special advertising section - global business · special advertising section the caribbean tourism...

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Special Advertising Section

The Caribbean tourism market is the region’s single largestemployer and contributor to economic growth. As theprestigious World Travel Market meets in London this month,we focus on four top destinations and discover their mostrecent tourism and economic developments. P

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Global connections

With new technology moving so fast, a company has to be fast out of thestarting blocks to stand any chance of breaking the tape first.As Olympic champ Tonique Williams-Darling would tell you, dedication

and commitment to excellence have been quintesential in her goldwinning success. BaTelCo follows her example by endeavoring to be

the first to offer new products and services as soon as they aretechnically possible to all our customers, domestic and global.

Bahamas Telecommunications Company Limited John F. Kennedy Drive,P.O. Box N-3048, Nassau, Bahamas

Tel: (242) 302-4000 Fax: (242) 356-0880 Website:www.btcbahamas.com

BaTelCo, more than a telephone company

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The archipelago of700 islands and isletsmay already be afavorite with millionsof tourists each year,but soon they will be coming in greaternumbers, after PrimeMinister PerryChristie recently gavethe go-ahead for the

most ambitious tourism project the Bahamas has ever seen.The Baha Mar complex, signed off in April, will see three hotel

resorts in Cable Beach brought together to create the secondlargest resort in the whole of the Caribbean. More than US$1billion is to be invested in renovating the properties anddeveloping their facilities. “We have set out to create a must-see, one-of-a-kind experience combining the creative genius oftop international and Bahamian professionals,” says Christie.

Meanwhile, further tourism developments, such as the US$725million expansion of the famous Atlantis resort, point to anatmosphere of confidence in the tourism sector. As MichaelHooper, general manager of the British Colonial Hilton pointsout: “Since 2004, tourism has made up 50% of our occupancylevels. The increased air traffic from the U.S. and the U.K. hasboosted our numbers.”

A British-trained lawyer and former triple jump champion,Prime Minister Christie took office in May 2002 pledging to fightcorruption, promote economic growth and attract foreigninvestment. “The Prime Minister is committed to taking theBahamas to the next level,” says Minister of Works and Utilities,Bradley Roberts. “He is encouraging investment, whichultimately will improve the quality of life for the people here.

“The announcement of the Baha Mar’s takeover, and the re-rationalization and re-engineering of Cable Beach, for example,is a significant milestone for us. It is the first time in the historyof both the Bahamas and the Caribbean that three majorinvestors had shown interest in developing a major project.”

Roberts points to other reasons why investors would betempted by the Bahamas. As home to some 250 banks andtrust companies, with combined balance sheet assets ofUS$300 billion, it is a major international provider of offshorefinancial services, plus there is a growing need for investmentin the utilities sector. The country’s close proximity to the U.S.and its long and stable political history are additional draws.

One organization eager to talk with potential investors isBatelco, The Bahamas Telecommunications Company Ltd.Created in 1966, Batelco’s portfolio covers telephone networks,facsimile, telex, cellular radio telephone, and private line services,

packet switching, satellite leasing, and radio licensing.Employing more than 1000 workers, it has in excess of 64,000phones in a 100% digital, fully-automated switching system,providing direct distance dialing to more than 100 countries.

Batelco recently signed agreements to offer state-of-the-arttelecoms and Internet services to the Atlantis and Baha Marresort developments, thereby playing its part in ensuring thesuccess of the enterprises. The company is also involved inprojects, which, according to Batelco’s president and CEOMichael Symonette, “will bring reliable next-generation telecomsto the Bahamas, and have created openings for investors.”



THE BAHAMAS

THIS IMPORTANT TOURISM ANDFINANCIAL CENTER IS TAKING ITS SERVICEAND UTILITIES SECTORS UP A NOTCH TOPREPARE FOR A MAJOR NEW ATTRACTIONAND EXCITING EXPANSION INITIATIVES

Setting the standardfor service

Bank of The Bahamas International, comprehensive financialservices for sophisticated clients

Investments you can relax with

Fourth Floor, Centreville House, 2nd Terrace West, Centreville, P.O. Box N.8303, Nassau, N.P., The Bahamas Tel: 242-356-6133 Fax: 242-356-6144 Email: [email protected] Website: www.montaquegroup.com

Left: Bradley Roberts - Minister of Works & UtilitiesRight: James Smith - Minister of State for Finance

We have set out to create a must-see, one of a kindexperience. Perry Christie, Prime Minister “

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First is an ambitious project to connect the main islands ofNew Providence, Grand Bahama and Great Abaco with manyof the smaller islands through a network of submarine fibercables. Batelco plans to use the network, scheduled to becompleted by summer 2006, to bring high speed Internetservices to many islands. It will encourage the development ofe-commerce and allow the government to extend its educationalprogram to remote places through distance learning. The PMhas announced plans to increase the number of computers inschools and is working to give all educational institutions andlibraries access to the Internet. “This project is incrediblyimportant for the development of the country,” says Symonette.

Next up is a plan to extend coverage of Batelco’s wireless GSMand GDMA networks beyond Grand Bahama and NewProvidence, out to the provincial islands. Already, 100,000Bahamians – a third of the population – use cell phones andSymonette sees this as a major growth opportunity for thecompany, which has roaming agreements with mobile carriersin the United States, Canada and Mexico.

Batelco’s willingness to cater for the needs of business isparticularly evident in the country’s capital Nassau, one of theworld’s leading international financial centers. The increasingdemands of money management and computerization have ledto a close alliance between the many banks and trust companiesand Batelco. Recently, in conjunction with Swiss Telecom PTT,Batelco developed a digital satellite communication systembetween Switzerland and the Bahamas.This is expected toreduce costs of transmitting data between the two prominentfinancial centers by about 30%.

According to Minister of Finance, James Smith, this is oneexample of how the Bahamas has repositioned itself in the globalfinancial services market. “The Bahamas is now able to promoteitself as a well-regulated financial services center, withestablished and efficient operations and an increased emphasison customer services and product development,” says Smith,a former governor of the Central Bank.

