Golden Seal of Approval

Recently I took a road trip around the islands of T&T where I noticed several properties prominently displaying “Hotels” and “Guesthouses”; but not a single property is registered with Tourism Development Company (TDC). Some properties flouting basic building codes and regulations; encroaching sidewalks,  adjacent to other buildings with waste water running freely into rivers and streams. We also visited  some of our popular beaches and rivers – a less than desirous state of affairs. Even at the lookout at Lady Young  there are food stalls without basic facilities begging the question of standards.

Which prompted me to ask – Which government agency is/was  responsible for our present state of compliance? Is it our culture at government agencies to disregard regulations? This brings me to the topic of regulations and standards that would make T&T compliant internationally and regionally.

The fact is , TTTIC (Trinidad and Tobago Tourism Industry Certification Programme)  was developed in 2001, derived out of the Tourism Master Plan,1995. This certification program was an MOU agreement valued over $3 Million as the basic project contribution, renewable annually thereafter,  between the Bureau of Standard (BOS) and TDC. The agreement was developed exclusively for operators in Trinidad which meant that Tobago and all International Branded Properties were excluded. The aim of the BOS was to implement a Tourism Certification System in Trinidad; and to certify Tourism Products in accordance with the Standards Act 1997.

One of the undertakings by the BOS was to develop, implement and administer TTTIC by which TDC provided impartial advice to the tourism operators and should be able to support any resolution of audit non-conformities. TDC also conducted joint public awareness campaigns, workshops and seminars in a partnership type relationship with the BOS. The nexus of this relationship  was to ensure that BOS was commissioned tostandardize the tourism product and to provide certification that will indicate quality products and services”

In effect quasi regulatory body as per national policy guidelines for operators registered in Trinidad under Tourism Development Company. Like most accreditation bodies, it is proprietary in nature and without fiscal injection it would in effect void itself – $3 Million plus annual costs flushed out the system that benefitted no one.

Nevertheless, TTTIC became de facto body of standards that placed significant pressure on operators (Hoteliers) in Trinidad to comply, noncompliance meant that they would be removed from incentive programs, marketing ,and business opportunities from governmental agencies. Fast forward to 2017, the Government now claims that TTTIC was “voluntary” blindly opening a doorway to a slew of legal action that can be taken against them by the association members for subverting the course of opportunities and incentives.

Some may argue that TDC’s powers were over quality assurance standards by facilitating inspections and licensing of tourism facilities . Indeed, this “power” fell under the Regulatory Framework aligned to the National Policy for Trinidad and Tobago. However, as the facts has shown, the proposition was skewed at the onset, which leads me to ineffective leadership and governance under TDC.

Now let’s address the recent decision to move from a Regulatory Framework that has cost taxpayers yet again,  to a new organisation,Trinidad & Tobago Regulatory and Licensing Authority (TTR&LA). I can only assume that the issues that arose with the regulatory framework were reviewed and this was the most feasible and cost effective approach to improve the amalgam of tourism products and services for both Trinidad and Tobago. Obviously some of the issues before overlapped with governmental agencies, such as Town and Country Approvals, Statutory Approvals, Environmental Authority, Local Government corporation , Finance and other related bodies.

According to Wikipedia,  a Public Regulatory Authority “is an executive branch of government , responsible for exercising autonomous authority over some area of human activity in a regulatory or supervisory capacity“. A licensing authority “has the right to grant, suspend or revoke licensure or certification privileges“.

The message invoked here is that accreditation will become de rigueur with enforcement as prescribed by the laws of T&T, somehow managed by an organisation that is owned by the government. So besides improved properties (inland and coastal), the public should expect world class sites and attractions with facilities, aesthetic surroundings, improved transportation and service companies, higher concentration on environmental management which will in turn ignite possible investor relationships,not to mention a higher yield of tourism receipts.

What should stakeholders expect from the golden seal of approval – Perhaps higher ratings to attract tourist; More programs in Marketing and Promotion campaigns; Better Leveraging for business opportunities, Reduction of complaints; Higher Revenue; Lower costs for liability coverage; Lower loan rates; and other incentives.

Presently there is a Request for Proposal (RFP) online which reads, “The Government of the Republic of Trinidad and Tobago is undertaking an exercise to regulate and modernize the tourism sector towards developing same as one of the main catalysts in diversification of the national economy“. Already a misdirected communique which makes me wonder whether anyone in authority truly apply critical thinking to determine what is best for the the sector in T&T?[http://tourism.gov.tt/Portals/0/Documents/RFP%20Documents/RFP_RegAuthority_2017.pdf].

The RFP leaves much to be desired and clearly sends warning signs yet again to the very small and already pained tourist affiliated hive. At this point I cannot fathom how a regulatory and licensing authority is expected to modernize the tourism sector and inter alia. Furthermore by analysing this RFP, I have a plethora of questions as it relates to the public purse and the expected guarantee of value to us , the people of our beloved land.

As I applaud the Honourable Minister Shamfa Cudjoe on taking this bold step of implementing Regulations and Licence , I would suggest that the approach should be holistic rather than pigeon-holed. It may have been better to have R&L as a division under a product development authority. In other words a division for licence and regulations for Attractions, Craft Traders,Transportation Operators, Tour Operators, Rental Companies (Water Sport Rentals, Bikes, etc); and for various categories of Accommodation Operators. Other sub divisions to monitor services in quality enhancements, training and community tourism development , environmental improvements, etcetera.   It’s a tighter approach which would be under one umbrella with the sole purpose of managing the product development of the islands.

https://revolutiondestination.wordpress.com/2017/04/17/golden-seal-of-approval

Author: Lisa Shandilya, MBA.(Specialized), CEM., B.Sc., A Tourism Consultant with 20 years as a practitioner in the Hospitality and Service Sector, Member of THRTA, International Hospitality and Service Industry .
Follow WordPress: Revolutiondestination ; Gmail:revolutiondestination@gmail.com

 

 

 

Advertisements

Why dissolve TDC?

