“The faith that you have, have as your own conviction before God.” – Romans 14:22

As part of a small Caribbean delegation, I participated in the Commonwealth Partnership for Technology Management Global 2013 Smart Partnership International Dialogue from June 28 to July 1 in Dar es Salaam, Tanzania which was hosted by the Tanzanian Government.

Talking to journalists in Dar es Salaam, the Chief Secretary, Mr. Ombeni Sefue, said that under the dialogue priority areas had been identified, including responsible persons or institutions to implement them and a strict timeline. The theme for the Global 2013 Smart Partnership Dialogue is “Leveraging technology for Africa’s socio-economic transformation: The Smart Partnership Way.” He said the government, the private sector and various groups will work together in making sure that those priority areas did well and therefore attained the government’s Vision 2025. Having met him in London last December, I can imagine him speaking passionately and with the courage of his convictions as if he was God’s instrument of divine love and peace.

Because of the international travel and a seven hour shift in time zone coupled with a very hectic schedule in Trinidad over the last week, I had to find a way to meet my weekly column deadline.

My friend Vincent Vanderpool Wallace, a tourism specialist from the Bahamas, solved my problem. I thought I would share his response to my last week’s column.

He wrote: “Dear Basil, I was great seeing you in New York. I am probably one of the most diligent readers of your columns but I haven’t sent written comments to them as frequently as I did in the past. I had to write to you about your most recent column entitled ‘Healing the Troubled Caribbean Economies’.

“It has always been very strange to me that trade treaties within our region and between our region and other markets appear to address trade in physical goods and ignore trade in tourism, the largest sector of our regional economy. Much world trade exploded with the removal of tariffs when items cross borders. Without the removal of these tariffs, the entire principle of comparative advantage becomes distorted. Once they were removed, the lowest cost, highest quality producers were able to emerge and companies and countries could grow much faster by specializing in the production of items for which they had a real competitive and comparative advantage. Why this is easy to understand for physical products and completely ignored with respect to the trade in people crossing borders, that is, tourism, has always been baffling. Why the Caribbean, the world’s most tourism dependent region, would not begin with reducing the tariffs on tourism, if only within our region, is little understood. You may recall that CARICOM countries had the brilliant idea of establishing a common visa regime for participating Cricket World Cup countries and when World Cup was over, they resolutely and promptly removed it.

“You will agree that it is much more difficult for us ‘to fix our mouths’ to complain about APD (Air Passenger Duty) from the UK when we progressively raise departure taxes, passenger facility and other charges which as incorporated into the cost of the ticket.

“Many have now come to believe that ‘healing the troubled Caribbean economies’ can begin with us. The largest untapped market for Caribbean tourism is the Caribbean itself. If we look at the fixed charges arising from these government taxes, we punish our neighbours the most since those taxes and fees represent a much higher proportion of the cost of the ticket. Indeed it is from our neighbours that we expect to get the highest level of repeat visits. As it stands now, in far too many cases, Miami is a highly competitive alternative given the cost of travel within the Caribbean.

“As has been noted elsewhere, if our hotels are now running at 65% occupancy, moving those occupancies to 90% will grow the GDP from tourism, our most competitive global business, by nearly 50%. We used to believe that such occupancies are impossible until we realize the cruise ships visiting our region regularly run over 100% FOR THE YEAR!

“There is no faster way to stimulate our Caribbean economies. No new capital investment is needed. There is no such thing as a “jobless recovery” in tourism. The high multiplier effects of tourism would reverberate through our economies in a way that would make us marvel. What happens to government taxes (if) removed to stimulate tourism? It can be shown fairly easily, just as the PriceWaterHouseCoopers study shows for the removal of the APD in the UK, it would pay for itself. Once we remove these tariffs on travel within the Caribbean, the region should negotiate with our primary source markets to remove their taxes on tickets also. That very same upscale businessman who travels in First Class and stays in a suite on business is looking for (the) lowest cost places to go on vacation for his family of four when the time comes for vacation. And he will take multiple trips over the course of a year if the price is right. Most families would rather pay for enjoying (their visit) instead of getting there.

“As I write this, I checked the round trip airfare from a US market to a city in our region. The base airfare is $200. The taxes and fees are $127 for a total of $327 per person. Does anyone believe that we would not see a travel explosion from that market if the advertised airfare for leisure travel were $199 per person? Let the healing begin.”

(Dr. Basil Springer GCM is Change-Engine Consultant, Caribbean Business Enterprise Trust Inc. – CBET – Columns are archived at

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