The new governor of the Central Bank of the Bahamas, WendyCraigg, who took over from outgoing governor Julian Francis inJune this year, says there are a number of key milestones whichhave strengthened the Bahamas’s position as a financial center.

One landmark was the introduction of the SMART (SpecificMandate Regulatory Test) Fund in December 2003, which,according to Craigg, has “speeded up the procedure ofestablishing funds by cutting the red tape.”

Other good news for investors includes the new FinancialTransactions Reporting Act, brought in to fight money-launderingand the processing of drugs money, and the country’s removalfrom the OECD list of countries practicing harmful tax legislation.

Also of significance was the signing of a Tax InformationExchange Agreement with Washington in 2002. With this, theBahamas retained its prized Qualified Jurisdiction (QJ) status,which allows Bahamian-based companies to earn income fromUS investments without having to pay a 30% withholding tax.

This combination of market-friendly regulations, competitivepricing and sophisticated tax compliant wealth managementstructure positions the Bahamian economy for strong growth,according to Hillary Deveaux, executive director at the SecuritiesCommission of the Bahamas. “We are very well-placed tocapitalize on international developments in the financial servicessector,” he says.

The financial services sector also enjoys a healthy, cooperativerelationship with the regulatory bodies. The Bahamas FinancialServices Board (BFSB) serves as the principal communicationarm of the industry, liaising with government to ensure theregulatory environment of the Bahamas is conducive forbusiness. “The regulators have proven to be sensitive to theneeds of the industry, while at the same time establishingstandards in keeping with international requirements,” saysWendy Warren, CEO and executive director at the BFSB.

The private sector organization has been important asset inhelping the jurisdiction respond to evolving standards byproviding legislators and regulators with industry feedback whenexamining and responding to initiatives. “It is very important tohave a regulation environment that is business-friendly,” saysMichael Foot, an inspector at the Central Bank of the Bahamas.


The British Colonial Hilton - traditional-style luxury in exquisite surroundings

Bahamas Electricity Corporation (B.E.C.)Blue Hill and Tucker Roads, P.O. Box N-7509, Nassau, N.P., Bahamas Tel: (242) 302 1000 Fax: (242) 322 8418 Web: www.bahamaselectricity.com

BEC – the national utilityBahamas Electricity Corporation (BEC) is a customer-

friendly, publicly-owned utility company responsiblefor the national electricity service in The Bahamas, exceptGrand Bahama and Inagua, where the supply is out-sourced. BEC General Manager Kevin A. Basden wants toraise service delivery standards by encouraging his team“to act national as well as corporate.” But BEC is not wait-ing for privatization before adopting a private sector cul-ture and is investing in training initiatives as well as newcapital equipment and generating plant. With new invest-ment pouring into The Bahamas for major tourism pro-jects, BEC is planning ahead by working closely in part-nership with developers and government officials, whileensuring that all its staff understand changing technology.BEC is highly sensitized towards environmental protec-tion and is evaluating the use of renewable energy includ-ing wind and solar solutions. Its commitment to customerservice is expressed in the investment of $8 million inmeter reading technology, reducing the cost of adminis-tration and improving the accuracy of billing. BEC nowseeks to boost cash flow and put its finances on a long-term framework by issuing $100 million in bonds. Theproposal is under scrutiny by government. As a bridgebetween the new and the old world, BEC is well geared tomeet any challenge arising from disaster managementand has excellent contingency plans for any emergency.


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An Englishman, Foot previously workedat the Bank of England and the UK’sFinancial Services Authority (FSA)showing the Bahamas’s commitment tohaving the best people available toregulate the sector.

Bahamian investment and financialservices advisory firm the MontaqueGroup is a member of the BFSB andpresident Owen Bethel recognizes thework the organization has done to

“promote and enhance the industry.” Formerly MontaqueSecurities International, the company recently decided to dividethe functions and services offered under the one structure intotwo new affiliates, Montaque Corporate Partners, Ltd. andMontaque Capital Partners, Ltd. Now collectively known as theMontaque Group, Montaque Corporate Partners performs theservices of corporate formation and management, foundationformation and management, family office and celebrity conciergefacilities, and all ancillary advisory services.

Montaque Capital Partners is responsible for all securities,investments, and capital market transactions, private equity andventure capital activities, asset portfolio management, andmutual funds structuring. Another independent arm of the group,the Bahamas FilmInvest International Ltd., is involved inpromoting and facilitating motion picture production in theBahamas, providing treasury functions, sourcing projectfinancing, and talent and crew recruitment.

Bethel says the fact the Bahamas has been rated A3 by

Moody’s is an indicator of confidence in the country, not onlyfor investors in and creditors to the country but also for end-users of products and services based in the Bahamas. “It is asymbolic quasi-guarantee for investment in the country andreinforces the credit-worthiness of the Bahamas,” he says. “Italso reflects the sound fiscal and monetary management ofthe government and a stable economy conducive for continuedgrowth in investments and international business transactions.”

At the Bank of The Bahamas, managing director PaulMcWeeney says the well-trained and equipped workforce in theBahamian financial services sector is another plus point forinvestors. “They have the necessary tools and deliver cutting-edge services,” he says.

The bank is corporate oriented and focuses on commercialand industrial loans as well as residential mortgages. Witharound a 7.5% share in the Bahamian market and 51% of itsshares government-owned, Bank of The Bahamas plans toexpand in a number of areas.

“First, we will expand our banking services to more of thedeveloping Islands of the archipelago and, in addition toproviding capital financing, seek to grow our consumer book ofbusiness. Secondly, we will continue to focus resources towardsforeign currency financing. Additionally, we have embarked upona plan to expand the bank’s business beyond its borders, a firstfor any Bahamian clearing bank,” says McWeeney.

As a first step, the company will establish a service center inMiami by the end of the year. “The service center will provideaccess to banking facilities Bahamians need to achieve theirbusiness objectives without leaving Miami,” says McWeeney.



