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Adrian Loveridge Column – Investment!

Are we any closer to establishing a one-stop-shop for tourism investment?

As someone who has been intimately involved with tourism on Barbados, after 30 years, we still seem far from simplifying the process of encouraging both locals and foreigners to invest in the sector.

For a country that is so dependent on tourism for economic survival, it seems an incredible void, especially when you consider the critical place, tourism plays in our ongoing fiscal recovery.

GOOGLE ‘tourism one stop shop investment’ and up comes a whole array of countries including: Jordan, Egypt, Sri Lanka, Rwanda, South Africa, Oman, Botswana, Turkey, Australia, Thailand, Indonesia, Zambia, Hungary, and Dubai, not to forget a number of states within the USA.

Looking into the website for the Omani government, mission statements abound like ‘a single window system for the processing of applications linked to projects is currently being established’ and ‘the proposed One-Shop-Shop is expected to do away with bureaucracy and dramatically speed up the licensing and approvals linked to tourism related investments.

Other examples include ‘it is expected that all relevant stakeholders will respond to tourism applications within a specific duration for each entity’ with ‘the process to establish a new hotel application (1-5 stars) will take a maximum of 27 working days, and the process for allocating unmarked land, will take a maximum of 92 working days’.

‘Our’ recent experience with the proposed Hyatt may make this objective seem entirely impossible, but surely there is a compromise?

It is not just the investment climate which needs serious revision, but also the unproductive time and stress associated with hotel ownership, including the very many licenses required to legally operate one.

This, while the overwhelming majority of alternative accommodation offerings, apparently can function very well without them.

In our early days, it was almost like an impossible game to accumulate all the necessary documents for license application.

Often by the time every requirement was extracted, at least one official paper component was out of date and the process had to start all over again.

This at first may seem trivial, but when Barbados is competing in a global world for every investment Dollar, anyone seriously planning acquisition and development of a tourism project, will weigh very carefully the ease of doing business.

The feeling often gained, is that if it’s really so tedious and challenging to get on the first rungs of the ladder, what is it going to be like further up the road?

Or in the case of foreign investors, this may be compounded by – do they really want our investment?

As my five decades of tourism involvement come to an end, I implore our policymakers to convene a group of industry players who can demonstrate various degrees of past success. Then together with financial advisors and those behind the scenes administering the many often perceived, disjointed Government agencies, to seriously review and streamline ways of making investment infinitely more friendly and appealing.

73 responses to “Adrian Loveridge Column – Investment!”

  1. John A Avatar
    John A

    Try opening something as simple as a bank account as a visitor or property owner who spends say 6 months here a year and you will see how far we are from even the basics of investment.

  2. Lawson Avatar
    Lawson

    Reading this morning that one of your doctors said that the deceased lost 8 litres of blood from his stab wounds this makes Barbados very ripe for investment if these are the brains on the island. Getting my 24 dollars in beads ready

  3. Pootpeacafulandpolite Avatar
    Pootpeacafulandpolite

    We changed the ” industrial ” to ” investment ” In BIDC to accommodate such versatility in offshore business promotion but tourism has always been taken for granted hardly in need of proaction. Give Adrian Loveridge the chairmanship !!

  4. David Avatar
    David

    @John A

    Is a savings account an investment?

  5. Vincent Codrington Avatar
    Vincent Codrington

    @ Adrian Loverage.

    Barbadian economic and social well-being is not dependent on tourism. It is too volatile an industry for us to invest all our resources in. It is important but not the sole source of our welfare. We need to vet every aspect of tourism project to verify that it fits in with our vision of where and what we want to be. This takes time. We reached where we reached by taking our time. We are not noted for making “hot and sweaty decisions”. So sorry , we are who we are.

  6. Vincent Codrington Avatar
    Vincent Codrington

    @ Lawson at 7 :19 AM

    Your $24 dollars can buy beads. But we need a rapid response ambulance system and an A& E facility that works at emergency speed. How much these two systems cost in Canada?

  7. Vincent Codrington Avatar
    Vincent Codrington

    @ John A at 6 :54 AM

    As a visitor to UK, USA or Canada. I can assure your the process is no quicker. The local branches of metropolitan banks follow the same management manuals as those in the metropolitan countries.

