Norman Girvan, General Secretary, Association of Caribbean States (ACS) is watching the FTAA trade table like a hawk. FTAA, he said, will either lead to another form of economic colonialism or improve the quality of life for developing countries. Girvan was at the time speaking at the Banking, Insurance and General Workers Union (BIGWU) 2003 Workers Education Programme entitled: “The Free Trade Area of the Americas (FTAA) – Implications for Labour, Business and the National Economy.” Girvan stressed the fact that trade liberalisation must be a form of growth that produces quality employment. “Employment that is secure and reasonably remunerated for the work done. Increased sources of opportunities for all and conditions which allow sustainable human development of the population.”

In Making Global Trade Work for People, a publication of  United Nations Development Programme (UNDP), Girvan said the assumption is that the purpose of trade is to support sustainable human development. He said the book went on to say that global trade and trade liberalisation is not an end in itself and they also make far reaching propositions and proposals for re-orienting the nature of the course and content of global trade negotiations in support of sustainable human development. Girvan said if one is to examine the declaration which accompanies the course of the FTAA, they would see that the FTAA supports such an initiative. He quoted from the declaration of the Summit of the Americas of 1994 which launched the FTAA process.

The declaration states: “The countries are aware that widely shared prosperity contributes to hemispheric stability, lasting peace and democracy… A key to prosperity is trade without barriers, without subsidies, without unfair practices and with an increasing stream of productive investments.” This, he said, is what will determine whether and to what extent  the “FTAA will actually, in practice improve the quality of life of the populations or whether the fears of some that it will amount to nothing more than a new form of economic colonialism will be realised.” The ACS general secretary said this is the question that has to be answered, but noted that it depended on the manner in which negotiations proceed and how countries organise themselves to defend their interests and insure that the outcome is reflective of their interests. Girvan said this is a very “inter-connected and intertwined” agenda and will profoundly affect all levels of the local economy and will also have social consequences and impacts. He added that more subjects which are normally within the purview of domestic policy and action are being incorporated into not only the FTAA but other trade negotiations and arrangements as well.

“Subjects such as intellectual property rights, competition policy, investment, government procurement, dispute resolution and labour standards are being negotiated and once an agreement comes into place it will be taken out of the arena and scope of autonomous, soverign, government action.” He said while the new rules are supposed to strengthen the framework for international trade and investment, it will also result in a new reality, a new way of doing business and changes which will affect the very substance of everyday life. “On the one hand the opening up of markets will enhance opportunities or provide enhanced opportunities for the business community and present an interesting potential for growth and the development of our countries but on the other hand they impose risks and challenges of equal magnitude.” For regional entrepreneurs, he said, the possibility of exploring economic complementarities with different economies, deeper markets and diverse preferences offers newer and greater opportunities for business, investment and growth.

However, he warned this also means a more complex legal framework and increased competition. He said in this framework, economies of scale and access to technology play a fundamental role. “These are significant challenges particularly for the small developing countries of the Caribbean region which do not have the benefit of economies of scale from the domestic market and do not have large technological complexes.” In the face of these challenges, Girvan said regional entrepreneurs can obtain  support from the enhanced regional markets and it is possible to forge strategic alliances and various joint production schemes which could be combined with the possibilities of creating productive conglomerates and regional clusters. He added that these ventures can take advantage of trans-border ties to increase the regional value of production and improve competitiveness by incorporating the best of the productive capacity of the various countries and sub-regions of the greater Caribbean. “We already see this in the significant flow of investment by TT firms into countries like Jamaica and others in the Caricom region.” However, he said for the governments, social actors and partners of regional countries, this is a task of “colossal proportions”, because of the numerous processes they must simultaneously embrace. Additionally, he noted that these governments’ desire to obtain the best possible reserves for their people are pushing the human and financial resources of the Caribbean region to their limits.

