Cliff Williams, ContributorWITH THE preferred bidder for the lease of the Caymanas racing plant about to commence negotiations with Government concerning the terms and conditions of the divestment arrangements, it is now an appropriate time to look at some of the more important challenges the new investors will encounter.
In last week's column, for those who may have missed it, I discussed the fact that immediately the preferred bidder was identified, speculation, escalating into a rumour surfaced. This, that the new investors could have a policy that could reduce significantly the employment opportunity for local professionals as well as administrative personnel in favour of foreign nationals.
As far as a member of the group of preferred investors, with whom I spoke, this is a load of nonsense since clearly they would have no control over the criteria used by the Government's regulatory agency to determine eligibility for the issuance of professional licences.
With reference to the employment of administrative personnel in the new promoting company, it is hardly likely that work permits will be issued to foreign nationals in any category where competent local operatives are available.
This however, is the least of the problems with which the new investors will have to wrestle.
In the meantime, Jamaica Labour Party (JLP) deputy leader Derrick Smith, a long-standing racing industry investor and representative for the organisation on racing matters, in a press release has indicated certain concerns he would wish to have addressed by Finance Minister Dr. Omar Davies and his Minister of State, Fitz Jackson.
Smith is making the serious charge that a game of secrecy is being played by the two officials, which has led to deteriorating relations between various parties, posing a serious threat to the cooperation necessary for the success of the industry.
Further, Smith is claiming that there is a major concern that substantial profits could end up with a foreign company because of the ownership structure of Caymanas Entertainment Limited (CEL), the preferred bidder.
With the involvement of Supreme Ventures Limited, the sole legal purveyor of lotteries, as a major partner in the CEL group, Smith is also claiming there is now a concern that a monopoly on legal gaming will emerge.
TOO MANY RUMOURS
Clarification of these issues should be forthcoming as a matter of priority since there are now too many rumours out there.
There is also the matter of a few important investors being entirely unhappy with the decision of preferred bidders, CEL, to modernise the existing racing plant rather than establishing new facilities elsewhere.
One has to admit that there is considerable merit in this position because much has changed in the half century elapsing since the Caymanas plant was designed and located in what then were undoubtedly ideal conditions.
In fact, the racetrack was the largest with the facility being the acknowledged best in the Caribbean region at that time.
With the massive influx of three decades of housing developments, however, the environment changed significantly with social and infrastructural problems emerging, along with difficult plant security challenges.
UPGRADING
While it is generally agreed that the establishment of new facilities is ideal, the upgrading of the 196-acre plant has to be the better option from a financial viewpoint.
I have not seen any estimates of the capital expenditure required to go to new facilities as opposed to upgrading the old, but an intelligent guess would be that modernisation of the existing plant is likely to prove less costly.
The main challenge for the new investors, though, is how to implement the plant upgrading exercise which is a massive undertakings without a lengthy interruption of the racing calendar.
During the construction period, the expense incurred by owners for keep and care of the horses would remain almost the same with no prospect of prize money, but it is something all concerned will have to deal with.
In order to minimise dislocation and loss of income for the professionals, the upgrading of the plant is going to have to be one of those construction projects delivered on time by the contractors.
There can be no question that the new investors face a task of considerable magnitude, but I think the challenges will not deter them from the stated objective of delivering a modern facility and promoting a satisfactory racing product profitably.
