Chief Secretary Says Sandals Project Will Go Through Due Process

As Chief Secretary of the Tobago House of Assembly, I am compelled to make a statement on comments uttered at a Public Lecture at the Scarborough Public Library on Thursday 13th December, 2018, and to bring a measure of clarity and balance to some of the issues raised at that forum entitled: “The Buccoo Reef Marine Park, Sandals and You. What you need to know”.

The primary focus of the lecture seemed aimed at discussing some of the implications of the non -binding Memorandum of Understanding between the Government of Trinidad and Tobago and Sandals Resorts International, 2000 Inc. dated October 10th, 2017.

While I appreciate the speakers’ interest in the project as citizens of Trinidad and Tobago and their desire to see that this country gets a fair and reasonable return from the Sandals project, I wish to remind the public that the Memorandum of Understanding that was being discussed on Thursday is not a legally-binding document and leaves room for further discussions and negotiations before a final legally-binding agreement is reached.  This MoU of October 2017 is simply a document indicating that both parties agree to work together to establish the resorts. Every single item listed in the MoU will be open for discussion when the Government’s Negotiating Team meets with the Sandals Team.

In the discourse on Thursday, reference was made of Clause B1 on page 5 of the non-binding MoU which states that, “the Government acknowledges that Sandals intends to establish subsidiaries, affiliates and associate companies to hold the Management Agreement, operate the resorts and otherwise operate its role”. It was also stated that the MoU creates opportunities to allow transfer pricing to take place by using euphemisms that allow for tax avoidance mechanisms. However, I am confident that the Government Tax Experts and legal advisors who will, no doubt, form a part of the Government’s Negotiating Team will ensure that safeguards are put in place to obviate the possibility of the transfer of prices.

With regard to the issue of “return on investment” the speakers seemed to focus only on the direct cost of constructing and outfitting the resorts including the soft and grand openings of the facilities. However, no regard seemed to have been placed on the significant indirect benefits that will accrue to the people of Tobago by way of increased economic activity on the island, as a consequence of Sandal’s massive promotional machinery that will attract vastly increased visitor arrivals, and to the people of Trinidad and Tobago who will benefit from greater inflows of foreign exchange to the country.

Equity in the application of the Tax concessions in the accommodation sector was also raised on Thursday. Since earlier this year, the Government is on record to say that as far as it was reasonable and possible, it proposed to treat new and existing hotels equitably. In other words, the Sandals/Beaches resorts which will be owned by the Government and by extension, the people of Trinidad and Tobago, will receive tax benefits no more favourable than those enjoyed by other deserving properties in the country.

On the issue of employment of Trinidad and Tobago nationals within the Sandals and Beaches Resorts, it has been suggested that the contract between Sandals Resorts International Inc. and the Government, when being negotiated, should include quotas to ensure that Trinidad and Tobago nationals are employed at various levels within the organization. Initially this may not seem practicable, given the size of the resorts and the very limited numbers of trained hospitality employees currently available on the island. It should be noted that in 2004/2005, with hotel occupancy levels at a record high on the island, some hotels in Tobago hired several Filipino staff to augment local employees to run their properties. However, I confidently expect that this matter will be competently dealt with around the negotiating table and that eventually, the interests of nationals of Trinidad and Tobago will be adequately protected. In the meantime, I wish to urge Tobagonians, particularly our young people, to avail themselves of the training opportunities that are being provided by the Tobago Hospitality Institute established by the Tobago House of Assembly and accredited by the University of the West Indies, to train our citizens to become qualified in the Tourism and Hospitality Industry.

Concerns were raised regarding the opportunities for providing local content such as agricultural produce. The agricultural sector has already begun to prepare to take up the challenge to provide food for the resorts. Our farmers are now thinking big. Already, in preparation for the establishment of Sandals/Beaches Resorts, a 50K chicken hatching facility is in operation that will facilitate the production of eggs and meat for the resorts.  A micro credit facility has been established at the ADB for small farmers. Fishing loans are being offered by the ADB to assist fishermen to improve their fishing activities and skills and 70 young Tobago farmers have joined the YAPA programme to increase food production on the island. A coconut revitalization programme has been established to provide adequate supplies of fresh coconut water. The Farming and Fishing sectors are energized now that Sandals is committed to utilize all local produce required by the resorts that are consistent in volume and quality.

The final issue I wish to address pertains to the concerns regarding the possible negative environmental impacts that are being suggested to affect the construction of the resorts at Golden Grove and Buccoo estates, especially the area associated with the 18-hole golf course. It should be noted that there are well established international standards and protocols that guide mitigation measures against harmful effects of golf courses on the environment. It is noteworthy that in 2006, Angostura was granted permission by the Environment Management Authority (EMA) to construct an 18-hole golf course in the same general area as is being proposed by Sandals International today.

Let me conclude by saying, whilst the Sandals Resort Project has the potential to significantly transform the social and economic landscape of Tobago, it is important that the population rest assured that the Government of Trinidad and Tobago intends to comply with the laws of the land and in this regard, it will ensure that due process takes place. I also want to assure the people of Tobago that the Tobago House of Assembly continues to respect and abide by the Environment Management Authority and its processes. As an administration, we remain committed to ensure that Tobago derives optimum benefits from this project.

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