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Bitt, the Barbados-based digital asset exchange, remittance channel, and merchant-processing gateway, was officially launched on Monday.
Founded in 2013 by Gabriel Abed and Oliver Gale, the company has partnered with Avatar Capital to expand operations in the growing cryptocurrency industry. This latest partnership has firmly established Bitt as the frontrunner in the Caribbean’s burgeoning cryptocurrency ecosystem.
Prior to the official launch, Bitt closed its landmark US$1.5 million seed round from Avatar Capital, a Caribbean investment group based in T&T. This initial capital investment will allow Bitt to continue to develop and expand its core services.
“Avatar backs Bitt with full confidence,” said Peter George, director of Avatar Capital. “We are pleased to invest in the development of the cryptocurrency industry in the region. It is our hope that this investment benefits the people of the Caribbean and becomes the catalyst for digital currency trading in this part of the world.”
Powered by AlphaPoint’s state-of-the-art technology, designed by veteran Wall Street traders, Bitt’s trading platform is a powerful, user-friendly exchange that allows clients to trade securely and seamlessly. Bitt facilitates international Bitcoin trading in 11 major fiat currencies, such as the US Dollar (USD), Great Britain Pound (GBP), Canadian Dollar (CAD), Euro (EUR), and Barbadian Dollar (BBD).
“We were very excited to be selected by Bitt to power their exchange and support their vision of lowering costs for payments and remittances,” said Vadim Telyatnikov, CEO of AlphaPoint. “By connecting their platform to global exchanges, Bitt can offer Caribbean residents competitive exchange rates and deep liquidity from around the world.”
“The Bitt Exchange is a cornerstone project for digital finance in the Caribbean. By facilitating trade between traditional and digital currency markets, Bitt is creating the platform for very low-cost international commerce and remittance between the people who need it most — the millions of unbanked and underbanked citizens in the Caribbean,” said Gabriel Abed, Bitt CEO.
“With a team of financial experts, IT network security engineers, cryptographers, and software developers from around the world, as well as banking facilities and asset liquidity spanning many major international fiat currencies, Bitt is poised to become the leading digital currency exchange in the Caribbean region,” said Oliver Gale, Bitt’s CFO.
The Employers’ Consultative Association (ECA) yesterday warned that T&T is in a precarious situation which could get worse if wage increases are granted without carefully consideration of various economic factors.
In a detailed statement on current wage negotiations, as well as the increase recently granted to the Public Services Association (PSA), the group called for tripartite discussions between the three social partners—Government, labour and business.
“The energy sector, as major earners of foreign income, are faced with decreasing oil, gas and product prices. Our non-oil sector, on the other hand, is uncompetitive with competing imports. Furthermore, our exporters are already faced with an increasingly troubled external environment.
“This has to be balanced with the reality that the food price index is driving the retail price index and ultimately inflation; creating for many a valid argument for higher wages,” the ECA said.
The statement continued: “An increase in wages without consideration of all economic factors including import/export, productivity and state sector reform will, therefore, as Ronald Ramkissoon (then senior economist at Republic Bank) warned in 2004, lead to ‘…strong and sustained price pressures which will make our products sold here more uncompetitive and further reduce our exports, since it will be much more difficult to compete in external markets.’ These effects weaken our companies. This can in turn slow economic growth especially in our non-oil sector.”
The ECA said strong and sustained price increases normally mean higher overall inflation which reduces real income or the purchasing power of money.
“Inflation affects different segments of the society differently. It is well known that those whose incomes are fixed and therefore cannot pass on higher costs, such as pensioners, suffer a loss in purchasing power. Consequently, rising prices affect individuals differently and redistribute income in a way that might not be intended.”
The ECA congratulated the PSA and the Public Transport Service Corporation (PTSC) for the settling of their wage agreements at 14 per cent maintaining parity with the negotiated settlement for teachers late last year.
The group urged employers and representatives of employees to work assiduously to ensure all negotiations are concluded on time and questioned the relevance of the negotiation style used in collective bargaining.
“The bigger question is whether the way we conduct negotiations in state sectors and state enterprises is still relevant, since parity seems to be the major concern. This issue of parity is exacerbated by the creation of organizations like Natuc, Fitun and more recently JTUM.
“It is clear that the unions/associations that form their membership are aware of wages, and terms and conditions in the other companies within the body and are making attempts to level the playing field. This is a reversal of the approach to negotiations in the mid 1900’s when the oil producers came together to conduct negotiations for prices in that sector.
“It is also no secret that the other sectors, principally manufacturing and agriculture, have to attract persons from the state sector as major employers and are therefore forced to set competitive salary scales to create movement of this labour force, if they are to survive. In the final analysis this has created a very inefficient system of national wage setting,” the ECA said.
Days after the announcement of a resolution plan to pay Government and policyholders of the Colonial Life Insurance Company (Clico), various analysts are now calling for more details of the arrangement to be made public.
Among them is financial analyst David Walker, who in a television interview yesterday, asked what prevented the Government from paying policyholders sooner and how interest will be calculated.