Tourism is at the front burner again when Honorable Minister Shamfa Cudjoe announced the dissolution of TDC (Tourism Development Company) at a recent post cabinet meeting. The minister indicated that two authorities would be developed;  “one will focus on Trinidad while the other will focus on Tobago” and if no one else was paying attention, a third authority is to be developed . This third entity as the Minister stated would be  “a regulatory authority which will set basic standards for all tourism operators” , a topic to be discussed in another article.

Sadly, what appears to be disreputable is the appointment of an Interim CEO , TDC on 8th March,2017 and then a notice of dissolution of TDC on the 9th March 2017. According to a news report, The Honorable Prime Minister Dr. Keith Rowley has affirmed his decision together with his cabinet on the ideologue of the two authorities, in a bid to improve tourism. A decision made without consultation with the Communications Union Workers , contracted employees and sector stakeholders. Within the past few weeks the public and stakeholders have ventilated concerns without being informed of the timeline, the vision or measures that the Government will take.

Let me digress a little on the facts of our existing established tourism organisation :

  1. Tourism and Industrial Development Company (TIDCO) was split into two entities; one with a focus on Tourism and another on Investor Development (see articles on  TIDCO ). The reasons for this separation seemed similar to Hon. Minister Cudjoe’s response on TDC. In May 2005, a special purpose company was formed as the implementation plan to the national policies. The Tourism Development Company (TDC) sole purpose is to develop and market the tourism product of Trinidad and Tobago;
  2. Tourism Development Act 2000 was developed which governs the policies for the industry in other words, The  Tourism Act is the foundation of legislation to facilitate Tourism Development for Trinidad and Tobago
  3. Draft plan of National Tourism Policy of Trinidad and Tobago commenced in 2003 and completed in 2007; Cabinet approved 2010. This present national working policy framework was derived from various developmental and economic plans that existed between 1995 to 2008.
  4. The THA Act No. 40 of 1996 incorporated a Division of Tourism as the main arm responsible for the destination marketing of Tobago;

These four(4) official documents were drafted for TDC, THA and The Ministry of Tourism to function and operate in congruence with one another. The crux of the matter is that the national policy was approved 5 years after TDC was formed with “old guards” transferred into the new system. Naturally, the system of governance forged within the organisation became the status quo as no one monitored performance of the organisation. Then there is the inherent power struggle with marketing campaigns and budgetary appropriations between TDC and the THA , a telltale sign of disunity.  This breakdown is further compounded with poor leadership, bureaucracy , nepotism , complexities of superiority, and the list can go on and on.

It is inconceivable that after 12 years with established legislation that TDC have failed one of the most fundamental exercises of branding the destination of Trinidad and Tobago. Not to mention that the branding exercise , drafted in policy and strategic plan/s of destination of T&T was irrationally transferred to InvesTT. At this point my guess is as good as yours when it comes the purpose of the existing legislation- an apparent written document to be comforted by. 

Based on facts above, I am of the perspective that there is need for reform of TDC and the Ministry of Tourism considering the dysfunctional structures of the non-existent TIDCO and the present functionality of TDC.

What is fundamentally critical to note is that tourism is always evolving with new concepts for investor development; new trends; environmental, social and economic changes; new accommodation concepts (ie. Pop ups) to name a few.

Now that the Government has also engaged in Tourism Authorities shouldn’t they also review the Act? What would be the changes made to the Ministry of Tourism? Would the policy be amended ? What is the master plan for the authorities? Does the Government have a plan to secure talent without “friends or family” involvement?  What would be the spend and would the budget be apportioned for the authorities? Which entity would be responsible for branding the image of the islands ? Would each entity use marketing and tactical campaigns of each island tourism products? What is the intention for branding the destination? What is the Government spend to dissolve TDC? What is the budget for creating three entities?

As I close I believe that the public and stakeholders need to understand the intention of the Government with these three new entities so that there are no misconceptions to the present and/ or future state of tourism.

Why dissolve TDC? Please note that the logo is a copy of that used for TDC site . Used (unofficially) for this article based on topic.

Author: Lisa Shandilya, MBA.(Specialized), CEM., B.Sc., 20 years Practitioner in the Hospitality and Service Sector, Member of THRTA, International Hospitality and Service Industry .
Follow WordPress: Revolutiondestination ; Gmail:revolutiondestination@gmail.com

 

 

The quagmire of CDA proposed plans.

Some researches are of the opinion that government authorities may be a better framework to curate a tourism product. It was inferred that an authority will have less political bureaucracy, less interference, better selection of resources and a higher level of accountability. Business dictionary defines a government authority as “Institutionalized and legal power given to a body created by a government to perform a particular function”.

Perhaps an idealistic goal for Trinidad and Tobago as there seems to be more political influence depending on the elbow grease that is offered.

