Black Immigrant Daily News

4. Electricity and internet

PHILIPSBURG — Establishing a business in St. Maarten is an at times an expensive road littered with stumbling blocks. The Ministry of Home Affairs and Kingdom Relations and the Ministry of Economic Affairs, Tourism, Transport and Telecommunication commissioned a report to assess the local business climate, identify bottlenecks and recommend solutions. The report is produced by the Foundation Economic Research (SEO), the Economic Bureau Amsterdam (EBA) and Tackling Law.

In this fourth episode in a series of articles based on the report we take a look at another issue that causes concerns not only to entrepreneurs but also to private citizens: the provision of electricity and internet services.

Report: Spurring Entrepreneurship in Sint Maarten

Both services have something in common: relatively low quality and relatively high prices, both most likely due to a lack of competition.

GEBE has the monopoly of the production and distribution of electricity. The energy market therefore lacks market disciplining incentives, the report states: “Costs are high and power outages are frequent.”

There is no transparent source of information for the frequency and duration of power outages. To make matters worse, St. Maarten makes hardly any use of solar power, even though the potential to exploit this venue is there. “This is partly due to GEBE-stipulations that solar power cannot be connected to the electricity network,” the report states.

GEBE uses fossil fuel generators to produce electricity. According to a 2015 report, the costs of oil-imports equal 18 percent of Gross Domestic Product. End users pay the price for the stubborn refusal to add renewable energy production to the mix. Consumers pay on average $0.35 per kilowatthour, while citizens on the French side pay only $0.12. This could be due to French regulations that require the equalization of electricity rates throughout France and its overseas territories.

In 2017, the St. Maarten Hospitality and Trade Association (SHTA) registered nine power outages in one month, putting the country in the same bag as countries like Burkina Faso and Tanzania. Companies in Burkina Faso report losses of up to 5.1 percent of annual turnover due to power outages. In Tanzania the reported losses are even higher: 15.1 percent.

Power outages are disruptive to the business community: store owners are unable to complete card transactions and phone calls and video conferences with international partners are disturbed.

Compared to other islands in the Caribbean, St. Maarten hardly uses solar power. This is not only due to GEBE’s rather outlandish claim that solar cannot be connected to the power grid, but also to legislation. According to the law, households and businesses are not allowed to generate electricity, other than with an aggregate. Those who want to use solar power, need a ministerial exemption.

Entrepreneurs who were interviewed for the report, claim that GEBE actively prevents them from using solar power. They also said that solar panels are unable to withstand hurricanes, even though there are designs on the market that solve this issue.

Using solar power definitely has its advantages in case of damages, the report explains. “Because it is decentralized, it will be up and running quickly compared to a centralized energy system.” According to the researchers, increased use of solar power has the potential to bring new entrepreneurs to the island.

The internet is another source of concern. There are four providers on the island, so it is tempting to think that competition will drive prices down and quality up. It doesn’t. The four providers are Coral Telecom, Flow, TelEm and WTN Cable.

Internet speed is slow. The researchers found an average download time of 19 MB per second and an average upload time of 13 MB per second.

“There are frequent service interruptions caused by power outages, damaged fiber cables of off-island service-interruptions, the report notes.

The questionable quality of internet services does not put any downward pressure on prices. The report mentions two examples. Flow offers 10 MB per second over a fixed line to business consumers for $65 per month. TelEm offers postpaid internet service of up to 12 MB per second for $85 per month.

That power and internet services are crucial for the business environment needs no further explanation. “In the digital era, reliable energy supply and well-functioning telecommunications markets are crucial,” the report states. “Some knowledge regarding these projects has already been built in projects for Saba, Statia and Bonaire. This can be used as input for the project to improve the efficiency in the utilities market.”

The report recommends the establishment of a public register that discloses service interruptions and their causes, the assessment of the potential for diversification of energy production and the improvement of energy consistency and the assessment of possibilities to allow new private suppliers of 5G networks to enter the market.