“You remember in October 2010 the Prime Minister and the then Minister of Finance stood up in Parliament and told them that to pay people properly, according to contracts without having need for this law that banned legal action, would cost the nation an additional $7 billion on top of the $7 billion that was already spent.
“Now, my arithmetic tells me that seven and seven is 14. We could not have afforded then, we were told, so there had to be this alternative plan which presumably would have cost less. Now we know that old plan was costing somewhere in the vicinity of $25 billion yet suddenly, we can afford it,” he said
Questions have also been raised by former Minister in the Ministry of Finance Mariano Browne, who expressed concern about how the repayment will be financed.
“Let me hear where the money is. Let me hear the numbers. The numbers are what I am interested in because that really tells you the company’s position, whether it is capable of doing it or not.
“This is an election year. This is a matter they said that would have been fixed as part of an election promise. So that we are going through the motions. I mean, one of the issues would be what is the value of Angostura? What is the value of Home Construction? Home Construction is the largest land bank in the country.”
Economist Mary King, in a commentary posted on line, noted that the Clico calamity was not the only one in the world but in the other CASES the governments handled the requests for cash flow bail outs differently.
She wrote: “The US bailed out AIG (US$85 billion), Bear Sterns and JP Morgan (US$29 billion), Fannie May and Freddie Mac (US$25 billion). Today these companies have weathered the storm and have repaid these advances where necessary, the assets were preserved and now are viable companies.”
King said in the case of Clico the hue and cry was to advance money to the company’s benefit so that “as many of their investors could be paid off, hoping that when the global economy picked up again the assets would be sold to repay government and the rest of investors and creditors.”
She said no thought was given to funding Clico that it would weather the storm and emerge as a viable operating asset that could repay its debts.
“Today as the global economy turns up we are here selling what is left to pay debts, denigrating our financial innovators. Instead we could have been celebrating the survival of a conglomerate that was our own creation,” she said.
On Friday, Central Bank Governor Jwala Rambarran announced a plan to settle outstanding debts owed by Clico to the T&T Government and its policyholders.
For medical tourism to be successful in T&T there is need for a change of attitude by the people who interact with tourists, when they enter T&T, beginning with immigration officers, Health Minister Dr Fuad Khan said yesterday.
Khan, who delivered the feature address at the U Health and Wellness Exposition at the Hyatt Regency, Port-of-Spain, said: “In order to produce a product—medical tourism—you have to give that product the appeal that you are trying to attract. What is your target market? What do we have here in our niche that will attract that market to come here?
Khan said it makes no sense having a visitor experience hostile treatment before experiencing destination T&T, or the services offered within the country’s medical tourism sector.
The minister said hospitals need to get accredited to bring them up to a certain standard.
Khan said the proposed legislation will make the accreditation plan mandatory for all hospitals and programmes. Hospitals will have to be up to standard or they won’t be accredited, he added
The minister said T&T is looking at Colombia’s medical tourism model where that country sends an aircraft to pick up the patient.
The Agriculture Development Bank (ADB) has disbursed more than $50 million in loans in the first five months of the financial year, Sheivan Ramnath, CEO of the ADB said.
He said this represented 101 per cent of the bank’s budgeted target while its total approvals exceeded $55 million or 97 per cent of budgeted target, he revealed when he spoke at the launch of the ADB’s online banking service and SMS texting online programme, e-agr, at the Trinidad Hilton and Conference Centre.
ADB customers will be able to use the online banking system to view their account balances, pay loans from savings accounts, move funds between accounts and request statements.
Ramnath said the bank has to change to move with the times and is rebranding its products and services while developing and implementing new ones.
“The ADB will continuously explore ways to ensure that its mandate of serving farmers of our nation is met and while this involves providing affordable financing to these agri-entrepreneurs, we are committed to doing so in a convenient, timely, cost effective manner driven by technology,” he said.
“Our intention is to make the bank available to our clients at their convenience while assisting them in utilising their available time for maximum benefit,” he said.
Planning Minister Dr Bhoe Tewarie says T&T will achieve its target to balance its budget next year by cutting current spending rather than racking up debt on the capital markets despite enthusiasm from investors for its paper. In a recent interview with Emerging Markets magazine, the minister said the country continues to feel the pinch from the decline in oil and gas prices, but Government is taking steps to guarantee that the economy regains speed while keeping deficits in check.
He said the T&T economy expanded by two per cent last year and inflation was 8.5 per cent. Unemployment stood at 3.3 per cent, with jobs being created despite the economic difficulties. Unemployment has fallen steadily since 2010, when it was nine per cent. “In a fundamental sense, what we have decided to do is live within our revenue capacity,” Tewarie told the magazine in an interview on the sidelines of an IDB meeting. “We are reprioritising what can be done.”
This has meant cutting the 2015 budget by around $560 million and eliminating $160 million in planned public works projects. He said the T&T government has decided for now to stay away from capital markets, because it does not want to add to the debt burden. “We can go to the markets and borrow quite easily, because we are regarded as a good risk, but we are very conservative in our approach and do not want to rack up debt,” he added.
