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ABSTRACT BUSINESS
LOCAL BUSINESS
Decentralization Effort Requires Attitude Adjustment Written by Shera Diaz
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entral and South have become the center of relocation for Government offices. The decentralization of these offices to buildings owned by the state is an initiative taken by the Minister of Planning, Bhoendradatt Tewarie. The availability of land and reserves to relocate different ministries is also currently on the agenda. From 2002 to 2011, Mr. Tewarie revealed, the Ministry of Science, Technology and Tertiary Education which was located at the corner of Agna and Patna Street, St James, paid a total of $41,046,497 in rent. This is just one rental fee paid by the state, among several other government offices. Relocation of offices can save taxpayers millions as the offices will now be owned and not rented by the state. Apart from the financial benefits, housing the departments of one ministry under one roof, was another way the government looked at decen-
The Minister stands firm that rationalization of ministries should lead to increased efficiency, as well as convenience to the public tralizing. The Government Printery is an example and has already been relocated to its new home at 55-57 e-Teck Park. The Minister of Public Utilities, Nizam Baksh says the relocation will allow the Government printery to improve production and efficiency and ultimately serve the citizens. The Minister stands firm that rationalization of ministries should lead to increased efficiency, as well as convenience to the public. Statistics shows that the Ministry of Legal Affairs made a giant step towards decentralization with the establishment of 14 electronic registration centers. This has considerably reduced the waiting time for obtaining births and deaths certificates from between 3-6 months after registration to mere min-
utes after registration. Some say commuters are against the traffic coming into south and central. Just as Port of Spain, the same applies, the long hours on the road will now be shifted from Port of Spain to Central and South. Travelling to Central and South Trinidad may require a mentality adjustment for commuters residing in the eastwest corridor. Port of Spain being the Capital City, the relocation of these offices would require an effective traffic management system. Speaking at a post-Cabinet news conference, Foreign Affairs and Communications Minister, Dr. Surujrattan Rambachan, stressed that this move was in fulfillment of Government’s pledge to make services more easily available
to the population, by taking them out of Port of Spain. He explains that the movement of government agencies out of Port of Spain sets into motion the development of rural communities, providing jobs in those communities and towns. He said it will also reduce traffic congestion and will improve the quality of life. He went on to say with people being able to access their work spaces in a shorter and quicker time, some of the stresses that lead to health problems would be reduced. In a reply to Minister Rambachan, the Opposition MP Amery Browne stated that there is a “serious” traffic problem nationwide; decentralisation would only “assist, but not cure the situation.” Central and South Trinidad is not as building saturated as Port of Spain and the population density may vary, but does this relocation means easy access to the offices? Until it is done no one will truly know the outcome.
www.amgtt.com • MAY, 2014 • ABSTRACT BUSINESS
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ABSTRACT BUSINESS GUIDE
LOCAL BUSINESS
Businesses Leaning Toward Investment Instead Of Sponsorship For Local Talent
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Written by Alicia Martin
or a population of approximately only 1.4 million, Trinidad and Tobago boasts immense talent. We have produced world-class entertainers, athletes and beauty queens who have been able to attain golden status and crowning glory on international stages. Dating back to 1977 when Janelle Penny Commissiong captured the hearts of the world to become the first black woman to win the Miss Universe pageant and 1976 when Hasley Crawford blazed his way to bag the first Olympic gold for the Caribbean in 100m, our country has continued to compare quite favorably to other world talents. We have also benefited from a legacy of great musicians such as Lord Kitchener, the Mighty Sparrow to more recent cultural ambassadors such as Bunji Garlin, Machel Montano and Kees Dieffenthaller. There is no question therefore that there is immense treasure to be found within our shores, regardless of the talent category. Unfortunately though, much of our talented sons and daughters only become the beneficiary of much needed corporate sponsorship after they have become successful making their road to success tortured and tedious. Funding is critical. For instance as good as an athlete might be, he/she requires particular supplements, training gear, financing to attend regional and international meets as well as a particular meal plan. Pageant contestants similarly need financial assistance to facilitate the upkeep of their public ap2
pearances, speech training and travel where necessary, just to name a few relevant areas. Indeed without the appropriate tools some may not scrape the surface of their inherent potential. It is within the best interest of all stakeholders to determine how to better equip our future stars because when they shine the best parts of Trinidad and Tobago are also illuminated. Theories and strategies to secure corporate funding should therefore be common knowledge for relevant appropriation by those bodies involved. According to Richard Young, Regional Creative Director and Production Designer, there has been an entire shift in terms of the definition of corporate social responsibility, “you have to make a sponsor a partner… you have to assure them that there will be a return on investment.” This means that the very way in which the corporation is approached needs to be tailored in such a way to ensure that they understand how their investment will be an enhancement to their image and profile in tangible ways, “… it must be quantified incrementally.” He added that it might be a good idea for a pageant contestant to investigate the company they are approaching to ascertain for instance their mission statement and align their needs as much as possible to the company’s goals, proving how their investment in the delegate can bring the company closer to attaining those goals. Even the use of the term sponsor as opposed to partner is instructive as a sponsor gives
ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
money and then cuts ties while a partner becomes more committed in the work of the talent and in the investment of the brand. The latter arrangement is beneficial to both parties, as the talent can become somewhat of a brand ambassador. Mr. Young therefore states that corporate funding, “has less to do with how talented you are and it has to do more with how your talent can promote their profile/public image … there is a lot more responsibility on the talent to sell themselves to the partner.” Sheldon Scipio, Chairman & CEO at Mercuri Caribbean Ltd, has proffered a similar view; calling for a greater emphasis to be placed on investment as opposed to sponsorship, “there is a great difference between a sponsorship and an investment. Sponsorship is giving away money, investment is putting money to work … I can sponsor a young athlete, meaning I give him/her money for clothing, travel to the event, food etc for the year 2014… sponsorship done.” On the other hand an investment would require the athlete to become involved in a projected marketing plan which may for instance require further spending on the athlete to develop their appearance and public speaking skills so as to facilitate the athlete to make public appearances on behalf of the company. In this way the company benefits not only from the athlete’s appearances at track meets but “…in the plan social media, billboards, quotes, etc. are made for the athlete … my company can now see returns on investment.” CEO of TnT Elite Sport Ltd, a company involved in athlete management notes that corporations consider W.I.F.M – What’s In It For Me? Those interested in marketing upcoming athletes
must be cognizant of that fact. For athletics in particular he suggests that companies should be continually updated with the backgrounds and progress of rising stars from early in the athlete’s career so that they can identify the potential in the athlete to be for instance the next Michael Johnson. He notes that while it is easier for the government to become involved in that particular sport because of all the government sponsored meets, there needs to be a special effort to engage corporate attention. Also, according to Roach corporations need to see their assistance as a form of social development, “I don’t think that corporations are unwilling to spend but sporting organizations need to spend more time on selling the benefits to them and showing them how they can also change someone’s lives.” Consequentially it becomes imperative for those seeking to partner with corporate entities to present to the organizations more than just what will be gained by the talent. Using the example of one of the world’s greatest basketballers, Mr. Scipio noted that, “Nike doesn't give money to Lebron for nothing, Lebron sells the brand, it is a win-win. Present a package on the athlete, showing past, present and a forecast of the future, then show why affiliation with the athlete is a great idea, show what the company gains, how it can use the image of the athlete …” As stated earlier when our talents are allowed to realize their true potential the entire country soars. For this essential reason the business of corporate sponsorship needs to be understood. In this regard it might be a good idea for stakeholders to come together to exchange ideas and develop expertise.