If BHP Billiton gets the business opportunity to monetise its reserves through  in the Atlantic LNG (ALNG) Trains, the company will seriously consider it. In fact, Geoffrey Ferreira, General Manager (Trinidad and Tobago), BHP Billiton said they will align themselves with any project that brings value to the company and to TT. “We have a production sharing contract with the Government, so therefore they also have a very keen interest to monetise their profits. “We all know that  ALNG provides the exportation and monetisation of these reserves and so we would clearly like to be a part of that.” Additionally, he said if at some time there are opportunities in the downstream business, such as in aluminum, BHP would also like to be a part of that since it is is a mineral-based company.

He said he has spent most of his life in the energy sector doing human resources, re-engineering and organisational development. “I had an opportunity to work in the Denver region for Amoco and also in Houston on a specific re-engineering natural gas business between 1992 and 1994.” When he returned in 1994, he took up the position of vice-president, human resources at bpTT, then he was offered the position of general manager, human resources, BHP. “I have been involved in this industry for some time and bpTT is the only other employer I had the opportunity to work for,” he said. Ferreira said he left bpTT because BHP presented him with an exciting opportunity to work in a ‘green field’ operation, something virgin and unexplored. “This opportunity really created a lot more space to have more autonomy to develop a new company that will have more of my own finger prints around.”

BHP, he believes, creates a whole new opportunity for creating wealth in TT and also for its companies and shareholders. BHP has been in TT for about six years now and during that short space of time, the company engaged in an exploration effort that ended with a major discovery in the Angostura Field located in Block 2 © offshore TT. Ferreira explained that this exploration effort was a success because it discovered hydrocarbons in areas that other companies had explored before. “It has created a new gateway of opportunities, exploration opportunities, not only for us but all those who would bid into future blocks in and around this,” he said. While BHP Billiton is the operator of the Greater Angostura development, it has entered into joint venture agreement with TotalfinaElf and Talisman Energy.

With this energy find, Ferreira said he wants to create a legacy, one that will be here to stay for many generations to come. BHP’s discovery, he said, had a life span of at least 25 years and the company is also going to start exploration in a block adjacent to 2 (c),  – Block 3 (a). BHP expects to build up at least six exploration wells to drill in 3 (a) within the next year and a half. “So the foot print of this company is yet to be developed and with the exploration success and excellence we have as a company, we are confident that we will find more hydrocarbons.” He said while BHP is a relatively small player in the energy industry worldwide as well as in TT, he is sure that the company will become a very big part of the industry in TT. “Relatively speaking, we are a small player globally in energy. We are the 10th biggest oil company in the world, but we are the number one mineral company.”

He noted that in TT, BHP’s well 2 (c), is going to produce anywhere between 75,000 and 80,000 barrels of oil per day. He said 2 (c), will be their largest operating asset when they do get to operate it, which should happen by the end of next year when they bring first oil to shore. While BHP’s major find to date has been oil, Ferreira said they do have a tranche of gas, about 1.7 tcf, which he is sure that TT would like to purchase. Additionally, he said while BHP is a mineral based organisation, and is the number one company when it comes to aluminum, copper, diamonds and other special products, petroleum produces about 30 percent of its earnings before interest and taxes. Even though Ferreira, has spent all of his life in the energy sector, he firmly believes that TT should diversify its economy. “The oil and gas business globally is a cyclical business and there will be times when it will put pressure on an economy, when they are basing their future look on certain prices of oil, that over time, will not be what it is today,” is how he put it.

Diversity in an economy, he said, will clearly strengthen its capability to be flexible and add stablity when oil prices dip. “I think that diversifying the economy is something that we should be doing and I think that there has been movement in that direction.” He also thinks that the future of oil and gas in TT is very “upbeat.” He said BHP has created an opportunity for more exploration and a renewal of interest particularly in the Angostura field, which, he said, can create more discoveries. Ferreira also addressed the issue of the limited supply of locally skilled workers available to the energy industry. “It is a fact that there is a lack of experienced, mature and skilled workers in the energy sector and which BHP will be requiring in the near future.” He applauded moves by the National Energy Skills Centre (NESC) and the Trinidad and Tobago Institute of Technology (TTIT) which have been trying to help fill that gap in the sector.

