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ABSTRACT BUSINESS
LOCAL BUSINESS
Tobago Jazz Experience: How is this event going to benefit Tobago financially? The event has made huge losses before. How long will it be sustained and at what cost?
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ocal and foreign music lovers are in for a thrilling musical experience very soon and not just anywhere! It’s all set to go down in Tobago, the island which boasts of being one of the most beautiful tourist destinations in the world. With top acts like Brandy, Keyshia Cole, Tessanne Chin, John Legend, Tarrus Riley and Earth, Wind and Fire, all set to descend on the isle between April 19th and 27th , Jazz attendees are in for a sensational experience. The event which has become one of the major and most anticipated events on Tobago’s cultural calendar has had two major incarnations. It started off in 2005 as the Tobago Gourmet Jazz Festival and then changed to the Plymouth Jazz Festival, a venture which was jointly spearheaded by the Tobago House of Assembly (THA) and Colonial Life Insurance (Trinidad) Company Limited (CLICO). In 2009, the THA regained full control of the event and it was aptly remodeled and rebranded as the Tobago Jazz experience. The event caters for diverse tastes as it incorporates a wide range of musical genres including soca, electronica, R&B, smooth jazz and new wave music resulting in “a nice kind of callaloo of jazz and all kinds of music that speak to the excited music lover!” according to the chief event coordinator Mr. John Arnold. The event started off in 2009 with a 3 million dollar budget and this figure has grown to approximately 11 million for this year. This increase can be justified given the growth which the festival has shown over the years for
Written by Alicia Martin
instance in terms of the ability of organizers to secure more high profile acts, a move that has been associated with higher ticket prices. The event has also been able to attract larger audiences, moving from 2000 to 6000, and an anticipated 8 -10,000 for 2014 if one is to make speculations from early ticket sales. Festival attendees have and will continue to score rich intrinsic and extrinsic musical benefits but how does the event benefit Tobago financially? Does the island experience sufficient returns on the huge governmental investment? According to Mr. Arnold, “There are benefits to the Tourism Business Unit and this includes all stakeholders such as hotels, restaurants, food service providers, air transportation, public transportation providers and craft makers... basically everyone who can benefit.” Several elements of the musical event have also been strategically linked to
Event Coordinator John Arnold
ensure that stakeholders accrue maximum benefits. For instance the event runs for a total of 9 days and there are a number of smaller attractive events within the larger festival. This creates the opportunity for longer stays within the island and in general there are increased trade opportunities given the increased potential for interaction between visitors and major stakeholders. Another important feature of the event has been its ability to showcase various tour-
ist locations within the island while synonymously providing entertainment. For instance Pigeon Point beach, which is now a part of the Pigeon Point Heritage Park, as well as Speyside are two featured sites. As stated by event coordinator, Mr. Arnold, “it is about bringing people to the island not just to be entertained by music but also to experience Tobago.” According to him other places such as Store Bay, Fort King George and the reef can be visited within one’s stay. Food and community activities can also be experienced… all pointing toward a positive financial experience for Tobago’s small and large businessmen. Another financial benefit which the festival creates can be found through the doors which it opens for development within the regional music industry and the local one. Mr. Arnold notes that a platform is created for the exposure of new and emerging talent in Trinidad and Tobago and the
www.amgtt.com • APRIL, 2014 • ABSTRACT BUSINESS
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ABSTRACT BUSINESS
local business
region. It allows for the building of capacities, fueling new bands, new musicians and new artistes in general. This has a direct impact on the ability of the country to make develop its music industry in a sustainable way. According to Sustainable Tourism Online (2010), destination marketing is “the process of communicating with potential visitors to influence their destination preference, intention to travel and ultimately their final destination and product choices.” One of the advantages of the Tobago Jazz experience is that it creates an avenue for a type of destination marketing of the island. In other words Tobago as a tourist location is highlighted through the event itself. Mr. Arnold enthusiastically states that, “It is a great opportunity for us to market the island by branding it with something significant.” He further implied that the intention is to make the Tobago Jazz Experience synonymous with Tobago “in the same way that you think of 2
Tobago’s economy is fueled to a large extent by the tourism industry and if the festival succeeds in positively feeding into that tourism thrust then the island is bound to benefit New York and Broadway, Chicago and Blues, Trinidad and Carnival, Jamaica and Reggae Sumfest…” Additionally it involves someone talking about the experience and selling it to other persons who may then visit the following year. In other words “something happening now can bring benefits next year” and this is an important process. Tobago’s economy is fueled to a large extent by the tourism industry and if the festival succeeds in positively feeding into that tourism thrust then the island is bound to benefit. Careful analysis can therefore lead to the identification of a number of positive features of the Tobago Jazz Festival. It is clear that THA spending is geared toward ensuring that the event is a success and
ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
that Tobago nationals are able to benefit financially. Nevertheless actual statements on the specific profits made from the event have not been forthcoming. Some have even wondered whether the event may be operating at a loss. Mr. Arnold is emphatic that the term loss cannot be used given all the people in the tourism sector who would have benefited from the event. Instead he admits that there is the need for an independent quantitative study to quantify profits made. “The only problem is that there is no independent study... you need to talk to the groceries to see how much more sales they get… talk to people at Speyside to see how much more people they take over to Little Tobago…” He is however confident that such an effort will only
prove that the event, which is definitely bringing in some form of revenue for the tourism and business sector, given ticket sales and visits to the island, is profitable. Organizers are saying that this is the first year in which they are seeing such early ticket sales for the Jazz. The cast is incredible and there is much anticipation for the 2014 experience. Ms. Tracy Davidson, Deputy Chief Secretary and Secretary with responsibilities for Tourism and Transportation within the THA, has summed up the potential profitability of the event in terms of its ability “to promote destination awareness and increase visitor arrivals… there is a multiplier effect of all tourism related business and communities that host activities benefit financially.” Here’s wishing that both Tobago as well as the Jazz attendees - the locals, members of the diaspora and international visitors to the island have fulfilling experiences and get a true return on their investments!
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ABSTRACT BUSINESS GUIDE
LOCAL BUSINESS
Decriminalizing Marijuana May Boost Economy
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Written by Leah Lewis
everal countries across parts of North and Latin America have made the point of amending their drug laws as it pertains to the usage of marijuana or weed as it is commonly known. Marijuana has been decriminalized in other parts of the Western Hemisphere. Lawmakers in Puerto Rico have filed legislation over the past year that would allow medical marijuana and decrease penalties for possession of small amounts. Uruguay recently became the first country to approve nationwide marijuana legalization, while the U.S. states of Washington and Colorado passed recreational laws in 2012. In addition, 20 U.S. states and the District of Columbia already have medical marijuana laws. They have taken steps to decriminalise the consumption and possession of marijuana. This move has aggravated the response of several Caricom countries who have weighed in on the potential benefits or repercussions associated with decriminalising the drug. The debate over the possibilities of medical marijuana has been gathering attention regionally and internationally, and some member states of Caricom have been weighing in on the issue of medical marijuana as an economic and
commercial industry. In essence, decriminalisation may eliminate jail time and other penalties, including a criminal record, for possession of a small amount of marijuana. Currently, within Trinidad and Tobago, serious consequences are attached to the possession of this substance, whether it’s for personal usage or for the purpose of trafficking. Classified as a dangerous drug, marijuana is included in the First Schedule list of narcotic drugs. It is classed as a narcotic drug and psychotropic substance under the Dangerous Drugs Act Chap 11:25. Possession of any quantity is an offence liable upon summary conviction to a fine of $25,000 and to imprisonment for five years; and upon conviction on indictment to a fine of $50,000 and to imprisonment for between five and ten years. Possession of marijuana for the purpose of trafficking is also a serious offence. Trafficking refers to the sale and distribution of illegal drugs. If you are found with more than one kilogramme of marijuana, this is classed as possession for the purpose of trafficking, unless you can prove otherwise. Upon conviction on indictment, the fine is $100,000, or where there is evidence of the street value of
Although there may be benefits to the decriminalisation of marijuana, serious analysis needs to be undertaken to ascertain what may be the ripple effects to such a move 4
ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
the drug it will be three times the street value, whichever amount is greater, plus imprisonment for a term of 25 years to life. This is the legislation that governs possession and trafficking of marijuana and other dangerous drugs in Trinidad and Tobago. These recent talks of decriminalising marijuana have only fostered more questions regarding the feasibility of such a change to Trinidad and Tobago’s drug legislation. So what will the decriminalising of marijuana entail? Decriminalisation of marijuana use would entail the removal of prohibitions on the possession of small, specified quantities of the drug for personal use. Decriminalisation may also be restricted to the use of specific amounts for medicinal purposes only. Such a recommendation for the decriminalisation of marijuana begs the question – what will be the benefits or the ills of strict prohibitions being replaced by the harm of increased usage? Recently, our Chief Justice made the suggestion that we examine our drug possession policy, especially where within our economy, the state is the major employer and a criminal conviction is a bar to employment, we may be pushing minor non-violent offenders into criminality when they can be saved. As such the move to decriminalise marijuana can
reduce the burden on both the justice system and the economy as enforcement and processing tasks now associated with such crimes would be greatly reduced. According to UCLA drug expert, Mark Kleiman, marijuana decriminalisation may even result in decreased alcohol consumption rates resulting in a reduction in the social harms associated with such usage. Researchers with a Caribbean trade bloc have found that decriminalizing marijuana and exploring its use for medicinal purposes could help boost the region's sluggish economy. According to experts, the Caribbean already has a built-in competitive advantage with marijuana cultivation, noting that Jamaican researchers have launched a company that produces therapeutic and cosmetic products derived from the plants. Although there may be benefits to the decriminalisation of marijuana, serious analysis needs to be undertaken to ascertain what may be the ripple effects to such a move. Minister of Foreign Affairs Winston Dookeran noted that Government should in fact find a way to decriminalise the use of drugs like marijuana in terms of its operation and usage. Despite the arguments for or against, marijuana still remains a legal offence punishable by law.