Michael HooperGM, British Colonial Hilton

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After long monthssailing, the ex-pedition led byColumbus arrivedupon a low-lying,“ b e a n - s h a p e d ”island, as describedin his journal entry. Itwas their first NewWorld landfall, andis believed to be inthe island of Grand

Turk, the political capital of the Turks & Caicos Islands (TCI). Centuries later, the TCI is one of the Caribbean’s rising

stars as a pristine destination with great investmentpotential, moving on the government’s vision of attractinga high-end tourism for this growing sector which accountsfor 60% of the gross domestic product (GDP). The 40islands and cays that comprise the country are less than600 miles south-east of Miami – 75 minutes by plane –and are home to 20,000 native “Belongers” who speakEnglish, use U.S. dollars and enjoy political and socialstability as a U.K. overseas territory.

Without renouncing its vocation as a quality touristdestination, the TCI has other industries that contribute tothe GDP, including the world’s only conch farm that exportsover a million of these delicacy shellfish a year, and, morenotably, a solid offshore financial services sector. But it isthe beauty, peace and tranquility of the TCI which beckonthe visitor and melt even the most seasoned connoisseursof tropical islands. It is “Beautiful by Nature,” according tothe island dwellers and rich in a history that can be seenboth on terra firma and under the crystalline Caribbeanwaters – the TCI has the world’s third largest coral reefpopulating the sheer oceanic walls that plunge 7,000 feetdown not far off the coastline; a paradise for divers, a hazardto the Spanish galleons whose seasoned wrecks nowdelight underwater adventurers.

The importance of the reef to the islands is emphasizedby Chief Minister Michael Eugene Misick when describingthe effects of the recent tourist explosion, which is reachingdouble-figure annual growth rates. “We focus on qualitytourism rather than quantity. Our coral reef and pristinebeaches are a fragile natural gift, which takes a millenium

to create and one minute to destroy,” he says. Two-thirdsof the TCI are natural reserves which protect the delicatebalance between beaches, vegetation, fauna and theastonishing diversity of the coral reef ecosystem. Not tomention the peace and tranquility, which visitors can enjoyalmost as much as the beaches, to the point that someprivate cays offer getaways featuring no phones, TVs orautomobiles. The capital island of Grand Turk, on theother hand, will soon be docking major cruise ships in theUS$40 mil l ion facil it ies that are being developed byCorporation. Horizontal infrastructure projects are beingfunded by another multi-million dollar agreement with theEuropean Union.

While promoting the islands as a high-end destination,Misick is keen for the islanders to benefit directly from thisgrowing industry, and encourages them to open shops andrestaurants or to gain employment in the sector. Recently,the TCI hosted the Small Islands Micro Economies (SIME)congress, an event which seeks solutions to the challengesshared by non-independent micro economies worldwide,including the need to adjust telecom capacity to growingdemand. For Minister of Communications, McAllisterHanchell, the end of the telecom monopoly held by Cableand Wireless will foster competition and lower rates, andthe government is planning to “open this market to foreigninvestors and get new players by the end of 2005.”

Deputy Chief Minister Floyd Basil Hall, who is also theMinister of Finance, explains that offshore banking is theterritory’s second source of GDP, with numerousinternational banks which provide a range of servicesoverseen by the Financial Services Commission, the TCI’sown regulatory body. “The insurance market is an importantgrowth are,” says Hall, “and we are now working on newproducts to invite more elaborate promotions.” Corporatehouses and holding companies are some of the optionsbeing developed to accommodate the heavy capital inflowto this territory that levies no income, corporate, property,capital gains or inheritance taxes. Instead, it relies on indirectforms of taxation and fees generated by the offshoreindustry as revenue sources.

The government prides itself on being the most investor-friendly in the Caribbean; as the Chief Minister says: “Inthe TCI, investors get the red carpet, not the red tape.” Thisis the idea behind TCInvest, the country’s investment


www.fortune.com/sections S6

The TCI has the third largest coral reef in the world

THE HIDEAWAY PARADISE CELEBRATESTOURISM GROWTH, A NEWLY OPENEDTELECOMMUNICATIONS SECTOR ANDMORE FINANCIAL SERVICES PRODUCTS

Red carpet, not redtape, for investors

THE TURKS & CAICOS ISLANDS

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Left: Michael E. Misick - Chief MinisterRight: Floyd B. Hall - Minister of Finance

and Deputy Chief Minister

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promotion agency, dedicated exclusively to guidinginvestors through formalities and offering help and advice.TCInvest CEO Conrad Higgs sums up the TCI’s edge: “Abig advantage is that we speak English and our currencyis the US dollar, making any business with North Americaeasier.” In the past few years, TCI has attracted more thanUS$3 billion in direct foreign investments. Other divisionsof TCInvest, such as its Banking division, help local peopleobtain loans to finance education, housing and businesses,while the Small Business division is charged withencouraging the entrepreneurial spirit of the Islanders todevelop their business skills.

“Our islands are a magnet for tourism – in fact, most of theinvestment requests we handle are from this sector.Investors who come here want to invest in the resourcesone finds here: sea, sun and people,” says Higgs.

The island of Providenciales has, until recently, been thefocus of most of the tourism-related development. Thegovernment is, however, seeking to attract investmentprojects to the other family islands, each one having its ownunique features and investment opportunities. North Caicos,for example, known locally as “the emerald isle,” is ideal forfruit and vegetable farming, while South Caicos is the centerof the TCI’s fishing industry and home to Boston University’sField Studies School. Eco-tourism projects can find greatpotential on the lush island of Middle Caicos, which alsohas some spectacular beaches. Grand Turk, the capitalisland, has a romantic history dating back some 300 years.On the UNESCO World Heritage site of Salt Cay, once thesalt capital of the world, investors will find an oasis oftranquility well-suited to sensitive development.

Higgs stresses the investment opportunities are not limitedto mil l ion-dollar investments. “Businesses requiring smaller capital outlay can also be profitable and are therefore welcomed.”