Ferreira said BHP is also trying to help train young people to work in the energy industry. In fact, BHP has already tapped into the TTIT and are going to employ ten young technicians, inexperienced by and large, and are going to give them an opportunity to be exposed to two of their operating assets in the United Kingdom (UK). “It is a very exciting opportunity for these ten young men. They have already been selected and we are now in the process of finalising the arrangements.” These young recruits will be at BHP’s operating assets for at least nine months and will return to TT to continue their training. Apart from his work at BHP, Ferreira is a family man with four children. He is also a very avid swimmer. “My passion is really competitive swimming and I still actually compete.” Ferreira was actually the first Trinidadian to compete in an Olympics for TT. He competed in two Olympics – in 1996 in Mexico and in 1972 in Germany. Additionally, he said, BHP is going to have a positive effect on TT and will leave something behind so that the company will be remembered for its creation of employment opportunities and skills development, which never existed here before.

A Memorandum of Understanding (MOU) between the Guyana Sugar Corporation (GUYSUCO) and Angostura Limited of Trinidad and Tobago was signed on Monday August 18, 2003 at Hermandston House, in Queenstown Guyana by Lawrence Duprey, Chairman of Angostura and Vickram Ouditt, Chairman of Guysuco. The new joint venture company will buy molasses from Guysuco for processing into alcoholic beverages while Angostura will supply management and technical services. The Memorandum of Understanding proposes that construction of the distillery will commence on January 02, 2004. The new distillery is expected to produce bulk rum initially and later will manufacture branded Guyanese rums for the global market. This will enable Guysuco to maximise the benefit from its molasses by converting it into alcohol.

Guysuco’s Oditt said the distillery project represents another important step in achieving one of the company’s fundamental goals, of adding value to its production. Duprey said: “We welcome Guysuco’s efforts in adding value to one of their key products, which is moving from sugar on to alcohol and which will have further value when we brand the alcohol. We have access to markets in almost every country in the world with the recent acquisitions we have just made.” Duprey believed that the signing of the MOU “could strengthen the economies of our countries and by putting good management sharing values and visions as we are doing now, the wider Caribbean would benefit significantly.”

One of the great truisms is that women live longer than men. We have been served this statistical reality from our very entry into the insurance industry and life insurance premiums duly reflect the higher life expectancy for women. However, all of that may well change although not any time soon! Most United Kingdom life insurance companies provide data to the Continuous Mortality Investigation Bureau (CMIB) — an organisation sponsored by the UK actuarial profession that collects information on mortality and morbidity and recent results suggest trends that have implications for the life insurance industry and the broader society.

There are no mortality tables for Trinidad and Tobago or for that matter the Caribbean and life insurance rates in our market are generally based on Canadian mortality tables for the most part. Some 25 years ago there was some interest by the leading life insurance companies to develop a Caribbean mortality table but this never came to fruition on the grounds of insufficient data, the prohibitive costs involved in such an investigation and the scarcity of qualified persons in the region to undertake this work. Naturally, while there is no dispute over the findings there is no empirical data yet available that can confirm the causes for the deaths charted in the investigation. However, there is a grave suspicion and even speculation that the stressful nature of work coupled with lifestyle implications might be the underlying cause for the reduced life expectancy in females. What emerged from the study was that male mortality has been improving more quickly than female mortality. However, in any sampling it depends on the size and the length of time the data has been tracked before firm conclusions can be drawn.

The CMIB has been gathering data on female lives from the 1970’s when women in sufficient numbers have been buying life and pension policies. With respect to men, the CMIB has data that go back the better part of 75 years. It is worth pointing out that the female lives studied were considered more affluent that the average British female. Again it was generally accepted that an affluent life lived longer but an affluent female with a stressful work environment and with lifestyle changes may be no more likely to live longer than the average female. However, we are dealing with insured lives and the sample may be considered too small. In the UK, the Government Actuaries Department undertakes population-wide studies and therefore this is more representative of the country as a whole. These studies revealed that female life expectancy rose more quickly than male life expectancy during the 1960’s and 1970’s but fell back in the 1980’s and 1990’s. The closing of the gap is evident and from a previous four and a half years, it is now three years and this trend appears to be continuing. This could lead to an eventual convergence and then overturn the old principle that women live longer than men. That outcome could see boys born in this century having a longer life expectancy than girls! While one could never be absolutely certain about outcomes, the trend suggests that possibility and then one would have to determine underlying causes.

