Gaming A ‘Strategic Imperative’

The Bermuda Tourism Board identified casino gambling as a strategic imperative for resucitating the island’s hospitality industry when it was formulating the forthcoming action plan, Minister Wayne Furbert revealed today [Nov. 16].

And the Tourism & Business Development Minister [pictured] said Government would announce in the near future whether or not to hold a referendum on the subject of liberalising the island’s gaming laws.

He said the full National Tourism Plan is on schedule to be released in spring, 2012.

“One of the ‘Hot Button’ [issues] is gaming,” said the Minister at a briefing to expand on his portfolio’s initiatives for the forthcoming legislative year touched on in the Throne Speech.

“Through its research the board identified gaming as a potential benefit to the success of the tourism industry. In this vein, the Ministry will consider holding a referendum on whether Bermuda should allow gaming.”

Mr. Furbert has previously said that while he personally opposes the introduction of casino gambling to Bermuda, he believes the final decision on the subject should be made by the Bermudian people rather than Government.

According to 2010 the Green Paper on the subject, gambling would add nearly 3,000 jobs and up to $146 million a year to Bermuda’s economy.

The release of the Green Paper was followed by a debate on gaming in the House of Assembly, with only a handful of Bermuda’s 36 Parliamentarians speaking in favour of relaxing the anti-gaming laws.

The only MPs to speak in favour were then-Premier Dr Ewart Brown, Zane DeSilva, Walter Lister, Michael Weeks, Mark Pettingill, Shawn Crockwell and Darius Tucker.

The Minister also said the island’s tourism branding would be undergoing a makeover in the coming months.

“After discussions with many stakeholder groups, the board also identified that the question of branding needs to be addressed,” he said. “The topic of branding is labeled as a key ‘Hot Button’, requiring immediate attention.

“The board recommended that the brand must clearly identify Bermuda in order to raise awareness and that it must be supported by brand promises that our visitors will buy into and most importantly, experience once on island.”

To this end,  Mr. Furbert said, in the near future, the Ministry will be calling on Bermudian advertising agencies, especially, to submit their best creative ideas for a new brand and campaign creative concepts for the destination.

“It is essential that the Company appointed fully understands Bermuda’s target audience and relates a robust, timeless campaign to support the brand,” he said.

Mr. Furbert’s remarks appear in full below

Good afternoon ladies and gentlemen,

Today I take the opportunity to share more details about the initiatives that will be undertaken by the Ministry of Business Development and Tourism that were outlined in the Speech from the Throne on the 4th of November 2011.

You would have heard that given today’s economic landscape, there is apparent agreement between all business sectors that they need access to capital. The mantra stated in the Throne Speech was ‘Free Up Bermuda’.

The Ministry of Business Development and Tourism will play a key role in ‘Freeing up Bermuda’. This will be done by strengthening the Bermuda economy through effective partnerships. The Business Development arm of the Ministry is well under way implementing programmes to stimulate the growth of the economy and strengthen the underlying infrastructure by promoting new ways of enhancing competitiveness and facilitating the establishment of new business. One of the programmes under consideration is a Space Enterprise Zone Task Force to investigate opportunities with respect to new business initiatives relating to the provision of various support services to the space industry.

Additionally, we are currently in the process of establishing an Inter-Agency Partnership which consists of representatives from government ministries as well as the Bermuda Monetary Authority. Furthermore, members of the public stakeholder community will be consulted from time to time to facilitate lateral decision making and operational agility.

The Inter-Agency Partnership will be responsible for providing a rapid response capability with respect to the implementation of valued initiatives, having the ability to make and execute critical decisions. Its overarching mandate will be to facilitate and support the growth of the economy in the business development and tourism sectors by “cutting through red tape” whilst ensuring the appropriate government policies and regulatory requirements are adhered to.

This will be achieved by:

• Identifying any organizational encumbrances to the implementation of initiatives and providing advice as to how they might be resolved
• Strengthening partnerships between key stakeholders
• Recommending potential business opportunities, and,
• Providing an independent perspective on progress made towards achievement of objectives

There has been widespread concern in Bermuda that the operational framework within which Corporate Service Providers currently practice has made the jurisdiction uncompetitive with respect to other comparative international financial centers. Many companies are managed by a Corporate Service Providers which also vets potential owners of shares in Bermuda companies they administer using their own internal systems. This means that the Authority and the Corporate Service Providers are currently engaging the same processes creating a time consuming and duplicative vetting arrangement which is referred to as “double vetting”. For greater efficiency, this process will be modernized and streamlined.

Ladies and gentlemen, for sustainability, growth and development of the business sector, it was deemed to be crucial for the Ministry to review the 60/40 ownership regulation in order to find ways to allow local businesses to obtain easier access to capital.

The current policy on non-Bermudian investment is designed to restrict investment in the local market of companies other than those controlled by Bermudians, except in special circumstances. This restriction requires that at least 60% of a local company be owned by Bermudian shareholders, with a maximum of 40% being permitted to be owned by non-Bermudian shareholders. In the past this approach has aided in the accumulation of wealth within the Bermuda economy, when sufficient Bermudian investment could be obtained. This restriction is now having a negative impact on the growth and reinvigoration of the Bermuda economy.

The aim is to create a more detailed and clearly written foreign investment policy position which would be designed to encourage potential investment in Bermuda while maintaining the existing safeguards with respect to critical national interests. This more aggressive policy position would permit the Ministry to directly target specific investors to produce the best potential capital inflows.