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ABSTRACT BUSINESS GUIDE
LOCAL BUSINESS
SECURING OUR BORDERS WITH BUSINESS IN MIND
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Written by Leah Lewis
rinidad and Tobago has become the host country or second home, for many Caribbean nationals as well as international persons. In the last few years, many have made their way here to study, visit family, gain employment or vacation, only, it has never ended and they have now set up permanent residence. Caribbean and international visitors have become business connoisseurs operating vending booths along our roadways or full-fledged business operations. This raises the issue of whether these individuals possess the necessary documents to do business on our shores and if not, are our borders properly secured? Many of the small streetside businesses, along with several small business enterprises in downtown Port of Spain and environs are not owned by nationals. Although the law dictates that a business may be owned by foreigners, it must be managed by a local. A walk along Charlotte Street reveals several variety stores and groceries owned by Chinese nationals along with clothing
stores operated by other Caribbean nationals. Are they all legally certified to seek employment? Several of the aforementioned are in fact covered by law to operate within our borders, while others engage in what is known as informal labour. This pertains to the ‘market-based production of goods and services, whether legal or illegal, that escapes detection in the official estimates of GDP’. Some unknowingly have been brought here by relatives and have no understanding of our language or our laws and so may by extension be unaware of our laws. However, ignorance is not an excuse to exempt one from the law’s recourse. On the other hand, several Caribbean nationals are fully aware of our laws yet do not possess permits and operate illegally to evade taxes. So how do we control this phenomenon that by extension can also fuel crime levels within our country? This is where border control becomes imperative. According to National Security Minister, Gary Griffith, the protection of this country’s borders is being undertaken in a joint col-
Caribbean and international visitors have become business connoisseurs operating vending booths along our roadways or full-fledged business operations. This raises the issue of whether these individuals possess the necessary documents to do business on our shores and if not, are our borders properly secured? 4
ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
laborative effort involving the Coast Guard, Air Guard, the National Operations Centre (NOC) and its Air Division and radar. This unit is responsible for securing our borders and coastlines from the transshipment of illegal drugs, arms and ammunition and the crime of piracy. Minister Gary Griffith, has announced that policies aimed at protecting Trinidad and Tobago’s borders, particularly the Gulf of Paria, are to be implemented in a month's time. Minister Griffith was commenting on an indictment in a US court, which pointed
to Trinidad and Tobago being a bridge between the Middle East, South America and the United States for transporting narcotics and weapons into the US. It also unveiled a plan whereby Hezbollah agents would get to the United States by passing through Trinidad. Minister Griffith outlined two different concepts for protecting the country's borders. These would involve the prevention of illegal entry of guns and drugs through illegal ports and enhancing security at authorised ports whether land or sea.
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ABSTRACT BUSINESS
EYE ON FDI
FDI in T&T: THE MOST PROMISING INVESTMENTS YET
O
ver the period 20032012, Latin America and the Caribbean region sustained an average GDP growth rate of 4%, while increasing its global slice of the FDI pie by 6.7% in 2012. Over the next 5 years, projected growth rates of 3-4% are expected, paving the way for a further influx of investment flows. Trinidad and Tobago has earned the title of being an ideal FDI location. This is due to its 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. According to figures from the World Investment Report 2013 released by the United Nations Conference on Trade and Development (UNCTAD), FDI coming into T&T grew by 38% between 2011 and 2012, totaling US$2.527 billion, the highest since 2008 when RBC of Canada re-acquired RBTT for US$2.2 billion. In 2013/2014, five sectors within the T&T economy have been earmarked as the most lucrative opportunities for FDI. Downstream Energy: T&T is already a major player in downstream manufacturing, as the largest global producer of methanol and ammonia. The National Energy Corporation of T&T is seeking partners to commercially explore the untapped niche manufacturing business, finding new ways to use hydrocarbon reserves. The
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Written by Crystal Cassie
is already operational. New projects include the construction of a US$124 million, 200room luxury resort on Rocky Point that already has been earmarked as a preferred destination for European visitors and the development of Chaguaramas as a yachting hub and ecotourism site, with a hotel, marina and golf course. This area attracted over 1000 vessels in 2012.
T&T boasts of having sites that are energy efficient, low cost and sound in infrastructure, with attractive incentives and tax exemptions for investors Ministry of Energy and Energy Affairs is hoping for FDI that will fuel melamine moulding production to produce and export melamine derivatives such as dinnerware, adhesives, laminates and coatings. These items are in high demand and are complementary to product manufacturing for the agricultural, construction, electronics and automotive industries. Data Centers and Business Process Outsourcing: T&T boasts of having sites that are energy efficient, low cost and sound in infrastructure, with attractive incentives and tax exemptions for investors. For example, the Tamana Intech Park is a light, 20-lot eco-industrial area to be utilized for high-value manufacture, ICT and agro-industry. In terms of BPO potential, T&T is apt for
ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
data creation and service-based industries like telemarketing, contact centers and help-desks. Experts base this potential on the fact that university graduates in engineering, ICT, and business management can provide a capable and educated employee base of 5,000 to 6,000 for BPOs. Tourism: T&T revised its Tourism Development Act to provide tax incentives to owners and operators of approved tourism projects, as global trends indicate that there is a new need for investment in high-profile activities like touring. FDI is also being sought for three large scale hotel developments, in Tobago and Chaguaramas. The five-star Magdalena Grand in Tobago, a 200-room beachfront property with an 18-hole golf course and a spa
Agribusiness: The Ministry of Food Production, Land and Marine Affairs has provided guidelines for agriculture and agribusiness investment. Promoting T&T as an economy with arable land and warm climate, it is suitable for investment in cocoa, honey, rice, sweet potato, fruits, vegetable and livestock. Increased output from this declining sector can be used to ensure food security, reducing the US $4billion annual imported food bill and exporting to the wider Caribbean region. Film and Animation: This relatively new, creative industry in T&T promises a significant rate of return on investment, given its growing global value as a sector. Successful animation and film festivals over the years have attracted international investment and cultural activities such as Carnival has provided powerful story material. The T&T Film Company offers rebate incentives for small to medium-sized filmmakers; as in 2012, the movie Home Again was produced. The T&T government is also seeking investors to partner for the construction of a 50 to 60-seater animation studio.
ABSTRACT BUSINESS GUIDE
BIZ HEALTH
Education Or Experience? Written by Rhoshenda Ellis
E
very year, thousands of graduates from tertiary level institutions enter the workforce and after months of ‘pounding the pavement’ are not able to find a job. Most employers complain that these graduates are very qualified but lack the experience for the position. As a result, these graduates either go away to find a job, become unemployed or even underemployed. Mr. Avinash Ramsubhag, a former employer at a very prestigious firm, gave his opinion on whether education or experience was the deciding factor when hiring an employee. “Experience is what I always look for,” he responded almost immediately when as the question of education or experience. He then went on to explain that in the Trinidad and Tobago business environment, firms often pay based on qualification. The more qualifications you have, the more money you earn. However, having these qualifications do not earn you the job. Avinash said that often, persons are very qualified but lack the ability to apply their knowledge, “Experience shows me that the person is able to apply their knowledge and adapt to different situations. This is why I will always choose experience.”
It is understood that experience does have its advantages. However, why would an employer not choose someone based on education? Avinash was able to explain this dilemma and discuss the impact an inexperienced person can have in a workplace. “Businesses do not want graduates with first class honours anymore,” he stated. He went on to explain his statement by saying that persons graduating with first class honours are often overachievers and are accustomed to perfection. When this individual becomes employed, they tend to be inflexible and are not able to take criticism. “Businesses tend to prefer employees who apply for a position with a second class honour since they tend to be more flexible and more all-rounded,” he explained. However, there are some employers who have hired employees with no experience. Given the evidence that shows that experience is the preferred option, why would they decide to go against the status quo? “Some employers see the potential in employees that come in with no experience. Some employers see the gains from taking such a risk,” Avinash explained. Employers see the promise in new employees and hire them based on that reason.
Businesses tend to prefer employees who apply for a position with a second class honour since they tend to be more flexible and more all-rounded 8
ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
Don’t be mistaken; it is not a favour the employer is doing since the applicant is qualified for the position. Therefore, the same is expected of this employee as with any other. Considering the fact that employers prefer experience to get a job, how does one get experience without a job? Avinash had a suggestion, “Internships!” While studying, students must understand the importance of internships. It has been proven that students, who spend their vacation working at a small firm for free or for a salary, tend to get a better job upon completion of their studies. Universities are also seeing the importance of internships and are beginning to design courses and degrees that include a semester as an
intern. This is how a student coming out of a graduate program would be able to get a job with experience. In the end, the evidence shows that employers prefer experience. This is because experience shows that employees are able to apply the knowledge that they possess to do the job. Applicants that lack the experience tend to be less flexible and are not able to take criticism. However, some employers take the leap of faith because they see the potential in the employee who may lack experience. Also, the classic argument that students need experience to be employed but need to be employed to gain experience can be resolved by doing internships during their studies.