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ABSTRACT BUSINESS
EYE ON FDI
The Changing Face of FDI Flows… A Lesson For T&T Written by Crystal Cassie
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he Wall Street Journal states that Foreign Direct Investment (FDI) includes "mergers and acquisitions, building new facilities, reinvesting profits earned from overseas operations and intra company loans". FDI should not be confused with portfolio investment, which is a passive investment in the securities, like stocks and bonds, of another country. FDI is the direct investment into production or business in a country by an individual or company of another country, either by buying a company in the target country or by expanding operations of an existing business in that country. In the 1980s, the main recipients of foreign direct investment were developed markets, plus some of Asia's miracle economies. Emerging markets were hardly featured, but the global financial crisis of 2008 accelerated the switch from a focus on developed to developing countries. According to the World In-
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vestment Report 2013 by the United Nations Conference on Trade and Development (UNCTAD), “six of the top 10 prospective host countries come from the developing world, with Mexico and Thailand appearing for the first time." China leads the list, followed closely by the United States. India has retained its position as the world's third most attractive destination for investment by multinational corporations, followed by Indonesia and Brazil. An examination of the global shift in FDI flows can suggest what makes a good FDI destination. The BDO 2012 Global Market Opportunity Index states that the seven most attractive investment opportunity markets made up nearly half of the world's GDP in 2011. The survey found that the most important reasons to determine firms’ expansion abroad include “market size and growth, local infrastructure and people, ease of entry and customer potential and cheaper labor rate.” The 2013 A.T. Kearney Foreign Direct Investment Con-
ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
fidence Index® reveals other strong reasons for FDI. The United States, Germany and the UK remain three of the top choices for FDI even in the face of policy uncertainty, debt issues, fiscal challenges and political issues. This is because investors have strong confidence in those economies and consider their investments to be “safe.” Canada and Australia maintain precedence as well for their unconventional fossil fuels and minerals. There are also incentives that make economies more attractive to potential investors. These can include low corporate taxes and individual income tax rates, tax holidays and other concessions, preferential tariffs, special economic zones and export processing zones (EPZs), investment financial subsidies, loan guarantees, free land or land subsidies, relocation and expatriation, infrastructure subsidies, R&D support and derogation from regulations for very large projects. Here in T&T, while FDI in-
flows to Central America and the Caribbean fell by 17% between 2012 and 2011, FDI coming into T&T grew by 38% over the same period, according to figures from the World Investment Report 2013 released by the United Nations Conference on Trade and Development (UNCTAD). Total FDI flowing into T&T in 2012 was US$2.527 billion, the highest since 2008 when RBC of Canada re-acquired RBTT for US$2.2 billion. The Ministry of Trade, Industry and Investment promotes T&T as an ideal FDI location because of strategic location for trade and transport, its access to a wide array of markets via CARICOM and other bilateral trade agreements, being English speaking, its macro-economic stability, competitive corporation tax rates, low energy cost, foreign exchange stability and developed manufacturing sector. But T&T still has much work to do to ensure that it retains its share of highly volatile and competitive FDI flows. Economist Marla Dukharan notes that it is a ”good thing” since GDP is growing faster than FDI, but T&T's investment in its productive capacity is declining. InvestTT Investor Sourcing Manager Sekou Alleyne also warns that T&T is yet to approve a national investment policy, so that the economy will be able to attract investments in a sustainable way and not just because of oil and gas. He agrees that T&T needs to grow its productive capacity but added that it needs to be done "in the right places, so we don't have a shot gun approach."
ABSTRACT BUSINESS GUIDE
BIZ HEALTH
Squatting “Out Of Control In T&T” Economic Burden On Government Growing
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Written by Priya Ramsubhag
here’s no place like home. Unfortunately, more than 250,000 people in T&T are squatting on state and private lands along old train lines, rivers and the coast. With 20% of households living under the poverty line, high inflation rates and unemployment, squatting has always been a viable option for many in the daily struggle for survival. In any economy, the government has a responsibility to improve welfare by providing or subsidizing housing for low income earners in society. In T&T, the Housing Development Corporation (HDC) is mandated to provide affordable shelter and associated community facilities for low and middle income persons and carry out the broad policy of the government in relation to housing including the stimulation of private sector activities with respect to home construction; rationalizing and restructuring of its mortgage portfolio; the management and maintenance of its housing estates, and the acquisition of land for housing development. But according to former CEO at the Land Settlement Agency (LSA), Osley Francis, “Squatting is the order of the day. The squatters have no fear whatsoever of squatting on State lands.” In recent times, even a new type of squatting has emerged where wealthy citizens have started grabbing for land. This “high class squatting” is seen where
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concrete structures are being erected on idle land for domestic use. In the city of San Fernando, business owners have constructed permanent food stalls and fixtures along pavements. While many sympathize with the squatter’s inability to legitimately acquire dwelling units, squatting represents a strong cause of market failure. There is a lack of property rights leading to environmental and human degradation as squatters often settle in highrisk, environmentally unsafe areas. Also, there is the issue of the tax burden on the working population to subsidize these in society as well as the notion that squatters have more rights than hard working citizens. In May 2010, Prime Minister Kamla Persad Bissessar made an election promise to regularize all illegal squatters with a $252 million loan from the Inter-American Development Bank. $151 million was spent to upgrade squatter communities, regularize their land titles, allow community participation/consultation and facilitate squatter relocation. Squatters also benefitted from $21 million in home improvement grants. There was also a call to establish an effective land use management policy and review the present legislation relevant to the Squatter Regularization Act 25 of 1998. However in October 2013, Francis stated that the People’s Partnership government had encouraged squatting and
ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
While many sympathize with the squatter’s inability to legitimately acquire dwelling units, squatting represents a strong cause of market failure allowed it to “get out of control” while failing to construct new houses. According to him, squatting had increased two fold between 2010 and 2013, as during the 3 years the government had distributed 20003000 Letters of Comfort. He calls for the strengthening of the two functions of the LSA, title regularization and infrastructure regularization. Certificates of Comfort should be provided, but only to the squatters who had been on the parcel of land before 1998. They must have applied for regularization and met all other legal requirements in accordance with the provisions of the State Land (Regularization of Tenure) Act No. 25 1998. Furthermore, the individual’s
living conditions should be improved, by upgrading or establishing physical infrastructure such as roads and drainage, along with the provision of services such as potable water and electricity. These works are performed in accordance with standards established by the Statutory Planning Authorities. In T&T, squatter regularization seems to be the route, instead of the stricter enforcement of squatter laws and squatter relocation. With 20% of the population being classified as squatters, scarcity of land and competition for cheap government houses, it seems to be the most economical way of dealing with this source of market failure.
ABSTRACT BUSINESS GUIDE
BIZ HEALTH
T&T Too “Culturally Weak” To Influence Supply And Demand Principles Written by Merrill Madson
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t seems like the editorials are always full with grievances about the rising cost of living. Lent is here and prices for kingfish, carite and salmon are through the roof. Properties with price tags of TT$1.5 million are considered cheap and almost every day you can visit a local supermarket and hear complaints of exorbitant grocery bills. In mixed economies such as ours, governments intervene when necessary but consumer markets are often left untethered. Essentially, consumers have the freedom to express their wants and needs, which backed with purchasing power of money, send a signal to suppliers to produce or source these items. These opposing forces of demand and supply are then set in motion to determine the prices and quantities of these goods and services available in the market. The T&T economy shows signs of recovery with growth of 1.6% in 2013, after 3 successive years of economic decline from 2009 to 2011. This is consolidated by an overall growth rate of 2.5% in the non-petroleum sector in 2013, which is exhibiting signs of strengthening.