The development of tourism in the western peninsula of Trinidad is controlled and managed by a government authority referred to as Chaguaramas Development Authority (CDA). In 1972, The CDA  was enacted by Parliament -Act #37, to develop land comprising of about fifty six (56) square miles. This authority has been operational for at least forty four (44) years with at least eight master plans and only one approval for land use by Parliament in 1974.

However CDA seems to be plagued with controversy as all agreements of land lease have had political interference which appears similar to that of the surreptitious land grab acquisitions of Caroni (1975) Limited.

What is also strikingly consistent is the sentiments shared by stakeholders , environmentalists, residents and members of the public about the issues of  lease agreements and letters of comfort.  Concerns have been voiced, but not acknowledged on several matters, for instance: The lease agreement for the acquisition and commencement date under agreement for the Chaguaramas Convention Center;  The bidding process for the Waterpark; The issue of land allocation to crop farmers; An upgrade to the  facilities at Macqueripe; Clean up programs; The issue of public exclusion to the beach in front of Guava Road and Chaguaramas Bay; The sustainability of the boardwalk; Environmental Management Authorities lack of interest to prevent Carnival J’ouvert events in a natural habitat zone; Marine Water Testing programs for sea bathers, Wasa Sewerage Plants and Waste Water Management; Security Concerns; and Traffic Management.

It is also thought provoking as to why the western peninsula development is in a conundrum when the land allotment that is managed by CDA represents only one percent of the world famous Yellow Stone National Park  (3,468 square miles) in the USA  .

This article will focus on the most recent contention which was exposed when a public advertisement was issued in June 2016, inviting private investors to bid for land at the tracking station to build a hotel. An assumption could be made that one of CDA’s proposed plans would have prompted the authorities decision. The premise is either CDA strategic plan 1995-2000 or CDA Master Plan 2011-2015? Incidentally, both plans follow similar perspectives, one proposal listed all areas to be developed and the other described the development of the areas identified in clusters with minor nuances. They were both aligned to tourism and preservation of land reserves for the natural habitat. Even the landing page of the CDA website shares a vision of eco-centric activities, healthy lifestyle for families, hiking trails, natural waterfalls, cycling and foot path zones, agri-tourism , marine, and industry .

The strategic plan 1995-2000 noted that ” The tracking station site with its clean air and invigorating atmosphere is an excellent site for a health spa with appropriate accommodation. The area surrounding the tracking station road will be developed into a botanic garden.”

The CDA master plan , Jan 2015 [ http://chaguaramas.com/master-plan/master-plan-document, pg 132] highlights The Observatory as an area of unpolluted urban lights. This plan proposed building an outdoor theatre and, an events area in front of the satellite. The plans also indicated the removal of the decaying building to be used for non-permanent eco camping lodge.

The contradictions of both proposals only exemplifies the lack of preservation, history and a lost future for Chaguaramas. Isn’t lights required to have an open theatre?   What is meant by appropriate accommodation? What mode of  transportation would be used to transfer guests to/from their accommodation/glamp  without any hindrance to nature?

From the vignette of CDA plans, the changing of guards and the convenient legitimacy for another land lease agreement are components in this quagmire. But what is even more disingenuous is that there is no proposed plan for the present CDA project at the tracking site and obviously no engagement toward the carrying capacity.

So where do we go from here? In my perspective the  Western Peninsula would be destroyed if CDA continues to exploit the virtues of ecotourism.There are many suggestions to develop a road map for an identifiable tourism product but I will focus my comments on the tracking station.

Simply consider cleaning up the observatory, with walking/cycling paths and an area to picnic or star gaze. Consider using the building to offer facilities, concession area, media room that can be rented; Forge partnerships with the astrological society to host star gazing events; Have areas identified for wedding photography , photo shoots or movie makers; Ensure that there are only golf carts or electric vehicles allowed to enter with an approved guide; Preserve as much as possible along the picturesque bamboo cathedral and have areas along the path as feeding areas for birds and howler monkeys where visitors can appreciate our real tropical rainforest.Lastly, consider the concerns from the public and its present impact to the area. It is critical for our island to have at least one unique natural haven which CDA has the power to make an impact for the benefit of all visitors to enjoy the Western Peninsula.

Author: Lisa Shandilya, MBA.(Specialized), CEM., B.Sc., 20 years Practitioner in the Hospitality and Service Sector, Member of THRTA, International Hospitality and Service Industry .
Follow WordPress: Revolutiondestination ; Gmail:revolutiondestination@gmail.com

The quagmire of CDA proposed plans.

 

Is poli-tricks stifling tourism?

One of the components within the pillars of tourism is leadership and its congruent relationship among the ministries, associations, and government to foster growth. Within the past few years,  T&T witnessed a game of “musical chairs” for the seat of Chairman within the Tourism Development Company (TDC); and a game of “reshuffle” for the post of Tourism Minister.

The latest uproar in tourism, was the termination of the sitting chair of  TDC on the basis of loss of confidence by the Directors of the Board. The Chair, having worked closely during the campaign with the now sitting Minister of Tourism, fearlessly spoke out citing issues of poor corporate governance.

With that being said, Mr Afra Raymond’s article “Board Games”[Trinidad Express, 2016,May 29] stated that ” The lack of an open process for selection of State enterprise board directors means that the entire arrangement can be seen as “Grace and Favour” appointments, in which certain persons are favored over others.”  

Where does the fault lie?  How transparent are these institutions with hiring policies, performance evaluations/ metrics in order to get the job done, if the credentials of candidates holding the position as Director, Chairman, GM, CEO, Advisor, Specialist, or even the Minister, are limited in their knowledge of the industry. Sadly, the few remaining stalwarts in the industry who are available to add value may possibly be  weathered with the ups and downs, and political bias from obscene nepotism, to be actively re-engaged.