Our Ministry is also proposing changes to the Companies Act 1981 which cover a wide range of amendments in response to changing economic conditions. It is recommended that conditions resulting from the recent economic crisis present an opportune time to remove proven inefficiency and unnecessary formality. The aim is to remove any competitive disadvantages. Through broad consultation with industry stakeholders the Companies Amendment Act 2011 will modernize the current legislation to support innovative corporate capabilities needed today more than ever.

PriceWaterHouseCoopers was engaged by the Government to identify the key developmental drivers and to review potential impediments to being able to successfully market Bermuda as a jurisdiction for Islamic financial product offerings. In particular, PWC completed a gap analysis comparing Bermuda’s legislative framework with several Islamic financial products.

It was concluded that the present financial sector framework offers the same advantages for Islamic financial products and institutions as it does for conventional products and that there were no major legislative or regulatory impediments to launching Islamic financial products in and from within Bermuda.

This means that investment funds or insurance/re-insurance products being sensitive to key Islamic principles (i.e.; the prohibition on interest) may be successfully regulated pursuant to Bermuda laws, rules or regulations.

The Bermuda Monetary Authority released a guidance note in April 2011 setting down the regulatory requirements for these extremely lucrative products. Bermuda can now move more aggressively towards improving its market share within this exciting space.

Turning to the Tourism industry, the Ministry recognizes the dire need to increase the hotel bed count inventory. Therefore, to encourage and stimulate hotel development the Hotels Concession Act will be reviewed with an aim to bring it in line with best practices in other competing jurisdictions.

The existing Act was created in 2000 and was primarily geared to upgrading and redeveloping existing hotel products or newly built traditional hotel models. The Act also makes provision for training Bermudians, promoting and marketing the development and hiring Bermudian entertainment. The review will consider the current and future hotel development trends that encompass hybrids of mass mixed-use development products with concessions that are attractive enough to draw world renowned developers and hotel brands whilst at the same time promote the advancement of Bermudians and the industry in general.

Ladies and gentlemen, I am excited to report that Bermuda will be host to the 2012 Corporate Games from October 25-27, 2012. For the first time the Corporate Games will be held in the Atlantic region. The event has been held annually since 1991 and is owned by a company called Sports For Life Limited.

To make this event happen, many of Bermuda’s sports facilities will facilitate up to fifteen games sanctioned by the sport’s National Governing Bodies. It is anticipated that the National Sports Centre will serve as the host venue. The event is targeted to bring between 500 to 750 visitor participants.

As host country Bermuda will have the opportunity to foster a special relationship between high-net worth corporate entities both on-island and around the world that support their staff members who participate in the event. The event will assist the Ministry in promoting Bermuda as a sports tourism destination and will create a spectacle that will appeal to a broad audience whether sport fan or not. The initiative includes a significant amount of added value through marketing and promotional opportunities in overseas markets.

Continuing its innovate approach to win visitors by developing initiatives that strike a chord of nostalgia with our key markets, especially the north east coast of the United Stated, the Ministry will host College Weeks Reunion from March 15-18, 2012.

The initiative will target a mature audience who remember the good old days back in the 60’s and 70’s and would enjoy a visit back to Bermuda and find old friends. In partnership with the Bermuda Hotel Association and the Bermuda Alliance for Tourism, this programme will certainly attract an audience that was the foundation of Bermuda’s tourism business for many years.

Just as important as those visitors who did Spring Break many years ago is the current university and college student.

The Ministry, with the assistance of several hundred Bermudian students in the United States, will be networking and inviting their friends and colleagues to visit for several fun-filled Spring Break sporting events and activities, also in March of 2012. The Ministry does not plan to divert from its main demographic of the upwardly mobile, affluent thirty-five to sixty year old target visitor, however, the college student is certainly that individual who we see as the future base of this audience.

Another initiative under consideration, although in the early stages, is a scheme to convert cruise visitors to air visitors. This is not a new concept but one worth exploring with a new approach. During the Tourism Board’s process of creating a National Tourism Plan, the board identified several ‘Hot Buttons’ that they considered to be essential to the success of the industry. These ‘Hot Buttons’ were translated into a number of short term strategic imperatives to help resuscitate, revive and service the industry until the Plan is developed. More will be shared about the Strategic Imperatives in the coming weeks. The National Tourism Plan is on schedule for spring 2012.

One of the ‘Hot Buttons’ is gaming. Through its research the board identified gaming as a potential benefit to the success of the tourism industry. In this vein, the Ministry will be considering holding a referendum on whether Bermuda should allow gaming.

After discussions with many stakeholder groups, the board also identified that the question of branding needs to be addressed. The topic of branding is labeled as a key ‘Hot Button’, requiring immediate attention. The board recommended that the brand must clearly identify Bermuda in order to raise awareness and that it must be supported by brand promises that our visitors will buy into and most importantly, experience once on island.

To this end, in the near future, the Ministry will be issuing an open Request for Proposal for Bermudian advertising agencies, especially, to submit their best creative ideas for a new brand and campaign creative concepts for the destination. It is essential that the Company appointed fully understands Bermuda’s target audience and relates a robust, timeless campaign to support the brand.

Ladies and gentlemen, the Ministry will continue its effort to showcase live Bermudian entertainment at hotel properties as well as through hosting tourism visitor events. These events not only employ Bermudian entertainers but create a forum for visitors to interact with residents where they have a truly local cultural experience and even sample local favourites like fish chowder and rum cake. Further, to accommodate the broad spectrum of visitor demands other forms of entertainment like tours, museums, and street festivals will also be supported.

Ladies and gentlemen, we have a full slate of short and long-term initiatives that are necessary for success in both the business and tourism sectors. My first two weeks on the job have been none-stop. I am prepared to continue at this pace and will do whatever has to be done to bring these initiatives to fruition. We all need to believe again!

Thank you!

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Category: All, Business