In terms of price levels, headline inflation settled at 6.8% in June 2013 after the 30-month high of 12.6%. In 2012, price increases for Recreation and Culture, Transport, and Health were the main contributors to core inflation. In 2013, the fall was attributed to the deceleration in inflation for non-food items to 0.4% down from 1.3% the previous year. The decline in core inflation reflected price declines for Housing (-0.5%); and slower price increases for Transport (0.2%); and Recreation and Culture (0.9%). There were lower inflation rates for Vegetables (17.9%); Meat (0.3%); Oils and Fats (1.4%); Bread and Cereals (0.3%); and Milk, Cheese and Eggs (0.4%), over higher inflation rates for Fruit (21.9%); Salt and Spices (5.7%); and Fish (1.0%). Despite a buoyant economy and falling core inflation, things often don’t add up in the eyes of the consumer. It raises the question of whether we the citizens of T&T are culturally strong enough to manipulate the market forces of demand and supply to work in our favor, in terms of lower prices. Let’s look at the demand side. Trinbagonians have ac-
It raises the question of whether we the citizens of T&T are culturally strong enough to manipulate the market forces of demand and supply to work in our favor, in terms of lower prices
cepted rising prices as status quo. Instead of refusing to purchase an item when the price is too high, consumers have adopted a culture of complaining and complacency. But from an economic perspective once a consumer exhibits effective demand by still buying the item, this signals strong demand against existing supply which puts pressure on prices to rise further. In addition, suppliers will continue to supply items at these high market prices. This contrasts with consumer behavior in more developed economies. For example, in Australia the price of lamb rose by a mere 15 cents, and due to consumers refusing to buy, producers were forced to reduce the price to its preexisting level. Currently in the UK, supermarket chains Morrisons, Aldi, Lidl, Asda, Tesco and Sainsbury’s have waged price wars to capture customers. This would be virtually unheard of in T&T.
The supply side exhibits an interesting phenomenon. Traditional economics dictates that what is demanded by consumers fuels what is supplied by producers. However, it seems that Say's Law of Markets holds true in T&T when it comes to consumer spending patterns. According to Say’s Law, “supply creates its own demand.” In other words, T&T consumers do not express demand for goods and services but purchase what is available for sale. Suppliers bring items to the market and T&T consumers are willing and able to spend hard earned money for the latest fads, instead of truly demanding the products that they require. So it seems on both the demand and supply side, producers stand to win with forces driving prices upward. It is time for Trinbagonians to claim back their rightful title of “consumer is king,” and exercise their right to choice. www.amgtt.com • APRIL, 2014 • ABSTRACT BUSINESS 9
ABSTRACT BUSINESS GUIDE
BIZ HEALTH
Is The Local Restaurant Industry In Trouble?
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Written by D. Nandlal
ne of the many benefits that you can receive from Trinidad’s very rich and diverse culture is the ability to taste a piece of almost every part of the world. There’s truly no shortage of exotic cuisine to tantalize your taste buds. Take a look at Ariapita Avenue. The varieties are endless. There’s Arabic, Mediterranean, Indian, Creole and the list goes on and on. It almost seems that restaurants are opening up at almost every corner of the country. So what does this mean for the local restaurant industry? We decided to speak with those involved directly in the field to get a better understanding of where the local restaurant industry is headed and the results were quite astounding. As you can imagine owning a restaurant is no easy task. There are overheads, endless competition and now the managing of your restaurant’s online image. With the rise of digital media more persons are flocking to Social Media to express their dissatisfaction about the type of service they received. Customer service seems to be dwindling away in our island. Instead of warm smiles, many of us are greeted with rushed gestures and sulky faces.
Speaking with House of Chan’s front manger, Jonathan Chan he admitted that this is a major issue within the industry. He believes that every restaurant should offer standard services, not only the upscale entities. Persons should be able to come into the restaurant and be given the best service possible. However while this may be the restaurant’s objective, it’s hard to find the manpower to execute this.” Secondly, another factor that is affecting business is the formal training provided by the some of the programs offered. Many interns that come into the restaurant do not display any sort of background training. This, he says, causes major problems, since they will not only have to provide training but once the internship is over, the person leaves and the cycles begins once more. While he agrees that the industry is thriving, the issues mentioned above are major stumbling blocks that are hindering productivity and growth. However Chan is not the only one who is being affected by limited staff. Managing Director of Arabian Nights, Abba Laquis also expressed his issues with lack of manpower. When we visited him, the restaurant was bustling with activity as per usual.
When asked what he thought about the industry, he admitted that while the industry is thriving at the moment, he doesn’t see this being permanent 10 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
However he took the time to show us the kitchen area. We were greeted with two women, hard at work. He admitted he had to rely on family in order to keep his business running. When asked what he thought about the industry, he admitted that while the industry is thriving at the moment, he doesn’t see this being permanent. “With the increase of raw materials, we have no choice but to raise our prices. People would not be able to afford this anymore. Buying a meal outside would be limited to special occasions, just like it used to be some years ago” he said. There are also external factors that are affecting the local restaurant industry such as the expansion of foreign fast food franchises throughout the nation. In 2013 managing director of Desk Restaurants, Dane Darbasie stated, “outside of Puerto Rico, T&T would be the most competitive quick service restaurant industry in the Caribbean. The market has been able
to accommodate new entrants because the T&T public has become very sophisticated in their purchasing pattern.” One restaurant owner admitted that it’s nice to have variety when it comes to cuisine. However she doesn’t agree with the fact that most of these foreign entities import their produce, therefore not supporting the local farmers as well as jeopardizing people’s health since most of the ingredients are frozen and are associated with hydrogenated fats. While there were statements in the past from Franchise owners admitting that they do support local as much as possible, many of the local restaurant owners we spoke to do not believe that these statements are accurate since there’s not enough for supply and demand and the cost is significantly lower when imported. Despite the factors affecting the local industry, there’s one thing that is certain; we all need to eat. The question is who do you support Foreign or Local?
ABSTRACT BUSINESS GUIDE
MONEY MATTERS Column by Lorraine M Phillips Lorraine Phillips is a chartered accountant (FCCA-UK) with over 8 years experience in areas such as Business and Strategic planning, Capital Budgeting, Auditing, Financial & Management Accounting ,Financial reporting and Forecasting She is also the holder of a first class Honours degree in Accounting & Economics from the University of the West Indies, Cave Hill campus, Barbados. Lorraine is currently completing her Executive MBA at the Arthur Lok Jack graduate school of business. Lorraine can be contacted at lmphillips2008@gmail.com
How To Let Your Credit Card Work For You
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here are actually no bad credit cards… there can be bad credit card custodians. This statement is very profound. Generally, credit cards being inanimate objects cannot be deemed bad. The onus therefore is on the credit card holder to use the credit card in such a manner that they benefit. The tips and tricks below will allow you to fall in love with your credit card. • Look for the free credit cards (eliminate annual fees) With banks competing for credit card business there are some that offer free credit cards. Shop around and look for those that waive their annual fees. You have nothing to lose. • Pay Your Balances Off Each Month
This is very important. Although credit card offers credit facility you do NOT have to use it for that. This way you will
benefit for ease of payment, additional value points and you will NOT be stuck with a big bill to pay off at the end of the month. • Look for rewards that will benefit you e.g grocery vouchers, cash backs There are many different ways to redeem your credit card rewards, but it's good to look for rewards that will benefit you in practical ways for example grocery vouchers, and cash backs. If you do not travel regularly, then airline miles may not be beneficial to you. I have a personal preference for supermarket credits. • Use Credit Cards Whenever Possible- Get paid to shop Once you pay off your credit card bill every month, it can be deemed that you are getting paid to shop. So remember to use your credit card every chance you get. Think about it. If you are using cash for all pay-
Efficient use of your credit card and good repayment habits will help in establishing a good credit history with your chosen financial institution 12 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
ments you will not benefit from the rewards associated with your credit card.
can benefit from travel insurance that is a feature on most credit cards.
• Use Credit Cards to build up credit history and improve your credit score
• Funds stay in your current account longer.