  8. Ewart Archer Avatar
    Ewart Archer

    Vincent Codrington

    Most North American academic economists involved in tourism research would firmly reject the assertion that tourism is an unusually volatile industry.

    All industries have their ups and downs, but the list of leading tourist destinations around the world has been remarkably stable since the end of World War II.

    In the Commonwealth Caribbean, we have had more trouble earning a steady or increasing income from export agriculture (e.g., sugar, bananas, cocoa, nutmegs, etc) or from manufacturing (e.g., clothing, sporting equipment, semiconductors, etc) than from tourism.

    Among certain elites, the lack of enthusiasm for the tourist industry is as misguided as it is regrettable.

  9. Hal Austin Avatar
    Hal Austin

    @Ewart Archer

    Most North American academic economists……..(Quote)

    Pleaseeeeeeeee Your exuberance sometimes……..

  10. NorthernObserver Avatar
    NorthernObserver

    @AL
    you didn’t have a topic this week? Remind me, how long you have lived in Barbados?
    Taking your time, is in itself, a pastime in Barbados. And a positive feature (read @VC). It is part of the island charm.

  11. Hants Avatar
    Hants

    Barbados needs to create NEW industries/businesses and ways of creating meaningful economic activities.

    The economy should be diversified and it is never too late to make changes.

    The Tourism industry should be continuously improved.

    Overall, the Caribbean received 29.9 million tourist visits in 2018, the second highest on record.

  12. David Avatar
    David

    @NO

    Check how we cross at the pedestrian crossing.

  13. Vincent Codrington Avatar
    Vincent Codrington

    @ Hants at 11:28 AM

    I agree with every point in your submission. The best way to ensure economic growth is to add new industries and make existing industries more efficient. The latter has to be effected by management. Pointing fingers away from oneself is not very useful. Where ever we are in the process we should do our part.

  14. John A Avatar
    John A

    @Vincent.

    Right now the people reaping the sweets are the real estate management companies. The owners wire the USD to them and they bank it off shore, then they pay the local bills for the clients here in bajan dollars and add a fee too of course.

    Think of the amount of USD alone we could collect in Land tax if the system was more “friendly “.

  15. David Avatar
    David

    @John A

    The real estate operation you described is known to the authorities.

  16. Vincent Codrington Avatar
    Vincent Codrington

    There is a real and present danger in being bullied to adopt hair brained ideas which sound good . Unfortunately when examined and assessed or even later at the implementation phase many are found to be not fit for purpose.

    When we do not know where we want to go; any road will take us some where. We need to be clear about our targets/ destinations.

  17. John A Avatar
    John A

    @ David.

    The problem we have is we don’t facilitate the flow in of hard currency in a simple way. We instead throw up barriers of paper work where ever we can. From the central bank landslide of forms to the restrictions we have for investment. I will give you one simple suggestion.

    Why don’t we make it legal that any foreigner owning property here be able to open a USD ACCOUNT on the presentation of a current land tax bill and 2 pieces of I’D?

  18. Vincent Codrington Avatar
    Vincent Codrington

    @ John A at 12:06 PM

    I thought you were a supporter of offshore accounts and foreign exchange deposit accounts. The behaviour of the real estate agents are rational. We cannot have our cake and eat it too. The stated policy sound good did it not? What is it we really want? Hal and I have a hypothesis that foreign reserves are not all that important. I hope I am not misunderstanding him. Hoarding in all forms is not very beneficial in any economy. It is the flow. That is very hard for many to comprehend. GDP is a flow. Income is a flow.

    Reaping sweets? Did you say? What happens when the bubble bursts. They are managing their business risks as best they can.

  19. David Avatar
    David

    @John A

    The government may be cautious in its policy because real estate attracts dirty money.

  20. Vincent Codrington Avatar
    Vincent Codrington

    @ David BU at 12 :29 PM

    You wrote”real estate attracts dirty money”.
    Precisely.
    Doing the due diligence takes time. And it cannot be done by Artificial Intelligence. Machines do not / cannot make judgements.