ABSTRACT BUSINESS GUIDE
BIZ HEALTH
Are We Adequately Dealing With White-collar Crime?
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re there separate laws for the rich and the poor? What is the relationship between class and crime? Are some crimes invisible? Are some crimes victimless? These are some of the questions, which are associated with the phenomenon known as white-collar crime, first identified by Sociologist, Edwin Sutherland in 1949. Sutherland described the brand as “a crime committed by a person of respectability and high social status in the course of his occupation." According to David Fredrichs (1996) “white collar crime is a generic term for the whole range of illegal, prohibited and demonstrably harmful activities involving a violation of a private or public trust, committed by institutions and individuals occupying a legitimate, respectable status, and directed toward financial advantage or the maintenance and extension of power and privilege.” Blue-collar crimes involving members of the lower classes are characteristically committed against individuals and include larceny, murder and assault. More specifically whitecollar crimes include various forms of corruption, misrepresentation in advertising, the breaking of food and drug laws,
identity theft, bribery, insider trading, forgery, embezzlement, copyright infringement and money laundering. One common form of this type of crime, which has come under public scrutiny within recent years, is the provision of ‘kick-backs’ to secure contracts by established companies. Generally most capitalist societies tend to focus more on blue-collar crime. Related criminals are more swiftly arrested and are also the recipients of more severe punishments. According to Haralambos, Holborn and Heald (2000) whitecollar crimes are sometimes more difficult to detect. Furthermore governments tend to lack the personnel and finances to detect and prosecute perpetrators. The close relationship between perpetrators and lawmakers often makes the process of punishment an even more complicated task. Often times various commissions are appointed to deal with the crimes and the review processes tend to be quite lengthy with minimal punishments being executed in the final analysis. As noted by Sutherland, when it comes to white-collar crime there “is a consistent bias involved in the administration of criminal justice under laws which apply to business and the professions
One common form of this type of crime, which has come under public scrutiny within recent years, is the provision of ‘kick-backs’ to secure contracts by established companies
and which therefore involve only the upper socio-economic group.” So why aren’t white-collar criminals legally pursued in the same way as blue-collar criminals in our country. The issue of separate laws for the rich and poor is not unique to Trinidad and Tobago but it is nevertheless directly related to our nation’s colonial history. We live in a hierarchical society and the persons who make the laws ... the persons who have the power to do so … tend to come from the upper classes. As a result the law tends to favor the upper class and lawbreakers from within that class tend to suffer less grave fates, as members of their own class do not vigorously pursue them. According to Dr. Dylan Kerrigan, lecturer in Anthropology and Political Sociology at the University of the West Indies, St. Augustine our country is not doing enough to treat with the issue of white-collar crime. According to him, “… we have an entrenched blind spot and structural reality that means elites and those accused of white-collar crimes are in the main ignored. Those who suffer greatest from the law are low-level blue-collar criminals. This is evidence of class warfare locally that was entrenched in our system from before Independence and into the present.” He further identified the role of the media in ensuring that there is more national focus on bluecollar crime, stating that “…media propaganda and sensationalism about street crime versus
white collar crime is pushed by those who own the media, this creates a false narrative.” According to an Express report dated February 20, 2014, 1,115 suspicious transaction reports were made to the Financial Intelligence Unit (FIU) between 2011 and 2014 in Trinidad and Tobago but no investigations, arrests or convictions ensued. It has been argued that there is a lack of legal framework and trained personnel to pursue such crimes. This issue was raised by anti-money laundering expert David West at a seminar on white-collar crime, which was held in Trinidad and Tobago in 2014. According to the Trinidad and Tobago Chamber of Commerce website there are four areas of white-collar crime which require attention and these are “revenue collection, customs and excise, procurement contracts and corporate malfeasance.” While some believe that the victims of whitecollar crime are invisible, it is argued that this is not the case. In fact this type of crime results in greater inequality between the rich and poor sectors of the society, the withholding of the rights and privileges to a certain standard of living to all and even more critically, a reduction in direct foreign investment. Additionally it has been debated, though insufficiently studied, that white-collar crimes often filter down into violent crimes and this should be of major concern given the upsurge of crime in Trinidad and Tobago in general.
www.amgtt.com • MAY, 2014 • ABSTRACT BUSINESS
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ABSTRACT BUSINESS GUIDE
BIZ HEALTH
The Safety Of Financial Institutions Being Called Into Question
M
Written by Daniela Nandlal
any years ago the ultimate savings account in most Caribbean countries included a foam mattress and money to be stored. It allowed instant access to funds; no long lines and most important no one knew how much money you really owned, unless someone broke into your house. Fast forwarding to the 21st century, we are now surrounded by institutions that are more than willing to safely store our monies in what they describe as secured systems. They are also constantly evolving to facilitate and meet their customers’ needs and demands. Some of the most recent services that have been added to their line of business are online banking and ‘Fast deposits.’ However with the recent robberies at the ATMs and stock improprieties, are people starting to become distrustful of the banks? Speaking with an employee at one of the popular banking institutions, he admitted that he did not notice a significant decline in customers. He further went on to say that the ATM robberies were not a result of failing banking procedures but rather he believed it said something about society and the justice system within
Trinidad and Tobago. Senior accountant at a local quality assurance firm shared the same sentiment. “In my opinion crime is at an all time high and persons should secure their funds. Whether it’s salaries or suppliers we need to pay, we do so using non-cash transactions, which are either direct deposits or cheques and I urge others to adopt this same method.” When asked what his thoughts were on the allegations against Phillip Rahaman, which occurred earlier this year he responded; “most people are opting to cut corners in an effort to get ahead. Thankfully the auditors were able to identify the problem and investigated the matter. This just goes to show that the banks have processes in place to ensure they are adhered to.” Employees at various organizations also prefer noncash transactions and insist on having their salaries deposited into their accounts. They admitted that it helps them to obtain good credit with the banks and therefore allows them to qualify for loans and other banking services offered. They view the bank as a necessity. However not everyone is of that opinion. Some are of the the belief that while the banks’ intentions are good, some staff
Some are of the the belief that while the banks’ intentions are good, some staff members are exposing confidential information and this is leading to financial crimes 10 ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
members are exposing confidential information and this is leading to financial crimes. A retired officer from the Trinidad and Tobago Police Service also agrees that many of the crimes happening in the financial sector are a result of abuse of information. “Robberies like that don’t just occur overnight. They take months of planning and insider information in order to successfully pull off such a hideous crime.” Others believe it’s a lack of concern. General manager at a well-known Marina stated that he does not trust the banks at all. “I don’t think they are concerned about securing our money. They take no responsibility for fraud, which I have a huge problem with. Banking is competitive and to a degree eve-
ryone needs a bank so they take it for granted that they can get away with their lack of concern for their customers. Furthermore after the CLICO fiasco, although that is not transactional banking, I have lost the little faith I had left.” Our research indicated that almost all banks already have procedures implemented to prevent ‘insider jobs’ and manage accountability. However as with most things, there are loopholes in the system and this can result in collusion occurring. It appears that the once perfect marriage between the bank and some of its customers is now facing issues of trust and by the looks of things, glossy posters and high quality advertisements are not the solutions to the problem.