Efficient use of your credit card and good repayment habits will help in establishing a good credit history with your chosen financial institution. This will assist you in seeking a loan for your car or house in the future. • Use your credit card as your travel companion If you travel relatively frequently your credit card can really come in handy. Most credit cards are accepted worldwide which means that you'll never have to worry about having a ready supply of foreign currency on hand. Additionally you
When you make a credit card purchase, your money remains in your checking account until a couple of weeks later when you pay your credit card bill. Hanging on to your money for this extra time can be helpful. If you pay your credit card from a high-interest checking account and earn interest on your money during the grace period, the extra interest will eventually add up to a meaningful amount. There are many more ways you can save with a credit card, but if your credit card isn't working for you yet, start with the tips up above.
ABSTRACT BUSINESS GUIDE
TRUMP CARD
chef Jason Peru
J
ason Peru graduated from The Trinidad & Tobago Hospitality & Tourism Institute (TTHTI) in the year 2004 with his Associate in Sciences Degree in Culinary Management. He was awarded three scholarships to attend Johnson & Wales University in Miami to pursue his education further. It was there he attained his Associate Degree in Culinary Arts & his Bachelors in Sciences Degree in Culinary Arts. After school he worked the restaurant circuit in Miami where he cooked for stars such as P. Diddy, Shaquille O’Neil , Gloria Estefan, Al Pacino and Jennifer Lopez to name a few. After his extensive stint overseas, Peru returned to T&T and was offered a position as a lecturer in his field. Several television appearances opened up for him and he even went on to develop his own internet cooking show in tandem with bmobile. These undertakings are just the tip of the iceberg for this talented chef who recently returned from an Ambassadorial trip to London, Dubai and Africa where in Uganda he was invited by The High Commissioner of Trinidad & Tobago to Africa (Uganda) to partake in a TNT Food Festival. Here we interview Mr. Peru for our Trump Card series. ABG: What made you decide to become a chef? CJP: Truly and honestly I was a really fat kid. I loved eating. I was a child who was always kept away from the kitchen and cooking activities, this would naturally only peak my curiosity. I wanted to be able to pick up a food mag and say hey I can make that. So said so done. It was this intention I knew that my creativity and imagination would be employed and utilized in its best way. ABG: What is your advice for persons wishing to enter a
similar field? CJP: You have to possess a diehard love and passion for this industry. To be a chef is something that is vastly demanding and can take a toll on your body, soul, family life and mental capacity. You have to stick at it and give it your all. The hours are long coupled with exhaustive physical work, but if you exude that dedication and commitment to making people happy, smile and fall head over heals with your oral bounded creations, you can find it very rewarding financially and personally. ABG: What was your biggest mistake at the beginning of your career? CJP: Quite frankly, one should always listen to those in higher experience levels. Your lecturers will always urge you to work functions and expose yourself to more whilst contributing your time and talent to other chefs. However, not all times will you be rewarded with compensation and this can be unattractive. However even though I gave some of my time to working freely in functions just to see and experience what other experts in my field were doing, I think I could have made more time for that. ABG: How did you deal with it? CJP: Peer pressure and conformity is a hell of a thing. The worst thing as a chef is to have your ego broken by someone who knows or is able to do more than you can do and outshine you. It depresses you sometime. Me personally, it happened many times and because of this I never missed an opportunity to expose myself to what other chefs are doing. It helped me grow and develop my culinary repertoire. ABG: Tell us something you would like to learn or improve upon? CJP: I think as we grow older we
14 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
become even more critical about ourselves, especially on how we evolve and innovate our skill and personality. Two areas I am constantly trying to improve in are staying abreast of what is going in my culinary field in terms of maturation and trends and my ability to reach out to new audiences and present myself as a chef who isn't your quintessential chef that works in the back of the restaurant. My language, approach and physical ability in terms of presenting concepts, ideas and dishes for people to comprehend and accept is probably my greatest and ongoing challenge. ABG: I read that your former mentor was Alberto Cabrera. What would you say is the best advice you received from him? CJP: Chef Cabrera always was a very organized and forward thinking man. He was a young man aged 30 who accomplished so much in his tenure. I admired this a lot about him. He taught me strategic planning and how to work smart. For a chef these days, we are more than just cooks who make dishes; we are managers and entrepreneurs who must possess the skill of management of others as well as ourselves. ABG: Tell us a little about Fanatic Kitchen Studio and Fanatic Foundation. CJP: Fanatic Kitchen Studio is a concept birthed by woman pioneer Donna Wyke Reece. She is a well traveled and highly educated hospitality aficionado who wanted to create a space where she showcased chefs and their culinary creations in a glorified way and help boost the industry in which we work. Fanatic Studio is what it is. We host food seminars, cooking classes of different cuisines, chef table dinners, and even do culinary team building for corporate firms. The question is
what can't we do with this unique concept and ground breaking enterprise we have. We even shoot cooking shows for the television. The kitchen is a boutique style one in which we not only showcase the skills of our pantheon of carefully chosen chefs but we indulge in using the best ingredients, providing quality service and assure you an experience you never had before. Come visit us. ABG: How did you feel when you were first asked to be a part of Bubble with Us? Did you approach them? CJP: May I declare I felt on top of the world? When I returned back home from studying in 2006, TSTT had transitioned into Bmobile and made clear in their value proposition that they were the number one mobile network In Trinidad. With their new marketing strategy and product champion advocates, I knew that they would be the one for me to launch my idea of Bubble with Us. With their ability for forward thinking, I sparked some attention with them and proposed the idea and out came the birth of Bubble with Us on their 4g network. I had never been so happy in my life and regard the experience as my dream come through. I thank them for this. ABG: Many chefs within Trinidad are seen using traditional methods of marketing themselves and their skills. What made you decide to have an online cooking show? CJP: Currently I am a marketing student pursuing my Master’s degree. I am no stranger to the different strategies of marketing. I believe in today's world we are so inclined and engrossed in the online craze. We live on the social sites and transact loads of business and interaction. Inte-
ABSTRACT BUSINESS
TRUMP CARD grating this advantage of having people connected at your fingertips, made it so clever to launch an online cooking show to capture and engage viewers. With the advent of YouTube and other video websites that host banks of visual property, why not utilize this platform integrating bmobile 4g in the mix where people can watch the show on their own time whilst learning visually and also myself showcasing my skill and talent for the world to view. You never know who will see it and what may come.
amongst his peers and counterparts. I work expeditiously to become a well-respected television chef who can change an attitude of how people see or view food. When this is done, then I would have made a change and this equates to success to me.
ABG: What is the difference between local culinary schools as opposed to international schools? CJP: This is a topic I have become very candid about. When culinary schools decide to offer a program of study to students, they need to always mentor or research what a well-developed similar culinary school is doing. I have had the opportunity to study both locally and internationally and when comparisons are made, we have lots of work to do. We need to stop becoming a society that is producing paper mill diplomas and degrees. Sure we do what is within our range and capacity to educate students, but we sometimes cheat them so much when we are not prepared with the skill and manpower to successfully deliver to them in an adequate and real time manner. More is needed such as experienced lecturers and tutors to professionally impart what the industry demands of us. If not, we end up sending out students into the work place and seasoned individuals who expect basic commonalities that were not bestowed onto them by the teaching grounds chastise them.
ABG: What are some of the challenges the food and beverage industry is facing? CJP: Attitudes are what help define our predisposed behavior toward something. It is all in our culture and socialization that we are born into. No matter how much food and beverage advocates yearn for betterment and change, we have to own it and change attitudes and enculturation from young. We need to understand that chefs and beverage professionals are individuals who belong to the hospitality industry. We are not scalawags who "cook ah food and mix ah drink". We work equally as hard as any other blue color or white color professional and we deserve our respect and commendation. We are not to be viewed as less than another because we serve people, but instead we delight people with our service. It is with this notion we are here to ensure your meal and dining experience or event was exceptional and should not be viewed as "servers". As a result we should be dually compensated for our skill and should not be categorized with paltry remuneration. The sooner this is done, I guarantee our service industry will rise omnipotent with lower turnover rates, food and beverage staff will have higher work ethic and morale to guide their output and our smiles will lead to grater consumerism and tourism for our country.