  21. John A Avatar
    John A

    @ Vincent.

    I do support off shore account and hard currency accounts. The problem is we collect a fraction of what we could collect because of how difficult we make it for persons to hold them. I also don’t buy into the excuse that it is to protect against money laundering either.

    If a person already owns a home in Barbados has he not already bought it by what ever means he used? To therefore collect the land tax on it for the state in hard currency, could in no way facilitate money laundering as the asset has already been acquired. Now if you want to argue that the asset wad bought with laundered money then that is an entirely different conversation.

  22. Vincent Codrington Avatar
    Vincent Codrington

    @ John A

    Obviously there is no contradiction in Real Estate agents holding their fees and other earnings in accounts abroad and locals holding Foreign currency accounts. It is the private sector that owns ,earns and spend foreign exchange not the GoB.

  23. David Avatar
    David

    If foreigners purchase properties in Barbados arent they allowed to register the funds wit the central bank to facilitated repatriation if the need arises?

  24. John A Avatar
    John A

    @ David.

    Yes they can register the funds and “apply” for permission to take it out which depending on the amount can take from days to years.

    What I am talking about is capitalising on extracting what foreign exchange we can from them when they own the property.

  25. Miller Avatar
    Miller

    @ Vincent Codrington October 14, 2019 12:24 PM
    “Hal and I have a hypothesis that foreign reserves are not all that important. I hope I am not misunderstanding him. Hoarding in all forms is not very beneficial in any economy. It is the flow. That is very hard for many to comprehend. GDP is a flow. Income is a flow.”
    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++

    It comes as a bit of a surprise at the ‘side’ you have taken on this foreign reserves matter.

    It’s also somewhat of a letdown to not see any such siding of support coming from the blue-eyed boy who is the current architect at the centre of Bajan economic policies, the professor(e) of persuasion Persuad.

    When is he going to join this two-Bajan-boys’ choir and sing from a similar hymn sheet or is he going to insist on maintaining the current strategy of rationing foreign exchange by defaulting on the country’s foreign loans’ obligations?

    Why is the current administration allowing its foreign reserves to build up while its foreign bondholders’ horses are starving?

    Why continue to tarnish the country’s reputation on the international financial markets by the continuing delay in meeting the country’s foreign obligations when some of the foreign reserves can easily be appropriated to cover the scars of a bad debtor?

    What is it that both you and Hal are seeing that the professor and his altar boys are not espying in the sanctuary hiding from Devaluation?

    Is the laissez-faire approach to holding reserves more relevant to the current Bajan forex situation or should the MoF- upon advice of the guru Persuad who is ‘acting’ in loco parentis of the Guv of the Central Bank- continue to play a game of cat and mouse with the country’s foreign creditors?

    BTW, the jokey jockey miller has no skin in the game of foreign reserves either as a ‘flow’ or as a ‘stock’ since his horse called ‘Devaluation’ has been scratched from the current lineup of ponies and awaiting another race on the cards where the foreign bookies are prepared to accept 10:1 odds.

  26. Hal Austin Avatar
    Hal Austin

    @ Vincent

    Have you read the Queen’s Speech from the UK government and the following debate. They have now abandoned austerity and have declared themselves the party of infrastructural renewal. Is Mottley listening?

  27. Vincent Codrington Avatar
    Vincent Codrington

    @ Hal at 8:00 AM

    No I have not seen/heard the Throne Speech nor the debate in Parliament. I missed it. But I am happy that Boris Johnson has seen the Light ; and has abandoned that bankrupt approach to the present economic environment.

    Like you I was hoping that we would have tackled the physical and social infrastructures head on in preparation for the New Economy. But We live in Hope.

    Thanks for reminding me.

  28. Hants Avatar
    Hants

    Barbados-based Elegant Hotels Group is being acquired by well-known global hotel group Marriott International in an “all cash offer” worth about $260.2 million.

    https://www.nationnews.com/nationnews/news/242287/marriott-buying-elegant

  29. David Avatar
    David

    Implications?

    Marriott Is Buying Elegant Hotels in Barbados in Further All-Inclusive Push

    Patrick Whyte,

    October 18, 2019

    Marriott International has agreed to a deal to buy Elegant Hotels for $130.1 million in a move that will see the company expand its all-inclusive offering in the Caribbean.

