Property Matters – The Sandals MoU, part 3

sandals-beaches

Two weeks after the publication of the Tobago Sandals MoU yet there has been no cogent defence of these detrimental provisions. The stark analysis is that the provisions of that MoU all favour Sandals’ interests, so much so that I am frankly wondering if they were the authors. Serious and inescapable questions of professional responsibility arise, given the eminent named persons and State Agencies said to have been involved thus far.

The reputable economist Dr Vanus James, writing in the TapiaHouse blog on 10th December 2018 described the Tobago Sandals MoU as ‘A road-map to economic ruin’.

tobago-mou-posterOn Thursday 13th December 2018 I addressed a public meeting at the Scarborough Public Library on this issue organised by my esteemed elder, Reginald Dumas. That was a full house and there was strong engagement on the implications of these large-scale proposals.

The starting-point for me was to tackle the question put to me the morning before by a media colleague from Tobago as to my being ‘a Trinidadian‘ and my role in questioning these proposals for what is certainly the largest-ever single development in Tobago. The simple fact is that ours is a tiny Republic such that those positions hardly seem to be credible. After all, if one were to adopt such a position we could end up excluding the Charlotteville opinion for a Buccoo proposal. More seriously, that position is entirely incompatible with our Regional aspirations – after all, why should we in T&T bother with Grenada which is 90 miles away or even Barbados, which is a whole 270 miles away. You see?

The main provisions are in this table.

KEY ANALYSIS of MoU Terms
or
The Anatomy of a White Elephant

ITEM BENEFICIARY
Design, Construction, Fitting and Furnishing of the new Resorts – in the region of $3.0 Billion TTD SANDALS – Since none of the capital at risk will be invested by SANDALS.
Taxes and duties to be collected arising from the operation of the Resorts SANDALS – Incentives/Exemptions are offered under the MoU, with Transfer-Pricing approaches.
Employment of a Staff of approximately 2,000 in the operating Resorts SANDALS – as they have ‘sole discretion’ on hiring, while the Government is to swiftly grant as many work permits as required. There is no stated quota as to employment, training or promotion.
Local Content – Large-scale procurement of goods and services for the operation of the Resorts. SANDALS – as the final choice of supplier is theirs on the basis of quantity, quality or competitive pricing.

It seems clear that the State will have to borrow the funds required for these large-scale Resorts. So what will those borrowings cost us? Have we agreed any provisions to ensure that our returns on this investment are at least enough to cover the cost of the borrowings? In my view such provisions are fundamental and must be included.

I am also concerned that there are no provisions in that MoU to guarantee that an agreed part of the workforce, at all levels up to and including management, is to be T&T citizens. Given that the Resorts are expected to take about two years to build, that seems to me to be enough time to establish a program to recruit our citizens who are interested in a career in the hospitality industry to join the Sandals group for training at their staff college. Those prospective staff can then be rotated through the group so that upon opening the Resorts could employ a set percentage of T&T citizens. That percentage needs to be on a rising scale so that there is a tangible prospect of our fellow citizens being employed.

After all, similar approaches were adopted when the oil & gas multinationals were forced to take those steps after serious ‘oilbelt’ protests. Texaco, Shell and other companies of similar stature recruited and trained many locals with technical and managerial skills, all of which was of tremendous benefit to our nation. We need to adopt a similar series of measures, if this project is to proceed.

Similar steps also need to be taken to foster a series of beneficial supply-chain links within our local economy, such that we can establish targets in terms of the supply of goods and services to these proposed Resorts.

The scope of the external impacts will be an important emerging factor during the environmental assessment of these proposals to be undertaken by the Environmental Management Authority (EMA). Given the strength of the exchanges at the Tobago meeting, I am sure that colleagues in the environmental groups will be most attentive to those issues.

Dr Rowley’s reported statements to Parliament on Wednesday 12th December 2018 were emphatic that the government was not ‘anywhere near’ to signing a final contract with Sandals.

“…Madam Speaker, as told to the national community, the gestation period and activities involved in bringing this project into fruition is one that is ongoing and we are not anywhere near to any position about signing any final contract with Sandals. The process of developing this project is going ahead unhindered through the normal channels and at the end of those processes, if a contract has to be signed, we would be the first to inform the country…” (pg 20)

In that case, there is still scope to review these damaging provisions.

It is interesting to consider the various persons and groups who are said to have worked on this Sandals MoU.

The first Negotiating Team – On 30th June 2016, former finance minister and international investment banker, Wendell Mottley, was named chairman of a negotiating team to arrive at an agreement between Government and all-inclusive operator Sandals Resorts for two hotels in Tobago. The other team members were Dr Terrence Farrell, Dr Rolph Balgobin, hotelier Michael Small, small farmer Glen Leslie and head of public/private partnership in the Ministry of Finance, Nadira Lyder, and two representatives to be named by the Tobago House of Assembly.

More recently, there have been reports of a “…Cabinet Appointed Negotiating Team comprising Wilfred Espinet, Conrad Enill and Waltnel Sosa…

ttal-logoIt was also reported that the Tobago Tourism Agency is to be chaired by Dr. Sherma Roberts, to consult with stakeholders and the public “to ensure that everyone is a part of the discussion,” the Secretary explained. Roberts is the Graduate Coordinator, M.Sc. Tourism Programmes, at the University of the West Indies, Cave Hill.

The project will ultimately be under the control of Golden Grove-Buccoo Limited under Chairman Neil Wilson and directors Verne Alleyne, Dr Selvon Hazel, Selby Leslie, Waltnel Sosa, and Enid Zephyrine.

The searing question in my mind is ‘How did we get to this position?’ Did all these eminent professionals and State Agencies agree with these provisions?

7 thoughts on “Property Matters – The Sandals MoU, part 3

  1. What we are seeing here is the effect of an even greater problem; Proper Procurement Legislation is not in place (and I know that you tried) and there is no transparency in the undertaking. Trinidad is amongst the top 4 Caribbean Countries as far as GDP is concerned, the other 3 are Tourism Based. But Bahamas, St Kitts and Antigua did not reach there overnight, and Antigua is pushing to relook the arrangement with Sandals as far as concessions etc. are concerned. Our focus should not be the MOU or Sandals, but why is it being done? Petroleum and Gas based products accounted for 80% of our exports and FOREX earner. Does the Government see an shift in this to the point where we are no longer able to earn adequate FOREX and is attempting to shift the Economy base? If so, there is a much greater problem than just Sandals. We will need great parallel injection into Tobago and Trinidad – who is going to fund this and what will be the conditions? We are focused on a project costing a few billion dollars when over 100 billion will be given out, without proper procurement procedures, in the next year. We need answers, not on Sandals, but on the overall plan.

  2. Again, on point regarding employment.
    Most people are not aware that Sandals has an agreement with an international Hotel & Catering educational institution. This allows Sandals to utilize students (as part of their internship) at their numerous hotels on a rotating basis. A check will show that all of the head chefs and managers come from this institution/s. The compensation to these individuals are below industry norms since they are interns ( and provision of room and board by Sandals is not a problem), and in some cases are even below local country rates.

    1. What is the name of this Hotel and Catering institution?Of course they will not compromise on the standards of their brand.

  3. If all parliament undertakings were to be assessed by groups of students who study politics and guided by UWI and UTT and other economists etc. and the general public, with e-based and communal forums then, with the right administrating infrastructure, we will actually be a democracy.
    The reality is that money tycoons, not politicians, make global policies.To the rich, we are con-trees.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.