The Adrian Loveridge Column – Brexit Counter Measures

BrexitThe abundantly obvious subject for this week’s column would have been Brexit and the potentially damaging results it could have on what is still our single largest tourism market, the United Kingdom. But in hindsight, there is so much speculation, unknown elements and possibilities yet to be clearly evaluated it is really difficult to formulate a measured or even an intelligent response.

What is unmistakably and without dispute at this stage, that due to the depreciated value of Sterling it will be immediately make Barbados and the Caribbean more expensive for British visitors. Some tour operators may have ordered forward United States Dollars, so may not have to immediately either absorb or re-negotiate contracted hotel and villa rates.

From my own twelve years as a tour operator in the UK, we experienced significant Sterling devaluation twice during that period. We both absorbed the cost increases without passing them onto the customer but also went cap-in-hand to many of the hotels we used. They were incredibly sympathetic and we came to an amicable arrangement which minimised their depleted revenue while ensuring that they did not lose room nights, particularly at short notice.

During our more than a decade trading period we did not discount a single holiday, but for clients willing and able to pay in full by credit card at least 9 months prior to the travel date we offered a 10 per cent published price reduction. Those monies were then placed in an escrow account that earned a meaningful rate of interest and this would either wholly or partially offset currency fluctuation.

While for many this Brexit has come as an unexpected shock, I think that we can use the situation to focus on ensuring that all tourism partners are giving improved value for money to our visitors. Clearly one of the ways that could help would be for Government to speed up the agreed concessions promised to the tourism industry at large and which only a single player has been largely benefiting from for almost three long years.

And that ‘special one’ largely collects payment offshore in the local currency where the product is marketed, therefore almost eliminating any losses caused by differing exchange rates. This ‘luxury’ is not available to the majority of our lodging providers, especially the smaller properties.

The administration must be convinced by now that there is only one major economic sector that is going to take us out of the current fiscal malaise of debt with currently minimal, if any, GDP annual growth.

I also wonder if Brexit and the lower valued Sterling has created an opportunity for many more British manufacturers to step-up-to-the-plate and increase exports to our region. As we import the vast majority of consumables used in tourism, this again could help soften the blow. One tiny example is that even with a milk glut our virtual monopoly dairy company decided unilaterally to stop making yogurt, a virtual staple at each hotels breakfast offerings. Our choice was then to purchase a product made in Minnesota, which even by air freight is some 2,995 miles away. More likely they are transported by refrigerated trucks and ships at a considerably greater distance.

Perhaps our very pro-active British High Commissioner to Barbados could liase with the BHTA and help identify areas where increased opportunities may be possible. Trade delegations also help fill empty air seats and hotel beds.


18 Comments on “The Adrian Loveridge Column – Brexit Counter Measures”

  1. David July 4, 2016 at 6:14 AM #

    Brexit claims another victim.



  2. millertheanunnaki July 4, 2016 at 8:33 AM #

    @ David July 4, 2016 at 6:14 AM

    That’s what is meant by being ‘hoisted by your own petard’. The buffoon has already exited now this joker is running away from his stillborn responsibility.

    What he should do next is to resign from his seat in the EU Parliament and save the misled British taxpayers a not so few thousand pounds in salary, perks and generous travel allowances.


  3. Bernard Codrington. July 4, 2016 at 11:10 AM #

    The Westminster model is working. Three cheers. Have no fear all is well. I hope Barbados learns to create a balanced and diversified economy. That is the best hedge against going into an economic tail spin when trading partners make adjustments in their best interests.


  4. Colonel Buggy July 4, 2016 at 12:43 PM #

    Helmsman Farage, trained under Captain Schinetto. After running the ship aground,has wasted no time in being the first person to jump into a lifeboat, ahead of the other crew members and passengers.


  5. Hants July 4, 2016 at 10:05 PM #

    Residents of Barbados who are planning travel to Jamaica via Trinidad and Tobago or Guyana are advised that they will require a valid yellow fever certificate to gain entry into that country.