    Elegant Hotels owns and operates seven hotels with 588 rooms and a beachfront restaurant on the island of Barbados.

    “There is a strong and growing consumer demand for premium and luxury properties in the all-inclusive category,” Arne Sorenson, Marriott’s CEO, said. “The addition of the Elegant portfolio will help us further jumpstart our expansion in the all-inclusive space, while providing more choices on the breathtaking island of Barbados for our 133 million Marriott Bonvoy members.”

    After completing the deal, Marriott is planning to renovate the hotels and rebrand them as all-inclusives under one of its brands. In keeping with its asset-light strategy it will also sell them off while keeping hold of the management contracts.

    Simon Sherwood, non-executive chairman of Elegant Hotels, said the deal represented “compelling value” for the company’s shareholders.

    “The fact that Elegant Hotels has attracted the interest of a company of Marriott’s calibre is a resounding endorsement of the outstanding quality of our properties, operations and people, and indeed of Barbados as a highly desirable destination. We are therefore unanimously recommending the offer to our shareholders,” he said.

    The offer values Elegant Hotels at around $199 million based on its total net debt of $68.9 million.
    Making Moves

    Having lagged behind some of its rivals in its all-inclusive offering, Marriott has been playing catch-up in 2019. In August the company announced plans to spend $800 million building two new resorts, one each in the Dominican Republic and Mexico.

    One of the big benefits of going deeper into all-inclusives is their attractiveness to loyalty club members. Marriott has spent the last few months shouting about its Bonvoy brand, and is clearly focussing a lot of its attention on making it more appealing.

    Adding Elegant Hotels to its portfolio should help but might it want to go further? Bloomberg reported in September that Sandals Resorts, perhaps the biggest name in Caribbean all-inclusive resorts, had restarted its sales process. It would be considerably more expensive — around $4.5 billion — than the $130 million paid for Elegant Hotels but with 24 properties across the region, would give it a substantially bigger footprint.

  30. Adrian Loveridge Avatar
    Adrian Loveridge

    As David pointed out there are many implications. While Elegant Hotels have been up for sale for some time, one is left to wonder just how much the concessions unilaterally granted to Sandals played in the decision. An average of around 67 per cent occupancy per year for Elegant against a quoted 92 per cent for the two Sandals properties on Barbados. It will be interesting to see exactly how Marriott brand some of the Elegant properties especially the smaller ones like Treasure Beach and Waves, where Marriott currently do not have similar types of hotels.
    While Barbados also remains largely tour operator dependent with larger hotels, it could also fundamentally change the way ‘we’ do business.

  31. David Avatar
    David

    @Adrian

    It is good to have the Marriotts brand in Barbados, this should help with marketing the destination, how much of the sale proceeds will make it to Barbados given how Elegant operates? It is listed on the UK exchange there one must assume it had foreign debt to liquidate?

  32. Miller Avatar
    Miller

    @ David October 19, 2019 5:19 AM

    What’s going on with the property on Sam Lord’s cliff which once proudly carried the brand name “Marriotts”?

    Shouldn’t the GoB be more taken up with the status of this ‘development’ which can contribute more to greater economic activity than a mere transfer of ownership of existing hotel plants and branches of up-scale restaurants?

    Now that the GoB appears to have struck a deal with its foreign bondholders when is a similar deal going to be made with the principals behind another ‘international brand name hotel so that they can proceed to find foreign investors to finance their pipe dream of an erection called the Hyatt which has been bragged about from the time Adam begat Mark Mal(m)oney?

    Blogmaster, why can’t you treat to the Hyatt project for what it really is?
    Just a figment of some scammers’ imagination whose tree has failed to bear real fruit.

    Blogmaster, if you were keen to invest your ‘inherited’ bagatelle currently worth US$ 100 million and idly sitting in some overseas bank account would you sink it in a concrete high-rise monument in a dying town where the rat population outnumbers the human residents by a factor of 5,000 to 1 or would you seek to buy out the Four Seasons villa view or even the Harlequin dilapidated real estate assets which both have greater potential to attract upscale foreign clientele than the town-rat motel?