The director of tourism of the Turks & Caicos Islands,Lindsey Musgrove, elaborates on this point: “We work inpartnerships to develop new products for all the differentislands. We are looking for all kinds of partnerships. We needmore travel agencies, gift shops, diving operations,restaurants... all the facil ities that tourists like,” saysMusgrove. The recent growth of the sector has put an endto the crisis that saw alarming drops in tourist arrivals in thewake of the 9/11 attacks and is the result of a promotionalcampaign that was put into place at that time. “We simplyadvertised the islands. We highlighted the stability of thegovernment, the security, the natural beauty, the tax laws

and the friendly people. It obviously worked because lastyear we had a 6% increase in tourist arrivals,” saysMusgrove.

This is good news in a country where three out of everyfive employees work in the tourism sector. Even better arethe predictions for 2006, when the Grand Turk CruiseTerminal by Carnival Corporation comes into operation -then visitor numbers arriving to the islands are expected torise by 20-25%. According to Musgrove, resorts and condodevelopments have increased by more than 40% during thelast few years. And communication links are growing; theinternational airport on Providenciales already has directflights to and from several U.S. cities, including New York,Boston, Miami and Philadelphia, and Toronto and London.

Meanwhile, the airport on Grand Turk is being completelyrevamped to accommodate direct international flights aswell. It is hoped that this will put the capital island on thedestination map, while creating employment opportunities.Musgrove is convinced that every visitor to Turks and Caicoswill feel the difference: “The Caribbean islands are allamazing, but what makes the difference is that Turks &Caicos is ‘Beautiful by Nature’; the islands are still pristineand new.”


Scenes like this have helped boost the TCI’s tourism industry, which was up by 6% last year, more than half of the country’s GDP Pho

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The Caribbean islands are all amazing, but what makes the differenceis that Turks and Caicos is ‘Beautiful by Nature’. Lindsey Musgrove, Director of Tourism “

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Turks and Caicos Tourist BoardP.O.Box 128, Front Street, Grand Turk, Turks and Caicos Islands, British West Indies. Tel: +649 946 2321 Fax: +649 946 2733lmusgrove@turksandcaicostourism.comwww.turksandcaicostourism.com

TCInvestP.O.Box 105, Church Folly, Grand Turk, Turks and Caicos Islands, British West Indies. Tel: +649 946 2058 Fax : +649 946 1464e-mail: [email protected] www.tcinvest.tc


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After the 2001 slump that gripped theregion, tourism in the Caribbean isback on track. U.S. visitors arereturning slowly but surely, while afavorable exchange rate has resultedin a strong European presence. Thishas pushed the region’s total travel andtourism demand up to US$40bn,according to World Travel and TourismCouncil estimates.

The Caribbean maintains animpeccable reputation as a safe and comfortable destination– an issue of vital importance to island-states which relyheavily on the sector’s GDP contribution and employmentgeneration. Many of the smaller islands have targeted thetourist niches best suited to their assets, for example:ecotourism, historical interest, aquatic activities or just plainlazing in the sun.

As Lindsey Musgrove, director of tourism for the Turks andCaicos Islands (TCI) notes, his islands offer all of the above,plus the world’s third largest coral reef barrier and 250 milesof pristine beaches. Daily flights already arrive from majorU.S. cities and the U.K. while new airl ines offeringcompetitive fares will start operating from both countrieslater this year.The quality of the offering is reflected in theisland’s rankings in specialized publications. Grace Bay, forexample, a prestigious seaside resort on Providenciales, orProvo as the locals call it, has been voted “World’s No.1

Beach” by Conde Nast, while Scuba Diving magazinehas voted the TCI “Best Overall Destination”and “HealthiestMarine Environment.” The latter title is borne out by the deepoffshore waters which serve as transit routes for manymarine animals, including humpback whales on their annualmigrations. Sport fishing and bird-watching are otheroptions in the 33 reserves, sanctuaries and historical sitesthat protect the delicate ecosystems that represent the truetreasure of the islands.

Accommodation in the TCI is as diverse as the islandsthemselves, from state-of-the-art four and five star resorts,such as Parrot Cay Hotel and Grace Bay Club, to quiet,historical hotels and inns. Most offer custom divingpackages, vehicle rentals and a wide range of activitiesthrough local providers. Small family hotels offer quaint andromantic atmospheres for getaway tourists, honeymoonersand business travelers. The government is encouraginginvestors to build outside of Provo, and predicts some 4,000additional hotel rooms being built within the next 8 years.

On Grand Turk, the Osprey Beach Hotel offers a cozybeach-front experience with an emphasis on goodcompany. “Belongers don’t think of hotels as places to stay,but as places to live”, says Jennifer Smith, the hotel’s owner.“Here at Osprey Beach, you’re living well and in interestingcompany, all enjoying the great tradition of hideaway.” Freshfoods, oversized drinks and no hurries are the hotel’s strongpoints, although Internet connection is available for thosethat need it.

Across the Caicos Bank on the island of Providenciales,nestled on six hilltop acres with panoramic views of the northshore barrier reef, is the family-operated Miramar Resort.A short stroll leads to the Turtle Cove Marina, the heart ofthe island, with restaurants, bars, shops and every kind ofnautical activity, although many guests are happy to stayon the resort’s own outdoor deck and contemplate themagnificent scenery. Those here on business will findInternet connection, and the perfect complements tounwind after a meeting, including a shuttle to the beach, apool and a fitness room.



In the great tradition of hideaway www.ospreybeachhotel.com

Wake up to Paradise - the best Caribbean views can be enjoyedfrom the luxury of your room. [email protected]

Get away from it all in the TCI DIVING, SIGHT-SEEING OR JUST SOMEPLAIN OLD PEACE AND QUIET ALL MAKETHE TURKS AND CAICOS ISLANDS ANACCESSIBLE, ATTRACTIVE PROSPECTFOR THAT SPECIAL BREAK

Lindsey MusgroveDirector of Tourism

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With a new airportproviding theisland’s “front door,”Montserrat is nowmore accessiblethan ever. Oppor-tunities in tourismand light industry,plus new incen-tives, are alreadybringing in newinvestors, who are

finding that when it comes to doing business, Montserrathas the best of both worlds.

Being within the jurisdiction of the British legal and financialsystems, it offers a stable and transparent businessenvironment. Yet it maintains strong links within the region,through trading body Caricom and the Organization ofEastern Caribbean States, which concentrates onpromoting the region on a global level.

