Growth & Jobs | Emerging markets in the Caribbean offering openings for investors

THE CARIBBEAN, known for its scenic beauty, has been a popular destination for investments in the hospitality and financial sectors for a considerable time. The region is currently expanding its economic horizons through several growing industries, such as outsourcing, technology, agriculture, renewable energy, petrochemicals, logistics, and medical tourism.

According to David Mullings, chief executive officer and chairman of Blue Mahoe Capital Inc, the presence of a robust local market for goods and services, ambitious renewable energy goals, attractive government policies, and top-tier educational institutions producing skilled professionals, offers a remarkable opening for investors to establish and expand their enterprises in the Caribbean.

“Investing in the Caribbean is a hot topic because global investors are searching for growth and they keep hearing about Guyana’s incredible gross domestic product (GDP) growth and Jamaica’s remarkable debt reduction story. Growth has slowed in developed markets, but emerging and frontier markets continue to lead global GDP growth. Smart investors go where the growth is,” Mullings said.

‘FOUR CARIBBEAN TIGERS’

The Caribbean region, he said, of itself is considered an emerging market by some, and even a frontier market by others. “The collective economy and population of all the CARICOM countries is tiny in comparison to most countries, especially Sub-Saharan Africa, Latin America and Southeast Asia. However, small market does not mean small returns,” Mullings said.

Mullings coined the term ‘Four Caribbean Tigers’ after he realised that there was a distortion when he would try to get overseas investors to seriously consider investing in the Caribbean.

“They were stuck thinking about all-inclusive resorts and beaches. They totally missed the consumer goods, financial services, infrastructure, agriculture and export opportunities under their noses while they vacationed in the region,” Mullings said.

“I needed to be able to relate the region to something they were already familiar with, and all serious investors know the story about the growth of the Four Asian Tigers; Singapore, South Korea, Taiwan and Hong Kong. I was focused on changing the perception of the region by connecting it back to countries that grew successfully, despite being tiny,” he added.

Mullings narrowed down to focus on the Bahamas, Barbados, Jamaica, and Guyana. Each, he said, has positive economic stories to share, and all are known globally.

“The Caribbean was always a major part of the British Empire but many countries regressed after they got independence, through a combination of stolen resources, entrenched classism and poor governance. Some have fared better than others, but mismanagement and isolationism have prevented them from having the same trajectory as Singapore,” Mullings said.

This perception, he said, has finally started to change because a new generation is globally minded, thanks to the world being flattened because of the Internet. “More global thinking is seeping into Caribbean countries, more focus on global competitiveness and improving customer service. There is still a long way to go but, slowly, they are getting there and we can be catalysts to speed things up,” Mullings said.

PRIMARY TARGET

Mullings indicated that their primary target market has always been the Caribbean diaspora, as they want to invest back home, not just send more remittances. They have felt taken advantage of, he said, and are only asked for donations but not offered an easy way to invest, so they are focused on solving that problem.

“We have increased access to investments in the region via a trusted and regulated company. With our SEC qualification of Blue Mahoe Capital, Inc’s offering, we can now raise from the regular person in the USA and then invest in Jamaica and other Caribbean countries like Barbados,” he said.

“We are starting with the simplest opportunity, building affordable houses for local Jamaicans and Barbadians. People can simply buy shares in the company, thanks to Obama and Biden’s JOBS Act passed in 2012. Other people are already investing as small groups, mainly doing real estate projects, but those aren’t open to the average person. We are focused on increasing access,” Mullings added.

He indicated that any developing country seeing growth in the same areas, a savvy investor needs only to study the history of countries like Singapore, South Korea, India and similar countries, to know where to invest for the long term.

Growing countries, he said, increase the incomes of their citizens, and those citizens will need improved infrastructure, improved healthcare, more financial services, more food, upskilling to remain competitive, outsourced services and housing.

The Caribbean, he said, also has the advantage of sports and culture, its largest exports in terms of brand recognition. Finding a way to invest in those and generate profits will also be beneficial.

“One can look at K-Pop or Reggaeton as a case study for ideas. Bollywood and Nollywood are great case studies for the film industry. Last, of course, is sports, and more can be done with football, cricket, track and field and basketball, all sports with large global fan bases and Caribbean athletes on the big stages,” Mullings said.

keisha.hill@gleanerjm.com