquo;, DON&rsquo;T &ldquo;DO NOTHING&rdquo;<br /> <br /> Compounding is crucial, as it allows for the accumulation of wealth. Compounding refers to reinvesting any realised gains made from the financial markets; this ensures that your money is always working for you. Starting early and compounding is wise, as this increases your store of wealth early in life and provides readily accessible funds for future demands/needs.<br /> <br /> Doing nothing is essentially the worst mistake you can make, simply because this does not increase your wealth. On the other hand, there is some amount of speculation involved in investing, and potential investors may therefore be reluctant. In cases such as these, simply take the leap of faith and begin investing.<br /> <br /> DO &ldquo;START INVESTING, NO MATTER HOW SMALL&rdquo;, DON&rsquo;T &ldquo;INVEST ON EMOTION&rdquo;<br /> <br /> Start investing with any disposable income you may have lying around. Irrespective of what many may think, a little does in fact go a far way where investing is concerned, as meagre investments can yield exponential returns - especially in instances where your position (buy/sell) coincides with high-impact fundamental analysis data.<br /> <br /> Emotional investing can be very dangerous, as becoming too attached to a particular stock may have negative effects on the value of an investor&rsquo;s portfolio. As such, it is wise to do adequate research when buying/selling a stock, and not buying/selling because you like/dislike the company.<br /> <br /> DO &ldquo;DIVERSIFY YOUR PORTFOLIO&rdquo;, DON&rsquo;T &ldquo;OVERINVEST&rdquo;<br /> <br /> Diversifying your portfolio essentially means buying stocks from sectors that are not correlated. This is in an effort not to put all your eggs in one basket. It would be ideal to invest in at least three sectors that you understand so as to properly diversify your portfolio and mitigate risk.<br /> <br /> Not overinvesting means you are not investing in such a way that your current financial circumstances become negatively affected by your investment habits, so it is imperative to set a budget on how much you can invest.<br /> <br /> DO &ldquo;KNOW YOUR RISK APPETITE&rdquo;, DON&rsquo;T &ldquo;BUY LOW SELL HIGH&rdquo;<br /> <br /> If you are someone who does not have a hard time seeing your money go down, you could consider investing in speculative (high risk) companies with the hope of high profits; however, if you do have a hard time seeing your money go down, investing in companies with low-risk index funds would be ideal for you.<br /> <br /> The smart investor would indeed seek to buy low and sell high; however, in this case, not buying low and selling high means you shouldn&rsquo;t try to anticipate the entire move the stock will make. The disciplined investor would seek to enter and exit a stock at predetermined prices.<br /> <br /> DO &ldquo;CREATE CORE HOLDINGS&rdquo;, DON&rsquo;T &ldquo;BE GREEDY&rdquo;<br /> <br /> Core holdings form the foundation of your investment portfolio. They should be able to support you in both the good times and the bad times, so it is necessary to build your portfolio around them, ensuring that they are known companies with relatively low risk.<br /> <br /> As an investor, greed will be one your worst nightmares. It has proven to be the Achilles heel for many investors, so it is essential to know when to sell both your winning stocks and your losing stocks, no matter how much you like them. <br /> <br /> Taking a loss on what seemed to be a good investment may be hard, but it is the only way to prevent the further loss of your hard-earned money, especially in the event that the stock&rsquo;s price continues to fall. http://www.jamaicaobserver.com/assets/13725667/265737__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 5 Improving trade facilitating while promoting compliance http://www.jamaicaobserver.com/business/Improving-trade-facilitating-while-promoting-compliance_93208 As the second largest contributor to the national budget, the Jamaica Customs Agency (JCA) recognises the crucial role it plays in propelling the nation&rsquo;s development, as the entity continues to facilitate trade, protect the country&rsquo;s revenue and borders, while promoting compliance.<br /> <br /> So, what are some of the strategic changes that have been made, which have served to assist the JCA to improve its operational efficiency for the benefit of all stakeholders?