MarksIn last week's edition of the Financial Gleaner, the CEO of Paymaster and chairperson of the Tourism Product Development Company (TPDCo), Audrey Marks, outlined Jamaica's economic challenge. This was her chosen theme for her address to the Rotary Club of Kingston last Wednesday. In today's edition of Sunday Business, part II of her speech focuses upon Jamaica's future and takes a peek at the year 2013 and sees what we can hope for.
IN THE year 2013, TPDCo has achieved collaboration between all agencies and stakeholders in meeting common objective in tourism development. World-class standards have been achieved in the areas of health, security and environment. TPDCo has aided the development of world-class
personnel and aided in the
socio-economic advancement. Through our first-class project services, TPDCo has become self-financing.
SOCIO-ECONOMIC DEVELOPMENT
In the year 2013, there are thriving urban and rural communities throughout Jamaica, which are engaged in a variety of tourism-based economic activities. TPDCo identified and nurtured the development of community skills and products grounded in our heritage and culture, which is a demonstration of growth and development through entrepreneurial energy and creativity of Jamaicans. By engendering a collective vision, TPDCo has created sustainable synergies for environmental protection and social harmony for the mental, spiritual and economic prosperity of our people.
In the year 2013, TPDCo has facilitated the positioning of Jamaica as the premier warm weather destination and is now the benchmark in world standards, manifested through total voluntary compliance of standards across various sub-sectors of tourism.
Continuous maintenance of high visitor satisfaction
High quality of visitor
experience
Delivery of tourism services
The quality and diversity of attractions
A highly-trained staff across all sub-sectors
Increased efficiency and sustainability through implementation of operational & environmental management systems
The ability to respond to the dynamics of the demands from the international travel and tourism markets
ECONOMIC IMPACT
In the year 2003, the country's debt servicing ratio is 65 per cent of GDP. In 2003 The tourism sector was envisioned as the engine of economic growth. Now 10 years later. There has been a reduction of the debt servicing ratio from 65 per cent of GDP to 30 per cent of GDP, primarily through the growth in the tourism sector.
Visitor arrivals increased by four million to six million.
Foreign exchange earnings increased from US$1.5 billion to US$5 billion.
Direct employment in the Sector increased from 77,000 to 200,000.
This achievement was achieved within the framework of the Tourism Master Plan
and TPDCo's involvement in
implementation.
Our vision is possible if we start today! And so our mission today is "to achieve socio-economic growth and development to the benefit of all Jamaicans by facilitating tourism product diversification and development while enhancing visitor experience. This will be accomplished with competent, committed and motivated staff; by being customer-oriented and standards-driven; and by building consensus and strategic alliances with other agencies, communities and industry stakeholders."
Five first stage objectives were identified for the next three years. Facilitation of;
1) 100 per cent implementation of Resort Partnership Plan in one resort
2) 100 per cent compliance with regulatory requirements
3) Two new JTB-licensed attraction categories, including PGA certification of one six-course trail
4) 25 per cent improvement in visitor experience rating
5) Four JTB-licenced viable heritage attractions/craft villages
Now it is critical that Jamaica understands that no matter how bad we think the situation is there are those who will seize the opportunities, at this point it is mostly foreign investors who seem to find Jamaica attractive and are investing huge sums and getting returns.
BUSINESS OPPORTUNITIES
What does TPDCo's vision, mission, strategic objectives, repositioning mean for you and Jamaica?
An analysis of Bear Stearns November Report states that since 1997/1999, tax revenue has risen only nine per cent, hence it is a little wonder the economy has not grown. This has contributed to the continued fiscal deficit and the cycle of increasing debt. The report reflects on two options; an unorthodox approach of pre-emptive debt restructuring but concludes; "The fundamental problem is that the public debt is so huge that even if the domestic debt was withdrawn by 100 per cent debt ratio Jamaica would still look like double B comparable. A restructuring of the domestic debt would likely technically bankrupt most of the financial institutions in the country, opening up another major problem." It therefore recommends and endorses the orthodox way i.e. for the Government to generate fiscal surplus and foster conditions for economic growth, thereby lowering the debt-to-GDP ratio overtime.