ABSTRACT BUSINESS GUIDE
MONEY MATTERS
POOR MAINTENANCE COSTING BIG
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ver the last few years several construction projects have been undertaken throughout Trinidad and Tobago. There have been major construction projects that have in fact been completed while several remain ongoing. In the past completed projects entail: Knowsley Residence Restoration, National Academy For the Performing Arts ( North & South), Office of The Prime Minister, International Waterfront Centre and the New Breakfast Shed to name a few. However, several remain outstanding such as the Government Campus Plaza, The Ministry of Education Tower and the refurbishment of Stollmeyer’s Castle. Outside of those buildings aforementioned, we also have locations such as the Red House, Biche High School, Tarouba Stadium and One Alexander Place that have experienced grave deterioration or remain unoccupied for a bevy of reasons. The case of One Alexandra Place was recently highlighted by Local Government Minister Marlene Coudray. According to Minister Coudray, government is expected to continue paying rent for the controversial building at 1 Alexandra Street, Port-of-Spain, at least until No-
vember. The building remains unoccupied while the rental agreement on the building has been in place since 2009 under the previous administration. Since 2010, Government has been paying $8.2 million annually in rent, at $690,000 a month, for the empty building in addition to $927,360 a year for security. If the lease is honoured to its end, Government will have to pay approximately $6.2 million for the period up to November. Completed buildings also face issues of deterioration. One such building is the National Academy for the Performing Arts. Arts Minister Lincoln Douglas has stated that the two performing arts centers are in need of repair as a result of low-grade inferior materials and bad workmanship in the original construction. Douglas said certain repairs for the Portof-Spain facility have cost $20 million so far and it would cost almost $100 million to make it fully functional. The Minister said the contractor who built the facility in Port-of-Spain was Shanghai Construction and although there was an agreement with the original contractor over a certain period it has now expired. Various items, which needed to be replaced have to be sourced from China, three
Arts Minister Lincoln Douglas has stated that the two performing arts centers are in need of repair as a result of low-grade inferior materials and bad workmanship in the original construction 12 ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
months away in terms of ordering and shipping, and therefore light bulbs, for instance, take three months to change. According to a source at UDECOTT, they are only contractually bound to maintain certain buildings under their preview upon completion, after which, the maintenance is handed over to the company. Surprisingly we do in fact have an agency dedicated to providing some level of maintenance. The Property and Real Estate Services Division (PRESD) is
mainly responsible for the provision of office accommodation and maintenance for Government Ministries and Agencies and to a lesser extent, residential accommodation. Whether it’s inferior building materials used in the initial construction phase or poor maintenance it’s obvious that the end result is millions of dollars in revenue lost in repair. All of these issuses amount ot millions in maintence fees for the government of Trinidad and Tobago.
ABSTRACT BUSINESS GUIDE
TRUMP CARD
IAN PANTIN
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nyone with a vested interest in local entertainment would know about Ian Pantin. He is one of the most renowned entertainment managers in Trinidad and Tobago’s history and his work is responsible for the success of some of the country’s biggest stars. Pantin also played a significant part in reviving the local film industry and now he looks forward to expanding his forte with some innovative business ideas. ABG: Tell us something about yourself. IP: I’m big on Day dreaming; I will switch off from time to time in meetings and travel into a world of my own. This all started from an early age, during sporting activities in my community, whether I was running, playing cricket, football or table tennis I would nod off for a brief moment and dream that I was representing my country. Listening to music and going to movies were no different; I would see myself as a star in most everything. Over time I slowly realized that I was never really that good. So in my adult life I began focusing more on the ancillary services I could provide behind the scenes. ABG: What is something people tend not to know about you? IP: I’m a treasure trove of ideas, mostly good, mixed in with a few disappointing ones. I’m always willing to invest in them despite the odds. What people don’t real-
ize is that I sometimes path them onto others with out the desire for monetary returns and other times I do the same without their acknowledgement or realization. I see them benefit from it and I feel proud for them. ABG: What made you decide to start IP Music International Inc.? IP: IP Music by the way stands for Ian Pantin Music. The idea for a Music Management label sprung from an invitation extended by my brother to accompany him on a mini tour of Alberta Canada. Luke was the lead singer and keyboardist of a Latin band named Risasa in Edmonton Canada. He took me with him on a bus tour of several cities nearing the Alaskan border. I was astonished with his success and organizational skills for managing tours. When I got back to Trinidad I did some research found there was a market, called him for a few tips and then started the search for young and undiscovered talent and now the rest is history. ABG: When was IP Music International Inc. founded? IP: The company was founded on May 3rd 1997; I signed KMC a few months later and sent him to Jamaica with Wayne Bowman (his tour manager at the time) for a few months to record and to learn more about structuring music. The following year we released his first Album Soca Bashment. It became an immediate Success. Later that year I signed Bunji Garlin.
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ABG: What were some of the challenges you faced in the early stage? IP: The artistes I represented were involved in a new genre of music, namely, “Ragga Soca”. Their avenues and opportunities were hindered by the initial lack of acceptance. It took some skillful marketing and innovate negotiating to get the industry powers to listen and take heed. Now, the then Black sheep of the Soca Industry are international recording label artistes. KMC is signed to Red One in collaboration with Universal Records in Sweden and Bunji Garlin to Play On in France for Continental Europe and VP Records for the rest of the world. ABG: Prior to founding IP Music International Inc. what was your profession? IP: Though I knew little at the time about computers, I was the major shareholder of four entities, 21st Century Computers Inc in Miami Florida and in Guyana. CECP Ltd and Computer Book Stop here in Trinidad. All built from the ground up by yours truly. ABG: What are some of the current projects you are working on? IP: It’s another one of my crazy ideas, my heart is very much into film these days, so coming soon look out for the Caribbean Movie Network “CMN” A cable channel dedicated to films produced in the Caribbean by Caribbean and international film producers. I am partnering with Peter C Lewis and Michael Richards on this. Also look out for the Film “Welcome to Warlock” written, directed and produced by Jeffrey Alleyne. There are many young and talented producers in the industry, but the avenues are very limited, that’s why the success of CMN will be key to the industry’s growth. ABG: Upcoming events for Lexo TV and IP Music International Inc.? IP: There is a lot happening with Lexo TV. I’m Santana the movie proved to be a success story, I’m thankful to God for introducing me to Roger Alexis. He is an abundance of talent. The Station has grown to over 15.5 million views on YouTube with over
52,000 subscribers and we are present in 162 countries. Roger and I continue to foster an avenue of a careful and controlled expansion. Production begins soon on I’m Santana the movie part 2. We are also expanding our network of young and talented film producers. I have also set up an International theatre and hosting tour for the Santana series of characters in other Caribbean island and in North America. The tour kicks off on May 24th in Orlando. As for IP Music, unfortunately I had to severe ties with Patrice Roberts my latest signing. It did not work out between us. I wish her all the best. She is a talented singer and will continue to do well. I am working on a shortlist of future talent, hopefully you should hear of another announcement soon. ABG: Do you think Santana changed society’s perceptions about the local film industry? IP: I definitely think so. Just look at Lisa Wickham’s success with the movie Home Again in Cinemas a year after. It has given young producers a benchmark to get their movies into local and Caribbean Cinemas. The norm prior to I’m Santana the movie was to have your movie accepted under the umbrella of The Trinidad and Tobago Film Festival usually held at Movie Towne for just 2 weeks. We defied that by creating a product by popular demand. I’m Santana the movie showed for 8 consecutive weeks to sell out audiences in cinemas through out the length and breath of Trinidad and Tobago. That success transcended up the Caribbean, North America and England amongst the Diaspora. I get calls from local film producers inquiring into the marketing success, others will follow I’m sure. ABG: How did your partnership with Lexo TV happen? IP: Being in the right place and timing has a lot to do with success. Networking can be key in making good business decisions. What is for you is for you. Simply put, God will open doors when you least expect it. I was planning Fay-Ann’s Soca monarch performance a few years ago and I was looking then at doing
ABSTRACT BUSINESS
TRUMP CARD an on screen video introduction. Whilst liming by a bar with Problem Child we were sharing laughs about the funny side of a new Internet puppet sitcom titled Santana and I thought “hmmm”. So I called Roger, we met, and he was awarded the project to do the video introduction. Working with him on the video presentation was so inspiring that when the project was over, I gave him my card with a note: call me if you should ever need my help. Three months later he called and asked if I would consider partnering with him at Lexo TV. ABG: Can you share one of your personal triumphs? IP: Triumph and endeavors? Hmm, well there is this one thing, for most of my early adult life that got the better of me, the fear of flying. That hindered my ability to move forward in life, my job required me to fly weekly. I needed to face this head on, otherwise that would not be the job for me. My first step was to take a few drinks of alcohol before I set foot on the plane and then during flight. Over time I drank a lot less. Now I don’t have to drink to fly anymore. ABG: What are some of your current obstacles? IP: When I become passionate about an idea, I generally move forward with planning and implementation like a Usain Bolt on steroids. Sometimes I’m a bit ahead of others as my sense of growing a business kicks in, and an artiste may not immediately understand the philosophy, so that can be frustrating. Artistes sometimes equate their creative talent to the success in their careers. That’s only partially true, their creative talent, combined with dedication, hard work, and an ear to listening, learning and working with an experienced manager would be a more holistic approach. Remember, creative talent does not equal good business acumen. I won’t be surprised if other artiste managers had similar experiences. ABG: How do you network?