Tewarie said the goal is to ensure a balanced budget is achieved in 2016. T&T’s debt at the end of last year was 40.2 per cent of its $30 billion economy. The government has also chosen not to tap its sovereign wealth fund, known at the Heritage and Stabilization Fund, which ended last year with $5.6 billion. The Government’s decision to live within its means has also led to long-term decisions. Budgets will be pegged to oil at US$45 a barrel and natural gas at US$2.25 per one million BTUs. It had originally planned the 2015 budget with oil at US$80 and gas at US$2.75.
“It is prudent at the current prices as a permanent reference point,” said the minister. Tewarie said oil and gas will always be the cornerstone of the economy, but it is working on a more diversified series of industry. In the oil and gas sector, the government is confident its drilling on new exploration blocks granted in the past few years will result in important finds to boost reserves and up production. It has 13.1tr cubic feet of natural gas reserves and 728m barrels of proven crude reserves at the end of 2014.
Among its plans is an agreement with Venezuela to monetise two gas fields the countries share and a commitment to work with Guyana and Suriname to help them develop energy resources. Tewarie said the country needed to start taking advantage of trade agreements with Panama and other Central American countries to boost its manufacturing sector.
Diversification of the economy focuses on six areas where it could become a leader in the English-speaking Caribbean: creative industries, financial services, food production, information technology, marine technology and tourism.
Renowned chef Wolfgang Puck will soon be launching a restaurant at Piarco International Airport. The Wolfgang Puck Bistro and Bar will be located on the upper floor of the duty free area at the airport and will be a contemporary casual restaurant with the guiding principle of “Simple is Delicious.” The menu will provide quick bites or leisurely meal options, with opportunities for breakfast, lunch and dinner. Chef Puck will use only the finest ingredients to prepare food fresh-to-order. The beverage programme will features a full bar including non-alcoholic beverages.
Chef Puck is an Austrian-born chef who began his rise to stardom in 1981, when he authored his first cookbook and a year later opened his award-winning restaurant Spago in Beverly Hills. He has received several awards during his auspicious career, including an induction into the Culinary Hall of Fame in 2013. He has more than 80 branded operations throughout the US.
The Airports Authority of T&T (AATT) said it was fortunate that Delaware North Corporation (DNC) and Superior Hospitality were able to persuade Chef Puck to bring his brand to T&T. DNC is one of the largest master concessionaires in the aviation industry. In addition to the Wolfgang Puck Bistro, DNC will be bringing two additional businesses to the Piarco International Airport – The Piarco Gourmet and Trinidad Chic.
Piarco Gourmet is a specialty food shop focused on locally made and/or grown T&T specialty products and related merchandise: rum cakes, chocolates, hot sauces and spices, coffees and teas, and related branded merchandise.
Trinidad Chic will sell locally made fashion, accessories, and jewelry and beauty products. Local artisans are contributing to the stores. The company has prided itself on identifying and introducing local talent to the world’s stage at the Piarco International Airport. They are supporting the small businesses in the country by providing a world stage for them to display and sell their merchandise. The AATT said introduction of these ventures is the continuation of the its continued work in making itself “the premier provider of aviation driven business in the region.”
An ambitious plan that will see the Caribbean get two of the largest graving dock facilities in the world has taken a step forward. The Trinidad Dry Dock Company Ltd (TDDCL) is inviting companies to submit proposals to conduct an environmental impact assessment and geotechnical investigation for a major new ship repair yard development project in Port-of-Spain.
The Trinidad shipyard is one of two planned by the company. The other will be in Guyana. Each will have five graving docks catering to vessels from 20,000 dwt to 250,000 dwt and up to 380 m long.
TDDCL has signed a memorandum of agreement with Invest T&T, to facilitate the future development and operation of the Port-of-Spain Dry Dock on the reclaimed 140-acre Sullivan Island. The project is located offshore in the Gulf of Paria, in the vicinity of Sealots, just north of the Caroni River outfall. It includes a 250-hectare dredged turning basin and a causeway connecting Sullivan Island to mainland Trinidad’s highway network.
TDDCL has now procured the final terms of reference from the Environmental Management Authority for an environmental impact assessment. As part of its engineering designs and as may be needed for the environmental impact assessment, TDDCL will also conduct detailed geotechnical investigations with soils analysis and report over an area of seabed of some 300 hectares.
The company has issued a request for expressions of interest from qualified and experienced firms to submit proposals no later than 2 pm Friday via e-mail to [email protected]. The full request for proposals will be sent to respondents after receipt of expressions of interest. TDDCL says its projects will cater to the growing international demands of the expanding global shipping fleet, with specific emphasis on meeting what it says is a critical need in the Western Hemisphere.
The firm’s project in Trinidad, the Sullivan Island, Port-of-Spain Dry Dock Facility will constitute world-class graving dock and bunkering facilities situated on the proposed Sullivan Island, along the Gulf of Paria. In Guyana, the New Amsterdam Dry Dock Industrial Port Complex will comprise graving dock and port facilities situated on the Berbice River estuary.