For instance, there is evidence suggesting that female mortality at age 40+ is not improving as quickly as male mortality and cigarette smoking is considered as one of the main reasons. It would appear that men are smoking less than female at the younger ages. It is suggested that the effects of stress on working women might have contributed to the lowering of the differential between male and female mortality. What is clear is that life expectancy between male and female is becoming more similar but there are no firm conclusions that can be drawn for the reasons why this should be so. It is possible that with gender equality and equal opportunities for women in the workplace life expectancy can also become closely aligned with very little differential between male and female. What you wish for you might well get. Women have been advocating for equal treatment whether it is prize money in sport or opportunities in the corporate world.

To a large extent, they are achieving their goals in gender equity. These recent studies on life expectancy at least for UK women are producing results that show the gap between men and women is narrowing and may lead to the new generation of women who buy insurance products paying premiums more in line with men sometime in the future. While this will not happen overnight, the trends will make actuaries take notice and they will no longer automatically assume that women are likely to live four years longer than men. This is the UK experience. We have no idea what our own experience is and whether we would have similar results if an investigation is undertaken. In the absence of this data, we can only adopt the experience of work conducted elsewhere and make appropriate adjustments and over time see whether the actual out turn matches the model and the assumptions used. This development must be followed to see where it actually leads and the insurance industry will naturally be keeping a watchful eye and there are implications not only for it but for society as a whole.

E-mail: daquing@cablenett.net

A general lack of interest, as shown by the slow trading volumes, left the global markets in lackluster trading last week. Not much really went on as markets moved down or sideways with some profit takers moving out of positions. Stocks ended lower Monday and were moving lower Tuesday as well. Notwithstanding the market performance, the economic news continued in a positive vain. There was plenty of good economic and corporate profit news for the week. US housing market remains red hot showing a 1.5% increase to 6.2 million units for July. According to a report released by the Commerce Department, the July housing starts figure is at its highest level in 17 years, supporting our theory that despite the recent economic contraction, people are not reducing their lifestyle. The surge in construction was fuelled by the lowest mortgage rates on record. Economists expect the housing market to remain buoyant.

Consumer confidence figures were up once again for August and for the fourth straight month, the Conference Board’s index of leading US economic indicators rose, this time logging 0.4% for July. The index benefited from the improvement in the unemployment and the increase in the money supply. A spokesperson for the Conference Board commented that the favorable environment could be further enhanced by increases in consumer spending and business investment. From past articles, readers would remember, we have been watching the employment figures with a particular interest and this week’s figures revealed more positive news. US unemployment figures continued to fall last week with new unemployment claims falling to their lowest level since February. The report by the Labour department said that the pace of redundancies had slowed, as the economy gained strength.
In the US corporate front, Home Depot, the world’s largest home improvement chain, reported its second quarter profits increased by almost 10%. The company’s chief executive announced that sales were boosted by higher demand for new products and by increased advertising. The strong housing market has also appeared to have helped lift sales at its home improvement stores.

Wall Mart has upgraded its guidance for sales, now projecting a 4 to 6% increase in annual sales, up from 3 to 5% last quarter. Again, this news augers well with our belief that consumers have the financial wherewithal to maintain their lifestyles and will continue to do so, thereby fuelling the programmed economic recovery. Across the pond, the UK more or less followed in the steps of the US with economic indicators showing the economy remains strong and economic parameters are improving. Areas of decline are slowing with turnaround becoming evident. Of greater concern in the Euro zone remains France and Germany. Economic growth in France was negative in the second quarter of 2003. According to government released figures, the French economy shrank 0.3%, as consumer spending declined and the strength of the euro hurt exports. Other major eurozone economies including Germany, Italy and the Netherlands have also reported an economic contraction during the second quarter. On a positive note, an index compiled by the ZEW Institute to measure investor confidence, rose for an eighth consecutive month amid growing expectations of improving economic growth in the eurozone during the second half of 2003. Perhaps consumer spending will be strong enough in the eurozone to fuel economic recovery as well.