ABG: What do you consider being truly successful in your field? CJP: I believe success is something we determine as we mature throughout different stages. Hurdles and barriers are thrown before us to strengthen our ability to succeed. Personally at this point in my life, success will encompass being a market leader in my field, one who is respected and exudes professional decorum
ABG: In your opinion, are people experiencing an “appetite for change” and gravitating towards foreign chain restaurants rather than local restaurants? CJP: With vast spending and flow of money in our country, foreign food chains are seeing us as a great market to open up fast food outlets and convenient international food restaurants. As a chef, variety is something
I applaud. The great number of food establishments present in our country helps give that experiential feeling for citizens. The down side is, what does this do to our local restaurants and chefs who pride themselves on using our local ingredients and community labor to showcase our level of culinary fusion creativity. One such example of this was the closure of Chaud Creole restaurant which was my local chef mentor's restaurant; Khalid Mohammed. Chef Mohammed prided himself on using our local ingredients in very innovative ways using classical French techniques of preparation. It was welcomed and praised by many open-minded citizens but shunned by many who preferred to have their "cream of dasheen leaf and Dougla styled chicken" done and presented traditionally and as "stewed chicken and calallo". I believe we need to be a little more supportive of our local cuisine and note that most chain restaurants usually are associated with hydrogenated fats and flash frozen goods. ABG: What are some of the things local restaurants can do to regain the patronage? CJP: Some of the things local restaurants can do to regain this patronage lies within communication and awareness. Sure everyone might find it easy and convenient to buy a box of fast food for 20 dollars because it may be cheap and simple, but local restaurants need also to understand our culture; of who we are and what influences us. Having prefix menus that are affordable and easy to prepare within short times and affordable is one great way to start. Advertising and making people know about these offers and boasting that it supports our local farmers, and use local ingredients gives people a sense of support socially and emotionally. Government and even large local businesses and cooperation’s within our hospitality industry can even run educational and social out reach programs to help make citizens and even tourists aware of what we offer and where to find great food, superb service and a memorable experience.
ABG: What are some of the things that set you apart from other chefs and entrepreneurs? CJP: I believe a chef is one who is unique and distinct in his own way. It's what makes restaurants different from another, the skill and talent of the hands and minds that cook and develop the flavours and presentation of your food. For me, I think my endless creativity and imagination is what makes me the chef that I am. I dream food in the night and get up suddenly and write down my ideas and sketches of my plating presentations. It's my thirst to excite, amaze and amuse the clients I cook for and see their smiles that I connect with. I play with their emotions through food and this is what drives me. Their words of appreciation are what also fuel me to outdo myself next time. It's with this catalyst that I ensure my food is attractive, delicious, tempting, experiential and my mantra of it always being "sexy". ABG: With the introduction of GATE, it allows many persons with limited finances an opportunity to pursue a higher-level education. How easy is it for graduates to find jobs within the food and beverage industry? CJP: Gate is a wonderful program hosted by the government. I myself being a recipient for all my studies am forever thankful for the financial assistance. When one graduates from school and is ready to enter our industry, he or she is well on a fulfilling journey to showcase all they have learnt to make our industry bigger, stronger and more attractive than ever. There are many openings and positions for new graduates in this field as the hospitality sector proves to be the second biggest one after the oil and gas industry. With ever growing numbers of hotels, guesthouses, restaurants and even independent entrepreneurs, I see that graduates have the world of opportunity before them. As the sector continues to mature there surely will not be a shortage of labour and expertise to fill these openings.
www.amgtt.com • APRIL, 2014 • ABSTRACT BUSINESS 15
ABSTRACT BUSINESS
FUTURE FINANCE
Business: The Old vs. The Young
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t is no secret that the most difficult thing for a leader to do is to give up his position as a leader to ensure there is succession in the organization. Perhaps this is the mentality that is embedded in the minds of the older generation when it comes to handing over the reigns of the business world to our young entrepreneurs. When examining the business environment, even right here in the Caribbean, we often find that the top positions in a business tend to be occupied by someone close to retirement age… or even older. What room does this leave for the young and vibrant entrepreneurs who possess the knowledge and experience to run the business effectively? What impact does this lack of mobility in the business environment have on the young people? For the sake of this article, let John Frederick be our test subject. Mr. Frederick has been working at ABC Co. Ltd for the past twelve years as a junior accountant. He has been innovative while playing by the rules; he gave his contribution to business improvement whenever needed and he is a hard worker. His boss, Mr. Charles, is the senior accountant in the firm and has been working for the company for eight years but he was previously employed at another company in the same position for ten years. Mr. Charles also sits on the board of directors. However, Mr. Charles is in his late sixties and really has a hard time connecting with the young people who are a part of his staff. This is a typical scenario in the business environment but we shall examine the impact this business set-up has on employees like John.
Written by Rhoshenda Ellis
Virgin founder Richard Branson argues, 'If we wish to align people, planet, and profit, we must nurture and learn from the next generation of business founders' Firstly, John will become quite demotivated. For years his ideas have been sidelined for the sole reason that he is young. He has been waiting for the opportunity to be promoted from his current position. He is very loyal to the company but he feels as though the company has been overlooking his efforts. As a result, he stops trying as hard. Secondly, John’s creative and enthusiastic fire can be extinguished because of the strong winds against him. His creative ideas and zeal will soon be a memory to the firm. According to John F. Kennedy, “Conformity is the jailer of freedom and the enemy of growth.” Without this innovative spirit, John will soon begin to conform to the rules of the firm and stay within his comfort zone. Apart from John, this mentality that business executives should only be rich and old men also affects the business
environment at large. Not only is there little job mobility and promotion for younger employees but also there are limited ideas for new problems faced by firms. Whenever new ideas are needed, firms often hire or subcontract other firms to come up with new ideas. The young and vibrant staff could, have generated these new ideas, or maybe even better ones. By keeping John on the sideline, what begins to happen is that John becomes less motivated to work and contribute his ideas. He is not reaping the rewards of his hard work since Mr. Charles gets the credit for it. John knows that if he were to run the business he would promote the use of technology that the staff is so familiar with and he would promote the business entirely through social media thus saving the company thousands of dollars from the current advertising campaign. Virgin founder Richard
Branson argues, “If we wish to align people, planet, and profit, we must nurture and learn from the next generation of business founders.” He says that by doing this, we invest capital, time and education to secure our future. He understands that senior personnel like Mr. Charles need to promote and allow their employees like John a large portfolio and more authority. Mr. Branson believes that nations should invest more into the entrepreneurial spirit of the young population, especially female entrepreneurs. He says that female entrepreneurs tend to reinvest more money into the health and education sector of the economy. Young people are often overlooked for the sake of age but I think its time we listen to their cry. Franklin D. Roosevelt once said, “We cannot always build a future for the youth, but we can build our youth for the future”. www.amgtt.com • APRIL, 2014 • ABSTRACT BUSINESS 17
ABSTRACT BUSINESS GUIDE
FUTURE FINANCE
NULINKS A TRINI LIVE PLATFORM TO STAY CONNECTED
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Written by Nicole Fisher
n today’s world staying connected is all we think about, we have our trendy ally our Smart Phone with instant capability courtesy WI FI technology utilizing the services of many social networking platforms such as Facebook, Twitter to either share data, information about anything, surely a way to practice democracy indeed. The question though is why we limit our social interaction surrendering mostly to the digital experience. Whatever happened to a good old fashioned brunches and lunch meetings with business associates where ideas are met with smiles and not smileys? Mr. Ayinde Burgess, an ICT specialist with 10 years experience and a member of the Project Management Institute has created a space and place for business professionals to make gratifying links. This concept is known as ‘Nulinks. He is an expert in website development- a software protégé at the age of 10 years old- network security and audio and visual integration. Furthermore, he has served on the Textel Credit Union and Central Finance Facility Boards. NuLinks is a brand new and
Professionals meet at the last NuLinks event
were not making the right connections and as such I decided to create a space for business professionals to link with the right people.
Mr. Ayinde Burgess
exciting chapter for Mr. Burgess as he recognizes the need for an environment where professionals can meet and exchange ideas, build relationships and at the same time have fun. We interviewed him on his Nu Links initiative, which was created to foster more personal business relationships. NF: What was your sole inspiration to create a network platform for business professionals? AB: It all started with my first business Burgess & Co, a web based company, when a group of budding entrepreneurs realized we needed to meet new people to offer our services because we
Business Networking is vital for any business it allows professionals to discover similar interests, reach potential business partners, utilize the forum to promote brand visibility, tap into new opportunities either monetary or building a long term mutual relationship 18 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
NF: Why did you choose the career field Information Communication Technology? AB: I always loved computers and gadgets. After receiving my first computer at age 8 I was inspired to write my first software application by age 10. I was also interested in Social Science and completed my first degree in History. My passion is to utilize technology with some sort of social interaction or experience. NF: How is business networking vital in the 21st century; what are the positive attributes? AB: Business Networking is vital for any business it allows professionals to discover similar interests, reach potential business partners, utilize the forum to promote brand visibility, tap into new opportunities either monetary or building a long term mutual relationship. NF: How is Nulinks different from any other live business networking platform, e.g. CISCO, Skype, Twitter etc.? AB: Yes… New Media has allowed instant feedback via several platforms such as Twitter, Skype or Instagram. However, the missing connection is the face-to-face interaction; the humane touch can provide insight about the mood of a person, if he/she is trustworthy etc. The vibe is different you can actually decide whether to invest time or money.