  33. Mariposa Avatar
    Mariposa

    Miller For what it is worth one can easily say that if a big name Hotel was erected on downtown Bay street the filthy delapidated enviroment would cease to exit
    Rats roaches vermin homeless and any specimen that would derive the investor of its fortune would banished over night
    Govt would have to do diligence expeditiously with due respect on how the investor receives a clean enviroment in return for monies invested in the island

  34. Mariposa Avatar
    Mariposa

    Interesting that some blp supporters see the Marriott sale as the best thing for barbados although much financial benefits or resources would not becoming to this island
    Also of interst would Marriott be employing local business contractors in the remodeling of the Hotel

  35. David Avatar
    David

    Some are saying it is a good news story which it is, Marriott’s is an international brand like Hyatt the one you support? We know they will not be having Chinese labour as was the case at the now derelict Sam Lord’s Castle site the party you support supported.

  36. Miller Avatar
    Miller

    @ Mariposa October 19, 2019 9:40 AM

    Couldn’t agree more with your dream-world expectations!

    I am certain that you dream a lot also about winning the Super lottery.

    The overriding issue with the Hyatt is that not one mal money boy or government official has addressed the sine qua non of the Hyatt proposed project.

    After the impressively glossy plans have been approved in toto where is the money coming from to convert these drawings into reality on the ground?

    Is it coming from the NIS, the local banking system, from Maloney’s foreign currency savings account or from Foreign Direct Investors like Butch Stewart or the Chinese as in the case of the Sam Lordie Wyndham?

    As it stands now, one can only speculate that the financing of this project which has been in the planning pipeline for many years would be coming from the grains of sand on the Pirate Cove beach and wheel-barrowed to Maloney’s Hideaway by an army of rats from Nelson Street.

  37. Mariposa Avatar
    Mariposa

    I say the Marriott story is a feel good story that only would attract and be applauded by the likes of flat footed koolaid drinking blp supporters
    However hiding away from the inquisitive eyes and ears of barbadians is what is in this story to the benefit of barbadians now living by the skin of teet and need jobs

  38. David Avatar
    David

    Let us agree sometimes you have to read and spell for some.

    It is an internationally recognized brand expanding its footprint in Barbados. With a brand of this recognition a la Sandals, bigger than Sandals, benefits will accrue to the country regarding marketing promotion of the island and filling rooms seats. Do you understand now?

  39. Mariposa Avatar
    Mariposa

    Miller my comment is resolute
    In that bridgetown bay street is in dire need of a facelift and if it takes a Hotel to do so(so) be it
    The political wheels keep turning which serves no help in the revitalization
    Recently right under all noses a political decision was made to sell all the land at Coverly to Maloney the same voices who have opposed Maloney interest in the Hyatt said nothing

  40. Mariposa Avatar
    Mariposa

    In what sense of the word
    There is marketing and there is Marketing
    Barbados foot print is already known as a tourist destination
    Dont see many great leaps with Marriott
    Tourist rely on affordability when choosing destinations
    In the long haul Marroitt setting up shop would benefit Marriott more than Barbados
    The end game is to sell not to be a salesagent for Barbados unlike Sandals whose brand of marketing for barbados includes media commercials in international markets
    One can venture to say that Marriott would not be inclined to throw top dollars into its budget to market Marriott barbados in the international market via tv

  41. NorthernObserver Avatar
    NorthernObserver

    “Barbados foot print is already known as a tourist destination”….true….so why give away the baby, bathwater and elder siblings as was done with Sandals. Does the Barbados brand have no value?

    “The end game is to sell not to be a salesagent for Barbados unlike Sandals”…..let’s be clear, Sandals promotes Sandals. When one of my friends saw Sandals had a Barbados location, he called to book. They couldn’t accommodate his schedule there, so offered him a “deal” in another location. Marriott likewise, will promote Marriott. And with their Bonvoy arm, have access to many more people, than a few Sandals TV commercials, and via a much broader range of marketing vehicles. TV is a dying marketing vehicle, only older people watch TV, which is why it is so successful for Sandals, because they are not cheap. The same way most young people do not own a ‘land line’ phone, they do not own a TV. Or if they do, it is connected to the internet, not any TV provider. They do not like ads. Or schedules.