Dr. John Osborne Chief Minister and Minister of Financeand Economic Development is bullish about his aims torebuild a buoyant economy and the need for outsideinvestment. He says: “We are offering great incentives topeople wishing to invest in Montserrat. Our main focus istourism, as we simply need more hotels to cater for thedemand. Developers can look forward to tax-free incentives,which we can extend to other areas within the touristmarket, and indeed other sectors.”

Dr. Osborne points to developments such as MontserratAirport as essential growth builders: “These moves ablydemonstrate how we are addressing the need forimprovements in Montserrat’s infrastructure. We arecombining these improvements with new initiatives whichaim to create interest in diverse aspects of the island. Inparticular, we are looking at our natural, historical andarchaeological resources and the volcano observatory,although this already receives a great deal of visitors and isunique in the Caribbean.

“Our policy of incentivizing outside investment is providingadditional employment for islanders, which in turn,stimulates the economy. Although the British governmentcurrently pays for the civil service, policeand their own government members, aswell as providing monies for roads andhousing, we do expect to be totally self-

sufficient within 6 to 7 years.”Financial Secretary John Skerritt explains how the island’s

economic and financial policies are based on real growth.This year alone, Montserrat is expecting a growth in GDPof 6.5%. “Our approach is two-pronged,” he says. “We areemploying a high level of public expenditure to maintain theisland as we develop its infrastructure, and we are alsotargeting specific economic sectors that have the greatestpotential for growth, such as: tourism, mining and quarrying,light manufacturing, water-bottling and agro-processing.”

The island is currently considering proposals from anumber of investors, thanks in no small part to the incentivesderived from a development budget of more than US$15million. These incentives are tied to the type and size ofbusiness and its contribution to employment and economy.“All an investor needs to start the process is an investmentproposal or business plan,” Skerritt concludes.

SAFE INVESTMENTAs a further boost to its potential for investors, Montserratrecently received a BBB-positive investing-grade rating,which Thomas Peacock of the Financial ServicesCommission notes ”unequivocally establishes Montserratas financially stable.”

These sentiments are echoed by Angela Greenaway of theMontserrat Development Unit (MDU), who maintains thatthe award says a great deal for Montserrat’s governanceand financial administration. The MDU, a one-stop-shop forinvestors, is currently developing adventure activities for thetourist sector, including nature trails and scuba diving. Theresult is that as the tourist industry thrives, it grows lightmanufacturing initiatives, like the water bottling companythat is currently being established. Greenaway continues:“The safety and appeal of the island financially is reflectedin the safety and appeal of the island’s ambience. Montserratis a literal paradise.”

Governor Deborah Barnes-Jones looks at the island’s newcenter as another positive step forward. “Work is in progressto establish a town center at Little Bay, which will presentopportunities for development in businesses, amenities and

residential villas. We have done what we canto finance the project locally and are nowlooking beyond Montserrat for privateinvestment. We have already had some

Montserrat ‘s new airport at Geralds will open up the island totourists and investors

THE BRITISH OVERSEAS TERRITORY OF 40 SQUARE MILES IS ENJOYING APHOENIX-LIKE RESURGANCE AFTER THE VOLCANIC ERUPTIONS OF THE LATE NINETIES

MONTSERRATPreparing for take off

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Left: Hon. Dr. John A. Osborne - Chief Minister & Min. of Finance and Economic Development Right: John R. S. Skerritt - Financial Secretary

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interest.”The island’s

undeniable naturalbeauty certainlyhelps efforts topromote the island,as John Ryan andErnestine Cassell,respectively thechairman anddirector of the

Montserrat Tourist Board (MTB) explain. According to Ryan,“Montserrat used to be an upscale holiday destination butnow, along with being a beautiful Caribbean island, we areunique in that we have an active volcano. At the MTB, weare focusing on the competitive prices of our villa tourism,the active volcano life, ecotourism and the fact we offertax relief for individuals from the UK on pensions, dividendsand royalties.” Cassell continues: “We launched our slogan:“Montserrat: know it, love it, show it” to promote the island.”The Tourism Board also has other promotional projects inthe pipeline: Cassell says: “In 2003, a German documentaryshowed how the island had progressed since the volcanowhich generated a great deal of interest from the Germanmarket. In fact, we saw a 7% rise in visitors, so we arerepeating the project again this year.”

FLYING HIGHThe increase in the number of visitors to the island and theeffect of increased tourism on the economy means trafficto the island is set to grow steadily. The new airport,therefore, is easily the most important development on theisland in recent years.

Situated at Geralds, on the northern safe zone of theisland, the airport is set to further enhance the fortunes ofMontserrat and help it cope with the influx of new visitors.Claude Hogan, project manager, Montserrat Airport says:“A great deal of tourism growth is based on day travelers.The fact Montserrat airport uses Antigua as its hub, withSt Maarten as an alternative focal point, means visitors toboth these islands can have an adventurous day inMontserrat walking the nature trails, observing the volcanofrom the safe vantage points, or even looking over the ruinsof Plymouth - the modern day Pompeii. Of course theservice is not exclusive to day tourists - we also expectretirees, business visitors and long stay tourists as well.”

Antigua is a 20 minute flight from Montserrat as opposedto the hour-long journey by sea, and has direct services toLondon, New York, Newark, Philadelphia, Toronto, San Juanand many of the Caribbean islands. Such enhancedcommunication links are obviously set to increase outsideinvestment in the island.

Bryan and Dyann Hollender, proprietors of WaterworksEstate, rent exclusive, high-end villas in Montserrat, whichMr Hollender calls “the safest place in the Caribbean.” Heenvisages a return to the island’s hey-day, when it was aplayground for the rich and famous, and is convinced thatnow is the time to invest in property on the island. “Spaceis limited and the window of opportunity is small. Property

is now a third of the price it was. If you want to get in, nowis the time. We really think there is going to be a boomhere within the next three years.”