In actuality, when Ministers are reshuffled, they would realign the offices of the Permanent Secretary  and the Chairman because of two main reasons: 1. To ensure that they have loyalty and ; 2. That personnel must follow instructions according to personal or political agenda. So, what is the political agenda?  Who is instructed to deliver the agenda?  Who is expected to benefit from the agenda?  Should  the government past and present be blamed, after all, leaders have changed and political agendas have changed?

Unfortunately, the turbulence that occurred over the years have stifled TDC via mandates from the sitting Minister to abandon,manipulate,suspend or ignore actions to be addressed by the board, suffice to say , nothing tangible would be derived for the industry. When last has Tourism actually realized its significant contribution to GDP, given that there is a strategic plan in place?

Let me refer to an article written by Shaliza Hassanali headlined “PP, PNM treated tourism as bastard child”[May,2016]; which gave viewpoints from former officials who held public posts. Firstly, it pained me to read a headline that the industry is perceived as a “bastard child”. It is irresponsible for anyone to echo such an asinine statement especially someone who held public office.

TDC is a well funded special purpose company established in 2005, however, “Ah eat ah food”   seemed to have been the modus operandi for this Ministry, as no one paid attention to the non lucrative returns.

Simply put, the focus by Government have always been on the energy sector because of its fiscal contribution to T&T’s economy. Agreeably, the Tourism industry can contribute billions to the national GDP  but again, who would be the lead to take charge  without pursuing avenues for profiteering?

From my nebulous recollection from past budget reviews, government allocate billions for initiatives and plans as advised by consultants and advisors, collectively for THA ,TDC and MOT.  That being said, what has been the outcome of the monies that was spent over the years as there has been no measurable growth in arrivals.

What is our position on branding? What is the position at Maracas Beach? Why are there issues with Lion House being in disrepair? Why is sponsorship given without metrics? Why is there a convention bureau fully funded by Government? Explain the rationale for the recent spend of marketing dollars for “Soca on the Seas” on Royal Caribbean vessel from Miami to Bahamas? – I shudder to think it’s because the promoter is Trini to de bone! 

According to the article by Hassanali, the sitting Tourism Minister stated ” Right now the government has instructed and is conducting a review of the ministry and the TDC arm of the ministry. We have a regional consultant who has been meeting with the staff in TDC…”. What does this mean?   Which framework is being adopted?  Why are standing committees being re-created with members whose aptitude is not within the sector? Is it another wishlist report to be generated as in 2011, and 2005; and possible training for the committee members to understand the industry.

Therefore in my perspective,if corporate governance is compromised in a state enterprise then that is a critical area to be addressed. Furthermore, if  leadership which includes the players at various tiers in the industry are irresponsible and unaccountable  to the sector then tourism will never be a pivotal pillar for diversification. It is strongly recommended that poli-tricks take a back seat to effectively reshape the landscape for tourism to prosper.

Author: Lisa Shandilya, MBA.(Specialized), CEM., B.Sc., 20 years Practitioner in the Hospitality and Service Sector, Member of THRTA
Follow WordPress: Revolutiondestination ; Gmail:revolutiondestination@gmail.com

 

 

 

 

 

Survival tactics

recessionThe impending economic and social dilemma, not yet identified by our economists as a recession or depression, will have a severe impact for owners and operators in  the tourism industry, as there is already a glaring decline in inbound tourist arrivals, corporate retreats , meetings and incentives. The rhetoric  Everything will be fine, God is a Trini, or any other airy fairy retort, are not solutions for the sector.

Hotel owners and operators are accustomed to cycles of lows and highs, it is a pattern that the industry is familiar with, based on several factors affecting the destination. I sometimes use the expression that the industry can be compared to a  “ride on a roller coaster”, so many turns and twists , highs and lows; before you know it, another year is ahead and you have to get back on the ride to plan for future opportunities.

With the recent comatose state of the country, after the dreaded April 2016 budget review by The Honorable Minister Colm Imbert, for which my interpretation is that there is no guaranteed recovery period for the country, despite the minister’s reassurance of investment initiatives in a new hotel project at Invaders Bay, an all-inclusive project in Tobago, and the extension of the room upgrade program.

I  would not delve into each initiative or it’s expected viability, but i would stress that the industry will be challenged in this present climate with  various negative variables, the silo operation of the destination authorities and the fact that the Government is becoming the largest stakeholder in the tourism sector of foreign brands.

Would competition be fierce? – the answer is yes. Would the competition be fair? – the answer is no. Would independent owners (stakeholders/taxpayers), be offered the same marketing leverage as the branded properties from government? – who knows, the proof would be in the clarion call of  “supporting local”.

The industry is aware of the effects of a recession which is obviously discouraging, however,owners and operators in the sector must consider intelligent survival tactics. I would present a few of my suggestions which the industry should consider if they expect to sell inventory at the right price.

Firstly, it is expected that the initial reaction by owners and operators in the sector would be to slash prices across the board. We have experienced this before, after the state of emergency in 2011, however, this time the discussion on recession is predicated by panic and fear of low profitability and possible foreclosure. Instead of price gouging, operators and owners should consider rate-obscuring tactics for specific periods or through well designed packages; another would be to introduce other income streams into the operation. In this way, the operator maintains brand integrity and price fairness thereby being able to recover from short falls in revenue.