While North America and Europe suffered the ravages of a heat wave and the north eastern seaboard recovered from severe power shortages, Japan was calm, cool and collected as the Nikkei 225 Index broke the 10,000 mark and the Topix rose above 1000 last week. This would mark the first time in over a year the indexes have been above these barriers, demonstrating a greater optimism about the Japanese and global economies. We continue to believe that now is an opportune time to revisit your existing portfolios with a view to restructuring to favour an asset allocation towards economic growth in ownership related positions.

e-mail: darcy@investments-intl.com

In order to deal effectively with workplace drug and alcohol abuse, top management must become knowledgeable about alcohol and other drugs, according to Lionel Remy, a consultant at Behavioural Management Solutions Limited. Remy was speaking at the Employers Consultative Association’s (ECA) one day seminar entitled: “Challenges of HR Professionals: Managing the Social Issues of the Workplace — Stress, HIV/AIDS and Substance Abuse.” He said every person in the workplace can take an active part in fighting workplace substance abuse. “The more people who are involved, the more successful the effort will be.”

Local business or industry associations should be encouraged to sponsor educational seminars on workplace drug and alcohol abuse so that top management can learn from presentations by other employers on how to develop effective programmes, he said. Twenty percent of the public sector workforce are perceived by human resource managers as having alcohol abuse problems. Education and awareness programmes, can vary widely from one workplace to another. “No one programme is right for all organisations. Top management must provide an education and awareness program for its employees that meet the specific needs of the organisation.” He believes that there are no “simplistic” solutions to the complex problem of alcohol and other drugs in the workplace. In fact, he said, no single approach to workplace substance abuse will meet the needs of every organisation.
Statistics from the Ministry of Health show that 11 percent of the national population have symptoms of alcohol abuse.

In TT, Remy said, all employers can do something about substance abuse to make their workplaces safer and more productive. However, he noted that because substance abuse tends to be a hidden problem, many organisations assume that there may be individuals in the workplace who have or are developing a problem with alcohol or other drugs. Remy said an often overlooked but equally important function of an education and awareness programme is assisting  the non-using worker, who may be directly or indirectly affected by the substance abuse of another. “No other institutional setting in our society can reach so many adults.” To be effective, he added, an education and awareness programme must be an on-going programme rather than a one-time effort. He suggested that as new employees are hired, they should be briefed on the substance abuse policy and made aware of the education and awareness programme. Current emp-loyees will benefit from reinforcement and new information through an ongoing effort. Activities that reinforce safe and healthful work behaviours and attitudes can be promoted to help members remain or become drug and alcohol free, he said.

Remy said employees can take the initiative to increase their knowledge about alcohol and other drugs and their effects. He spoke of “brown bag lunch meetings” in which parents can learn how to recognise signs of substance abuse among their children and invite discussions with local health resources that provide alcohol and other drug abuse treatment services. Remy noted that supervisors are the key players in implementing a substance abuse policy. “Top management must be sure that supervisors understand the policy, are able to explain it to the employees, and can take action where necessary.” He said supervisors have a legitimate right to initiate corrective actions when a worker’s performance begins to decline. “If it appears that personal problems — including the possibility of substance abuse — may be impacting performance, the use of constructive confrontation is one of the most effective ways known to get an employee to seek help. On Employee Assistance Programmes (EAPs), Remy said, this is a cost effective, job-based programme designed to help employees whose personal problems are affecting their work performance.
 
EAPs, he noted help identify and resolve employees’ problems by providing various forms of confidential short term counselling, referral and follow-up services. He said corporations are increasingly turning to employee assistance programmes to deal with employees’ substance abuse problems. He pointed out that there are over 10,000 EAPs in operation across the country. He said employers can start a drug-testing programme but this is not a simple process and advised top management to consult lawyers who know about drug-testing.