  6. chad99999 July 4, 2016 at 10:46 PM #

    There was a time, several decades ago, when Canadians formed the largest segment of the tourist population in Barbados. Not the Brits. In the immediate aftermath of Brexit, the pound fell 10% in value, and although it has since recovered partially, many economists expect a second period of decline as the costs of separating from the EU take hold. Bad news.
    Tourism planners should re-think their focus on high-end tourism for the UK market and try to win back some of the business they gave up to low cost destinations like the Dominican Republic and Cuba. The only way to do this, of course, is to replace some smaller hotels with large ones that can use their scale, and the very latest technologies, to achieve greater efficiency and lower production costs. The island needs US branded hotels to enhance its appeal to North American travellers and this might be a good time to meet that need.
    What the government must not do is allow hotel managers to demand more tax concessions. The taxpayer has spent heavily to provide the infrastructure the industry relies on, and it is time for the industry to re-pay the taxpayer and earn its keep.


  7. David July 4, 2016 at 11:04 PM #


    Don’t businesses chase ROI? If destination in Barbados’ peer group are subsidizing/giving concessions how will Barbados compete? How will we attract investors in the sector?

    On Tue, Jul 5, 2016 at 2:46 AM, Barbados Underground wrote:



  8. chad99999 July 5, 2016 at 3:12 AM #

    There are problems with the costly, “tax holiday” approach to hotel industry development. It may be absolutely necessary for completely new destination areas, with minimal infrastructure, that are starting from scratch. But for well-known, already developed destination areas like the Caribbean, which offer relatively high-quality resources and substantial bragging rights to their customers, tax concessions are not necessary to attract large hotels. They are accustomed to paying taxes in the US on their global income, and what they need most is the support of efficient, high quality infrastructure and reliable public sector services: water supplies, sewerage, Internet connections, cable TV, roads, hospitals, transportation, security from criminal attacks, airports, etc.


  9. David July 5, 2016 at 5:26 AM #


    Not disagreeing with just exploring the practicality of your position. Let us examine one input to the cost of how the sector does business. At the government level millions of dollars have to be allocated to subsidize the marketing to the airlines. In your proposal you suggest to transition the sector to volume thus reducing the average dollar spend. In this scenario who will invest in rooms given airline cost to reach Barbados and the relatively high cost of living compared to St.Lucia, DR, Cuba and other destinations. How does the government influence the sector to transform without concessions?


  10. de pedantic Dribbler July 5, 2016 at 6:20 AM #

    @David, the beautiful thing about Chad45’s exhortations is that they can be as lacking in reality (his assertions about levels of talent) or practicality as in this case and still be wonderful blogging.

    As you point out the real world details can quickly fecundity up the sweet prose.

    It would be a complete retool of our tourism strategy to go down-market given as you note our comparatively high cost structures. Beyond the obvious local issues in dovetailing those two conflicting variables – high cost, low value renter – there is the other issue of how do we actually compete with DR and Cuba at that end of the spectrum.

    Your remarks highlight some of the complexities involved and savvy readers would realize that you can’t just automatically re-brand as a low cost destination without major changes.

    I don’t even know that Barbados has the fundamental ability to effect any of those really necessary changes to its plant (eg attractions) and its product (eg CoL) to move down market.

    And of course the airlift issues are always interesting.


  11. David July 5, 2016 at 6:25 AM #

    @Dee Word

    Part of the solution from a lay perspective must be our Caribbean islands sharing airspace and collaborating on points of interest to build the appeal of the whole. It makes no sense every other island building the same infrastructure/attractions. We must leverage what each territory has to over to complete a compelling offer. Ordinary citizens are always called on to provide solutions, of course this is a red herring position offered by politicians and others to defend the status quo in our system.


  12. Bush Tea July 5, 2016 at 6:34 AM #

    How do you build palaces …and then try to market them to poor commoners….?
    How do you pay New York salaries to staff – and seek to have them serve bums?

    Our tourism is doomed….. like most prostitutes after age 50.
    We needed to learn a REAL trade – like needlework, agriculture, cooking or some other PRODUCTIVE shiite if we seriously intended to continue making a living AFTER having our stuffings knocked out by five decades of ‘Johns’.

    Lotta shiite….
    Old hoes looking to sell ‘a good time’ on discount….