Cost cutting of operational hours or for renovation is another tactic based on the business cash flows. Some hotels already practice this strategy when there is low inbound arrivals to the islands; whilst others including myself reduce operational times.This approach becomes a practical move if operational expenses exceed profitability, however, this must be carefully monitored, and communicated without sacrificing quality of service. From my own experience,  i can affirm that your team compliment, must be aligned to the integrity of the business and they would go the extra mile to ensure they meet service demands.

A rule of thumb is “Cash is King”, and therefore, operators must ensure that monies are collected up-front from the customer, whether it is Public or Private enterprises. Another revenue stream that has been taken for granted is the rental of facilities , that is , conference or meeting spaces. This is real estate, every square foot including dressed tables, chairs and air conditioning has a cost. Once this is understood by all in the industry then this is another way to ensure that the property makes additional income. Obviously, if the cash flow is healthy then operators would be able to reinvest in small upgrades and maintain credit ratings.

It is also worthwhile or sometimes idealistic thinking for operators to start consolidating efforts to better negotiate with suppliers, for better pricing and to assist in cash flow shortfalls. This is a hopeful thought especially for mid/micro sized properties.

Managing your online travel agents (OTA’s) and your social media reviews is important for your business. OTA’s make a killing on commission, however, it is up to the operator to know how to plan rates and promotions, bearing in mind that the US dollar exchange is fluctuating.

Besides trip advisor, almost all  OTA’s have introduced a review button, where customers can lodge comments. This feature can have great responses and sometimes very distasteful ones. Studies have shown that  psychological behaviors of people using this communication rather than speaking directly to the manager is not yet understood. The bottom line is that these features on media channels are on the world wide web, therefore, responding to comments whether good or bad is critical.

Finally, from a macro perspective, industry operators are heavily reliant on the marketing efforts and incentives from authorities that govern the tourism sector. Therefore, I can only  hope that these players operate strategically  charting the course toward a sanguine expectation. After all, aren’t we all in this together!

 

Author: Lisa Shandilya, MBA.(Specialized), CEM., B.Sc., 20 years Practitioner in the Hospitality and Service Sector, Member of THRTA, Speaker on International Hospitality and Service Industry Seminars.
Follow WordPress: Revolutiondestination ; Gmail:revolutiondestination@gmail.com

 

What does VAT have to do with tourism?

The reduction of Value Added Tax (VAT) from 15% to 12.5% which took effect February 1st 2016 in Trinidad and Tobago, was a political election promise to lower cost of living. However, it seems this fiscal measure came with unanticipated adjustments with revised zero rated items.

Very briefly, Value Added Tax (VAT) is a country’s fiscal policy which registered businesses charge on goods or services; and reclaim what they paid on business-related goods or services. In Trinidad and Tobago , we have a standard vat rate on goods and services; and a list of  zero rated commodities which meant that they were still VAT-taxable, but the rate of VAT charged to customers would be 0%.

This recent fiscal plan is a costly and time consuming exercise for any vat registered business operators.Operators in the tourism industry would have to re-adjust entries for purchasing ; revisit modules for food and beverage costing; update pricing on retail /accounting system; and reprint menus with the adjusted prices. This is just one aspect of how registered businesses deal with the change on vat . So what about the impact on the sector? Would the reduction on vat change the behavior of the consumer spend?

The impact of lowering tax for the tourism sector , which is already price sensitive, has its merits, as taxation changes could contribute to competitiveness and fairness. Ideally, the impact of cost savings by the reduction of vat and zero rated items , should allow operators to reinvest in plant and operation, generate employment and improve staff wages. Of course, this impact is achievable if the tax savings is sizable enough to realize change in the industry within 3 to 5 years.

Let me highlight a simple example, a Pizzeria , would purchase raw materials to prepare it’s  pizza; and offer bottled water (zero rated) for resale.  Assuming resale price of the pizza and bottled water are both sold at $10.00 each, then the customer pays $21.50, if vat of 15% was applied.  With the new change on fiscal policy at 12.5% , and the  revision the zero rated item, the customer is now paying $1.00 more, with the assumption that the selling price of the goods remains the same. Is this change working for the sector?

Interestingly,  within the past two weeks of February 2016, there has been a spike in the U.S currency by almost 11 cents on the dollar. What this suggests,is that the cost of imported goods would be sold at higher prices. From my very own experience,  Heinz mustard which was sold at  $38.00 up January 31st ,2016 is now sold at $48.00 by the same supplier. This alludes to the fact that the selling price , using the the initial example would be even higher, which the consumer will have no savings.

It is my perspective that the industry operators would be challenged to be competitive and maintain standards at the same time. Inevitably, cutting quantity and quality for the sake of selling at best price would not be a promising solution for operators. With the  U.S currency increase, and other factors combined, prices is expected to inflate suggesting that consumer spend may change, perhaps becoming budget conscious. On the flip side, business operators would be unable to absorb rising costs and therefore these increases would be passed on to the customer, that is, if the operator wish to maintain quality offering. From an economic perspective of supply and demand, if the customer cutback on spend then the establishments, for instance restaurants, may experience low or no turnovers. This will lead to negative growth in the economy as no monies would trickle downstream. So where does that leave the tourism industry?