<br /> <br /> E-SYSTEM IMPLEMENTED<br /> <br /> The implementation of the Automated System for Customs Data (ASYCUDA World) has significantly enhanced the trade facilitation mandate of the JCA. <br /> <br /> Since full implementation in April 2016, the use of ASYCUDA World has resulted in 55 per cent of cargo being cleared within 24 hours of arrival, versus 22 per cent prior to implementation of the system. ASYCUDA World has revolutionised the interaction between the JCA and its clients, and the Ministries, Departments and Agencies (MDAs) for which the Agency conducts regulatory functions. <br /> <br /> ASYCUDA has enhanced the JCA&rsquo;s business and operating procedures to the benefit of staff, Customs Brokers, importers, and other stakeholders, as it allows for less bureaucracy, and more accountability and transparency. <br /> <br /> LEGISLATIVE REFORM UNDER WAY <br /> <br /> As a consultative partner the JCA is committed to creating an improved legislative framework which promotes business opportunities for Jamaica in the shipping industry as well as international trade. <br /> <br /> The Government has indicated that the development of Jamaica as a global logistics hub and the establishment of special economic zones are key strategies for economic growth. The realisation of these strategies requires appropriate laws that support customs procedures that facilitate trade and promote predictability and efficiency.<br /> <br /> Legislative reform is being undertaken on a phased basis, which included amendments to the Customs Bill (2014) and current revision of the Customs Bill (2015), through robust stakeholder consultations.<br /> <br /> Phase one culminated in the passing of the Customs (Amendment) Act, 2014, the primary focus of which was to provide the legislative support for implementation of ASYCUDA. <br /> <br /> Phase two is under way and covers, among other things, the following areas:<br /> <br /> The introduction of modern terminology in accordance with international best practice<br /> <br /> Express provision for electronic communication<br /> <br /> The modernisation of the Act using easily understood legislative language and structure<br /> <br /> The introduction of the concept of voluntary compliance<br /> <br /> The introduction of risk-based compliance and selectivity in the Customs processing or treatment<br /> <br /> The introduction of advanced rulings<br /> <br /> Temporary imports<br /> <br /> IMPROVED EFFICIENCY <br /> <br /> As it pertains to air travel, the JCA has implemented the Advance Passenger Information System (APIS) which will boost the Agency&rsquo;s efficiency for timely and less intrusive methods of processing passengers, while applying more effective means of advanced risk assessment.<br /> <br /> Recently, the International Air Transport Association (IATA) and the United Nations Conference on Trade and Development (UNCTAD) also announced that IATA&rsquo;s Cargo-XML messaging standard has been fully integrated into ASYCUDA World which will serve to standardise the electronic communication between airlines and Customs authorities which use the system. <br /> <br /> Also, as a result of Jamaica&rsquo;s ratification of the Trade Facilitation Agreement, the JCA will further increase its focus on trade facilitation. Jamaica Customs, therefore, looks forward to seeing even further improvements in its processing capabilities of both cargo and passengers, as part of its trade facilitation strategy. <br /> <br /> The JCA continues to be resolute in effectively executing its mandates, as it continues to keep Jamaica on a path of sustainable growth and development. http://www.jamaicaobserver.com/assets/12709938/188654_w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 5 The regulation of banking fees and customer service http://www.jamaicaobserver.com/business/The-regulation-of-banking-fees-and-customer-service_93201 It was reported in a February 2, 2017 article that 90 per cent of the 974 respondents to a Jamaica Observer poll agreed with the proposal for the government to regulate banking fees. This poll was initiated in response to the tabling of a draft Bill before the House of Representatives by Opposition MP, Fitz Jackson, to amend the 2014 Banking Services Act (&ldquo;the Act&rdquo;). <br /> <br /> The stated purpose of the bill (&ldquo;the Bill&rdquo;) is to increase customer protection via the regulation of fees and charges, provision of information and a mandatory service package to customers. Music to the ears of many financially frustrated Jamaicans, but a less melodious tune for the deposit-taking institutions. <br /> <br /> In this article, we have considered the present provisions of the Act, some of the proposals set out in the Bill as well as what pertains in other territories. <br /> <br /> The Act already contains provisions, in section 132 (4) (b), that stipulate that the Supervisor (who under the Act is the Governor of the Bank of Jamaica) may issue a code of conduct on consumer- related matters. <br /> <br /> The code may provide for matters such as the obligation to provide customers with reasonable notice of fees and charges, customer access to information at a reasonable cost, require interest rates