November 25, 2020

The novel coronavirus pandemic has severely impacted Jamaica’s agricultural sector. The sudden shutdown of the tourism industry in March left thousands of pounds of produce with no market. The loss of sales from those crops made it difficult for several farmers to replant, this was followed by severe drought throughout the summer. Plus, there was continuous rainfall for several weeks making recovery by this vital sector slow, causing an extended scarcity of several crops. Like other major planks of the country’s economy, the agricultural sector must develop robust measures to cushion the effects of the virus. Co-founder and chief executive officer (CEO) of FarmLinkr Shelly Heaven says her organisation is one of the entities focused on transforming the agriculture sector with the hope of safeguarding Jamaica’s national and economic development and post-pandemic recovery. “FarmLinkr began its operations in 2017 as an online marketplace that is on a mission to revolutionise the agricultural sector through the use of technology. “We link together farmers and fresh produce resellers with wholesale buyers, bridging the market information asymmetry gap, via the sale of fresh farm produce both locally and internationally,” Heaven said in an interview with this publication. Heaven said that FarmLinkr’s platform provides a safe and secure environment for vendors and shoppers to conduct their business. “With fewer local markets available to farmers, due to the closure of the tourism industry, it is important now more than ever to increase the efficiency of our food distribution and supply chains. ”Our online platform provides the opportunity to significantly assist in this area,” the young entrepreneur said in her interview.   HOW IT WORKS Heaven explained, “FarmLinkr provides farmers with the opportunity to create a free online store to list their first produce for sale, free of cost, in a matter of minutes. The platform provides all the necessary tools to effectively manage an online store. Farmers are therefore provided with much-needed visibility to market their produce to a wider audience both locally and internationally. Buyers can pay with any international Visa or Mastercard and farmers receive funds from sales in their local bank accounts. Services such as ours are invaluable under our new normal, where avoiding unnecessary contact is advised. The convenience of our service is also vital to both shoppers and sellers as a well-needed time saver, a scarce resource for many people.”   RESILIENCE UNDER COVID-19 Heaven advised that since starting in 2017, “the company has since pivoted and now also offers contractual farming agreements with large buyers such as hotels, exporters, restaurants, supermarkets and processors. Buyers are invited to identify their produce quantity and frequency needs, which are then grown by the company’s trusted network of farmers. Where there are no contracts in place, FarmLinkr can provide buyers with a fresh supply of produce based on availability. With the reduced local demand due to COVID, the company has now increased focus on exporters and export markets”. According to Heaven, “agriculture is a ‘sleeping gold mine’. We need to awaken it and unlock the benefits for Jamaica’s national and economic growth and development, and in so doing, also transform the lives of our farmers”.

In a bid to increase transparency and ensure Jamaica is safe for doing business, the Common Reporting Standard (CRS) is to be introduced locally, in keeping with global standards on tax compliance. Aimed at combatting tax evasion, the CRS is an information standard for the automatic exchange of information regarding financial accounts between tax authorities globally, which the Organisation for Economic Co-operation and Development (OECD) developed in 2014. Both Houses of Parliament have now approved legislation that incorporates the CRS into domestic law. This is the Revenue Administration (Amendment) Act, which was approved by the Lower House on November 10 and passed in the Senate on Friday (November 20). Piloting the Bill in the Senate, Leader of Government Business in the Senate, Senator the Hon Kamina Johnson Smith, pointed out that Jamaica has been a role model and example in the region in respect of tax compliance with the global standards. “In that context, we weren’t previously required to commit to starting automatic exchange of information, but as we seek to maintain high standards in tax compliance and our global standing in this regard, we are now proceeding to this next level of legislative strength,” she said. The Senator, who is also Minister of Foreign Affairs and Foreign Trade, noted that exchange of information between revenue authorities has been a long-standing part of the legal and domestic landscape in Jamaica, forming the basis of an article in the country’s double taxation agreements as well as being the subject of stand-alone bilateral tax information exchange agreements. “However, in the aftermath of the global financial crisis, and the political momentum with respect to international tax matters, it shifted towards opportunities provided by automatic exchange of information, and as such, in September 2013, the G20 Finance Ministers and Central Bank Governors determined that automatic exchange of information was the new globally accepted standard,” she informed. She noted that by 2014, more than 104 jurisdictions committed to swiftly implement multilateral automatic exchange of information through the Convention on Mutual Administrative Assistance in Tax Matters (MAAC), using the CRS platform. “The MAAC is a multilateral convention that was designed as an instrument of international law to facilitate all forms of administrative cooperation. It contains strict rules of confidentiality, proper use of information and permits automatic exchange of information. One of its main advantages lies in its global reach with 141 signatories as at September 1, 2020,” she said. Jamaica signed the MAAC in 2016, ratified it in 2018 and it entered into force on March 3, 2019. The Minister noted that Jamaica is now seeking to operationalise the CRS platform under the MAAC through amendments to the Revenue Administration Act, which incorporates the text of the Convention. “As Jamaica works towards continued growth and development, these amendments are designed to ensure increased compliance by entities operating within the country as well as to maintain tax transparency. This will in turn maintain and even enhance Jamaica’s reputation in the global landscape,” she said. Senator Johnson Smith further noted that under the CRS, it is financial and banking information that forms the focus of the global model for automatic exchange. “So the CRS, with a view to maximising efficiency and reducing the cost for financial institutions, draws extensively on an intergovernmental approach, which is already used through implementation of the [United States] Foreign Account Tax Compliance Act (FATCA),” she said. The idea for the CRS is based on the FATCA implementation agreements. FATCA is an important development in US efforts to combat tax evasion by US persons holding accounts and other financial assets offshore. “Jamaica intends to leverage its successful experience in the implementation of FATCA to proceed with the introduction of the CRS locally,” she said. In the meantime, Mrs. Johnson Smith noted that the Government has had stakeholder consultations regarding the CRS with a number of representatives of various private-sector organisations, including the Private Sector Organisation of Jamaica (PSOJ), the Jamaica Chamber of Commerce, the Bankers Association and numerous financial institutions. “The representatives were sensitised to the CRS and had the benefit of expertise of the OECD to address their concerns,” she said. Source: https://jis.gov.jm/common-reporting-standard-to-be-introduced-locally-to-combat-tax-evasion/