Some seven months after insurance giant, Sagicor, first offered more than 2,000,000 shares to investors, the Board of Directors of the Trinidad and Tobago Stock Exchange (TTSE) approved its application to have the shares cross-listed on the exchange. The company started trading on August 15. Sagicor now joins the growing number of regional companies which are listed on the local stock exchange. Industry sources say more regional companies are interested in having their shares cross listed on the TTSE. Of the 33 companies listed on the TTSE, about five of the local companies are cross listed in other exchanges. These include Trinidad Cement Limited (TCL) which is cross listed in Jamaica; Neal and Massy in Barbados; RBTT which is cross listed on the Barbados and Jamaica stock exchanges and debt ridden, national carrier BWIA is cross listed on the Barbados stock exchange.

But while few local companies are cross listed on other exchanges, many regional companies are expressing an interest in trading on the TTSE.
According to Brent Salvary, research analyst, Caribbean Money Market Brokers (CMMB) more companies outside of TT are interested in trading on the TTSE because shares trade at a higher price earnings (p/e) multiple ratio in TT than in other Caribbean countries, especially Jamaica.
Some of the companies which are cross listed on the TTSE include Barbados Shipping and Trading, Grace Kennedy, Jamaican Money Market Brokers (JMMB), FirstCaribbean Bank and now Sagicor. “We are not seeing many local companies being cross listed, but the opposite. Other companies in regional markets have expressed an interest in trading on the TTSE.”

He cited Capital and Credit Merchant Bank (CCMB) and Jamaica National Commercial Bank (JNCB) both of Jamaica as examples. He said both these companies hope to list on the TTSE soon. Salvary said some of these regional companies look at the performance of their counterparts on the TTSE and when their shares perform well, they expect that their shares will also do well. He noted that the shares of the two Jamaican companies which are listed on the TTSE, JMMB and Grace Kennedy performed very well, which might be an incentive for other companies. Salvary said in some markets, some shares trade at higher p/e multiples based on factors such as interest rates and the outlook of the economy. He explained that in TT where interest rates are low and the outlook of the economy is good, there is a higher p/e ratio for the shares of those companies listed on the TTSE than those listed on the Jamaican or Barbados stock exchanges. “So when a company cross lists it may trade at a higher p/e multiples than its home base, which is a good thing because they get a higher price for the shares.”

He added that there were three basic advantages of cross listing : with cross listing comes increased liquidity in terms of the amount of shares traded; arbitrage opportunities (same commodity being sold at different prices in different markets) and brand awareness which can be used as a marketing ploy. Additionally, he said the TTSE will receive some revenues based on the amount of trading done on the exchange. He said while there are no real disadvantages to cross listing, one obstacle in terms of Sagicor cross listing, might be the restrictions on the amount of shares one can have in order to avoid a possible take-over. The TTSE had previously refused to allow Sagicor shares to be cross listed as its listing requirements prohibited companies listed on the exchange from having restrictions in shareholding. The board’s approval came after their recent amendment of clause A2 of Schedule 4 of the Listing Requirements which now permits companies to be listed on the stock exchange with a restriction in shareholding of not less than 20 percent.

Asked whether more local companies should consider cross listing, Salvary said the eventual hope is that there will be one regional stock exchange where all companies will be listed on one exchange. “We are heading in that direction but it is going to take a while. There are many legal and other issues which must be addressed before that becomes a reality.” He said because many regional companies are interested in listing on the TTSE does not mean that the TT economy is performing well. “In fact it is just a signal that the trading culture is different in TT than in Jamaica and Barbados. We have a more developed trading culture which attracts companies to list here.” Another industry source, said when a company cross lists it provides them with a wider base for stock ownership. He said if the company were to limit itself to one exchange, it means that it only has one base of investment. However, he noted that if it lists in TT, Barbados and Jamaica like Grace Kennedy, it will have the entire Caribbean as its investment public. Additionally, he said if the company wants to raise capital like a rights issue, instead of limiting itself to one country, it has the entire Caribbean.