to be expressed as an annual rate calculated in a standard manner across the industry, impose an obligation to keep the language in contracts with customers simple and clear, and that key terms are brought to the customer&rsquo;s attention and require licensees to establish effective methods to deal with customer complaints. <br /> <br /> A contravention by a licensee of the provisions of the code could result in the issuing of directions by the Supervisor. The failure of a licensee to comply with those directions would constitute an offence, but would not invalidate any transaction. <br /> <br /> On October 21, 2016, The Banking Services (Deposit Taking Institutions) (Customer Related Matters) Code of Conduct (the &ldquo;Code&rdquo;) came into effect. The Code essentially addressed the matters outlined above. <br /> <br /> Now the Bill seeks to repeal section 132 (4) (b) and replace same with a new section, 132 A. This new section would retain almost all of the present provisions of section 132 (4) (b) with the addition of the following:<br /> <br /> (1) The enactment of the code by the Supervisor would be mandatory as opposed to discretionary; <br /> <br /> (2) The code must provide for a mandatory minimum service package; <br /> <br /> (3) It must impose an obligation to provide 45 days prior notice before any changes to fees, charges, terms and other relevant information. (Note that a similar provision is included in the present Code) and such notice is to set out how the customer can either accept or dispute the changes or close his/her account free of cost or penalty; <br /> <br /> (4) Customers are to be given access to their information at a reasonable cost (which is already addressed in the present Code), by inclusion in the &ldquo;minimum service package&rdquo;; <br /> <br /> (5) The code is to impose an obligation of fairness and reasonableness of terms, bearing in mind what the parties to the agreement ought to have reasonably known or contemplated at the time of the agreement; <br /> <br /> (6) Include measures that will facilitate access to banking services for senior citizens and customers with disabilities; and <br /> <br /> (7) Speak to confidentiality and privacy of customer information (which is already addressed in the Act). <br /> <br /> In addition to providing that non-compliance with the code is an offence, the Bill states that contravention may invalidate a transaction where the customer was unfairly disadvantaged on a balance of probabilities. <br /> <br /> The provisions of the mandatory service package are set out in the Bill, and if enacted would form the Twelfth Schedule to the Act. Its provisions are applicable to any account, credit facility or financial instrument between a licensee and a customer. It includes provisions that mandate:<br /> <br /> 1. No charges for customer inquiries of any sort, by any medium on any transaction.<br /> <br /> 2. A minimum of 120 free transactions by any medium, per annum, per account.<br /> <br /> 3. No charges for statements.<br /> <br /> 4. Free cheque (or similar instrument) cashing and changing.<br /> <br /> 5. A licensee can freeze an inactive account with a credit balance and classify it as dormant or close a zero balance inactive account. However, in each instance, this can only be done where the customer has been given notice 90 days prior, and the notice had set out when the account would be classified as dormant, how to respond to the notice, and consequence of failing to respond. The notice should also include the current statement of account and whether a dormant account can be reactivated, and in the case of a zero balance account, whether this can be revived before closure. Also, where the dormant account has a credit balance, no transactions are to be made to the account, benefits shall continue to accrue, there is to be no maintenance fee, and electronic statements are to be published. <br /> <br /> 6. No modification of terms and conditions which would place the customer in an adverse position, or which differ materially from the initial agreement.<br /> <br /> 7. No increase in interest rate, annual fees, other fees, and no charges or other change unless at least 45 days&rsquo; written notice has been provided to the client explaining that they can opt out of the changes and propose changes. The notice should state when the change will be effective, how the customer is to respond to the notice, and the consequences of failing to respond.<br /> <br /> 8. Disclosure of all fees and charges for ABM, automated tellers or any other medium for processing transactions, prior to the completion of the transaction, and providing the option for the customer to either continue the transaction or cancel it free of all fines, charges or penalty.<br /> <br /> 9. 