    And you may be surprised the coverage Barbados gets. Appreciate it was as recently as August 2019 that Marriott announced they would be pursuing the all-inclusive market. This Barbados purchase represents a new model for them. Expect it to get much coverage once they have remodelled the properties to whatever their specifications are.

    Marriott is very familiar with Barbados. They used to operate Sam Lords? They were also GEL’s partner in the Flight catering business. I think they may have overpaid for Elegant, but it gives them quick access, and in a market which already has upscale appeal.

  42. Mariposa Avatar
    Mariposa

    Do not envision outside Internet promotion Marriott selling barbados on world wide tv
    I have yet to see Marriott marketing a country in which its brand is locatted via advertisement on tv
    I have seen many Sandals ads via different media sources having a scenery along with barbados and sandals brand inclusive
    Most of Mariott marketing strategy is by internet or media print

  43. Adrian Loveridge Avatar
    Adrian Loveridge

    Mariposa, suggest you – YouTube ‘Marriott commercial 2019’ and see the number of TV ‘ads’ they have produced.

  44. NorthernObserver Avatar
    NorthernObserver

    Precisely….TV is an outdated advertising vehicle. The magazine industry has all but collapsed. Newspapers, should soon be called Netpapers, because they have more subscribers to the internet version than the paper version. And the latter is way more costly to produce.
    Billboards? They adorn most major roadways, airports, train and bus terminals etc etc And they have gone digital. Sandals uses these too.
    You do not need to worry, all these hotel chains spend heavily on advertising and promotion. You do not have to see it, which only means, you are not in their target group.
    And you still do not accept Sandals is selling Sandals. I see Sandals/Beaches ads almost daily. They love the Golf Channel. And I haven’t seen one featuring the Barbados brand/location in eons; though I am well aware some of the scenes captured are from Barbados. They only advertised Barbados when it was new. As they likely will do whenever they open their location in Speightstown. I have seen Grenada recently, maybe that is newer than Barbados, I don’t know.
    All you are set on doing, is justifying to yourself, the value to Barbados of giving away what was given to Sandals. Butch knew they were desperate, and worked them over real good. That is history.

  45. Mariposa Avatar
    Mariposa

    Dont discount tv ads there is a whole generation of people who still find tv advertising as convenient because of not having to be bothered with passwords and other personnel internet details

    Mr. Loveridge i am aware of Marriott ads on U tube

  46. Hants Avatar
    Hants

    Spent a few weeks at this resort.

    https://www.marriott.com/hotels/hotel-photos/bnago-gaylord-opryland-resort-and-convention-center/

  47. NorthernObserver Avatar
    NorthernObserver

    Convenient? Taking 20min of every hour is convenient? I know you have no trouble with PW’s or sign ins, and are just fine on the net. You had the news from foreign sources on the debt settlement first? Personally, between a PVR/Pause button, I rarely watch any TV ads. As u would say…point being, all the major hotels chains spend lots of money of advertising and promotion, how they reach their targets is up to the content buyers.

  48. Mariposa Avatar
    Mariposa

    Reference was made as to whether Marriott would be employing barbadians during its rebuilding process of Elegant
    The answer given in local paper suggest that Elegant has a workforce of 1,100 people in barbados
    Which now begs the question how many are barbadians and if preference would be given to barbadians in the rehiring process
    Govt must be diligent in their efforts in acessing such information for the greater interest of society
    The information delivered by kerrie Symmonds indulges but does not give a clear understanding of Marriott’s intentions towards further employing x amount barbadians when Elegant reopens

  49. Mariposa Avatar
    Mariposa

    NO

    As i regularly say i rarely watch Tv
    My point being that on those rare occassions when i do i captured an essence and the beauty of a Sandals barbafos commercial in a 30 seconds spot .
    I have yet to see a Marriott commercial in similar fashion on tv. which highlight the country where Marriott is located

  50. Mariposa Avatar
    Mariposa

    this is the latest Mariott commercial done in Sept 2019

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