The report stops however short of recommending concrete measures. “Such measures require careful analysis of the market conditions and the current technical state of affairs of energy and telecommunication networks.”

Related article: The potential and benefits of geothermal energy for the islands (incl. St. Maarten)

Furthermore, the report states, an assessment is needed of the feasibility of technical solutions to improve efficiency and of the specific needs of the market. “This could not take place within the scope of the current project and requires additional expertise.”

The overall aim remains clear: Investigating which measures can improve energy security, efficiency and sustainability and the quality of internet services.

”Realizing this is an important basis for a sound entrepreneurial climate on the island,” the report concludes, thereby making it clear that there is plenty of work to be done and that it could take quite some time before the private sector sees any results.

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Related links:Doing business in St. Maarten: bottlenecks and solutions (part 1)Doing business in St. Maarten: bottlenecks and solutions (part 2)Doing business in St. Maarten: bottlenecks and solutions (part 3)Report: Spurring Entrepreneurship in Sint MaartenReview article SEO Economisch Onderzoek (In Dutch)Reducing red tape improves the business climate

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Education and Youth Minister, Fayval Williams, has agreed in principle with a call by the Opposition People’s National Party (PNP) for improvements to be made to staffrooms and other infrastructures at public schools locally.

“I have no quarrel at all with any call for us (at the Education Ministry) to upgrade the staff facilities at schools, and we will continue to do that within the constraints of the budget that we have,” said Williams.

She was speaking at the ministry’s press conference on Monday to address several issues regarding education, including teacher migration.

Last week, Opposition Spokesman on Education and Training, Senator Damion Crawford, called for immediate investment in the upgrading of school staffrooms to create an adequate and comfortable environment for teachers to work from.

In addition, he called for the ministry to address the poor and insufficient infrastructure at several schools across the island.

On Monday, Williams disclosed that the Education Ministry has a database in which schools are ranked based on the status of their infrastructure.

“It is going to take time for us to get to all our schools. There are approximately a thousand schools across Jamaica with varying needs, and I do agree that many of the facilities in our schools for teachers and our administrators need to be upgraded,” she shared.

The minister said she has indicated to the National Education Trust, which “manages most of our major infrastructure work for major works going on at schools, that we have to begin to construct an administrative block for our schools, because after all, our teachers and administrators go to work and it’s their work place.

“As we continue to maintain and improve our schools, you will begin to see better facilities for our teachers and administrators,” Williams assured.

Meanwhile, the minister said a meeting is to be held this week with principals across the country to update them about school infrastructure projects that were completed in the last school year, and those projects which are to commence during the 2022-2023 academic year.

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PARAMARIBO — Steven Gonesh is de komende twee maanden waarnemend CEO bij de Surinaamse Luchtvaartmaatschappij (SLM), terwijl Ganesh Laigsingh zal

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Black Immigrant Daily News

A memorandum of understanding (MOU) was signed on Tuesday (August 23) between the Ministry of Economic Growth and Job Creation and Arc Properties Limited for the contribution of units by the private entity to the New Social Housing Programme (NSHP).

This follows an appeal to the private sector to partner with the Government in building more houses for vulnerable Jamaicans.

The signatories to the document included Prime Minister Andrew Holness; Permanent Secretary in both the Office of the Prime Minister (OPM) and the Ministry of Economic Growth and Job Creation, Audrey Sewell; Managing Director, Kinetic Engineering Services, Keon Hinds; Managing Director, Arc Properties Limited, Ashley-Ann Horne; and Director of Arc Properties and Deputy Chair of Arc Manufacturing, Charlotte Horne Hayles.

In his remarks at the signing ceremony at Jamaica House, Holness said he was pleased to see Arc Properties Limited coming on board the NSHP.