The two projects will have a combined total drydocking area of 199,300 square metres. In addition to the core drydocking facilities, TDDCL plans to maximise the potential of the projects by embarking on the development of a number of on-site, downstream projects including a marine and industrial park, and residential and commercial centres at both locations.
ATHENS—The ratings agency Fitch has downgraded Greece’s sovereign rating amid growing uncertainty over the new government’s pledge to overhaul reforms needed to restart bailout loan payments and avoid default. The agency said it had lowered the country’s rating deeper into non-investment grade status from B to CCC, citing “extreme pressure on Greek government funding.”
Rescue lenders are expected to review reforms overhauled by Prime Minister Alexis Tsipras’ new left wing government. The new government has promised to ax austerity measures that cut chronic deficits but kept Greece in a punishing recession for six years.
Moody’s Investors Service has assigned state-owned Petrotrin an investment grade rating of Baa3 with a stable outlook from international credit rating agency. This follows the agency’s annual review of the company’s operations last month, Moody’s said key factors contributing to Petrotrin’s favourable rating include support from the shareholder, single Asset refinery risk mitigated by degree of upstream (Exploration and Production) integration and a strong market position.
The agency said Petrotrin’s refining margins in 2014 were negatively impacted from negative fuel oil margins, rising global refined product supply and product marketers introducing low sulfur diesel in the Caribbean region but positively commented on the degree of operational integration provided by the company’s exploration and production division, offsetting its reliance on its refining operations.
Moody’s also took note of Petrotrin’s strong market position in T&T and the competitive advantage enjoyed by the company in the Eastern Caribbean petroleum product exports markets as a result of its flexibility in accommodating customer requirements and the premium service it provides.
Commenting on the agency’s report, Petrotrin said in a statement: “Given the challenges currently facing operators in the global energy market, Petrotrin welcomes this rating affirmation as the company continues to implement strategic initiatives geared towards securing its long term viability.”
Less than three months after refurbishment began, Massy Stores has relaunched its supermarket in Glencoe, now offering customers more options in a comfortable and contemporary environment. Renovations to the Glencoe supermarket started in January.
The store reopened last Wednesday with a launch ceremony attended by Massy Stores CEO Derek Winford and senior operations director Watson George. The revamp of the supermarket was performed to maintain a high level of service for the Glencoe and surrounding communities. The Massy Stores located in St Ann’s is also undergoing its own refurbishment.
“The refurbishment of the Massy Stores Glencoe is another example of Massy Stores’ unfailing commitment to growth, improvement and the enhancement of the customer experience,” Winford said during the ceremony.
In addition to upgrades to the registers, floors, aisles and freezers, the new-look store has a range of features in-store such as a butcher’s counter where skilled staff can now offer customers advice on a wide selection of meats and prepare them to specification. Like other Massy Stores, a hot food station with full meals and a menu of the day that can include dishes like callaloo, stew chicken and macaroni pie, has been added to provide traditional food options to customers.
Debra Harris, store manager for Massy Stores Glencoe, said: “The store relaunch has been an exciting time for us and our customers have been really patient during the refurbishment. The Glencoe location is now completely updated and we are very eager to resume service and offer our customers the opportunity to enjoy all the new additions.”
KINGSTON, Jamaica—Digicel has asked the Eastern Caribbean Telecommunications Regulatory Authority (Ectel) to publicly clarify and confirm the status of the regulatory approvals process they have undertaken in conjunction with the National Telecommunications Regulatory Commissions (NTRCs) in relation to the proposed merger between Cable and Wireless Communications (CWC) and Columbus Communications Inc as it relates to Grenada, St Lucia and St Vincent and the Grenadines.
This follows the decisions by the Barbados Fair Trading Commission (FTC) and the Telecommunications Authority of T&T (TATT) to approve the CWC/Columbus merger. Digicel Group CEO, Colm Delves, said; “We very much welcomed the initial intervention by Ectel and its expression of support for a rigorous regulatory examination of the proposed merger.
Digicel was taken aback by the dismissive stated position of CWC/Columbus that the governments of the Ectel member states and the established regulatory authorities in those countries were essentially powerless and had no right to oversee the proposed merger. “We are now respectfully calling upon Ectel to clarify the process for regulatory approvals for the proposed merger in the OECS member states.”
The regional telecommunications service provider noted that soon after the proposed merger was announced last November, Ectel had expressed concern that the proposed transaction could “potentially result in a negative impact on competition” by “reducing choice for consumers of both services and service providers.” Digicel recalled that a meeting of the Ectel Council of Ministers was convened in St Lucia on December 4, to address the challenges posed by the proposed merger and concluded that due process must be followed with the proposed merger.
The company said: “Both the Barbados FTC and TATT confirmed unequivocally that the proposed merger would involve anti-competitive effects in the fixed voice (landline) telephony and broadband markets whilst TATT also confirmed that the proposed merger would also have anti-competitive effects in the Pay TV and wider wholesale telecommunications markets in Trinidad and Tobago.