IP: Fortunately via my travels I have been lucky enough to build a global database of relevant parties over the past 16 years and with the advent of social media the network continues to grow. I also attend seminars and entertainment conventions. ABG: What advice would you give to someone trying to enter the entertainment or film industry? IP: I will start with film first. I see my self as a student, so I am learning as I go along. Currently the industry lags behind other entertainment sectors by perhaps a decade. But there are some positives and growth, so within a few years the industry can explode. I would recommend that they first write a good script, get it vetted by an experienced producer make the necessary changes, then create budgets for production and marketing of the movie. Apply to the Trinidad and Tobago film company for funding. Use whatever is granted to create a trailer, use the trailer to raise financing to complete the movie. Once you have done that you are halfway there. Next comes the equally hard part of marketing the movie to distributors and cinemas. With respect to artistes, a star is just the finished product of hard work and sacrifice made by a talented artiste. Analyze yourself, you may have the talent, many of us do. You may have the love, many of us do. But do you have the passion and insatiable desire for success? How much are you willing to sacrifice in order to become a star. Will you quit your day job or end a relationship or go hungry for years on end? If the answer is yes, then you are on step one. Next, get an honest evaluation from an expert, not your friends. The answer you get you most likely will not like, so be guided by that voice from within you. Read a book, you can Google books on how to become a successful entertainer and the professional singer handbook. Let them be your entertainment bible. Thereafter find you a good manager not a booking agent. There is a
big difference. ABG: What are some of the challenges the entertainment industry is facing? IP: The model for creating a hit has changed. It takes more than a great song or a great movie to get the attention of record labels and distributors. It’s very much a numbers game out there. Record labels and distributors of today are firstly interested in the numbers of views, likes and followers on social media. Finding good marketing initiatives to grow them are essential. ABG: What/if any changes you would like to introduce to the local film and entertainment industry? IP: Access to finance is a major stumbling block for up and coming entertainers and the government coffers are limited. Even though the government has great incentive programs via the Trinidad And Tobago Film Company as well as prizes at Soca Monarch etc. I think the government should also look into setting up a system that quantifies the foreign exchange benefits that the country earns from Entertainment and commit a percentage of that specifically for grants and other types of funding to young artistes, in music, theartre and film, pan etc. A portion of it can also be used for arts & entertainment scholarships and for training of young managers at international seminars and conventions. In other words, measure the industry growth by its earnings Internationally and peg a percentage of that to reinvestment. My idea needs tweaking, it’s not perfect but the entertainment industry can grow substantially to have a positive impact on our country’s bottom line, thereby creating sustainable long terms jobs via the export of our arts and entertainment. ABG: What sets you apart from others in this industry? IP: There are others who have done really well from an artiste management perspective… Elizabeth Montano, Simon Baptiste and Robert Nurse amongst oth-
ers. I believe they have also done well with other business ventures and I’m sure they can relate their own personal success stories. I think what makes me a little different is my involvement in Film. ABG: What are some of the major misconceptions people have about the entertainment industry? IP: Sometimes people perceive a success story as a happening now story. There is a term in the industry called “paying your dues”. Artistes can be around for a decade with very good songs, but there are obstacles in their way. A film may be in production for a number of years. But there are obstacles in its way. Doors are constantly being slammed in our faces. People see the finished product; they don’t see the hard work put out by entire teams, the years of preparation, the sleepless nights etc. Then you hear them say “who is this Mister Killa? Where he come from just so?”, or “Kerwyn come good this year” or “allyuh taking real long to bring part 2 of Santana.” ABG: What are some of your goals for the next five years both professionally and personally? IP: I described one earlier which is the birth later this year of the Caribbean Movie Network “CMN”. This station will be available regionally. I have also been daydreaming lately about a sports agency and book publishing company. Look out for those in the future. I get personal satisfaction hanging with my mom Bianca. She inspires me. I am the proud father three children, Robyn, Alexi and Melanie so seeing them achieve their goals are key and for some reason I’m also having dreams about the Himalayas… not sure why just yet. ABG: Anything you would like to add? IP: Just want to say thanks to you and all at Abstract Business Guide, for inviting me to this interview for your May Issue and want to wish you all and your families all the best.
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ABSTRACT BUSINESS
FUTURE FINANCE
Can T&T really be self-sustainable?
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reek Philosopher Aristotle regarded "political and economic self-sufficiency as a basic prerequisite of the ideal state." However, international trade economics dictates that for efficiency in the use of global resources, countries should specialize in the production and export of goods and services that they have the comparative advantage in. It would logically follow that any economy cannot be fully self-sufficient and must rely of some level of imports. But Trinidad and Tobago’s heavy reliance on energy export revenue and imports begs the questions…. Can the T&T economy cut back on the level of foreign trade? Can we better use local resources for gain? In 2012, the energy sector accounted for 40.2% of GDP, 52.3% of government revenue and 83% of total merchandise exports. Main export markets include the USA, CARICOM, EU and Central and South America. Exports to these markets are precariously built on a narrow range of energy related products and dominated by preferential market access. Merchandise exports include mineral fuels, oils, distillation products, inorganic chemicals, organic chemicals, iron and steel, ores, fertilizers, beverages, spirits and vinegar, paper and paperboard articles. Service exports accounted for only 12% of exports and include travel, transportation, insurance and communications. While it is inevitable that T&T needs to engage in trade for necessary foreign exchange, its undiversified economic structure makes the country vulnerable to external shocks. The instability of price and demand for energy exports in
While it is inevitable that T&T needs to engage in trade for necessary foreign exchange, its undiversified economic structure makes the country vulnerable to external shocks major export markets threaten how sustainable the economy can be with regard to its path to economic development. Furthermore, T&T’s nonenergy trade balance has been in deficit for the past two decades. This suggests that there is a need to diversify production and exports in order to wean the economy from overdependence on the energy sector. In response, the Trade Policy and Strategy of T&T 2013-2017 earmarks several sectors as hav-
ing export potential, including food and beverage, printing and packaging and miscellaneous manufacturing sectors. With regard to services, ICT, financial services, tourism, creative industries such as fashion, music, and film, energy and maritime services are identified for development. This move to utilize local resources has been met with some success, as the IMF notes that “The non-energy sector was fairly buoyant in 2013, which we anticipate will
continue to be the case in 2014.” T&T’s imports originate from the USA, Gabon, Colombia, Brazil, China, Russia, Canada, Japan, Congo and India. Top merchandise imports include mineral oils, machinery and nuclear reactors, electrical and electronic equipment, vehicles other than railway and tramway, ores, slag and ash, articles of iron and steel, plastics, ships and boats, base metal and miscellaneous chemical products. It can be argued that many of these imports are capital goods and technology that T&T simply does not have the resources to produce. However, there is growing concern about rising food import bills that compromise food security as a nation. In 2012, the National Food Production Action Plan 2012-2015 was launched to help improve the country’s food security by reducing the country’s food import bill, reducing the overall rate of inflation, creating sustainable longterm, productive employment and diversifying the economy. However, adverse weather conditions negatively affected the planting and gestation periods of several crops and the availability of most commodities fell in 2012 as compared to 2011. The small open economy of T&T is still developing and very much dependent on international trade for its growth and development. Pressure to diversify away from the economy’s backbone of energy, inadequate attempts to revive a declining agricultural sector, reliance on preferential trade agreements and forces of globalization and trade liberalization makes T&T on the slow path to achieving a comfortable level of self-sufficiency.