It cites Ireland and Indonesia as two examples of countries where the debt-to-GDP ratio exceeded 100 per cent, and these countries have managed to stabilise their debt dynamics using the general policy model. "However, these countries had special conditions that do not seem to be present in Jamaica. In Ireland's case they had a structural boost to economic growth and policy discipline that EU convergence brought. In the case of Jamaica, structural forces are arguably exerting negative economic impulses at this time namely; secular declines in manufacturing and loss of protected markets for sugar and bananas, among others."
Therefore, what do we have what will allow us an economic recovery? The answer is Tourism. The National Industry Policy states that "Tourism is the largest and most important sector in the Jamaican economy. Contributing 13.2 to GDP, 45 per cent of Jamaica's foreign exchange inflows from the productive sectors and eight per cent of national employment." Despite this importance, Jamaica's tourism is not contributing near its potential to the economy. With more than half (54.9 per cent) of the world cruise ship capacity deployed to the Caribbean, with SARS and WARS, Jamaica should be crawling with tourists.
BARBADOS
Barbados, with a population that is equivalent to 10 per cent of Jamaica's population and a land mass of 3.7 per cent of the size of Jamaica is having 50 per cent of the stop-over arrivals in Jamaica. Other small islands such as Antigua and Barbuda show similar performance gaps with 2.6 per cent of Jamaica's population and 30 per cent of Jamaica's arrival count.
Our premier products are sand, sea and sun. This is so for all of competitors without crime and bad press issues. Hence, having outperformed our competitors for much of the 1990s, we are now underperforming; our competitive advantages in the sand, sun, and sea market are being eroded rapidly. Our all-inclusive product is now being copied by Cuba, Dominican Republic etc. Those are what can be copied and competed with. What we have not capitalised on that will give us a complete distinctive competitive
advantage is Jamaica's outstanding natural, cultural, historic and built heritage. Our attraction sector has been dominated by a single attraction; Dunn's River Falls. Why have we not capitalised on our natural diversity, cultural uniqueness and strong mystic brand "Jamaica"?
I ask myself the question: Why is a sector that has so much to contribute to national development, still existing on the fringes of the consciousness of the ordinary Jamaican? Why is this important sector not entrenched in our national consciousness? The answer is that there is a perception that the tourism sector is elitist, that it exists for the benefit and the glory of only a minority of the Jamaican people, the belief that the sector exploits the small man while concentrating wealth in the hands of few wealthy interests.
This perception has perhaps been fed by the early origins of the sector and the fact that much attention has been focused on particular sectors and particular players in sector.
Just as the saying that Jamaica is more than a beach, the island's tourism sector is so much more than one hotel or attraction. The brand Jamaica is to be a multifaceted commodity, running the gamut from small breakfast operations to large hotel chains; from adventure attractions to shopping, entertainment, craft, ground transportation and others related to the sector. The benefits of tourism have far reaches beyond the confines of the tourist resorts.
In the Bahamas and Barbados, tourism is not only a livelihood, it is a way of thinking, a way of doing things, and people are always mindful of how their actions will impact on the sector. Even the media in these countries are conscious of how their reporting can affect the sector and therefore their lives, and as such they are always careful in their reporting of the news.
For the first time in Jamaica, tourism is the priority. We have always had many choices: sugar, banana, and bauxite. Tourism is now identified as the lead industry, we must focus on making it a success.
In so doing, TPDCo's approach to achieving our vision and mission will be two-fold
Facilitate the information flow, or
Re-education on tourism, "Team Jamaica" awareness throughout Jamaica. We will include our nearly one million students and 22,000 teachers as we enrol every Jamaican to be a tourism ambassador.
Secondly, we will be the facilitators for investment in the numerous tourist opportunities that will evolve over the next 10 years. The master plan calls for over US$2 billion to be spent over the next 10 years, we are already seeing over US$100 million per year from private sector investments. To achieve the targets of the master plan and place us in a position to capture opportunities for the Cricket World Cup in 2007 while positioning ourselves for the explosion of cruise business we are now seeing, we will have priority focus on the development of attractions, resort town, support service and accommodation.