NF: Do you think thus far these objectives are starting to take shape? What has the response been at the event? AB: Yes... So happy to advise since Nulinks’ inception new partnerships have been forged and many new contracts drafted for further consultation. NF: Let’s pretend Abstract Business Guide has placed you in the shark tank, can you invite new entrants to the next Nulinks Session via an Elevator Pitch in 35 seconds? 5,4,3,2,1 Go! AB: NuLinks is new dynamic company focused on creating a space where individuals and companies can come together to create opportunities for themselves by making new contacts, sharing ideas and experiences and building trust relationships. These relationships can then transform into new business or personal development. NF: What is your favourite segment in the Nulinks programme and why? AB: Definitely the Speed Networking Session- an opportunity to focus and present your mini elevator pitch in 6 minutes, participants must deliver their business core values, core messages. The good news is you can practice beforehand mastering the art of sharing such good news. Bring along your Business Cards at the next session Thursday May 29th 2014, visit their website mynulinks.com for more information.
ABSTRACT BUSINESS
BIZ HEALTH
Obesity Bloating Healthcare Budgets
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eing obese, places you as one of the statistics used by the Food and Agriculture Organization of the United Nations (FAO), to calculate the world’s obesity rate. According to the FAO report, an estimated 12 percent of the world’s population is obese. A 2013 World Health Organization (WHO) report defines obesity as abnormal or excessive fat accumulation that may impair health, which is commonly measured using Body Mass Index (BMI). Adults are considered obese with a BMI greater than or equal to 30. The obesity rate and obesity related illnesses for both adults and children in Trinidad and Tobago are on the rise. Stated in a report released by the FAO, Trinidad and Tobago is the Caribbean country with the most obese adults. The report found that Trinidad and Tobago is ranked sixth among all countries worldwide with an estimated 30 per cent- 390,000of its population being obese. Obese patients often have special health needs. The Centers for Disease Control and Prevention (CDC) listed that obesity increases the risk of many health conditions including: Coronary heart disease, type 2 diabetes, cancer, kidney and gallbladder diseases, reproductive health complications and mental health. According to CDC, overall medical care costs related to obesity for U.S. adults were estimated to be as high as $147 billion. People who were obese had medical costs that were 1,429 higher than the cost for people with healthy body weight. While no such detailed statistics are available in Trinidad and Tobago, the Health Minister, Dr. Fuad Khan, made
Written by Shera Diaz
There is an increase in hospital admissions, which in turn, intensifies the bed shortage in hospitals, causing more money to be spent on healthcare equipment and services a statement in the Trinidad Express article on January the 15th 2014, in which he said, “The obesity epidemic is costing taxpayers $5 billion a year in medical costs and figures are set to rise unless people make serious lifestyle changes.” Healthcare costs associated with obesity and other obesity related illnesses are a direct threat to the nation’s individual, economic and social health. Healthcare costs and decreased productivity at work are expected to rise with a high obesity rate. There is an increase in hospital admissions, which in turn, intensifies the bed shortage in hospitals, causing more money to be spent on healthcare equipment and services. Direct cost including preventative, diagnostic and treatment ser-
vices related to obesity, will also rise. The cost from outpatients and inpatient health services including surgery, laboratory, and radiology tests and drug therapy are all examples of direct cost. If someone goes for a medical exam or is involved in an out-of pocket and insurance covered expenditure, related to physician services, emergency room care or purchases pharmaceuticals, this is the cost of being obese. Indirect cost related to obesity, includes: morbidity and mortality cost. With a high obesity rate and obesity related illnesses, the morbidity cost, which is the value of income lost from decreased productivity, restricted activity, absenteeism at the work place and early retirement is most likely to increase because of ill health.
This absence from work measured by the annual number of days of sick leave, reduces work output. The mortality cost of a country is also drained, where the value of future income is lost by premature death. Although $5.096 billion was allocated in the Trinidad and Tobago 2013/2014 Budget to health, the alarming FAO report shows an increase in obesity in recent decades. This shows that while the government has an obligation to allocate resources to healthcare, an increase in obesity or obesity related illnesses, constitutes to a public health and healthcare challenge. Although the Ministry of health launched a “Fight the Fat” campaign to reduce obesity, the cost for an obesity- related disease may be someone’s life, if left untreated.
www.amgtt.com • APRIL, 2014 • ABSTRACT BUSINESS 19
ABSTRACT BUSINESS GUIDE
BIZ TECH
Plans To Give T&T A Technological Boost Underway
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rom kindergarteners to the retired, citizens in T&T are enamored with technology, from tablets to the latest smart phones and smart TVs. This is not unusual to many developing economies, where exogenously created technology is quickly adopted from more developed economies who dominate the INSEAD Global Innovation Index (GII). Technology is seldom produced locally as the process of innovation, invention and creativity is not sufficiently encouraged or easily achievable due to limited resources. Compared to developed countries, T&T’s investment in science and technology is exceedingly low, at less than 1% of GDP. Science and technology achievement at secondary and tertiary levels is below international benchmarks. In response, the Ministry of Science, Technology and Tertiary Education (MTTE) has mandated to move T&T “towards establishing a sound and flexible national innovation system to create a workforce capable of undertaking research, development and innovation to positively impact on its economic competitiveness. This new system will facilitate collaboration and the sharing of resources among industry, tertiary educa-
tion and training institutions, quality and regulatory institutions, and other stakeholders in the process.” This three-fold approach involves encouraging innovation in businesses, integrating it into the education system and fostering creativity in the general population, in a climate where citizens are fearful that their ideas get stolen. In the Medium-Term Policy Framework 2011-2014 termed “Innovation for Lasting Prosperity” the government recognizes the key role that innovation plays as a driver of economic wealth. The focus is to apply innovation in all facets of development, especially in productive sectors. The Economic Development Board and the Council for Competitiveness and Innovation has the core mandate of developing a national policy on innovation which includes the interrelationships of the various institutions, including research and development, intellectual property, funding, training and entrepreneurial development, curriculum reform. It is understood that to carry out local research, there needs to be fostering of greater public-private sector partnerships to problem-solve, provide advice on technology usage and innovate on new processes and products.
The MTTE and Skills Training have been promoting the importance of industry-based learning and developing potentially commercial ideas as part of the coursework 20 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
The Ministry of Education has the challenge of infusing new ways of learning to foster and reward creativity in children at the pre-primary, secondary, tertiary and technical vocational institutions. This policy mandate supports the notion that the development of internationally competitive business begins with a workforce that is skilled in management, technology, innovation and entrepreneurship. The MTTE and Skills Training have been promoting the importance of industry-based learning and developing potentially commercial ideas as part of the coursework. University of Trinidad and Tobago has been partnering with the private sector to develop new ideas for their businesses to become more competitive. In May 2012, MTTE launched the “i2i” idea 2 innovation Competition to give citizens an opportunity to submit their ideas for consideration for grant funding. This grant of up to $200,000 was intended to reward business creativity in areas such as Primary Agriculture and agro-processing activities, Bio-technology, Creative Industries, Information and Communications Technology, Alternative/Remedial Energy/Energy Efficiency, Environment (Clean Technologies, Eco-related Activities), Biowaste and Other Waste (including Recycling Activities) and
Tourism. Since then, 103 ideas have been funded with the real possibility of becoming real businesses. In February 2014, St Lucia, St Vincent and Grenada benefitted from a series of workshops on infrastructure development that could usher in a new era of technology-based innovation and entrepreneurship for the Caribbean. The World Bank funded Caribbean Communications Infrastructure Program (CARCIP) initiative set out to stimulate new approaches to national telecommunications through the application of modern technology and new ways of thinking. It is imperative that the T&T economy continues along the path to innovation, as our long term economic growth and development depends on it. Alarmingly, the 2013 Global Competitiveness Report released by the World Economic Forum shows that T&T fell in the overall competitiveness ranking - 84th out of 144 countries in 2012 to 92nd out of 148 countries in 2013. Bevil Wooding, one of the leading technology experts in the Caribbean and an Internet Strategist with US-based Packet Clearing House says “In reality, the potential exists today to overcome the many challenges in the region. What we face is more a challenge of leadership paradigm than of technical possibility.”