Where the reduction of the vat was welcomed , the U.S currency increase will erode competitive advantage for many in the sector. I believe that the sector need to lobby government to stimulate the domestic economy and the destinations competitiveness by: 1.Reverting vat on technology to zero rated, as it is critical business tool for operators in the industry;2. Consider zero rating basic food items produced by local manufacturers; 3. Consider zero rating beverages manufactured by local producers; 4. Consider providing vat refunds for international tourists; and 5. Promote MICE, Cultural Exchange , Sport programs both large and small that can stimulate demand to both island destinations.

Author: Lisa Shandilya, MBA.(Specialized), CEM., B.Sc., 20 years Practitioner in the Hospitality and Service Sector, Member of THRTA, Speaker on International Hospitality and Service Industry Seminars.
Follow WordPress: Revolutiondestination ; Gmail:revolutiondestination@gmail.com

image

A budget balance -Budget 2015/2016

The budget presentation for 2016 themed “ Restoring confidence and rebuilding trust- Let’s do it together” seems like a balancing act of the new administration manifesto promises and the stabilization of the economy. The 2016 budget presentation considered measures of appropriation of funds to various sectors, despite the challenges of low production of oil and gas, foreign exchange constraints, and increased public sector constraints.

The primary focus of this article is to review the measures taken for tourism sector of Trinidad and Tobago. Quite evidently, the PNM administration fulfilled Tobago election promises with a 4.4 % increase for fiscal year 2016. An injection of T.T $ 2.772 billion dollars of which a percentage is provided for capital expenditure.  However, a large percentage of funding has been injected to boost tourism in Tobago through infrastructural development, such as: increase and improvement of room stock, air bridge and sea port capacity, new and equipped police and fire stations, and a much needed waste and water management facility.

As we know a budget is a forecast which the Government will try to keep to its mandate throughout the fiscal period which they have hinged on the oil and gas dollar. Interestingly, if i quickly review the tourism measures of the 2014/2015 budget by the previous regime they too spoke of diversification of the economy which was also in their mandate. It is of course quite evident that there was no shift in their plans to boost tourism ,as their plans were based on replicated initiatives of a medium term policy framework that has been in existence since 2009. What is pertinent for discussion is that tourism sector despite these annual injections of fiscal incentives, was and is faced with, a slump in tourism, leaving many in the industry fighting for survival.

This slump, in my humble opinion may have arisen from poor air/cruise carrier negotiations, low affinity to tourism, increased costs of living, limited tacit knowledge of the sector by those in authority, lack of strategic direction, to name a few. In other words, no direction of policy, measurements and action plans as applied to the sector will have the tourism of T&T ,using our local parlance, in a  “voops! vaps! ” dilemma,

How then would this shift be made if the systems and structures remain the same with the plethora of challenges in the tourism sector? Furthermore, how can we treat with a sustainable plan for tourism if the government is leveraging on a new record low oil and gas price?

The new administration spoke to the diversification of the economy underpinned by stakeholder forums to steer the direction of the various sectors to develop a tourism growth strategy, which,in my perspective is a great start for all players to understand the value to industry to the economy. Of course this will take time and therefore, it becomes prudent that the voice of the stakeholders through associations (THTRA, THRA, TTITOA, etc.,) can collectively work together to suggest solutions to steer the way forward for the growth of the sector.

The Honorable Minister of Finance, Colm Imbert, also alluded to the environment and socio-cultural improvements, one of the major indicators in tourism competitiveness. Funds injected for renewable resources such as Solar Energy; Water and Waste Water Management measures which was started by the former regime was re introduced in this year’s budget; the introduction on restoring green policies; protecting/enhancing natural resources through partnership with environmental groups; emphasis on improving creative industries (art, film and fashion); the development of sport and the rejuvenation for the agriculture sector, can be amalgamated towards the development of the tourism product of our destination. Out of these various sector reform growth plans one can therefore presume that the tourism strategy would be aligned to the tourism trends in areas such as: sport, eco/adventure, business and leisure/culture. Furthermore, with the allocation of funding directed to National Security with the intent to improve the security and safety of nationals and tourists, is also a fundamental competitive indicator for the sector.

The Hon Minister of Finance also spoke to intermediary support, that is, the role of Ambassadors and a tourism steering committee, as having more robust performance measures with the mandate of improving tourism and hopefully not enlisted for personal agendas.

Despite my delighted view on conscious awakening by the Finance Minister of what Trinbagonians own and have not recognized, I felt a bit disenchanted however that money or partnership agreements for rebuilding heritage sites, museums, hall of fame, carnival artistry, duty free port , risk recovery fund, labor reform, policy reform were not included. Unless, it is to be further discussed within the steering committee mandate.

Another discerning issue, is the increased cost of fuel , the increase in the green fund, the unknown property tax cost, and the other factors of degeneration of income, which would inevitably increase the costs on labour and supply chain.This would have a domino effect as transportation fares increase despite the talk on CNG fuels,  then so too the cost of goods sold, wages, and operational costs. For property owners, who have been complaining of low ADR (Average Daily Rates) in the industry will inevitably feel the pinch on escalating cost. With these creeping costs, despite the lowering of VAT to 12.5% at the start of 2016, the industry will be challenged to maintain quality, improve product and keeping a price of “value for money” to the customer. Herein lies the challenge for the government to effectively market T&T destination with these major shortfalls that will be faced by the stakeholders. Hoteliers/ Operators, more so, the independent properties, will definitely have to regroup to consider going green to cut costs, using technology to reduce labour charges, be creative with training methods ,review customer incentives and ensure that any incentive program offered by government for hotels, is without bureaucracy.

