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$383 million approved in TEF/EXIM bank loans

BY HORACE HINES
Observer staff reporter
hinesh@jamaicaobserver.com

Monday, June 19, 2017

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MONTEGO BAY, St James — The tourism ministry's initiative to drive Small and medium tourism enterprises (SMTEs) has so far resulted in $383.9 million being approved for 21 clients under the billion-dollar revolving loan fund being administered by the National Export-Import (EXIM) Bank.

This was disclosed by Tourism Minister Edmund Bartlett, while speaking at the Montego Bay launch of the Small Businesses Association of Jamaica (SBAJ) inaugural Caribbean MSME Conference at the St James Place in Montego Bay last Thursday.

The Caribbean MSME Conference is scheduled to take place July 19 to 21, 2017, at the Hilton Hotel & Spa Resort in Montego Bay.

The loan fund is being seeded by the Tourism Enhancement Fund (TEF) as a first step towards establishing a tourism credit bank, which Minister Bartlett proposed last year as a source of funding for service providers in the tourism industry, thereby enabling them to build capacity and reap more from the industry.

Noting that the fund was one of the avenues through which the Ministry of Tourism was helping small businesses, Bartlett also disclosed that, to date, $166.13 million has been approved and disbursed to nine of the applicants, with the remainder awaiting approval of collateral.

“I am told that applications in varying stages are being processed, now totalling $117.5 million, while there are expressions of interest totalling an additional $430 million,” Bartlett said.

He reminded the audience that under this facility, applicants can access a minimum of $5 million at an interest rate of five per cent for five years, and a maximum of $25 million.

Additionally, Jamaica National is administering a $20-million loan facility to support upgrading of small tourism entities.

Endorsing the SBAJ MSME Conference, the tourism minister said its focus was in harmony with the direction in which tourism was being guided.

“Eighty per cent of global tourism is driven by small and medium-sized enterprises represented across 157 countries, several of which were agrarian economy or were driven by extractive and manufacturing and all sorts of mineral-based industries, and have transformed into tourism as the centre of their economic activity,” he noted.

He further noted that the 80 per cent of small businesses driving the industry were dealing with the consumption side of the tourism paradigm, with production accounting for the remaining 20 per cent, and making big investments to produce infrastructure of rooms, marketing and air travel.

With financing being a major factor for local MSMEs, Bartlett pointed to the support being made available to enable Jamaicans to have full control of supplying goods and services to the expanding tourism sector.

In the absence of funding, he said: “Because we have not been able to give you the capacity to deliver those things that the tourist wants to consume, the money that should stay in Jamaica is gone. So they bring the money come and it goes back out, even when they consume things locally because we have to import much of it.”

The tourism minister said Jamaicans had to put themselves in the position where the things tourists buy here are authentically 'made in Jamaica' merchandise; that the foods they eat come from production by local farmers.

“And if we are able to do that, the dollar will remain here,” he said.

Facilities were put in place to empower MSMEs through training at the Jamaica Centre for Tourism Innovation, scheduled to come on stream in September.

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