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ABSTRACT BUSINESS GUIDE
FUTURE FINANCE
The Effect Of Tightening Tobacco Regulations On The Sale Of Tobacco
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Written by Rhoshenda Ellis
he government of Trinidad and Tobago is going further to tighten regulations regarding the sale of tobacco even with opposition from a tobacco company on the basis that the new measures of tobacco sale are beyond its capabilities. The Health Minister Dr. Fuad Khan under the Tobacco Control Bill pilots these new regulations. He suggests that Tobacco companies display health warnings about the use of Tobacco using pictures rather than text. The warnings must also be placed on at least half of the cigarette packaging rather than on the cigarette itself and the message must be placed in such a way that it is not destroyed upon opening the package. The medical practitioner believes that these measures would greatly reduce the use of tobacco by smokers as; “It serves to ensure that the user is always in a position to see the health message.” Therefore, smokers would be more aware of the harmful effects of tobacco on their health. While this is a good move by the health minister, it must be noted that the tobacco industry has generated billions of dollars to contribute to the
Trinidad and Tobago economy. From 2008 to 2012, the West Indian Tobacco Company has generated over TT$2 billion dollars in before tax profits. Therefore, one must wonder the effects of placing greater restrictions on the sale of tobacco. What effect does this move by the health minister have on the tobacco industry? Firstly, these messages that must be placed on the packaging become another expense incurred by the tobacco companies. They would have to modify the production to include the printing of this message on the packaging. Also, they may have to redesign a marketing campaign with new strategies to publicize the new packaging so that customers are aware of the change in packaging. However, compared to the profits they make, these costs may be minor. The main effect that displaying this message will have on the sales of tobacco products is the decrease in sales. When smokers become aware of the harmful effects of tobacco on their health, some patrons may heed the warning and stop smoking. While this is a good move for the country, with respect to the overall health of its citizens, this industry contributes almost 4%
When smokers become aware of the harmful effects of tobacco on their health, some patrons may heed the warning and stop smoking 18 ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
of the GDP (statistics from the CSO) every year. Is the Trinidad and Tobago economy prepared to sacrifice this form of income? What other industry can we rely on to compensate for this lost income? On the other hand, a healthy population is a productive population. A country like Trinidad and Tobago, where smokers make up almost half of the population, is a country prone to lifestyle diseases, such as cancer. It is no secret that Trinidad and Tobago has one of the highest mortality rates for cancer in the Latin American region. As a result, the government may actually spend more money to develop the health sector to
treat smokers. This may counteract the money earned from the tobacco industry. Therefore, it is obvious that the tightening of the regulations for the production and sale of tobacco-based products will have a negative effect on the tobacco industry. More expenses will be incurred to meet these regulations. This, in turn, may pose a threat to the industry since the message is aimed at reducing the number of smokers in the country. As a result, if the government wants to reduce the number of smokers in the country, they would have to encourage growth in another sector to ensure that the national income of the country is maintained.
ABSTRACT BUSINESS
BIZ TECH
As A Result Of Connectivity And Globalization, Local Retail Is Paying The Price
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ith the advent of information technology, consumers have become more aware of different ways to purchase goods and services. Globalization of technology also has a major role to play in the purchasing power of consumers. The e-business space is exploding and transforming, often at the expense of traditional retailers. A retailer, being the person or business who sells goods to the consumers, as opposed to the wholesaler or supplier who normally sell their goods to another business are forced to develop new strategies to operate within the market. Technology is now in the palm of the consumer’s hands and a click of a button can arrange the purchase of an item or find out the cost of a service by a provider online. Whereas before consumers had to wait until the store is open to visit, consumers can now review products online before purchasing. This has become the trend, as online shopping offers 24/7 shopping, with some tax-free products and customer reviews. Consumers are now focused on searching the Internet to find the best online deals. A study completed by the California Institute of Technology found that consumers pay significantly more for products they can view in person. Consumers are now willing to let the internet prices drive their purchasing decisions and abandoning any loyalty they may have to any particular retail outlet. Jahyouth Guischard, a local clothing retailer who offers his customers an online shopping option
retail outlets internationally are adopting beacons to provide customers with product information, flash sales and deals to speed up the checkout process with a completely contactless payment system. Retail businesses are increasingly setting up online shopping for their customers and even social networking pages for their business. Besides delivery and shipping and handling costs to be paid by consumers for shopping online, different websites offering shipping to consumers has caused local businesses to provide shipping services to deliver the items at the doorstep of the consumer. This is now a growing business and FedEx, Jet Box and Jet Express, just to name a few, have made a name for themselves with delivery services locally. International retailers are now taking a stand with their products. Although there is no such practice locally, online websites such as Amazon, Flipkart and Snapdeal who offer online shopping, have been warned. Lenovo India issued an advisory on its website to its buyers against doing business with e-retailers. This advisory urges customers to Technology is now in the palm of the purchase products only from its exclusive store or its own econsumer’s hands and a click of a commerce portal. Toshiba and button can arrange the purchase Nikon also placed similar adviof an item or find out the cost of a sories. service by a provider online Purchasing online is growing and local retailers are for clothing, explains his rea- boost his own sales. This is a forced to change their stratesons why. “Although customers confession of a retailer, in turn, gies. According to the Interpurchase what may be at the changing his marketing strate- national Monetary Fund, easstore at the time, I noticed over gies. ing of tariffs and quotas, more time, a lot of customers prefer Over the past few years, efficient communications and an online shopping experience,” retailers also made a shift to- falling transportation costs said Guischard. He said that wards technological advances. contribute to ease of purchashe offers this type of service to Business Insider reveals that ing online. www.amgtt.com • MAY, 2014 • ABSTRACT BUSINESS 19
ABSTRACT BUSINESS GUIDE
BIZ TECH
Making Mobile Apps Work For Your Business
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ith the amount of things that can be done with your smartphone, some people are beginning to forget that it can still actually be used to make calls. Apps have made smartphone technology exciting and because of them people can barely put down their phones. No doubt, businesses should take advantage of these technological developments. Here is how a mobile app may benefit you.
not just – as of now – business people, social networkers and gamers. The main driver will be a reduction in handset prices. Currently, some handsets carry a whopping price tag which makes it feasible for only the upper echelon of society to use them. When the price diminishes, it will be a free for all.
Closeness to Customers Mobile devices, especially smartphones, are much more personal and intimate devices than a laptop or desktop device. For most users their phones are never further than 1 meter away 24/7. Imagine how attractive it is for consumer goods, food, and myriad other companies across the economy to be able to place their products and services in such proximity to consumers.
Broadened Brand Exposure Smartphone app developers around the globe make the work of most business owners convenient, as mobile marketing through app technology provides constant brand exposure. Other marketing strategies may provide consistent visibility, but not in the same extent as mobile apps seen as often as a person browses through his/her phone. Having the brand name or company logo in constant view on home screens can be a constant reminder to mobile users that your company is there, waiting to serve them.
Smartphones Fast-becoming Ubiquitous Smartphones will increasingly replace feature phones in stores. Nearly everyone will be able to use smartphone apps,
Ability to Learn About Your Customers Mobile phones can actually help you Collect feedback and data about customer behavior. If you want to learn how cus-
if you want to learn how customers are using your products and services and what they like (and possibly don't like) about them, a mobile app can be a simple method for collecting this sort of information 20 ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
tomers are using your products and services and what they like (and possibly don't like) about them, a mobile app can be a simple method for collecting this sort of information. In addition, with a well-designed app, you can learn more about your customers, from their locations, job roles, ages, spending limits, and much more. This data could be useful when you're tailoring communications and potential offers to them. It Offers New Opportunities for Financial Gain Many small businesses believe that the price of creating an app is way out of their budget and steer away from it for this reason. Although it can be very expensive to develop a mobile app, it does not have to be. Creating a basic app, without unnecessary bells and whistles, is a lot more cost-effective. Planning
your app way ahead of schedule, creating your own content, logo and images, is another way to cut costs. After you have laid the ground work, a professional app creator can develop your app. Once your app has been created, you can take advantage of available methods for earning money through your app, like in-app advertising. Use as a Discount Distributor People are more likely to download a business’s app if it will help them save money. Offering coupons, discounts, and promotional codes is a great way to interest people in your app. Your app doesn’t even necessarily have to do anything else than provide customers with opportunities to save. A coupon can be a great incentive for downloading an app and encouraging people to try out your business.