Inevitably, the buck stops with the direction of sound macro and micro policy plans by the government and through the stewardship of the leaders in the industry, to truly take tourism out of the doldrums where it has been sitting for years.

Sport, Business and Government

sports+tourism

There is a saying that “sport and politics do not mix”, the reason being, sport represent an untangled, free spirited emotion of patriotism; and politics has an agenda of control and divisiveness. Within recent years, sport-related travel has increased, suggesting synergistic relationships amongst sport, government and business activities for sport tourism to become a popular trend.

The marriage of sport and tourism is evident, as sport promote tourism through various sport events, seminars, sport conferences; and tourism promote sport by increased participation, touristic attractions and infrastructure. Therefore, Sport Tourism can be defined as “travel away from ones primary residence to participate in a sport activity for recreation or competition, travel to observe sport at the grassroots or elite level, and travel to visit a sport attraction”.

As such, sport tourism comprise a broad range of niche tourism markets which tourism destination marketers can effectively use push and pull factors that can promote destination T&T. Push factors explore experiential marketing such as, the culture and lifestyle of the islands; and pull factors would explore the islands tangibility of its natural attractions, historical sites, special events, entertainment opportunities. In essence the market drive is designed to encourage either the participant or spectator of the sport to revisit the islands. Therefore the key, if T&T is to develop sport tourism is to comprehend the impact of economic benefits, destination image and the social impacts.

Infrastructure is critical to start the business of sport tourism, whereby the reputation earned by the brand created by the facility is able to attract spectator participation and improve destination marketing. For instance NY Yankee Stadium, Rigley Field, American Airlines Stadia, Wimbledon, Wembley, Augusta National Golf course Georgia, Soldier Field, Lords, Kengsinton Oval and Queen’s Park Cricket Club (QPCC) to name a few. Likewise, many destinations encourage investors to build resorts offering sport facilities in watersport, ski, and golf where the attraction of the sport facility becomes the primary motive to be negotiated into the trip. Ski Resorts and Golf resorts of international standards are the top travel trend for the higher income traveler.

According to research there are several categories that integrate sport tourism, business and government such as, Sport Tourism Events (such as olympic games, world cup, marathons, etc.), Sport Tourism Attractions (such as sport hall of fame, sport clinics, sport shows, conference), Sport Tourism Tours (Trekking, Cycling, Dragon Boat, zip lining, Adventure), Sport Tourism Resorts (Golf, Camp Sites, Fishing resorts, Fitness/Spa), and Sport Tour Cruises (Deep Sea Fishing, Snorkel cruise, Kayaking). The fact is, every category mentioned can be facilitated in T&T thereby having the islands poised to move on sport tourism as a unique destination, as both islands can boast of public infrastructure built to international standard: stadia, cycling velodrome, hockey centre, in door sporting complex, racing circuit and soon to be opened aquatic centre. Seemingly, these facilities and lit playing fields should be an impetus for our young sport enthusiasts to grab opportunities to become elite athletes similar to our national achievers as evidenced by our medallist and representatives in individual, team and paraplegic. T&T is the only islands in the Caribbean with divergent sport talent as compared to the other destinations. The T&T flag has been represented in areas such as track and field, cycling, sailing, aquatics, badminton, athletics,gymnastics,tennis, racing, cricket, football, triathalon, netball, hockey, chess, rugby, boxing, just to name a few.

Therefore, it is expected that congruence, if not policy, must exist irrespective of mandates between the two major public institutions Ministry of Sport and Ministry of Tourism with special purpose companies, Sport Company (SPORTT) and Tourism Development Company (TDC). What can be questioned is whether there is a collaborative framework for sport tourism trend to be a forecasted measurement to our GDP?  Where does the responsibility lie to pursue sport tourism to attain brand uniqueness for T&T?

Studies have shown that tensions will arise out of differing ideologies by governing parties, organisations and individuals, private investors, where the responsibility lies in a merged relationship, subsides, and the issue of which public sector authority should then make the final decision.  Since little research is in this area of sport tourism in T&T, it may be interesting that confluence exist in the quasi-autonomous government policy framework.

Historically public administrations in T&T are known to have been poor service providers and most times incapable of generating economic benefits despite grand assertions made by government officials.  With the many facilities built and owned by government, it is only logical that the treasury drain will be more so to maintain facilities and infrastructure. The government will also be financially burdened for hefty sponsorship requests for sport events, advertising, promotions,an apparent norm only in T&T. This substantial financial drain is at the taxpayer expense, therefore this should raise an automatic red flag to establish success indicators to highlight the wealth of return of every dollar that is spent.

It is my perspective, more so as a new administration has been installed, to review its strategic plan with action plans that can have an impact on its goals so as be uniquely established as a sport tourism destination in the Caribbean. One can put forward many recommendations but for the purpose of this article I will venture to offer a few:

  1. There should be a focus towards bidding for major international special events; engage with international teams to host friendly matches; ‘charm‘ meets with private investors to consider leasing stadia; and encourage facility rental;
  2. Entice international brand merchandisers (Lucozade, Coca Cola, Pepsi, Red Bull, Adidas, TATA, etc.) who are seeking new markets to become primary sponsors for events or conferences;
  3. Build on coaching and training camps in various disciplines;
  4. Review the tax break sponsorship incentive for private companies making it less bureaucratic and also include tax break for small businesses;
  5. Promote specialist online pages to advertise sport and adventure travel;

Economic benefits are attainable as long as the destination brand encourage the tourist dollar to be spent on the visit of attractions and accommodation, shopping and dining; the government will benefit from tax collections and income through sponsorship / leasing /ticket sale distribution; and our people would benefit with a sense of pride, patriotism and support from having a pool of international athletes on the world stage. Therefore, I fervently believe that the mix of sport, government and business can soon become a fine blend for destination Trinidad and Tobago.