Salvary went on to say that there is no evidence to show that a company which cross lists performs better than one which limits itself to one exchange. He said sometimes when a company cross lists, the share price might go in an upward direction like in JMMB’s case. The industry source also highlighted a few disadvantages to cross listing. He said when a company wants to cross list, it has to meet the listing requirements of the different exchanges. He said when listing in TT, the TTSE asks for semi-annual financial reports, but in Jamaica and Barbados, companies are required to report quarterly. “So companies like RBTT which used to produce semi-annual reports, now have to produce quarterly reports. For big firms like these that is a lot of accounting work to do which is an added expense.” In addition, he said they also have to pay listing fees and other different costs for each territory they wish to enter. He said the companies also have to visit the different investment publics and inform investors of the performance of their shares.

A new proposed paddy agreement involving Guyana and Suriname would maintain their traditional market share for rice in Jamaica. Moreover, paddy sourced from within the region has to be discounted from the 65,000 metric tonnes import waiver granted to Jamaica. Meanwhile, US-based Archer Daniel Midland (ADM), the largest importer of rice into Jamaica and one of the largest grain traders worldwide, imported over 4,000 metric tonnes of white rice from Georgetown last month and Guyana is expected to export another 18,000 metric tonnes next month. The company is also interested in investing in Guyana. Minister of Foreign Trade and International Cooperation, Clement Rohee made these announcements at a recent press conference at Guyana’s Ministry of Foreign Affairs.

And inspite of complaints about the loss of the European rice market, Guyana Rice Development Board Chairman, Jagnarine Singh said that current demands are greater than local production at present. The new paddy agreement was reached at a meeting between the Ministers of Foreign Trade of Guyana, Jamaica and Suriname and their delegations at a meeting held in Kingston, Jamaica in early August. Guyana was represented by Rohee, Guyana Rice Development Board (GRDB) General Manager Jagnarine Singh and GRDB Marketing Manager Nigel Dharamlall. Suriname was represented by a seven-member delegation. Also represented were the CARICOM Secretariat and Jamaica. The meeting was in keeping with a mandate by the CARICOM Heads of Government at their last summit in Jamaica to resolve the issue of the agreement between Guyana and Jamaica to which Suriname had objected. The heads had mandated that the parties meet within a month’s time after the issue was raised by President Bharrat Jagdeo at the summit in Montego Bay in July.

The original paddy agreement signed between Jamaica and Guyana in February this year had allowed Jamaica to import 65,000 metric tonnes of paddy extra-regionally for a period up to 2010. The new agreement reduces that amount. According to Rohee, Guyana would maintain its 50% market share in Jamaica, while Suriname will also keep its share. A statement circulated by Rohee at the press conference said that the advantages of the new agreement for Guyana will be that this country’s share of the Jamaica rice market will be preserved; and in cases of excess paddy production, the opportunity exists for an export market. Further, it is likely a long-term relationship could be developed with the parent company of the rice mill in Jamaica, ADM; and there will be an end to Jamaica’s unlimited importation of paddy from extra-regional sources.

Angostura Holdings (AHL) produced some flat results in the six months ended June 30, 2003 when compared with the similar period in 2002.  Net turnover declined by 5.6 percent to $617.5 million in 2003 compared with the $654.1 million achieved in 2002.  Gross profit was 3.0 percent lower in 2003 at $228.2 million from the $235.2 million made in 2002. Operating profit declined by 49.2 percent in the first half of 2003 due to a 21.6 percent rise in operating expenses.  The likely cause being the “challenges of operating in the highly competitive worldwide market.” Finance costs rose to $47.3 million in 2003, an increase of 37.5 percent over the 2002 figure in the similar period of $34.4 million.  Investment income was 24.8 million in 2003 compared to the 2002 amount of $5.7 million.  There was also a $10.1 million gain on sale of investments in 2003, while in 2002 this figure was just $0.007 million. AHL’s profit before taxes dropped 50.7 percent to $21.7 million in the first half of 2003 when compared to the $44.0 million posted in 2002.  Profit attributable to shareholders though was 4.3 percent higher in 2003 at $20.9 million from the 2002 corresponding period amount of $20.1 million. 