The Jamaica Business Development Corporation (JBDC) is partnering with international organisation, CIAL Dun & Bradstreet, to deliver critical development services to operators in the micro, small and medium-sized enterprise (MSME) sector as they grapple with the effects of the coronavirus (COVID-19). The agreement between the entities was signed on Wednesday (November 18) during a ceremony staged by the JBDC to mark Global Entrepreneurship Week 2020 under the theme ‘IDEATE. INNOVATE. ACTIVATE’. With a strong presence across 43 countries in Latin America and the Caribbean, CIAL Dun & Bradstreet empowers companies of all sizes to grow, manage their customers and suppliers, and operate successfully in an increasingly global, transparent and modern economy.  The entity has enabled millions of businesses around the world to make confident decisions with reliable and accessible information. JBDC Board Chairman, Dr. William Lawrence, said he anticipates that the partnership will help the country’s MSMEs to recover quickly and go forward. “As you know, the country, like many others, has been hard hit and as the main driver of economic growth, the business sector has had to grapple with many challenges. “A number of surveys suggest that… at the MSME sector, there is need for special help and this is where the JBDC has always stepped up to the plate,” he noted. Dr. Lawrence said that the JBDC Board of Directors is pleased with the swift progress that the organisation has been making since the onset of COVID-19. State Minister of Industry, Investment and Commerce, Dr. the Hon. Norman Dunn, for his part, charged the JBDC to continue to engage industries in an effort to assist them to transform and identify new ideas. He noted that Global Entrepreneurship Week is more than just networking and building awareness. “It is also about unleashing our creativity, exploiting new opportunities, solving problems, taking risks, learning about our failures and successes and charting a new course for the future. It is about thinking big, making our mark in the Jamaican landscape and the world,” he pointed out. He further noted the appropriateness of Global Entrepreneurship Week theme. “As an entrepreneur myself, I understand the importance of these terms – ideate, innovate and activate. It is what makes us entrepreneurs,” he said. The JBDC is the Government’s business development agency that assists in the sustainable creation and development of MSMEs in Jamaica. Source: https://jis.gov.jm/jbdc-partners-with-cial-dun-bradstreet-to-assist-msmes/

Jamaican Teas Limited is adding 12,000 square feet of factory space, a $150-million investment that will give the company over 50 per cent more room to make non-tea products for its expanding market. CEO John Mahfood says construction is planned for March-April in 2021, which means the new space should be commissioned into service by next September, taking the company’s Kingston-based factory from 22,000 square feet to 34,000 square feet. “Of course, there will be additional racks and shelving, along with manufacturing production equipment,” said Mahfood. “Based on the type of construction we should be operational in four to five months,” he said. Jamaican Teas currently runs three work shifts, six days per week, but with food being a COVID-resistant market, the company, whose core business is tea production under Tetley and Caribbean Dream brands, but also the maker of other items, says it needs new capacity for non-tea goods. At year ending September 2020, the tea maker reported record revenue of $2.2 billion, and, as Mahfood noted, Jamaican Teas achieved its objective of getting most of its revenue from exports, which accounted for 65 per cent of top-line income. The company did not fare as well at the bottom line, due to its holdings in equity investor QWI Investments Limited. Jamaican Teas say a reversal in investment income from positive $533 million to a loss of $433 million, coming mostly from the heavy unrealised losses from QWI during the second quarter, due to COVID-induced collapse of the equities market. Consequently, Jamaican Teas’ net profit fell from $396 million to a preliminary estimate of $210 million this year. The 2020 numbers are still subject to audit. DEEPEN MARKET PENETRATION The factory expansion will allow the company to focus even more on exports, while concurrently addressing demand in its home market, he said. Mahfood is projecting US$1 million in additional revenue from the expansion, which will centre on soups and spices and other non-tea items. “We’re very fortunate that we’ve been able to reap the benefits of years of hard work in building that base. With this expansion we expect that our distributors will deepen the market penetration, by expanding the customer base and the number of locations we go to, especially in the USA,” he said. He added that the Caribbean market, which has been growing at about 20 per cent per year, is ripe for further expansion. Last week, to create more supply of the company’s shares, Jamaican Teas sought and got approval from shareholders to execute a three-for-one stock split, effective November 30. It will grow the listed JAMT shares from 695.08 million to 2.085 billion units. While reporting to shareholders about the company’s overall performance, Mahfood said Jamaican Teas had seen a 70 per cent spike in revenue over the past year, arising from a 49 per cent increase in exports, seven per cent growth in domestic sales, a full year of supermarket sales, as opposed to just four months in the previous period, and income from the sale of the Manor Park apartments developed by the company’s real estate arm. Of the 18 units at the Manor Park complex, 12 were sold outright, while five are under contract for sale, and one remains unsold – bringing in enough cash to finance the additional factory space, he told the Financial Gleaner. “The real estate development delivered $380 million. That will give us sufficient resources to deal with the expansion,” he said. Jamaican Teas has another real estate project under way at Belvedere, near Red Hills, St Andrew. The 25 residential units, priced at $14 million to $20 million, are under construction and due for completion in October 2021. Source: http://jamaica-gleaner.com/article/business/20201125/jamaican-teas-upsizing-factory-50-cent