Susan Edgecomber of Tradewinds Real Estate agrees:“Prices are rising but very competitively, and the factproperty is sold in US dollars means that Europeans arefinding investments favorable.” Visitors to the island,whether investing or relaxing, wil l also enjoy the VuePointe Hotel which offers rainforest hikes, volcano tours andis also home to the Sea Wolf Diving School.

Alternatively, the Tropical Mansion Suites offers a relaxingbreak for the high-end traveler with stunning views from thebalconies of its 18 well-appointed and intimate rooms.The hilltop location benefits from an invigorating, tropicalbreeze, enchanting swimming pool, cascading waterfall andgazebo. General manager Merle Galloway says: “Thehotel offers a unique warmth and cares for each of its guest,with all the amenities one would expect in a boutique hotel.Opened in December 1999, the hotel stands as a symbolof hope for the regeneration of Montserrat and is within easyreach of the ferry port, heliport and Little Bay beach.”



Left: John Ryan - Chairman, Tourist BoardRight: Angela Greenaway - Permanent Secretary,

Montserrat Development Unit

MONTSERRATMontserrat Tourist Board, # 7 Farara Plaza, Buildings B&C, P.O. Box 7, Brades, Montserrat, WITel: +664 491-2230/8730 Fax: +664 491-7430E-mail: [email protected] www.visitmontserrat.com

UNITED KINGDOM & IRELANDFor media and tour operator inquiries:The Saltmarsh Partnership, The Copperfields, 25d Copperfield Street, London SE1 0ENTel: +44 020 7928 1600 Fax:+44 020 7928 1700Email: [email protected] For tourism information: Montserrat Government (U.K) Office, 7 Portland Place, London WIB 1PPTel: +44 020 7031 0317 Fax: +44 020 7031 0318Email: [email protected]

GERMANYMontserrat Tourist Board (Europe), West India CommitteePostFach 701423, Hamburg 22047, GermanyTel: +49 40 695 8846 Fax: +49 40 380 0051Email: [email protected]

Tropical Mansion Suites - luxury amid unspoiled beauty

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For Enquiries and Information

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After being recognized as the world’sleading developing country by the UN’shuman development index, Prime MinisterOwen Arthur is using this position as aplatform to take the country into fulldevelopment: “We have already covered agreat deal of ground in reinforcing ourstanding as a country on the brink of FirstWorld status,” he says. “We’ve diversifiedour economy away from a heavydependence on sugar and chosen toaccelerate our development in our aim to become an exporterof high quality services.”

Through this, Barbados wants to exploit its ability to becomea financial center and use the workforce to export a range ofservices. Indeed, since the original International Countries Actin 1964, Barbados has determined that it should be marketedas an active business center offering both mind, managementand marketing capabilities. Further to this end, the governmenthas recently constituted a coalition of service providers to bringall services, whether engineering or health, to spearhead furtherdevelopment. It is also creating new economic policies,institutions and infrastructure to enable the country to performwell in the Caribbean Community (CARICOM) Single MarketEconomy (CSME)– the main provisions of which will be set inplace this year.

Through the CSME, Barbados is lookingto increase its global standing. Smallcountries are finding it increasingly difficultto be heard in a rapidly globalizing world andwhen trying to negotiate with organizations,there is little patience for dealing with groupsof small countries. Through the CSME, it isbelieved that increased influence throughnegotiations with such organizations and,by operating without trade barriers in a singleeconomic space, will enhance growth.

In conjunction with these widely accepted factors, it is hopedthat new arenas for trade such as South America, China andAfrica will be created. As deputy Prime Minister and AttorneyGeneral Mia Mottley says: “Our traditional trade partners, suchas the U.K. and the U.S., will continue to play a strong role,although other countries, such as China and those in LatinAmerica, will be warmly welcomed.”

A further attraction for these countries is outlined by the PrimeMinister: “In a short time, we have developed a strong andexpanding international business and financial services industry,energized by a low tax regime, a sound regulatory structure andfinancial integrity. This combination, together with a longestablished reputation for financial stability has attracted a greatdeal of foreign investment and will continue to do so withpartners old and new.”



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Barbados’s Parliament building in Bridgetown

RENOWNED AS A TOP DESTINATION FORHIGH-END HOLIDAYS, BARBADOS’SREPUTATION HAS BEEN FURTHERENHANCED THIS YEAR AS A HIGHQUALITY INVESTMENT OPPORTUNITY

BARBADOS

Investor’s paradisefinds more niches

Left: Owen Arthur - Prime MinisterRight: Noel Lynch - Minister of Tourism

C O L O N Y C L U B ● C RY S TA L C OV E ● T H E H O U S E ● TA M A R I N D C OV E ● T U RT L E B E AC H

FIVE INDIVIDUALLY STYLED PROPERTIES IN BARBADOSONE HIGH STANDARD OF ELEGANCE

Tel: 0800 587 3427 • Fax: 001 246 432 7150Email: [email protected] • www.eleganthotels.com

As the Barbados economy grows, BNOCL is continuing to develop and implement strategies aimed at guaranteeing that the energy needs of all sectors of the economy are efficiently met at the most competitive prices.The Barbados National Oil Company LtdWoodbourne, St Philip, Barbados, West Indies, Tel: +246 420 1800 Fax: +246 420 1818 E-mail: [email protected]

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What is the perfect climate for investing?About 30 C.

The most beautiful part of Barbados may be the investment opportunities. To learn what makesBarbados the perfect place to live, invest and do business, contact the President of the BarbadosTourism Authority at 246-467-3600, or visit www.barbadosinvestments.com. For more on a Barbados holiday go to www.visitbarbados.org.

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Such partners arebeing encouragedthrough incentives toinvest in servicesectors with a focuson the diversificationof traditional financialand tourist sectors.However, there isalso a commitmentby Barbados to

encourage investment in truly pan-Caribbean companies thatcan effectively operate in the global market and benefit the regionas a whole.