“In their respective decisions, both TATT and the Barbados FTC made their mergers approvals strictly conditional on significant asset divestments in Barbados and share divestments in Trinidad. The proposed merger between Columbus and CWC also involves the creation of a monopoly and strong potential anti-competitive effects in the markets for landline, broadband and Cable TV in Grenada, St Lucia and St Vincent and the Grenadines.”
Delves said: “Digicel has previously stated that ECTEL and the NTRCs in each member state have an absolute right, morally as well as legally, to subject the proposed merger to a rigorous examination and approvals process in collaboration with their respective governments and relevant ministerial bodies before it is allowed to proceed.
“We are seeking clarification from Ectel as to the present position in this regard. We believe that the consumers, as well as the industry as a whole, in St Lucia, Grenada and St Vincent and the Grenadines would certainly welcome such clarification and we look forward to receiving such prompt confirmation from Ectel.”
RIO DE JANEIRO—Brazil’s economy grew just 0.1 per cent last year, barely keeping the country out of a recession, the government’s statistics bureau said. It was the worst result since 2009 and bad news for President Dilma Rousseff, whose popularity has plummeted along with Brazil’s economic performance. To blame for last year’s poor performance was a drop in investments, which fell 4.4 per cent from 2013.
Consumer consumption had been a driving force for the economy for years, but it grew just 0.9 per cent last year. “This seems unsustainable given the run-up in consumer debt and signs that the labour market is weakening,” London-based Capital Economics said in an e-mailed statement. Still, most economists were expecting figures from the IBGE statistics bureau to show the country actually entered a recession last year. Most private economists polled by the Central Bank expect Brazil to be in a recession this year.
Finance Minister Larry Howai says T&T is starting to see the light at the end of the tunnel as far as the collapse of the CL Financial empire is concerned. Speaking at a hastily called news conference at the Ministry of Trade’s offices at the Nicholas Tower in Port-of-Spain, Mr Howai said the process of making payments to Clico’s policyholders will “take some time” because it involves the sale of assets of the insurance subsidiary of the CL Financial group. The minister’s responses followed an organised news conference held on Friday morning by Central Bank Governor Jwala Rambarran on the Clico Resolution Plan at which he outlined proposals to ensure that all Clico policyholders, both short term and long term, are given full value for their investments in the company. In the first phase of the resolution, the Government will receive $4 billion in cash and Clico’s shares in Angostura, CL World Brands and Home Construction.
Following is a lightly edited excerpt of the Finance Minister’s answers to questions from the Guardian’s chief editor-business at the news conference:
Q: Governor Rambarran said that $950 million will be paid to the non-assenting policyholders within three months but that the Ministry of Finance will have to make arrangements for the assenting policyholders.
What are those arrangements going to be and in what timeframe?
A: We will seek to coincide the settlements with the three-month period that has been identified. But because there are some people who may have converted to the Clico Investment Fund (CIF), there will be some discussions that we will have with them around the issue of perhaps closing off the CIF or reducing it and allowing those who wish to get cash out of the process. That may take a longer period and it also depends on the number of people who are holders of units in the CIF being willing to vote in favour of the collapsing of that particular arrangement, which was put in place a few years ago.
So there are some technicalities as far as that is concerned, but I want to make the point that our intention is to make those assenting STIP (Short-Term Investment Oroducts) holders whole. There is no way we could make the non-assenting STIP holders whole and leave the assenting STIP holders in a position where they are disadvantaged.
Our intention out of this process is as the liquidation continues and as the cash flows come in to us, and go into the statutory fund and then comes over to Government, we will arrange to liquidate those persons who are assenting STIP holders as part of the process.
Q: As the Governor said this morning, it seems as though non-resident policyholders will also be paid out of this.
A: We estimate that the amount is about $410 million for the non-residents and the mutual fund investors, so we will be making those whole also as part of this process. The mutual fund holders can expect that as we continue the process of liquidation that they will receive their monies, where they have not received it to date.
Q: And is the proposal to make cash payments to the non-assenting policyholders and the assenting policyholders?
A: Yes, the intention would be to settle the indebtedness fully in cash. As the cash comes in, and we are able to start making the payments out…Remember that with respect to the assenting STIP holders it is really Government that is standing in the shoes of those people because we had settled them by way of the zero-coupon bonds and cash and we took their rights against the statutory fund.
Now that we know that the statutory fund has been made whole, as the funds come to us from the liquidation of the assets, we will ensure that we make them whole as part of the process so that they are no worse off than the non-assenting STIP holders and we will also recover our funds from what we advanced.
Once we are able to collapse the CIF—to extent that there is agreement with the unitholders to do so—then some of the indebtedness that is in there, which are Government bonds, will immediately be liquidated meaning that those bonds will be extinguished as part of the process. This means our overall debt position will change.
Q: Why has it taken six months from the sale of the MHTL shares in October to now to arrive at this point? In other words, some $7.5 billion from the sale of the MHTL shares would have gone into the statutory fund and would have put the fund into the black. But that happened six months ago. Why has it taken six months?