ABSTRACT BUSINESS
Personal Finance
Personal Finance Advice:
How to s-t-r-e-t-c-h your pay cheque
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nother month end is around the corner and many of us cringe at the thought of paying our bills. Oh yes! The water bill is due, the electricity bill is due, you have just paid the kids school fees, and you have to buy food, and pay the car and mortgage loans. You have just received bills for your subscription TV service and you wish someone could put a piece of elastic into your bank account to help you cover all your bills. Do you know that applying a few smart tips and tricks can help you add some ‘strechability’ to your pay cheque? Absolutely! It does not matter what your salary is, utilizing these tricks can help you make the most of it.
Tip 1: Separate your needs from your wants: I know this is very hard to do, in this era of neon flashing bill boards and celebrity sponsored infomercials. Nevertheless one must categorize one’s monthly expenditure into the critical needs (the- must- haves) and the wants (the nice- to haves). Once this list has been compiled you must stick to it. Tip 2: Prepare a budget and manage it: This is a no brainer; you must make a list of your income and expenditure (a budget) and adhere to it. If you do not have a plan or budget, your money will quickly evaporate as you try to pay your bills. I must point out that budgeting does not mean accounting for the every single penny of your salary but is rather a systematic approach to itemizing your income and the items same will be expended on.
Written by L. Phillips
that premium coffee every day, three or four times per day? Think about this seriously.
Tip 3: Limit eating out -Prepare your meals and take them to work / school: I am a true example of this. I prepare my meals and take them to work /school. It not only gives me the peace of mind that I know what I am eating but it also allows me to save hundreds of dollars every month. With today’s busy lifestyles most persons find it hard to make the time to prepare their meals, but setting aside a few minutes to make a meal for your family will not only benefit your stomach but your bank account as well. I have a friend who found this out the hard way. He ate out every day for breakfast, lunch and dinner. This cost him approximately $120 per day. He was unpleasantly surprised when he did the math to find out that he was spending over $3600 in eating out. Limiting your eating out does not mean you will not share a meal outside with a friend or relative occasionally.
Finding the balance is key. Tip 4: Buy Generic brands: We all like to be identified with big brands, whether it is food, automobiles or pharmaceuticals, but do you know there are ‘no name’ and generic brands that can do the job just as good if not better. I will share a personal example. A couple of years ago my doctor gave me a prescription for medication (I had a choice of the well-known brand and the no name one since chemically they are the same). To my surprise the cost of the well known brand was $1000.00 while other one was $362.You work the math!
Tip 6: Ensure your monthly tax deductions are accurate: Everyone loves to receive a tax refund at the end of the fiscal year. However I must explain that the economic form of a tax refund means you actually gave the government an interest free loan …that’s right you got no interest on your loan. Additionally the government would have benefited from the time value of money concept that “a dollar received today is worth more than that same dollar received a year later’. Thus you must ensure that your TD1 form is updated and that your employers are deducting the correct taxes. This will eliminate the need for a tax refund or a tax payout at the end of the year. Tip7: Pay yourself first: Have you ever considered that once you get your salary you start paying bills without giving yourself anything? Pay yourself first by setting up a standing order to establish a savings account. The standing order works because as soon as your salary is placed into your account the desired amount is removed immediately and placed into your savings account. Over time you will see the reward of this as your savings grow.
Tip 8: Pay bills the last day they are due: There is no benefit to paying bills before they are due unless you will get a discount for prompt payment. If not hold on to your money until the last day the bill is due. However do not wait too long, because you may incur late fees. www.amgtt.com • APRIL, 2014 • ABSTRACT BUSINESS 21
Tip 5: Lower Monthly Bills: Part of stretching your monthly income involves eliminating unnecessary or excessive costs. Do you really need to pay for that subscription TV package with over 100 channels (how many channels do you watch honestly). Do you really need
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ABSTRACT BUSINESS
Developing the Entrepreneur
Examining Entrepreneurial Mistakes
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here is nothing like seeing someone harness the entrepreneurial spirit and develop an idea into a successful business. However, it is not as easy as it seems to be successful as an entrepreneur. Too many people end up failing their start up because they made one of many entrepreneurial mistakes. Here are a few of them. Trying to Do Everything Alone It is very true that most young entrepreneurs prefer handling everything in their businesses alone without asking for assistance from others. This is very detrimental for any type of business. You should always know that running a business is a great challenge that you can never face alone even if you have all the necessary resources at hand. Therefore, you should stop wasting your valuable time trying to do everything alone and start looking for professional support and help from different people. Never be afraid of asking for any type of assistance from people who are more experienced than you. Always strive to work with like-minded individuals who can help you with better ideas on how to manage your business. Even though it is a good idea to ask for help from others, it is very dangerous to seek help from everyone. Due to jealousy, some people will try to give you wrong and conflicting opinions just to prevent you from succeeding. The best thing for you to do is to identify and listen to a few trusted individuals who you believe can help you out. Before you start doing anything you are told, you should be able to trust your own instincts and
your revenues can cover your expenses and generate positive cash flow. Calculate your startup costs before you open your doors, not afterwards.
ensure you are doing the right thing. Asking too many people for advice It's always good to get input from experts, especially experienced entrepreneurs who've built and sold successful companies in your industry. But getting too many people's opinions can delay your decision so long that your company never gets out of the starting gate. Assemble a solid advisory board that you can tap on a regular basis but run the day-to-day yourself. Pull in your advisors for bi-weekly or, at the very least, monthly conference calls. You'll wish you did it sooner! Underestimating Responsibilities One of the most common reasons people claim they want to be an entrepreneur is for the “freedom” and the chance to “be my own boss.” That is a somewhat romanticized notion of owning your own business, and when the entrepreneur discovers that there is no such
thing as “regular work hours” anymore, and that he or she must now answer to even more people (i.e. bankers, investors, employees, customers), it can come as something of a shock. Business owners that succeed tend to thrive on the challenge and demands of starting a business. They understand that there is nowhere to pass the blame if something goes wrong, and they’re willing to put in all the extra hours that real success requires.
Targeting too small a market It's tempting to try to corner a niche, but your company's growth will quickly hit a wall if the market you're targeting is too tiny. Think about all the high school basketball stars who dream of playing in the NBA. Because there are only 30 teams and each team employs only a handful of players, the chances that your son will become the next Michael Jordan are pretty slim. Pick a bigger market that gives you the chance to grab a slice of the pie even if your company remains a smaller player.
Avarice If your main intention for becoming an entrepreneur or businessman is to get money and become rich, be prepared to fail terribly. Being greedy is one of the deadliest mistakes you can ever make as an entrepreneur because instead of building you, it will only destroy you and make you more miserable than you could ever have imagined. Never keep your mind Raising too little capital solely on the amount of money Many start-ups assume that you expect your business to give all they need is enough money you. Instead, try to concentrate to rent space, buy equipment, on other important things like stock inventory and drive cus- how to serve your clients in the tomers through the door. What best way possible, how to motithey often forget is that they vate your employees, how to get also need capital to pay for sal- more business partners, how aries, utilities, insurance and to invest wisely, and other vital other overhead expenses until factors that can make your busitheir company starts turning a ness better in future. In addition, profit. Unless you're running always be content with whatthe kind of business where eve- ever your business has to offer, rybody's working for sweat eq- however little and be proud that uity and deferring compensa- you are managing your own life tion, you'll need to raise enough better than many of your peers money to tide you over until or colleagues. www.amgtt.com • APRIL, 2014 • ABSTRACT BUSINESS 23
ABSTRACT BUSINESS GUIDE
DEVELOPING THE ENTREPRENEUR
Ensuring Fair Employee Compensation
W
hen it comes to business, it really all boils down to the bottom line. For employers, dollars and cents are what drive business operations. Similarly, despite whatever intrinsic value attained it is ultimately the compensation that motivates and keeps employees interested in their job. Therefore, it is important to have a proper and fair compensation package available to staff. With that said, there are some things to consider in achieving this. Before deciding adequate compensation for employees, employers should first consider their options. When you just don’t have the kind of cash needed to hire more employees, consider other options aside from typical compensation and typical employees. For instance, compensating interns is a completely different story from compensating an employee as you can offer college credit and a stipend rather than a salary. Keep in mind that interns do deserve fair compensation but the ways in which you compensate them can be a bit more creative. Similarly, part time or contract employees may be a better solution when a full time employee is out of the question.