Other welcome developments, such as the TouristDevelopment Act (TDA), are already bearing fruit as they increasethe incentives for investment in tourism in Barbados. “The ratesof return on investment, the continuing growth of the tourismindustry and the political stability here are all encouraginginvestment,” says Minister for Tourism and InternationalTransport, Noel Lynch. The figures bear this statement out, withthe country boasting around a 5% increase in tourism year-on-year for the last five years and, taking into account projectedinvestment of US$2 billion in the last two years, the country’smajor industry is booming. This success is being pushed bothinternally and externally, as exemplified by the increase in airliftinitiated by the Ministry of Tourism, which has resulted in newcarriers appearing and longer standing carriers adding flightsfrom this winter.

Reporting to the Ministry of Tourism is the Barbados TourismAuthority (BTA), responsible for marketing the country’s tourismin conjunction with partners in the private sector. BTA has ascientific approach to marketing and, through profiling, a clearidea of who their customers are. Its strategy is also clearlyfocused in terms of profit and stability, aiming to grow earningsand ensure that tourism has a sustainable base.

BTA’s president and CEO Stuart Layne further explains thisstrategic approach to growing tourism: “From the figures, youcan see we are looking at immediate investment – and directinfluence from that investment – but that isn’t the end of the

story. There are a variety of products from hotels, condodevelopments, all-inclusive destinations and so on, but we aimto supplement these through acts such as the TDA and enhanceour ability to sustain development over the long-term.”

Certainly, with no ownership limitations and no capital gainstax, the incentives are clear. However, by spreading the focusto auxiliary developments, such as offering concessions onrestaurants, recreational facilities, services and attractions thatemphasize the island’s heritage, and the construction of non-coastal properties, the BTA is aiming for a broader, morejudicious mix.

GLOBAL COMPETITORSuch forward thinking is due to the fact that Barbados is nowcompeting against the most popular and luxurious destinationsin the world. With this in mind, high-end investment is coming.The recently rebuilt Hilton Barbados Hotel has opened its doors,for example, and a Four Seasons hotel is currently beingdeveloped. As Layne notes: “Government funds have alreadybeen allocated to develop the smaller hotels to a minimum 3-star standard. We aren’t suggesting that all hotels conform toa set of criteria in terms of size, but in terms of standards andservice delivery. For example, if it is a guest house, it must bea 5-star guest house. It does not have to be turned into a villa,but it does have to deliver a very high quality of service whereverit is positioned within the tourism product offering.”

Certainly, as Barbados has one of the highest achieved roomrates it is investment in the higher priced accommodationsthat are showing better returns as they have the betteroccupancy.

These investment opportunities are being strategicallypromoted globally to “wherever there are people who are lookingfor a safe place to invest, good returns and political stability,”



Left: Stuart Layne - B.T.A.Right: Darcy Boyce - Barbados Tourism Investment

The rates of return, thecontinuing growth of tourismand the political stability hereare all encouraging investment.

Noel Lynch, Minister for Tourism and International Transport

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5 essential elements to remember when making an investment.AdviceWe advise Governmenton all matters relating tothe Commission and thesecurities market.

MaintenanceOur Commissioners havethe appropriate experienceto maintain properstandards of conduct andprofessionalism.

RegistrationWe insist all securities areregistered in accordancewith the Securities Act toensure orderly, fair andequitable dealings.

CreationWe aim to create theright market conditionsto ensure the orderlygrowth and developmentof the capital market.

ProtectionWe are obliged to bringaction against anyindividuals andcompanies contraveningthe securities law.

5th Floor, Tom Adams Financial Centre, Spry Street, Bridgetown, Barbados. Tel: +246 437 3924 Fax: +246 437 3931 [email protected]

The Hilton Barbados, a Caribbean treasure

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continues Layne. “These are core elements in attractinginvestments such as we are encouraging and Barbados’spolitical and economic stability and our legislature are alreadybringing this investment in.”

The BTA is also seeking to increase return on investment byextending the island’s peak season. Layne says: “To a very largeextent, we’ve already succeeded in promoting events such asCrop Over, the traditional, harvest festival held every Summer,to shift the idea of Barbados solely as a beach destination. Also,by hosting the ICC Cricket World Cup in 2007 (CWC 2007),we will attract a great deal of long-term stays.

“We are lucky that the U.K. is our biggest market and theyhave a great deal of interest in cricket, even more so since theyrecently won the Ashes, but will also promote awareness in non-traditional markets, such as Australia and Pakistan,” he says.

While CWC 2007 will be a great catalyst for attracting bothinvestment and awareness, there will also be long-term benefitsin terms of investment in infrastructure. One final BTA initiativeis that of up-skilling the workforce. Although a literacy rate of97.6% means Barbados already has a head start as adeveloping nation, there are cash grants available for investorswho include worker training in their schemes.

Stuart Layne is bullish about how such joined up thinking willhelp Barbados in the future. “By encouraging investment likethis and further promoting Barbados as a high-end, year-rounddestination, 12 years from now I see Barbados as a developedcountry and here, I’m defining ‘developed’ at self sustaining.We are 29th within the United Nation’s development index,meaning that we’re the highest ranking developing country. Ifwe could double our tourism industry, we could increase ourforeign reserves and create greater sustainability and hedgeagainst potential recessions. This is not a dream. This is a veryreal future for Barbados.”

One organization working with the BTA to maintain growth andstability in Barbados’s tourist economy is the Barbados TourismInvestment Inc. (BTI). CEO Darcy Boyce sets out their aims:“Over the next four years, we are focusing on transactions withthe private sector using government land as equity to contributeto direct joint venture projects in order to create profitable touristenterprises. Hand in hand, we are looking to intensify our urbanregeneration program whereby we maintain older buildings andinfrastructure and develop new ones. For example, we recentlyredeveloped St Lawrence Street Gap where the street and itsrestaurants were our priority. ”

The BTI is working with a mix of local and foreign investors,with local investors bringing onboard their foreign partners. Inorder to maintain growth, Boyce sees a need for moreattractions on the island: “We have a number of festivals thatare attracting people but physical attractions are also key. As aresult, BTI is involved in a number of projects including theConcorde project: a theme park based around a recentlypurchased plane; a beach development whereby abandoned



Twelve years from now, Isee Barbados as a developedcountry.

Stuart Layne, President and CEO

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Barbados – a picture-perfect destination

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buildings are being redeveloped and a new marina complex thatwill have room for 41 luxury yachts, as well as a further 75 smallercraft at a cost of around US$45 million.”