ABSTRACT BUSINESS
Personal Finance
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he Wolf of Wall Street book and movie probably made a lot of average Joes contemplate stock investments. That doesn’t mean all you have to do is choose a stock, invest and it will be smooth sailing. Here are some investment tips to help you along your journey.
Investment Tips
Make as few investments as possible Investors these days are pushed to be active and to buy low, sell high. Slow it down. Frequent buying and selling only cuts into long-term returns. Both individuals and institutions will constantly be urged to be active by those who profit from giving advice or effecting transactions. The resulting frictional costs can be huge and, for investors in aggregate, devoid of benefit. Ignore the chatter, keep your costs minimal, and invest in stocks as you would a farm. Never invest in poor quality companies A good company is one that regularly makes a high return in cash terms on capital employed, and can reinvest at least part of that cash flow in order to grow its business and compound the value of your investment. Bad companies do not do this. They make inadequate returns on the capital they employ. You may think you should invest in these poor companies as they are going to improve because the management will change, or they will be taken over, or their results will pick up with the economic or business cycle. But each day you wait for such events, these companies destroy a little bit more value. Good companies do the opposite. With a good company, time is on your side. Study everything and get help when needed Knowledge is and will always
be the truest key to success. Obtain and analyze as much information as possible before making your investment decisions. This will alert you of any problems a company may have, or what to expect from your investment. If you're starting out, hire the best professional help you can afford. Professional advice will likely pay for itself within a short period of time. Once you become used to the market, do the research yourself. Later on in the game, switch to an online broker. Do the requisite financial planning If you are looking for a getrich-quick scheme, you should play the lottery. Investing is not a panacea, or one-size-fits-all process. Instead, it is a process that allows investors to reach certain financial goals through a carefully crafted financial plan. The said plan should include financial constraints,
and a strategy that targets financial products that help you match your goals with those constraints. With that said, it is understood that different investors may develop and execute different investment strategies. It all depends on your needs. Younger individuals, for instance, may opt for shorterterm investments in liquid assets. This may come in handy for use in paying for education or for a down payment to purchase a house. Middle-aged individuals may want to pursue a strategy that maximizes asset appreciation, as they may not need the funds until retirement. All this should be considered when constructing the financial plan. Take stock of the risk involved With any investment, there is always the risk that you won't get your money back or the earnings promised. There is
usually a trade-off between risk and reward: the higher the potential return, the greater the risk. Many financial institutions and governments around the globe have put measures in place to insure bank savings accounts and back up savings bonds. Other investment options are not protected. Be realistic There's nothing wrong with hoping for the 'best' from your investments, but you could be heading for trouble if your financial goals are based on unrealistic assumptions. For instance, lots of stocks have generated more than 50 per cent during good market times, but it doesn't mean that you should always expect the same kind of return from the stock markets. Sometimes, it’s all down to dumb luck, but you should do everything in your power to ensure you don’t need luck.
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ABSTRACT BUSINESS
Developing the Entrepreneur
Myths And Misconceptions Of HR
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ven a one-employee workplace is a minefield of legal and industrial relations ramifications waiting to be exposed. Therefore, you should never overlook the importance of proper Human Resource practices and knowledge. Here are some things that are commonly misconstrued when it comes to HR. Training Has Its’ Limitations There is a misconception that you can never offer too much training for your workforce. Well here’s why this is not entirely true. While employee training is essential for improving productivity, perhaps companies are spending too much on education and training. There are optimal levels of spend and hours beyond which there is a decreasing rate of return on investment. Interestingly, some types of training such as in sales - seem to have no effect on sales revenue at all. It is recommended to give training to new employees in order to get them up to speed and productive more quickly, thereby increasing overall performance. However, managers who have been with the company for several years may benefit more from increased interpersonal skills or executive development. In order to fully maximize the potential of training effectiveness, it is important to take the time to use analytics to find the best opportunities. Companies can ensure the highest return on investment if they understand which employees (or groups of employees) should be offered training, along with how much, when, what content, and at what stage of their tenure.
ployee with the GPA may not be proficient in dealing with such tasks, as it was not taught in school. Financial incentives are Not the Best Form of Motivation People love money, so many companies' higher-ups and HR staff default to financial rewards for a job well-done. Some love money so much that a financial incentive may cause them to act in ways that go against company policy or in a manner that could result in short-term success but long-term failure. Money is definitely a motivator, but it should not be all your worker is concerned about.
fer letters and oral statements. Unfulfilled promises may lead to liability for fraud.
HR Doesn’t Only Seek Employee Interests It is a misconception to think that HR is just there to make employees happy, or just there to enforce rules. Don’t let the use of the word “Human” in the title fool you. While unions and establishments such as the Labour Board do tend to put employees first, your company’s HR department has an obligation to both parties. Effective HR departments balance the needs of employees vs. the goals of the organization.
Confusing Education with Intelligence Oftentimes, hiring managers and staff believe an applicant's academic performance in college is a great predictor of how they would perform in the office. However, GPAs are determined by students' mastery of a subject and practice on a particular subject matter over a certain period of time, not an indicator of how they would perform on their toes on the job. Furthermore, many jobs are task oriented and the em-
With that said, note that is a myth that Human Resources must keep things private when asked. HR does not have the same fiduciary duty as attorneys or priests. Think of them more like a bartender; you can empty your soul to them, but they have no obligation to keep it a secret. The job is to focus on solutions to workplace problems, if they come upon knowledge of a serious problem in the workplace; their primary task is to take care of the problem—secrets or not.
Companies can ensure the highest return on investment if they understand which employees (or groups of employees) should be offered training, along with how much, when, what content, and at what stage of their tenure “At Will” Doesn’t Really Mean “At Will” Many employers believe they have the power to hire and fire as they wish. Unfortunately, there are legal ramifications which supersede your company’s HR framework. The fact is, even at-will employers cannot fire someone for “bad cause.” Also, there is a contract of employment even in at-will situations. Remember that at-will does not allow you to fire for an illegal reason, or in some cases, against public policy. Furthermore, at-will employment can be displaced by an employment contract, which may be created by of-
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ABSTRACT BUSINESS GUIDE
DEVELOPING THE ENTREPRENEUR
Traits Employers Look For When Hiring
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mployers usually don’t have to look for a reason to fire someone and frankly they shouldn’t. When it comes to hiring on the other hand, there are lots of things that are taken into account. Some of the major skills employers seek when hiring staff, are discussed here. Job Knowledge and Ability Can you do the job? This isn't about whether you think you can do the job; employers are looking for concrete evidence in your past that shows that you can. This doesn't mean that you need to have done this particular job with this particular title before, but it does mean that you need to have a track record of success in the skills that the position requires. Are you intelligent enough? Do you think quickly on your feet? All of this will be taken into account. Contacts First, the more contacts you have in the marketplace, the more likely it is you will find the job you want. The more people you know and who know you, the more likely it is you will uncover one of the 85 percent or more of job openings that are never listed anywhere.