The acquisition of Burn Stewart Distillers plc which was completed in the first quarter of 2003 was funded by debt raised by Angostura Limited, a wholly owned subsidiary of Angostura Holdings.  Burn Stewart has since been transferred out, and now falls under the umbrella of CL World Brands.  The operating results of Burn Stewart as a subsidiary were therefore not consolidated in the first half results of AHL in 2003. CL World Brands also holds a controlling interest in Angostura Holdings, with the latter operating as a “stand alone” company.  It is our understanding that CL World Brands meets interest payments on the debt incurred to finance the purchase of Burn Stewart. Looking at the numbers, AHL continues to struggle to become a global player as the decline in the operating margin in 2003 to 6.7 percent from the 2002 level of 12.5 percent attests.  The chairman has stated that AHL has incurred “substantial costs in the reorganisation of the group’s international marketing platforms.” 

In explaining the decline in net sales and profit before tax, the chairman stated that the loss of a large bottling contract by Todhunter International was the reason. An interim dividend of five cents per share has been declared, to be paid on September 26, 2003. 
Trinidad Publishing Com-pany Limited
Results for the Six Months ended June 30, 2003

Trinidad Publishing Company (TPC) posted some good results for the first half of 2003.  In 2003 turnover reached $42.5 million, up 3.5 percent when compared with the $41.1 million posted in the similar period in 2002.  Income before taxation and goodwill in 2003 was $7.6 million, up 46.0 percent in comparison with the $5.2 million made in 2002. Income after taxation rose 65.9 percent to $5.1 million in 2003, while the similar period in 2002 yielded $3.1 million. After tax profit more than doubled in 2003 to $2.2 million from the 2002 figure of $1.0 million.  The chairman attributed the success largely to the new “G-size” Guardian.  In fact, the new Guardian saw an increase in readership from September 2002 to May 2003.  The increase was mainly in the middle to middle-high income groups. In radio, TPC maintained its market share, holding on to its number two position in all segments. 

The Chairman has pointed to “several new strategic initiatives” under evaluation and a new radio station may be one option.  The attractiveness of this option is that most if not all the infrastructure is already in place.  So this would be the strategy requiring the least capital outlay.  Also on the cards, are the options of commercial printing and acquiring a television station. 

These options would require some capital outlay.  On the side of the commercial printing, TPC has identified it as a $436 million per year industry.  Currently, TPC performs pre-press work for commercial printing jobs, and a foray into this field would seem a logical extension of its current product offering. Earnings per share for the first half of 2003 reached 13 cents, an improvement of 62.5 per cent over the eight cents achieved in the same period in 2002.  An interim dividend of seven cents per share to ordinary shareholders has been declared.  The second half is TPC’s better half by far, and a full-year EPS of 40 cents may not be beyond the company. Accordingly, we cite this as our forecast, together with a dividend payout of 25 cents per share. At the current level of $4.60 and the forward PE of 11.5, we would recommend this share as a buy for medium to long-term investors. Analysis by West Indies Stockbrokers Limited. Member of the Trinidad and Tobago Stock Exchange Ltd.

TSTT has been awarded the Caribbean Region prize for the highest sales growth from a leading international business communications company. The Canada-based MITEL Networks Corporation (MITEL) announced the award to TSTT based on TSTT’s 2003 performance. MITEL is one of the suppliers of PABX and Voice Over Internet Protocol (VOIP) systems used by TSTT to develop communications solutions for local businesses. Paul Alfano, MITEL’s Regional Sales Manager presented the award to TSTT during a recent visit to Trinidad. Alfano added his congratulations to TSTT’s staff for achieving this significant level of performance in the very competitive Caribbean region.

TSTT’s CEO Samuel Martin noted that the MITEL communications systems were an important part to TSTT providing businesses in Trinidad and Tobago with competitive, reliable and high quality services. “TSTT strives to help local businesses enhance their profitability through the use of state-of-the-art communications solutions. MITEL shares this vision with us and has been very supportive of our strategies to reach more business customers.” The MITEL Networks Corp-oration presents similar awards annually for companies operating in US, Canada and Europe. Last year the Sales Growth award was won by Cable and Wireless – Cayman Islands.