A: We wanted to go over some of the computations that we had. We asked Ernst & Young to take another look at some of the numbers and to make sure that when come out and start making promises, we can keep those promises. I wanted to be absolutely sure that we were in a position to meet those commitments. We may have some slippage of a month or two in terms of the sale of assets and that’s fine.
Therefore, I asked that they take another look at the valuations, they take another look at the overall total of liabilities. If it is I have to pay the assenting STIPs, what would the cost be and how would it be funded? What are the implications for Government? What it means of the tail-end of the debt that would remain to be liquidated? Do any of these decisions compromise the ability to realistically recover the funds that will remain from the assets.
There were a number of elements that I wanted to be more certain of before we came out to make the statements and I think the Governor and the Central Bank concurred with that approach also and they wanted to do their own evaluations to be sure.
Both sides wanted to be very comfortable before we came out to make these statements. That time was used to ensure we have a fair degree of confidence with regard to the representations that we make.
Q: What of the shares in Angostura, CL World Brands and Home Construction:
A: At the end of the restructuring, I suppose the Governor would have mentioned that there will be a tailend of the debt. We expect that within the next 12 to 18 months we should be able to dispose to the Methanol Holdings (International) Ltd shares as well as the Republic Bank shares. That would perhaps liquidate about 75 per cent of the debt that is owed to the Government.
We want to see those companies that I mentioned before continue in operation and there will be a dividend stream that will be coming to Government as a result of ownership of those assets.
Therefore, we will be working together with the shareholders of CL Financial to ensure the remaining tail-end of the debt gets paid out over an agreed period of time. It could be as long as ten years with a moratorium.
As part of this arrangement, we expect to put a debenture in place to ensure we have full and proper security...
Q: What are the implications of Corporation Sole being the owner of 32 per cent of a publicly listed company, Angostura Holdings Ltd?
A: First of all, I don’t see that the Government will take any different position. We have been in effect owners, through CL Financial, of a number of private companies over the past few years and there have never been any issues with that.
The intention here is to put everything together in a new company, both our shares and the shares of the CL Financial group, which will be the company that owns the assets of these companies going forward. So this company will be the controlling shareholder of this new company going forward.
Q: Explain that further please. Are you suggesting a new holding company for Angostura and CL World Brands? Because there are minority shareholders in Angostura.
A: No, no no. I am talking about our shares. Our shares going into a new company, which will be a company that will own the shares and exercise the voting rights over…So instead of being in Government’s name per se, it will be in the hands of this new company.
Q: And what about the CL Financial shareholders? It seems to me they will remain with 45 per cent of Angostura, 58 per cent of CL World Brands and 57 per cent of Home Construction, which probably totals more than $3 billion. Is that their settlement out of this resolution?
A: We expect that coming out of this that of course excluding the related party shareholders—there were certain shareholders who we continue to leave out of this particular arrangement—the intention is that once all of these remaining liabilities are paid at the tail end, that this company will revert to the original shareholders.
It is not our intention to continue to own companies throughout T&T. It is our intention to get back the money that we would have advanced to the CL Financial group over time.
Q: If that’s the case, can it not be argued that Lawrence Duprey, the former executive chairman of CL Financial, comes out of this arrangement quite favourably?
A: What we expect will happen is that the shareholders themselves of CL Financial will enter into some kind of arrangement with respect to those particular shares so that we don’t find ourselves in that kind of a position. And certainly it is not our expectation—and that part of it still needs to be worked out in some detail before we proceed, because there are still hanging ends that we need finalise.
For example the shareholders’ agreement which we may continue to extend while we continue to fine-tune these aspects to ensure that what we have is a solution that is socially and politically acceptable and palatable to the people of T&T. We would want to ensure that we manage that process very carefully.
Q: But what might be socially and politically palatable, might not be legally and constitutionally correct. Do you not concede that point?
A: Yes and that therefore is something…and which is why we have been taking some time with the shareholders agreement.
We want to ensure that we arrive at some kind of solution, which while recognising the legal and constitutional requirements, also gives us a position that I think the taxpayers of T&T will be comfortable with. I don’t think the taxpayers will be comfortable about assets going back into the hands of persons who may have created this debacle in the first place.
We are seeking to see to what extent we can find a solution that allows us to meet these requirements, but it has been a challenge as you have identified.
Q: Is it the Government’s intention to structure an agreement that excludes Mr Duprey?
A: I don’t want to dwell on specific individuals because governments don’t deal ad hominem. We deal with classes and I will deal with the class of related shareholders in an appropriate way. It may mean having to hive things off in a certain way to achieve that particular end.
Whatever decision we arrive at will respect the legal and constitutional rights of persons in T&T. It is not our intention, in any way whatsoever, to deprive people of what may be their constitutional rights.
The new Shipping Bill will bring T&T’s shipping and maritime industry into the 21st century, Transport Minister Stephen Cadiz said yesterday.
“When I came into the ministry a year and a half ago it did not exist. Cabinet did approve to establish a maritime policy strategy for T&T which is still a work in progress. You cannot build a maritime industry without a policy and proper legislation.