continued employment? Maybe they came in and demonstrated a unique skillset that you never expected to encounter. If you are lucky it might be all of the aforementioned traits. Whatever the case, it is up to the employer to create a pay plan in accordance with the job being performed. How do you rate the duties performed and how damaging would their loss be to your establishment? Develop a written pay policy and stick to it. When there is no written pay plan, it is easy to become inconsistent and pay employees based on different criteria. If they realize it (and they will), morale can be damaged, and you can potentially end up losing a good employee or being involved in a lawsuit for unwittingly practicing discrimination. Equity Your Principles of Business and Human Resource Management textbooks would have taught you about equity. They would have told you that pay structures, regardless of the size of the organization, must have two things going for them: internal and external equity. Internal equity relates to fair compensation in comparison to employees within the same organization. External equity means that employees within an organization are paid fairly in relation to people with similar jobs in the region. Equity has little to do with the size of your company. It does not matter how big or small your business is, equity should be key in
Purpose Employers should know exactly what is required of their employees and as such know what he/she is paying the employee for. Were they hired based on education and/or experience? Is job tenure a reason for their 24 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
deciding on a proper remuneration plan. Accurate Data A number of excellent surveys exist that provide pay information. Select at least two of those sources and use them consistently. While they can cost hundreds of dollars, the money spent is insignificant if they prevent over- or underpaying by thousands of dollars. Use them every year, and you will find that they become the best compensation tools available. Job Descriptions While writing them can seem tedious and bureaucratic in a smaller organization that prides itself on its entrepreneurialism, they are the foundation for every human-resources initiative, including a solid compensation system. Get a format everybody agrees on and use it. Review them annually and revise them when changes occur. You will be surprised at how much information they provide and how often you will use them. Money Isn’t Everything While all of us expect and appreciate good pay, research has repeatedly shown that employees will not stay with an organization with poor
management or working conditions even when the pay is excellent. While the poor economy during the past few years has hindered many from switching jobs, as conditions improve, employees will begin looking for greener pastures unless they like the working environment as much as they do the money. Remember: Most good management practices don't cost a cent. With that said, employers should focus on the total compensation package. When the cash just isn’t there, fair compensation is achievable through considering your total compensation offering and not just salary. Total compensation includes all the benefits and extras you offer your employees in addition to salary. Typical aspects of a total compensation package include benefits such as health insurance and a retirement package but it can actually include anything you would like to add, such as gym memberships, transportation assistance, equity offerings, incentive pay opportunities and more. Don’t be afraid to think outside the box because it may be the difference between being able to hire the best and not being able to compete for quality candidates.
ABSTRACT BUSINESS GUIDE
GLOBAL FINANCE & WORLD REVIEWS
US Consumer Confidence The Highest In Six Years
U
.S. consumer confidence rose in March to its highest in more than six years as expectations brightened, according to a private sector report released at the end of the month. The Conference Board, an industry group, said its index of consumer attitudes rose to 82.3, the highest since January 2008, from an upwardly revised 78.3 in February. Economists had expected a reading of 78.6, according to a Reuters poll.
February's figure was originally reported as 78.1. "Overall, consumers expect the economy to continue improving and believe it may even pick up a little steam in the months ahead," said Lynn Franco, Director of Economic Indicators at the Conference Board in a statement. "While consumers were moderately more upbeat about future job prospects and the overall economy, they were less optimistic about income growth."
The expectations index rose to 83.5 from an upwardly revised 76.5, while the present situation index fell to 80.4 from a revised 81.0. Consumers' labor market assessment was slightly more negative in March. The "jobs hard to get" index rose to 33.0
% from a downwardly revised 32.4 % in February, while the "jobs plentiful" index dipped to 13.1 % from 13.4 %. Consumers anticipated larger price increases, with expectations for inflation in the coming 12 months up to 5.5 % in March from 5.2 %.
China Loses Trade Dispute Over Rare Earth Exports, U.S. Says
C
hina has lost a dispute at the World Trade Organization over restrictions on its exports of rare earth metals, tungsten and molybdenum, says the U.S. Trade Representative's office. The complaint about the restrictions on the highly prized commodities was made by the United States, the European Union and Japan two years ago. "This victory shows that we stand prepared to take action whenever necessary to protect the high-quality middle class American jobs that trade supports," U.S. Trade Representative Michael Froman said in an emailed statement. The WTO is expected to publish its ruling in the case later on Wednesday. Any of the parties in the case can appeal within 60 days. China produces more than elements, which are used in a 90 % of the world's rare earth wide range of applications in 26 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
sectors like renewable energy, telecommunications and de-
fence. The United States, Europe and Japan complained export restrictions, including duties and quotas, gave Chinese companies in key high-tech sectors an unfair competitive edge. "China's decision to promote its own industry and discriminate against U.S. companies has caused U.S. manufacturers to pay as much as three times more than what their Chinese competitors pay for the exact same rare earths," Froman said. "WTO rules prohibit this kind of discriminatory export restraint." For its part, China has said rampant overmining has caused ecological damage and that it no longer wants to pay the environmental costs of supplying the vast bulk of the world's rare earths. In 2013, it capped rare earth production at 93,800 tonnes.
ABSTRACT BUSINESS GUIDE
STOCK WATCH
March Stock Summary Courtesy The Trinidad and Tobago Stock Exchange
Written Report for Friday, 28th March, 2014
O
verall Market activity resulted from trading in 15 securities of which 5 advanced, 2 declined and 8 traded firm. Trading activity on the First Tier Market registered a volume of 166,856 shares crossing the floor of the Exchange valued at $2,039,656.78. NATIONAL COMMERCIAL BANK JAMAICA LIMITED was the
volume leader with 26,435 shares changing hands for a value of $30,664.60, followed by NATIONAL FLOUR MILLS LIMITED with a volume of 22,175 shares being traded for $27,940.50. FIRSTCARIBBEAN INTERNATIONAL BANK LIMITED contributed 21,520 shares with a value of $123,740.00, while JAMAICA MONEY MARKET BROKERS LIMITED added 21,000 shares
valued at $11,790.00. ONE CARIBBEAN MEDIA LIMITED enjoyed the day's largest gain, increasing $0.25 to end the day at $20.00. Con-
Stocks Advancing: Security
Volume
Closing Quote ($)
Change ($)
7,800
20.00
0.25
332
58.20
0.13
11,650
0.90
0.11
ANSA MERCHANT BANK LIMITED
1,280
38.49
0.11
REPUBLIC BANK LIMITED
6,854
120.11
0.01
ONE CARIBBEAN MEDIA LIMITED UNILEVER CARIBBEAN LIMITED WILLIAMS LJ B
Stocks Declining: Security
Volume
Closing Quote ($)
Change ($)
FIRST CITIZENS BANK LIMITED
8,500
34.99
-0.17
GUARDIAN HOLDINGS LIMITED
11,716
13.59
-0.16
Volume
Closing Quote ($)
NATIONAL COMMERCIAL BANK JAMAICA LIMITED
26,435
1.16
NATIONAL FLOUR MILLS LIMITED
22,175
1.26
FIRSTCARIBBEAN INTERNATIONAL BANK LIMITED
21,520
5.75
JAMAICA MONEY MARKET BROKERS LIMITED
21,000
0.56
GRACEKENNEDY LIMITED
versely, FIRST CITIZENS BANK LIMITED suffered the day's greatest loss, falling $0.17 to close at $34.99. CLICO INVESTMENT FUND was the only active security on the Mutual Fund Market, posting a volume of 3,763 shares valued at $82,221.96. CLICO INVESTMENT FUND remained at $21.85. PRAETORIAN PROPERTY MUTUAL FUND remained at $3.40. The Second Tier Market did not witness any activity. FNCU VENTURE CAPITAL COMPANY LIMITED (SUSPENDED) remained at $1.00. MORA VEN HOLDINGS LIMITED remained at $14.97.
Stocks Trading firm: Security
20,000
3.50
SAGICOR FINANCIAL CORPORATION
4,100
7.05
CLICO INVESTMENT FUND
3,763
21.85
NEAL & MASSY HOLDINGS LIMITED
3,494
66.31
28 ABSTRACT BUSINESS • APRIL, 2014 • www.amgtt.com
In Friday's trading session the following reflect the movement of the TTSE Indices: * The Composite Index declined by 0.49 points (0.04%) to close at 1,171.28. * The All T&T Index declined by 0.98 points (0.05%) to close at 1,987.20. * The Cross Listed Index remained at 46.62. * The Composite Index comprises all Ordinary companies. * The All TTSE Index comprises Trinidadian companies only. * The Cross Listed Index comprises companies originating outside of Trinidad & Tobago.
Abstract B.G Is Published By Abstract Media Group, Premium Commercial Complex, San Juan, Trinidad, W.I. • Tel: (868) 638 1156/9 • Fax: (868) 638 1160. Printed By The Office Authority - Printing Division And Distributed By AMG