Insurance Corporation Makes Its Presence Felt
The time has come when certain influential organisations in this country
must step out and make their presence felt within the community where
they exists. NIC has stepped out to influence the generation of wealth
and the provision of resources for the poor.
It began with NIC involvement in the launch of the Productive Sector Equity
Fund on July 31st, 2002 and on the following day August 1st, 2002 with
the launch of the National Community Foundation.
It is the general feeling that these steps are in the right direction.
With regard to the Productive Sector Equity Fund, the currently available
EC$15,000,000.00 should at least be extended to a minimum of fifty companies.
The involvement of the funds is limited to 40% of the capital or a maximum
of EC$750,000.00 contribution to the capital Structure. This is a reasonable
start but it was agreed that there is need for much more funding.
In the meantime, I took the opportunity to make a plea to the audience
that given the existing economic environment, many entrepreneurs are having
difficulty in meeting their obligations and may go under. I therefore
proposed that these persons should not be left behind but be encouraged
and assisted to return to a position where they can continue to make a
contribution to the development of the Private Sector.
Those Entrepreneurs who have failed can be our greatest asset only if
for the experiences learned from such failures.
It is public knowledge that the memory of Banks are long and past bad
loan repayments come back to haunt Entrepreneurs. However, while this
may be so there must also be consideration in regard to the circumstances
under which delinquencies occur. Unlike the several provisions to take
care of Entrepreneurs due to the lack of performance within their companies
such as Chapter 11 in the USA, what do we have in the Caribbean, except
for shame and disgrace with no hope of a return. This is the reason why
so many Caribbean Entrepreneurs stay with projects which they should abandon
but rather stay with them and loose all. In most cases when a Caribbean
businessperson goes broke, he is broke indeed.
We must enact more humane laws in relation to risk oriented businesses
if we are to preserve the existence of our Entrepreneurial class. There
is no simple solution to the problems that confront the Private Sector,
especially the Small Business Sector. The success of the Equity Fund will
depend on a new attitude of Entrepreneurs who until now rather be a big
fish in a small pond and cannot breathe rather than be a small fish in
a big pond where there's space for sustainable growth and no possibility
of being stifled.
I believe the time has come for the establishment of an Investment Club
which will be responsible for developing this new culture so badly needed
and for counselling established Entrepreneurs who are currently traumatized
due to the present state of their investment. Those who are caught in
the dilemma of being unable to meet their Bank Loan commitment - what
is their future? No one has addressed a moratorium, no one has answered
the question if the business is now closed and the borrower is without
a job - what is the position? These are issues that we cannot push under
the carpet or have we predetermined the fate of such persons? We need
to deal with this state of affairs the way we deal with national disasters
- we must be armed with answers to deal with the present situation.
Too often we look at the end before considering the means. The current
crop of experienced entrepreneurs must be embraced and solutions found
to bring those who will confirm to theraphy back into the productive force.
There are many who have both the asset base and the expertise to move
on to another project but not given the encouragement because they are
The Productive Sector Equity Fund must be innovative and as its major
thrust seek to invest in businesses that are currently cash starved but
have real potentials for success. I call on the Fund Administrators to
provide a list of investments they are willing to enter into equity relation
and only seek to undertake business plans for viable projects after a
series of interviews with the project proposer.
Now about Poverty. We now have an institution that will source and channel
funds to agencies that provide for the poor. The NIC should be complimented.
I seek to suggest to the NIC to go a step further to ensure that wherever
possible there must be self generating income contribution by the recipients.
I am alluding to an example such as blind persons making baskets and mats.
For too many people - poverty is a state of the mind and, or outright
laziness. We must not seek to encourage a community of beggars.
There's a handful of real leaders in our country and I take my hat off
to two such persons who are breaking out of the old mould and can be considered
as movers and shakers of this new era. They need our support, let us give
it to them. Congratulations to Miss Emma Hippolyte and Mr. Marius St.
Keep the Faith. God is in Charge!
August 9, 2002