  13. de pedantic Dribbler July 5, 2016 at 6:58 AM #

    Oh lawd, that is a stark analogy there of 50 year pros. However, Mr BushTea do remember that there are exceptions. Either created by medical procedure of plastic surgery or good genes and a little medical.

    Even old pros can look good after 50!

    @David, great theory at 6:25 AM. CHA and other regional tourism entities sing that tune but the island musicians often don’t play in harmony.

    Talking about tunes and music, a little aside. Yesterday I heard the opening stanza in a tourism ad of a song I last recalling singing at primary school. It was that independence ditty that 8 year olds would sing: ‘L-O-V-E, I love you…’

    I actually started to fill in the blanks with ‘Barbados, you mean everything thing to me you’re my beautiful paradise…’ And nearly snapped my head off when the ad finished out ‘….Anguilla (or Antigua)’. Can’t even remember now I was so distraught. LOLL.

    The fact that the ditty rushed right back to me after all these years was nice. Can take a Bajan out of the rock, but can’t take the rock outta de Bajan. Oh lawd.

    Do primary school kids even do that ditty anymore..or is that too old and dried up now!


  14. chad99999 July 5, 2016 at 6:59 AM #

    As usual, we get people who believe that if you propose some large hotels, you are suggesting a “re-branding” of the island.
    Not so, dummies. Just as cruise travel co-exists with high-end services, you can have large franchise hotels that offer greater familiarity and better deals to North American tourists than the inefficient high cost boutique hotels we depend on now.
    It used to be fashionable in tourism planning circles many years ago to insist that destinations aim for diversification, with several different tourist segments, precisely to provide a measure of insurance in the event of the collapse of one segment.
    One other thing. You do not have to match Cuba and the DR dollar for dollar in prices. Many North Americans will never set foot in Cuba for ideological reasons. Others feel uncomfortable in the DR because of the Spanish language and the Haitian beggars. Get it?


  15. chad99999 July 5, 2016 at 7:25 AM #

    Still another point: The new-normal long term oil price of $60 a barrel is a 40% reduction on the status quo before 2015. The newest commercial aircraft offer so much additional fuel economy that the extra cost of flying to Barbados is trivial.
    And yes, David, the biggest problem in Barbados and the rest of the Caribbean is the scarcity of talent, ingenuity, and energy. No-one wants to hear that, but as they say, the truth offends.


  16. de pedantic Dribbler July 5, 2016 at 7:56 AM #

    As I suggested earlier if sweet blog posts was all that was necessary to resolve our tourism issues you would be a genius. Whether on a blog, on the block or in the executive meeting rooms the comments should have some seriousness to them. If you want to take it to a subjective level then good for you. I actually try to respond to David and others as objectively as possible.

    Your recommendations have been on the table for years within the Bdos context and so far the execs have not been able to mix high and low as effectively as you simplify.

    I well recall the times when the chatter (rather snobbish it was too) spoke of refuse collectors being on island with others of supposedly higher class and all that type of marketing disconnect palaver.

    So if you with facile verse perceive that a US chain hotel will the panacea or that the spoken word of English gives us volume ability over DR or Cuba then with you as CEO of Bdos Tourism we clearly would be in for some challenges from your strategy.

    But that’s what change and ‘new ideas’ are all about!

    I gone.


  17. chad99999 July 5, 2016 at 8:41 AM #

    I am not up to date on the kinds of people who currently make the big decisions for the Barbados tourism industry.
    But when I was dealing with the Ministry of Tourism and the Caribbean Tourism Research Centre back in the 1980s, I know for a fact that not a single executive I personally dealt with had any ground level experience in tourism logistics, or any useful insights about the industry. Most were not even familiar with the academic research in tourism economics and marketing, although of course there were a lot of opinions about how to spend the money budgeted for marketing should be spent.

    It is telling that not a single outstanding evidence-based tourism textbook has been written by a Caribbean tourist industry bureaucrat or university faculty member for a major publisher, although some of these people have been sitting on mountains of data for 50 years.
    And before you ask, I am familiar with the name Jean Holder.


  18. David July 6, 2016 at 5:08 PM #

    New Ministry of Tourism website coming!


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