“I am almost overcome with emotion to see the call being answered. You are the pioneer in this area and I am very pleased; and it does speak well for Jamaica. The truth is our private sector has been very active in treating with social issues… and I am sure there are others who will hear the call and respond,” he added.

Holness noted that the NSHP targets beneficiaries or households earning minimum wage or less, or which earn no income.

“This is what you would consider to be an income-contingent subsidy. Governments give subsidies for all kinds of reasons. But the best way to give a subsidy is to make it income-contingent, meaning if you are not earning any income, then you genuinely should get the subsidy,” he said.

“Because if you think about what a subsidy is, it is a transfer, a grant from the Government to enable you to afford consumption. People with income have consumption ability, people without income generally don’t. So, for Government to be efficient in subsidies, you usually want to tie your subsidy to the income of the beneficiary.

“That is what the Government is doing generally with all its subsidies across the board; we are making them specific and targeted to beneficiaries who we have identified, and we are making sure that people who have more income don’t get more subsidy,” he added.

Holness stated that already some 89 units have been built under the programme.

He noted that initially, some of the units would cost between $8 million and $9 million, “but now the prices are coming down nicely”.

Meanwhile, the prime minister is calling for more private partners to come on board the programme.

“Once the private sector realises that the project is integrous, meaning that the reputational risk of association is very limited or non-existent, then it’s easy for the private sector to say, ‘I would associate my brand with this project’. It is transparent, it is well-run, and you can only get a positive gain from it,” said Holness.

For her part, Mrs Horne said Arc Properties will do what it can to increase the construction of houses for the most vulnerable in the society under the NSHP, at no cost to the Government.

“We are patriotically proud to be contributing to the upliftment of the Jamaican people in this manner, and we will continue to be a good Jamaican company and a sterling partner for all social, economic and national upliftment programmes,” she said.

The New Social Housing Programme was established in 2018 by the prime minister as the housing component of the Housing, Opportunity, Production and Employment (HOPE) Programme.

It was developed to improve the housing condition of the country’s poor and disadvantaged population by providing quality, affordable and sustainable housing.

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Caribbean Cement Company (Carib Cement) has announced a project to expand its production capacity up to 30 per cent.

Cemex, Carib Cement’s parent company, will invest US$40 million ($6 billion) in phase one of the project.

This increase in capacity should be completed by the second half of 2024.

Speaking at the official groundbreaking ceremony on Wednesday, CEMEX CEO Fernando Gonzalez disclosed that Carib Cement is in the final stages of the engineering phase and is obtaining permits from the local authorities.

“Very soon we will begin to procure the equipment needed for this initial phase of the project, that will not only expand our capacity, but also allow us to optimize our heat consumption in the manufacturing process, and therefore, reduce the carbon footprint of our facility in Jamaica,” said Gonzalez.

The expansion is expected to strengthen the self-sufficiency of the local cement industry and the export market.

“Carib Cement has been a part of the fabric of this country for a long time and has been playing its part in ensuring that the booming construction sector continues to be supported,” Gonzalez added.

Wednesday’s groundbreaking ceremony at Carib Cement’s facilities in Rockfort, Kingston, also saw the Cemex CEO unveil a mural to commemorate the 60th anniversary of Jamaica’s independence.

The local cement producer reported stable earnings in its latest financial report.

Its unaudited earnings report shows the company reporting a six per cent increase in revenue for the three months ended June 2022, up to $6.7 billion.

Due to the impact of higher operational costs, operation earnings totalled $2 billion, nine per cent lower than the $2.2 billion reported in 2021.

Overall net income for the quarter decreased to $1.5 billion, a seven per cent reduction over the corresponding period in 2021.

Carib Cement recently made a dividend payout of J$ 1.5032 per share to shareholders on August 15, 2022, the first in 17 years.

It described the payout as the start of a sustainable dividend programme that would provide stable returns to shareholders.

Carib Cement also said the introduction of a dividend reflects the strong operating results and turnaround that the company has experienced over the last years.

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