CRUISING AHEADStaying in the marine world, Barbados Port Inc. (BPI) is alsolooking at expansion. It is currently undergoing the mostambitious expansion plan in its history, which involves capitalinvestment of over US$100 million with a further US$45 millionhaving just been pledged. Larry Tatem, the chairman of thispublicly owned company, says: “At the moment, the port’sphysical capacity is the same as it was in 1961, while vesselshave obviously increased in size. This has meant anchoringcargo vessels outside the port to create docking space for cruiseships. Part of the project that is yet to commence is the new

cruise pier, which will provide berth capacity for two mega cruisevessels and be situated away from the main harbor. It is a US$25million project and will take 18 months to complete once it hasgot the green light.”

BPI is also looking to become a transhipment center for theCaribbean, and combined with a strategy of incentive programsfor cruise lines and working closely with the necessary localstakeholders, it aims to maintain the port’s status as a leadingCaribbean cruise ship destination. It is also looking to developpart of the port area into an entertainment complex with shopsand restaurants and opportunities for further propertydevelopment scheduled by relocating export facilities away fromthe cruise ship terminals. The port is keen to work within theframework of the CSME to ensure there are common standardsthroughout the region.

In the post 9/11 era, the port has enhanced its securitymeasures and was one of the first in the Caribbean to meetthe rigorous criteria of the International Ship and Port FacilitySecurity code (ISPS). As Kenneth Atherley, divisional managerof corporate development and strategy at BPI points out,passing such tests is key to the port’s success. “We aim toremain best in our class – there is a driving force here tocompete, to build our transhipment business and continue toimprove productivity,” he says.

Such determination is also evident in the words of MichaelPoynter, chief operating officer of Elegant Hotels Group, whichowns five hotels on the island. All the hotels are currentlyundergoing renovation as part of a capital investment program.He says: “I am determined to show that hotels in Barbados donot compete with other local hotels; they are in the global marketand are competing with hotels worldwide. Each of our hotelswill be positioned in its own market, with the Colony Club as ourflagship, and our standards across the board will reflect thisglobal strategy, not just in terms of facilities but in offering highquality service across the board.”

The recently opened Hilton Barbados with 360 rooms, a 24-hour business center and 10,000 square feet of meeting space,is another development aware of this global competition.General manager Marilyn Sopers says: “We are competing ata global level with resorts on nearby islands and around theworld, but we are keen to maintain the sense of communityhere.” This balance is mirrored in the fact that the hotel has toaccommodate the business traveler as well as the leisure

traveler, as Sopers qualifies: “We need to find the mix so thatthe rooms meet both class of guest. We may have businessfacilities, but the rooms don’t look like offices.”

INVESTMENT IN THE PIPELINEOverseas investment continues to be one of the country’s keyeconomic drivers and Dr. Marion Williams, governor of theCentral Bank of Barbados clarifies this: “Capital account inflowshelp us to boost our balance of payments as the current accounttends to be in deficit and the capital inflows really make thedifference. Tourism continues to be important for capital inflowsand the financial services industry will continue to be importantas well. A great deal of emphasis is being put on improvementsof the skill sets of practitioners in that sector and it is clear thatgreater results are being achieved in creating an environmentto attract foreign investors.”

However, it is not simply tourism and finance that are attractingexternal investment: in addition to its natural beauty, Barbadosalso has other natural resources and it is the aim of BarbadosNational Oil Company Limited (BNOCL) to maximize oil and gasresources and make energy available to the island at the bestpossible prices. To this end, they have recently completed anew storage terminal and are planning to drill four horizontalwells this year which will equate to 16 vertical wells. General



Left: Larry Tatem - Barbados Port Inc.Center: Ron Hewitt - BNOCL

Right: Sir Neville Nicholls - The Securities Commission

Top notch accommodations and golf courses at Sandy Lane

We aim to supply at least 40% of the country’s demand forcrude oil over the next couple of years. Ronald Hewitt, GM, Barbados National Oil Company“

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manager Ronald Hewitt outlines their targets further: “We aimto supply at least 40% of the country’s demand for crude oilover the next couple of years. The proposed Caribbean pipelineis an initiative from the private sector in Trinidad and the proposalis to run the pipeline from Tobago to Barbados and then onwardto Martinique and Guadeloupe. The design also allows for spursinto Dominica and St Lucia.

“The idea of the pipeline is to convert the economies,particularly power generation, away from the lessenvironmentally friendly fuel oil and to insulate the users fromthe uncertainty of fuel oil prices. It is envisaged that the countrieswill seek long term contracts, where the price of that energysource is known for a fixed period.”

Alongside these approaches, Barbados has signed aconcession agreement with ConocoPhillips of the United States,under which one offshore well was drilled. When the structurethey were looking for was found, it was considered too small

and abandoned as a dry hole. ConocoPhillips opted not to drilla second well and the relinquishment of the acreage has nowbeen completed. It is Barbados’s intention to place this acreageout to competitive bid.

As Barbados readies itself for the CSME, more diversecommercial opportunities are becoming available. The SecuritiesCommission, established in 2001, is gearing up for the transition.While they currently regulate only 24 companies on theBarbados Stock Exchange, there is a strong belief that oncethe CSME is achieved, there will be a greater amount of regionalinvestment as the Caribbean people see the benefits of investingin stocks alongside traditional investment opportunities such assavings accounts.

To further encourage this, the Commission is promotinginvestment in securities by ensuring companies comply with

legislation and rigorously investigating complaints of malpractice.Also now the Securities Commission has been separated fromthe Stock Exchange, there is greater confidence in the system.

As the Commission´s chairman, Sir Neville Nicholls, sums up;“Barbados is known for its political stability, its educatedworkforce and a very good infrastructure, all of which mean thatthis is a stable environment for investors to operate in.”



Barbados is known for itspolitical stability, educatedworkforce and goodinfrastructure.

Sir Neville Nicholls, Chairman, The Securities Commission

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Cruise liners will soon be docking at a new cruise pier

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