72 hours cooling-off period after the execution of an agreement, where the licensee has stated how the agreement can be terminated, free of all charges.<br /> <br /> 10. Provision to customers of a &ldquo;key contractual terms&rdquo; fact sheet.<br /> <br /> It is not difficult to see why a bank would be concerned by the provisions of the Bill and of the minimum service package. The mandatory removal of such a lengthy list of fees would likely have an adverse impact on a bank&rsquo;s bottom line. <br /> <br /> Of note, the very notion of the proposed obligation of fairness and reasonableness of terms, bearing in mind what the parties to the agreement ought to have reasonably known or contemplated at the time of the agreement, could impact on the interpretation of many banking contracts and agreements. <br /> <br /> Though the Consumer Protection Act has long since contained provisions regarding unfair contract terms and a requirement for reasonableness in relation to contract terms, this provision would bring the requirement to specifically bear on all deposit-taking institutions, and may cause them to have to amend some of the provisions of their loan agreements, mortgages and other security documents. <br /> <br /> It is also likely that the banks will strongly object to the imposition of a restriction preventing them from implementing any change to its terms and conditions that would adversely affect a customer.<br /> <br /> Different jurisdictions have taken varying approaches to bank fee and customer service regulation. <br /> <br /> In Barbados, the Central Bank of Barbados has instituted guidelines governing the fees which can be charged by commercial banks. These guidelines stipulate that the percentage charged for application/negotiation fees should not exceed 0.5 per cent of the loan amount, the percentage used to calculate commitment/standby fees should not exceed 1.0 per cent of the loan amount, and charges for transfers via the Real Time Gross Settlement (RTGS) should not exceed $15 Barbadian. <br /> <br /> Additionally, there is to be no charge for cheque cashing, for transferring money between customer accounts at the customer&rsquo;s bank&rsquo;s ATM, third party withdrawals in respect of pensioners or for making account inquiries at the customer&rsquo;s bank&rsquo;s ATM. Notification is also to be given within 30 days of the effective date of new charges, there is a maximum $10 Barbadian per annum dormant account notification charge, which is reversible on acknowledgement of the account holder, and the minimum balance on which interest is to be paid should not exceed $300 Barbadian.<br /> <br /> In Trinidad and Tobago, the concern has been expressed that banks are charging exorbitant fees for their services. Finance Minister Colm Imbert was recently quoted as stating that the matter of whether &ldquo;to regulate all fees charged by commercial banks...is a matter that is being carefully studied at this time&rdquo;.<br /> <br /> It was reported by the Jamaica Observer on March 10, 2017 that the Government intends to introduce a new financial services consumer protection agency to protect commercial bank customers from exorbitant bank fees. Having regard to the provisions of the Bill, this will hopefully not result in overregulation regarding these issues. <br /> <br /> Minister of Finance and Public Service Audley Shaw told the House of Representatives that banks currently hold $45 billion in dormant accounts, which are subject to regular bank charges. It is these dormant account fees that appear to be of particular concern. Minister Shaw, however, noted that in the meantime the Government would depend on the banks complying with the current Bank of Jamaica Code of Conduct. <br /> <br /> Since then, it has been reported that National Commercial Bank Jamaica Ltd (&ldquo;NCB&rdquo;) has announced that it has indefinitely suspended dormant account charges.<br /> <br /> With Jamaica National Bank joining the commercial banking fold and promising &ldquo;low and no fees&rdquo;, and pre-emptive moves such as that announced by NCB, competition may well motivate others to tackle this issue. Time will indicate whether the Government opts to take a more stringent approach to bank customer service and fee regulation. <br /> <br /> Simone Bowie Jones is a Partner at Myers, Fletcher & Gordon and is a member of the firm&rsquo;s Commercial Department. Simone may be contacted via simone.bowie@mfg.com.jm or www.myersfletcher.com. This article is for general information purposes only and does not constitute legal advice.<br /> <br /> http://www.jamaicaobserver.com/assets/13627187/257057_91751_repro_w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 5 Rags, not riches, defining Africa&rsquo;s urban explosion http://www.jamaicaobserver.com/business/Rags--not-riches--defining-Africa-s-urban-explosion_93099 BAMAKO, Mali (AFP) &mdash; Anarchic architecture, unchecked pollution, and high costs of living are the lot of African city dwellers, experts warn, as living standards fail to keep pace with rapid urban growth on the continent.