This is why it is so important for you to network continually. Join clubs and associations. Ask people for referrals and references. Tell your friends, relatives, and associates that you are in the market for a new job. Make sure that everyone you know is aware that you are available and looking for a job. Nothing is more important than your circle of contacts. The great majority of jobs that are filled in the hidden job market are filled because someone knows someone. And you can expand your range of contacts just by telling people that you are available and asking for their help and their advice. Integrity It’s probably the most important single quality for longterm success in life and at work. Integrity begins by being true to oneself. This means that you are perfectly honest with yourself and in your relationships with others. You are willing to admit your strengths and weaknesses. You are willing to admit where you have made mistakes in the past. Especially, you demonstrate loyalty. You never say anything negative about a previous employer or a person whom you have worked with or for. Even
Integrity begins by being true to oneself. This means that you are perfectly honest with yourself and in your relationships with others 24 ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
if you were fired from a previous job, never say anything negative or critical. Adaptability In some fields, a job is changing and evolving day by day. Employers want to hire adaptable professionals who can change with it. This may mean someone who can follow directions one day and figure out his or her own direction the next. Perhaps someone who can spend some days behind their desk and other days in the field and be equally productive in both environments. Courage This is the willingness to take risks. Courage also means the willingness to accept challenges, the willingness to take on big jobs or even new jobs where there is a high degree of uncertainty and the possibility of failure. Courage also means the willingness to speak up and say exactly what you think and feel in a difficult situation. Employers admire men and women who are not afraid to speak
their minds. And you demonstrate this in a job interview when you ask frank and direct questions about the company, the position, and the future that you might have with the organization. Loyalty/Commitment Will you be satisfied with the job or will you be looking to leave within six months? Most employers want to hire people who will stick around for a solid block of time (usually at least two years, and more for senior-level positions). They also want to hire people who will be happy with the job, because unhappy people tend to be less productive and a drain on other employees' morale. Teamwork You’ve heard it before, but there is no “I” in “TEAM.” Even those who are hired to fill individual positions may eventually find themselves working as part of a group. Employers are looking for those who can collaborate well with others, not behave like divas.
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ABSTRACT BUSINESS GUIDE
GLOBAL FINANCE & WORLD REVIEWS
Worldwide M&A Activity Tops $1 Trillion So Far This Year
T
he value of worldwide mergers and acquisitions announced so far this year has topped $1 trillion, passing that level for only the third time this early in the year since records began in 1980, weekly Thomson Reuters data showed on Friday. Deal volumes started to recover earlier this year after falling back in 2013 due to a mix of economic uncertainty, regulatory interventions and shareholder activism that made executives cautious about pursuing deals. By the end of the first quarter of this year, deal activity had risen 54 percent on the same period last year, with deals worth a
U
S industrial products giant General Electric is in talks to buy the global power division of struggling French engineering group Alstom for more than $10 billion, sources familiar with the matter said on Friday. The sources said a deal was backed by Alstom's main shareholder, French conglomerate Bouygues with 29 per cent, and could be announced in the coming days after an Alstom board meeting on Friday afternoon. "Talks are going ahead swiftly, the deal's structure is defined and everything is almost ready," one of the sources said. "It would be a very big asset sale, enclosing the entire energy business." Alstom Chief Executive Patrick Kron confirmed to union representatives there were talks about an "industrial deal",
total of $710 billion announced. Bankers said confidence appeared to be returning, with some companies are becoming bolder and more aggressive. "M&A seems to be back," one banker told Reuters. This week's data shows yearto-date volumes of $1.1 trillion, helped by a flurry of deals in the healthcare and pharmaceuticals sectors. Earlier this week Zimmer Holdings said it would buy rival orthopedic products maker Biomet for $13.35 billion - the largest deal in the healthcare equipment sector since Johnson & Johnson acquired Synthes in 2011. The deal came one day after
Canada's Valeant Pharmaceuticals International together with activist investor Bill Ackman made an unsolicited $47 billion bid to buy Botox-maker Allergan. European dealmakers were also busy, as Swiss drug-maker NovartisBSE -1.83 % and. GlaxoSmithKline announced an agreement to trade more than $20 billion worth of assets. Investors reacted positively to the asset exchange, and industry sources believe the transaction could become a template for future M&A deals in the pharma sector and beyond, especially between large corporates. "It just makes sense for companies to get stronger in fewer businesses," said one sector banker.
U.S. investment bank Goldman Sachs, an adviser to Biomet and Novartis, climbed to the top of the M&A league table after working on deals worth $72 billion this week. Morgan Stanley took second place, while Bank of America Merrill Lynch lay in third. Dealmakers are expected to remain busy in the coming weeks, with several potential tie-ups in the pipeline. Media reports earlier this week said Pfizer has approached British rival AstraZeneca to propose a $101 billion takeover. Sources told Reuters on Friday that US conglomerate General Electric was in talks with France's Alstom to take over its global power turbines division.
General Electric In Talks To Buy Alstom's
Power Arm For More Than $10 Billion
but did not name GE. Alstom, Bouygues and General Electric declined to comment. A deal to sell Alstom's power assets, which account for about 70 percent of total group rev-
26 ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
enue, would effectively break up the engineering group and leave Alstom as a pure transport business, already known for its high-speed TGV trains. It could however be less politically sensitive than a full takeover offer for the company, talk of which caused Alstom shares to soar on Thursday. "By separating Alstom Transport, which may remain an independent French company and national cham pion, resistance could stay muted," Berenberg's William Mackie wrote in a note. The French government weighed into the issue anyway on Friday. French Economy Minister Arnaud Montebourg promised to protect the national interest and to study "other solutions and scenarios"
for Alstom, one of France's top private-sector employers. He said he had already met Kron on Thursday and would meet GE's Chief Executive "shortly". Alstom was bailed out by the French state in 2004 and relies heavily on orders from national rail operator SNCF and utility EDF. It employs 18,000 people in France, half of them in the power business, out of 93,000 worldwide. The deal could value the group's power assets - which include turbines for coal, gas and nuclear power plants, wind farms and systems for power transmission and distribution - at over $10 billion, analysts said. One source familiar with the matter gave a price tag of $13 billion including debt.
ABSTRACT BUSINESS GUIDE
STOCK WATCH
April Stock Summary Courtesy The Trinidad and Tobago Stock Exchange
Written Report for Friday 25th April, 2014
O
verall Market activity resulted from trading in 13 securities of which 5 advanced, 5 declined and 3 traded firm. Trading activity on the First Tier Market registered a volume of 135,847 shares crossing the floor of the Exchange valued at $2,261,810.80. GUARDIAN HOLDINGS LIMITED was the volume leader with 84,547 shares changing hands for a value of $1,107,604.72, followed by ONE CARIBBEAN
MEDIA LIMITED with a volume of 27,875 shares being traded for $567,618.17. ANGOSTURA HOLDINGS LIMITED contributed 12,960 shares with a value of $168,350.40, while FIRST CITIZENS BANK LIMITED added 3,718 shares valued at $140,990.80. ANGOSTURA HOLDINGS LIMITED enjoyed the day's largest gain, increasing $1.29 to end the day at $12.99. Conversely, ANSA MERCHANT BANK LIMITED suffered the day's greatest loss, falling $0.09
to close at $38.40. CLICO INVESTMENT FUND was the only active security on the Mutual Fund Market, posting a volume of 111,075 shares valued at $2,402,111.00. CLICO INVESTMENT FUND advanced by $0.18 to end at
Stocks Advancing: Security
Volume
Closing Quote ($)
Change ($)
12,960
12.99
1.29
3,718
37.92
0.51
111,075
21.63
0.18
47
120.44
0.11
639
3.70
0.05
Volume
Closing Quote ($)
Change ($)
ANGOSTURA HOLDINGS LIMITED FIRST CITIZENS BANK LIMITED CLICO INVESTMENT FUND REPUBLIC BANK LIMITED POINT LISAS INDUSTRIAL PORT DEVELOPMENT CORPORATION LIMITED Stocks Declining: Security ANSA MERCHANT BANK LIMITED
500
38.40
-0.09
2,884
7.00
-0.03
84,547
13.10
-0.01
1,500
118.00
-0.01
63
69.75
-0.01
Volume
Closing Quote ($)
27,875
20.36
NEAL & MASSY HOLDINGS LIMITED
577
66.50
NATIONAL ENTERPRISES LIMITED
537
18.75
SAGICOR FINANCIAL CORPORATION GUARDIAN HOLDINGS LIMITED THE WEST INDIAN TOBACCO COMPANY LIMITED SCOTIABANK TRINIDAD & TOBAGO LIMITED Stocks Trading firm: Security ONE CARIBBEAN MEDIA LIMITED
28 ABSTRACT BUSINESS • MAY, 2014 • www.amgtt.com
$21.63. 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.
In Friday's trading session the following reflect the movement of the TTSE Indices: * The Composite Index advanced by 4.12 points (0.35%) to close at 1,178.66. * The All T&T Index advanced by 8.41 points (0.42%) to close at 2,012.36. * The Cross Listed Index declined by 0.03 points (0.07%) to close at 45.22. * 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