“All of the people in the industry would know of its ills. We have finished the first draft of our new Shipping Bill which we hope will create the initiatives to build a proper and solid maritime industry,” he said.
Cadiz, who spoke at the 77th Annual General Meeting of the Shipping Association of T&T at the Radisson Hotel, Port-of-Spain, said T&T cannot build a modern maritime industry when the shipping industry is being run with archaic systems.
“The Single Electronic Window (SEW) will cut down on the filing and paper work that is being done now. It is horrendous how the shipping industry is being run.
“I do not know how people who work in the industry do it. It sounds like a nightmare similar to the Licencing Office,” he said.
The minister said there will be rationalisation of the Port of Port-of-Spain and the Point Lisas Port..
“Should we move the Port of Port-of-Spain? It sits on TT $11 billion worth of real estate. Should the Government be reinvesting in a port or partnering with someone else and just provide the land? We have the investment in Point Lisas, what do we do with Point Lisas?” he asked.
He said a new port could cost between $5 to $6 billion in investment.
“A lot of work has gone into it with studies and reports, how we will get back our investment?” he asked.
The minister also spoke about the La Brea area and said the Shipping Association had advised that a port in that location will not be a good idea.
“What are we doing with three ports in T&T?” he asked. “The investment in Point Lisas will cost about $2 million to be able to improve their service. What we will look at for Brighton is a ship repair facility. We have the skill set to do proper ship repairs. It also provides far more employment than a modern port facility. A modern port facility does not have the thousands of workers needed as it is now all automated.”
One day after the Telecommunications Authority of T&T (TATT) approved the US$3 billion merger of Cable and Wireless Communication (CWC) and Columbus Communication International, the Barbados Fair Trading Commission (FTC) has followed suit.
In a statement, the FTC said that it had considered the overall efficiencies of the merger and the anti-competitive effects it will create in the telephony and fixed data services and is approving the merger subject to certain conditions.
The regulatory agency has given 14 conditions. Among them is that CWC/Columbus divest one set of fibre cables in the zones where there exists total overlap of the Lime and Flow networks and that customers of the fixed voice residential and commercial business and the fixed broadband residential and commercial business “be released from any contracts, if they so desire, so that they are able to exercise the option to choose a service provider.”
The FTC further stated that during the transitional period customers are not to be disadvantaged and that the applicants submit an independent valuation of assets to be divested within 60 days.
“The responsibility lies with the merged entity to find a suitable buyer that has the economic and technical capacity to maintain a viable network. The company or companies interested in acquiring the divested assets must be approved by the Commission before divestment occurs,” the FTC said, noting that within 45 days “the merged entity must vest such assets in a holding company.”
The FTC will appoint trustees of the holding company who will be responsible for monitoring ongoing management of the divested assets. This will ensure the divested assets are maintained intact and made available for sale, the agency said.
In the event of the failure, by the merged entity, to find a suitable buyer for the assets of the holding company within 180 days of the announcement of the merger decision,” the Trustee(s) will also assume the responsibility to seek out a buyer for the assets for a maximum of five years.”
The FTC added: “After five years the trustee(s) will place the holding company for sale in the open market.”
The regulatory body gas also stipulated that within three months of the date of the merger being effected, the new entity “must offer the same prices, products and service standards to customers in areas not passed by any competing fixed voice network as those offered to customers in areas passed by a competing fixed voice network.”
CWC/Columbus announced their merger plans in a joint statement last November. They have said this will enable the combined company to significantly accelerate its growth strategy, improve service delivery to customers in the region, offer customers a comprehensive portfolio of high-quality products and services and strengthen their position against larger competitors.
Overall market activity resulted from trading in 12 securities of which five advanced, three declined and four traded firm.
Trading activity on the first tier market registered a volume of 848,180 shares crossing the floor of the Exchange valued at $4,448,585.06.
Trinidad Cement Ltd was the volume leader with 767,623 shares changing hands for a value of $1,919,631.56, followed by Guardian Holdings Ltd with a volume of 51,604 shares being traded for $748,258.
Angostura Holdings Ltd contributed 10,548 shares with a value of $147,672, while The West Indian Tobacco Company Ltd added 10,000 shares valued at $1,250,500.
Clico Investment Fund enjoyed the day’s largest gain, increasing $0.10 to end the day at $22.60. Conversely, Trinidad Cement Ltd suffered the day’s greatest loss, falling $0.10 to close at $2.50.
Clico Investment Fund was the only active security on the mutual fund market, posting a volume of 45,830 shares valued at $1,035,550.
The Central Bank has announced the fourth consecutive increase in the repo rate. The decision to increase it by 25 basis points to 3¾ per cent was made at the March meeting of the Central Bank’s Monetary Policy Committee.
There will also be a continuation of the agressive programme to absorb excess liquidity to strengthen the impact high interest rates will have throughout the financial system.
These decisions were based on recent forward guidance from the US Federal Open Market Committee (FOMC) on the medium-term path of US monetary policy, the potential for higher domestic inflation in the medium term and the relatively positive growth outlook for 2015.