What tourism policy?

      What is Haiti’s strategy to re-invent the island’s tourism sector to attain private-equity firms to invest in hotels, resorts and transportation projects after years of political struggles, financial impropriety and natural disasters?

Barbados, on the other hand, under the successive stewardship of Ministers Miller and Lynch, developed aggressive policies that positively impacted the island’s tourism sector ranking the island as one of the top Caribbean destinations.

Theoretically, a tourism policy is a component from a national model and should be regulated by the public sector. It is a working document that identifies future projections of tourism receipts beyond government conjunctures.

What the tourism policy attempts to do is to provide a clear plan of action from short, medium to long term goals; to identify destination targets of travel for cultural, trade and other pertinent business which translates to economic benefit for the country; to build well informed customers that will promote the product of the islands; to interest investors, to improve on the heritage and culture of the people; to develop infrastructure; to secure financial funding to support projects, and to build a more sustainable tourism. However, the tourism policy cannot be static as the tourism sector is dynamic in nature therefore recommending that reviews are done to tweak the actions plan to accommodate change.

Research has shown that partially funded tourism organisations work on tourism receipts and sales quotas to fund the organisation. These organisations cannot be lapsed in their strategic marketing efforts otherwise they will fold. Almost all smaller destinations in the world and the Caribbean manage their tourism operations from the state support. Evidently successful public tourism organisations must have the political will to access resources to improve competitiveness to achieve the national tourism goal.

A tourism policy cannot be copied and adapted to a destination, especially if a destination is to offer a unique and identifiable product offering in a global market place. Recently, a comment was posed to the Minister of Finance at a post-budget debate 2014, suggesting that Trinidad and Tobago (T&T) should adopt the Dubai model for development of our island tourism product based on the premise that both nations are owners of non-renewable energy. Agreeably Dubai, in a space of thirteen years managed to quadruple its inbound tourist arrivals being the most luxurious and sort after destination in the world. However, it should be noted that the tourism component was not in isolation for Dubai’s aggressive action for their country.

The fact is , Trinidad and Tobago have been following models over the years , the pre-colonial system of governance and the fatally adopted western world ideologies, a toxic combination,  without critical reflection of what, why, how or where our island’s should be in the long term.

For any model to be effective it requires strong private/public sector relationship that is beneficial for investors, communities, culture and heritage, economy, environment and the human resources. Additionally, researched data have shown that government and the tourism public sector advisers or leaders must be of a futuristic ilk with a clear vision for the country and its populace for tourism development.

For instance, Prime Minister of T&T, Mrs. Kamla Persad-Bissessar, at the start of her tenure engaged several international audiences in Asia, London, New York, Panama and Brazil promoting T&T. Who should have channeled these efforts? Is this a failure of her government or the failure of the management of the state enterprise mandated to market the destination?

Perhaps one should question whether Trinidad and Tobago have a national framework of which one of the components is the national tourism policy? One can argue that Trinidad and Tobago has a national tourism policy (http://www.ema.co.tt/new/images/policies/tourism_policy.pdf) which was drafted in 2008 and published in 2010; and there is also a tourism act, 2000 (minor updates in 2006).

Researchers within the Caribbean highlighted in several published articles, a series of on-going challenges which has positioned T&T at a standstill in destination performance.

The first issue is the weak congruent relationships among the three public tourism institutions which has had conflicts in driving tourism as a unified voice that is glaringly evident in the marketing strategies for the islands. The second challenge is that decisions are ad hoc without alignment to a policy which has had projects at a stalemate thereby increasing financial costs. This was evident with the incentive plans, the green globe project, the blue flag project and the recent “tOURism is about us” marketing campaign to name a few. And finally, the politics, which seem to be a major contributor to the weaknesses of tourism not only in T&T. Issues , such as, nepotism of the Government in power, the internal politics within public tourism organisations and the profiteering pseudo consultants are some common occurrences faced by the sector.  According to research many wielding the power in state owned tourism enterprises, are not necessarily the politicians, but those with agendas who are retained as advisers irrespective of government in power, whose intent is to keep the system at a stalemate for their own prosperity.

Therefore, Is T&T national tourism policy well designed and effective to fuel our national tourism goals?  Perhaps, more research is needed to identify which simulated model is practiced by the state owned tourism organisation in T&T : 1. “Cart before the horse” model  whereby  plans or incentives are introduced for the sector by ignoring the  bureaucratic formalities; 2. “The Knee Jerk”  model ,whereby the industry becomes reactive rather than proactive in a crisis; 3. “The Clueless” model whereby the workforce in the tourism organisations do not have the passion or skill sets to be involved in tourism;  4. “The oil syndrome” model whereby tourism funds are  hemorrhaged without understanding whether it will impact on increased tourism receipts; and  5. “The blame game” model whereby everyone point fingers at the sitting government and opposition without either side validating measures to diversify the sector.

In reflection, transformation of the tourism sector can be driven in T&T once the leadership embraces the complexity of the industry to deliver innovative ideas through a well-designed framework of a national tourism policy with performance measures regulated by an established team of knowledgeable public/ private sector partners. Just saying!