KINGSTON, Jamaica – Measures announced by Prime Minister Bruce Golding of Jamaica, to assist the tourism sector, specifically the hotel industry, in order to ensure sustainability during the global economic crisis, and to save jobs that might be lost, have been well received.
In his address to the nation on Sunday, December 14, the Prime Minister said that one of the measure being implemented includes a reduction of the General Consumption Tax (GCT) paid by hotels by half, from 8ΒΌ per cent to 4.125 per cent, effective January 1, 2009, for a six- month period.
In an interview with JIS News, General Manager of Christar Villas Hotel, in Kingston, Charles Brown, said the lowering of the GCT would be very beneficial to the sector. “It will potentially help with your overall cash flow… and at this point in time, the sector is under stress, because of the level of fall-out in terms of your occupancy level, and hence, any form of liquidity to help sustain your organization, is absolutely critical,” he said.
Mr. Brown said he hoped the reduction could have been more, but he was aware that the Government has its own fiscal constraints.
Chairman and Chief Executive Officer (CEO), of the Astra Country Inn, in Mandeville, Manchester, Diana McIntyre-Pike, also deemed the move “commendable,” noting that she was pleased that tourism, the “number one industry” in the island, is being assisted.
Mrs. McIntyre-Pike said she is delighted that “the process has at least started, to offer the sector some relief,” but she wished that measures had been put in place to address the present situation in the industry.
The Prime Minister also announced that the Development Bank of Jamaica would make available, a special loan facility of $500 million, to provide working capital to players in the tourism sector, some of whom are experiencing cash flow problems.
“Loans will be offered to a maximum of $50 million, at an interest rate of 10 per cent for a period of two years. This is in addition to the $100 million already being provided by the Tourism Enhancement Fund,” Mr. Golding said.
He noted that the Government has also ramped up its advertising and marketing programme, while commending major hotel operators for their efforts to do the same.
The Prime Minister noted that despite the gloom in the market, stopover arrivals up to the end of November were five per cent above last year’s figure, although some level of price discounts have had to be offered.
Mr. Brown told JIS News that he also welcomed the loan facility, which he said would help organizations that may be experiencing some liquidity problems, especially in terms of their working capital, and their day-to-day expenses.
He emphasized that despite the challenges, he would not fold his hands and play dead, but he was doing his best to ramp up business, particularly in advertising.
“We have just gone back into ‘Destination Jamaica’, which is the premiere magazine for the industry; we are contacting our partners abroad; and we have extended specials of one form or another,” he said.
The General Manager further commended the Government for being proactive in providing some relief during the current financial meltdown.
“I think that in terms of coming out at this point in time (and) putting in measures..when January, February and March come around, when the storm is actually upon us, we will be in a position to hopefully, weather the storm, based on some of the relief that is being given to us,” he said.