<br /> <br /> The Bamako Forum, a pan-African think tank, recently considered the phenomenon of African urbanisation against the backdrop of a city living the results of rural flight clashing with poor urban planning.<br /> <br /> At 1.8 million inhabitants, Bamako is far from Africa&rsquo;s largest city. But its 5.5 per cent growth rate is the fastest on the continent, outstripping that of established African megalopolises like Cairo, Kinshasa or Lagos.<br /> <br /> One billion Africans will live in a city by 2040, according to World Bank estimates, compared with almost half a billion today. <br /> <br /> &ldquo;Such growth has never been seen globally, and probably never will be again,&rdquo; said Somik Vinay Lall, the bank&rsquo;s top urbanisation expert, speaking at the forum. <br /> <br /> Visitors to Bamako&rsquo;s dusty streets don&rsquo;t have long before they chance upon what residents have nicknamed Lafiabougou Hill, a pile of stinking rubbish that at one point loomed 20 metres (66 feet) tall in the city centre.<br /> <br /> Lacking fuel to transport the trash to depots on the city&rsquo;s edges, Lafiabougou Hill has become a pungent reminder of the municipality&rsquo;s inability to provide basic services to its rapidly expanding population.<br /> <br /> &ldquo;We have protested, burnt tyres, blocked off roads, because this affects the health of the people living in this area,&rdquo; said Djiri Nimaga, head of a local youth group that held protests last year aimed at rousing action from the authorities in the ACI 2000 commercial district.<br /> <br /> Until now, Lafiabougou has not killed anyone directly, but at least 113 people were killed in a giant landslide at Ethiopia&rsquo;s largest rubbish dump last weekend, including several children.<br /> <br /> VICIOUS CIRCLE<br /> <br /> The Western perception of poor countries having low costs of living, true across much of Asia, does not hold true for Africa, where some of the world&rsquo;s most expensive cities are populated by some of the planet&rsquo;s poorest people.<br /> <br /> As a result, manufacturing and services, driven by consumer spending, are all too often absent.<br /> <br /> &ldquo;Twenty-three per cent of land in Ho Chi Minh City is taken up by industrial and commercial activity, compared with 5.9 per cent in Nairobi and 1.1 per cent in Addis Ababa,&rdquo; Lall emphasised.<br /> <br /> A World Bank report entitled Africa&rsquo;s Cities: Opening Doors to the World, released in February, said deep-rooted problems with the way land was bought and sold, a lack of investment in infrastructure, and an absence of regulation constrains African cities.<br /> <br /> &ldquo;Closed to regional and global markets, trapped into producing only locally traded goods and services, and limited in their economic growth,&rdquo; is how the report characterised cities such as Bamako.<br /> <br /> THRIVING ON DISORDER<br /> <br /> Ousmane Sow, who works for Bamako&rsquo;s city council, is building up an &ldquo;urbanisation agency&rdquo; of the kind encouraged by international development bodies, but says little will fundamentally change until basic rules are respected.<br /> <br /> &ldquo;Say a neighbour has the permit for a one-storey structure, he will build a four-storey one. Buildings fall down all the time,&rdquo; Sow said.<br /> <br /> &ldquo;You can&rsquo;t do architecture on the fly, you are putting people&rsquo;s lives at risk. Behind all of this is the issue of impunity, the true evil of this country,&rdquo; he added.<br /> <br /> Among the chaos, some are making fortunes.<br /> <br /> In Abidjan, Ivory Coast&rsquo;s largest city, a single square metre (3.5 square feet) of land can fetch one million FCFA (US$1,625), encouraging ever more landlords to bend the rules.<br /> <br /> The small minority of those private or public investors controlling the market &ldquo;love urban disorder because it&rsquo;s all about gambling on property&rdquo;, said Jean-Pierre Elong Mbassi, secretary-general of the UCLG Africa local government association.<br /> <br /> &ldquo;They aren&rsquo;t interested in whether the city actually works as long as they can get such a high rate of return, which happens specifically because the city doesn&rsquo;t function,&rdquo; he added.<br /> <br /> Back at Lafiabougou Hill, trucks are waiting to load rubbish dragged to the site by donkey carts. <br /> <br /> &ldquo;As soon as they stop taking it away, the trash just piles up again. It takes too long,&rdquo; Nimaga said. http://www.jamaicaobserver.com/assets/13725819/265699__w300.jpg Local Business Wednesday, March 22, 2017 12:00 AM 6