Attractions include the broad area of entertainment and sports to provide:
Visual & Performing Art centres, night clubs
Man-made attractions - theme parks
Leisure complexes
Sports and recreation facilities
Videos and films (Smile Orange and The Harder They Come classics that showcase Jamaica use media to positively project Jamaica
Events and tours sports tourism
Focus in this area includes developing golf trails and golf product packaging, and going after the 50 million high-spending golf market. Employment on one course involves all skilled or unskilled levels. Both Ireland and Kabas in Mexico, credit golf tourism for the influx of over five million golfers per year, since developing their golfing product less than 10 years ago. Ireland with three months of summer!
The development of resort type casinos and theme parks and entertainment centres can be a strong catalyst for investment, attracting Foreign Direct Investment and having a significant multiplier effect on the rest of the economy through construction, impact on retail stores, restaurants, entertainment etc. Initial economic impact from adding this attraction is estimated at US$132 million with a one-time impact on GDP of US$61 million.
Jamaican music and multure
From Bob Marley through to Shaggy and now Sean Paul, Jamaican music has captured the world stage but on entry at the airport of Jamaica, through our hotels etc. there are no real major attractions celebrating this achievement. This cannot continue.
Heritage attractions From historical towns, Great Houses, forts, the story of the Maroons, slavery and emancipation, our churches, there has been no development. It's a shame to see the rotting of our Great Houses, some of the finest Georgian architecture.
Our natural wonders - waterfalls, caves baths, mountains, gardens
Health attractions retirement villages, health spas (Tapping in on the wellness industry)
Support services
Food and beverages our cuisine is slated for major development as a product
Ground transportation tours will have to expand and tour guides will be needed
Shopping in bond, craft, clothing, all will have a market
Accommodations
While we continue to pursue major chains, a part of a diversified product offering calls for time-share, villas and Bed and Breakfast.
TPDCo will help getting persons to the standard to be certified Bed and Breakfast facility this is your own home if you have a 3-6 bedroom home and your children have left or you are a returning resident or you are on pension. There will be the potential to earn from US$30.00 per night with no additional overheads.
The opportunity is now; we have to develop our attractions using our strength as the first step. A flow can be depicted as follows:
Infrastructure support - air, sea roads, telephones, electricity, water (all in place)
Marketing
Attractions
Support services
Accommodation
The marketing has started, JTB has launched a targeted marketing plan, which will see Jamaica going after 10 different marketing segments including:
1. Sports/adventure market 100 million
2. Health & nature market 75 million
3. Eco/nature tourism, 50
million
4. Honeymoon
5. VFR, non-resident Jamaicans, reunions
6. Groups and convention market
7. African American 35 million
8. Family 70 per cent of U.S. travel market (still untapped for Jamaica)
9. Gospel market
10. Cultural/heritage market/ domestic market
Even a one per cent success will see Jamaica achieving over 5 million visitors per year. What will that mean for the economy? Well it depends to some extent on the level of local vs. foreign investments. American Airlines has moved its hub from Jamaica to Haiti, Haiti is doing great business. Does that mean that the majority of the people are benefiting in a real way? No.
Let us not make Jamaica earn without most Jamaicans having their share. Jamaica now has 60 per cent of the fundamental infrastructure airport, sea ports, highway, access to everywhere in two hours will become a reality.
Sustainable tourism for all Jamaicans should have your investments but won't wait for it. There are numerous incentives. Well, firstly the ability to earn foreign currency income;
1. Tourism Industry Fund
2. Tax incentives
3. Training grants
4. Technical assistance
5. Credit line
A lower interest TPDCo vision is tied in with facilitating your creativity to become profitable ventures for you and the country. Now I know, in this current climate it's hard to think investments, this is 2003, but let me encourage you. From personal experience I know there are issues; the playing field is not perceived as level for local investors. The, FINSAC experience for those who try etc., etc. On the other hand, Mr. Michael Lee Chin is investing in Jamaica's tourism. His track record is not of idle investments, so let's stop but, but, butting. Let us not be goats but flamingos.