Based on recent information from the FOMC, markets are expecting the first increase in the US Federal Reserve funds rate to occur between July and September and for US policy rates liely to rise at a gradual pace after that.
The Central Bank said: “This normalisation of US monetary policy has implications for portfolio capital outflows and foreign exchange demand in Trinidad and Tobago, especially since returns on US dollar assets remain more attractive than TT dollar assets.
“By mid-March 2015, the TT$-US$ differential on benchmark ten-year Treasuries had narrowed to 64 basis points, from 87 basis points since the end of January 2015. Higher domestic interest rates are necessary to enhance returns on TT$-denominated assets, helping to curb portfolio capital movements out of Trinidad and Tobago.”
In January the MPC noted that the domestic economy appeared to be approaching full capacity. The Central Bank said the situation remained unchanged, although headline inflation slowed for the third consecutive month in February to just over six per cent from nine per cent in November 2014.
The slowdown in food inflation was due to higher food supply and favourable weather conditions and it contributed to the deceleration in headline inflation.
However, the Central Bank expects this easing in headline inflation to be short lived, as inflationary pressures are expected to pick up during the rest of the year due to a number of factors.
“Growth of consumer credit remains robust, increasing by nearly 8 ½ per cent in January 2015, suggesting consumers are still willing to spend despite negative sentiment surrounding falling oil prices,” the bank said.
Current and expected settlement of wage negotiations for teachers, civil servants and other public sector workers with considerably large retroactive payments and salary increments will boost consumer spending and further stoke inflationary pressures.”
Government’s spending on its capital programme was up by seven per cent in the first four months of the financial year compared to the corresponding period last year.
In the final quarter of 2014, economic growth was buoyed by further positive momentum in the non-energy sector, even as activity in the energy sector was marred by maintenance work, the Central Bank reported.
ST GEORGE’S—Former Barbados prime minister Owen Arthur says the resilience of Caribbean people rather than the content of programmes with the International Monetary Fund (IMF) is what will likely determine whether regional countries succeed or fail.
Arthur, delivering the Sir Archibald Need Memorial lecture on Thursday night, said the new type IMF programmes will “not in and of themselves solve all the problems of the Caribbean.”
“At best, they will function as catalysts which can trigger access to additional resources and help to generate new policy responses from others that all together may help to make a situation which started as being unsustainable, come into the realm of being manageable,” Owen said, as he spoke on the theme Can the Prescriptions of the IMF solve the economic problems of the Caribbean?.
He said countries facing such a “brutal reality must draw therefore upon more than what the IMF provides for.”
“Indeed, the totality of the adjustment that will be required to solve the problems will be the sum of those undertaken by the government in response to the national challenges, those undertaken by enterprises to improve and reform their balance sheets, and those undertaken by the people to ensure that they can enjoy successful livelihoods,” he said.
The Arthur said the contemporary Caribbean does not face the best of circumstances nor does it enjoy good fortune.
He said the longstanding and often cited difficulties that are associated with and derive from the region’s dubious distinction as the world’s smallest and most vulnerable set of nations, have persisted and have become more pronounced.
“In addition to its long standing challenges, our region, now has to grapple with stresses which are of a more recent vintage, which are gathering in scope and intensity and which are now so massive as not to lend themselves to easy resolution,” Arthur said.
He said the typical Caribbean country now faces the real danger of having to rely for their material progress on economic systems that are not viable.
“Conditioned for centuries to depending upon preferential access to foreign markets for their exports, on high levels of domestic protection for their industries and on generous access to concessional financing to support their development, almost every Caribbean nation has, now to face the prospect of building economic systems without the benefit of such props. “
Arthur said all the evidence suggests that the transition from the age of preferences to the age of competitive self-reliance has had devastating consequences, as is evidenced in the case of every banana producing economy.
“Our region has also been more adversely affected than most other regions, though unintentionally, by the economic rise of the South, especially China and India,” he said, adding “for much of the capital that our region used to attract to build for manufacturing and our informatics industries has been diverted to those nations, as they have embraced liberalization as their dominant economic ideology.”
“Ideally, therefore, the fiscal consolidation programme should go hand in hand with the growth programme,” Arthur said. CMC
An earlier verison of this story identified the number of jobs cut as 1,000 rather than 100. The corrected version is published below.
BP T&T has confirmed a decision to cut 100 jobs, amounting to a 10 per cent decrease of its total workforce.
The job cuts affect "mainly support and office-based staff," a release from the company said.
The details of the job cuts "were shared directly with employees and also with relevant authorities," the release said.
The changes "are aligned with the BP Group’s global simplification and efficiency programme announced in 2014," the release said.
“Safety remains our number one priority. All these organisational changes were carefully considered to ensure the safety of our personnel and operations will not be compromised,” said bpTT President Norman Christie.
“We remain strongly committed to running safe and reliable operations in Trinidad and Tobago and will continue to invest in our people and our operations.”
The release said that the company "will continue to monitor the environment and plans to move forward with approved major projects already underway in Trinidad."