Government has not given the entire painting sector to one company says Greene

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I refer to the Article posted on Thursday September 17th, 2020, in the Daily Observer entitled, “Paint retailers decry ‘unfair’ policy changes” written by Elesha George.  In my review of the named Article several pertinent information were not referenced, which would have given readers the correct background and context to the newspaper Article.

 

As a signatory to the Revised Treaty of Chaguaramas, Establishing the Caribbean Community including the CARICOM Single Market and Economy, the Less Developed Countries (LDCs) of CARICOM, (i.e. Antigua and Barbuda, Belize, Dominica, Monserrat, Haiti, Grenada, St. Kitts and Nevis, St. Lucia and St. Vincent and the Grenadines) are beneficiaries of Article 164 (Promotion of Industrial Development). In essence, Article 164 provides a special provision for disadvantaged countries in the context of industrial development within the LDCs.  The provision is designed to promote the development of fledging industries in LDCs of CARICOM, which are allowed to suspend community origin treatment and levy higher duties on imports of identical products originating from Most Developed Countries (MDCs) of CARICOM and Third States.

 

In pursuit of the Government’s policy option to ignite and expand the local manufacturing sector to produce and export more goods within the region rather than being mere buyers of goods, an application for the inclusion of water base paints of tariff heading 3209,  under the list of items benefitting from the application of Article 164. This application was made against the backdrop that Lee Wind Paints at the time, needed support to redevelop its business operations and model. Subsequently, the company fell into financial difficulty and a decision was taken to sell the property to Harris Paints Ltd., which filled the manufacturing void of paints.

 

With the regional approval through the Council for Trade and Economic Development (COTED), to renew the list of products which includes curry powder, flour, pasta, water, aerated beverages, malt, beer, stout, animal feed, paint, candles, oxygen, acetylene, and furniture under Article 164 in 2018, the Cabinet agreed to a phased approach to its implementation.

 

To this end, the implementation of the duty changes to the importation of paints and water was initiated and the legislative changes were made. Accordingly, the Ministry of Trade in collaboration with the Customs and Exercise Department facilitated a consultation with manufacturers and importers of water and paint on Friday 6th, Mach, 2020, and all of the business persons with the exception of Sandy Chaia Bahir referenced in the Observer Article were present at the meeting. The consultation outlined the context of the regional decision and the Government’s approach to implementation. The meeting was also advised that a three (3) month moratorium would be given to all businesses where the duty rates would remain the same until June 30th, 2020, to accommodate imports that were already ordered and on route to Antigua. Further, given the impact of the COVID-19 pandemic another extension was given, and the Statutory Instrument (No. 40 of 2020) came into effect on September 1st, 2020.

 

Let it be clear, the Government has not, “given the entire painting sector to one company – Harris Paint”. Through the implementation of the Article 164 the opportunity has been given to the private sector to expand their business operations while encouraging new investments in the manufacturing sector. As the Minister with responsibility for trade, my Ministry has not presided over no segmentation of the market or placed any restriction on the importation of any product(s), particularly paint, but the tariff must be strictly upheld.

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11 COMMENTS

  1. I was not going to speak up on this issue, but after this response I feel a lot more light needs to be shed on this subject.

    1) The meeting held in march went as such when several retailers attempted to ask questions. Directly from the meeting head ” This meeting is for information purposes only , it’s not a discussion ” WE had no consultation we only received dictation and were told in other words. Sit down,. listen and don’t talk.

    2) Article 164 is “OPTIONAL” it didn’t have to be turned on. You also had the choice to set a more reasonable duty rate.

    3). Let me be clear. YOU have by virtue of an exorbitant tax given a monopoly to one of the Caribbean’s LARGEST paint manufacturers .

    You are not protecting an indigenous local paint manufacturer. You are giving a massive company control over the paint market, causing the paint prices to rise and trying to force people to buy products they might not want because they can no longer afford the items they have used for decades.

    Lastly you are taking away innovation from local antiguan artists as they use paints under 3209 that will never be produced by this company. There are more people effected negatively here than I believe you realize .

    Mr Greene, I do believe you have made a major error in supporting this measure and essentially you have thrown under the bus many retails who contribute tens of millions of dollars a year to Antigua & Barbuda directly in taxes and social good.

    I leave this question. Why would you give the one of the largest foreign based manufactures of paint in the Caribbean such a massive advantage over its competition? Who benefits besides them solely ? And who looses?

    Jason Holowchak
    &
    Nicole Holowchak
    Owners North Coast Hardware

    • Neither Green or the PM fully understands the treaty the ALP signed us up to. You can’t establish a de facto monopoly and then wash your hands. Regulations need to be in place to manage the industry or you’ll end up with all the abuses mentioned in the article.

  2. If Harris has been given a monopoly, then they shouldn’t be able to pick and choose who they will sell to, and if specific products are not offered by Harris, Antiguan companies should be able to import them duty free.

    • Boss you read “Let it be clear, the Government has not, “given the entire painting sector to one company – Harris Paint”. ” There is no monopoly being pushed here. Local companies are free to start their own pain manufacturing plant. Will they or do they prefer to complain?

      • Do you know what a monopoly is? With the imposition of high tariffs, they have created a de facto monopoly, and that’s the point. If Harris wasn’t getting a captive market, they wouldn’t be here. Also, all the companies “complaining” are retailers. If they wanted to be manufacturers, they would have opened factories. I’m not against monopolies, but they have to be regulated or you get abuses.

  3. Chet and the opening of the new paint shop close to the race track where you spoke so glowingly about the operation and pledge to personally support them by buying from them.
    Were they aware of this move by the govt. Knowing that info you think they would still make that investment knowing that their paints might increase by about 50%

    How come leewind paints was never afforded such protection.

    Were there any discussions with paint suppliers?

    Personally expressions on american road is one of my go to spots. I wonder if can i still afford their paints after this action.
    The nice patient lady that helps me pick colours at north coast hardware what will be made of her department.

    its a pity Bau panel didnt get the support from the govt harris paint seem to be getting

    • UPP gave them plenty incentives(hundreds of acres of land, tax incentives..) how come they have gone nowhere? You recall the groundbreaking in 2012 for the factory? It growing grass now, yet ABLP came to office in the middle of 2014. Baupanel failed long before the elections in 2014

  4. What the Government did by giving Harris Paints the monopoly is wrong, but I am looking at this from a different view point. Nobody would hear Holowchak’s and others like him voice if they did not think they stand to lose so much. They all got their good concessions from the UPP and then turned their backs on them. Not even a donation to the party for a toy for a child at Christmas. Just like the dog looking down in the water at the dog with the bigger bone in its mouth, they all hopped onto the Browne bandwagon hoping to make their nests even fluffier. Well, they could cry as much as they want now. If the Dog gives them a big incentive near election, they will forget all this and vote again for him. Argentina is not crying for me. Don’t want to hear them.

  5. You know Antigua is a unique place. A foreigner can come here setup a business and then criticize my government while we are the ones supporting his business. I wonder if I go to Canada I can so easily setup business get the support of Canadians and then turn around and criticize Trudeau for his trade policies against my business. I think not. A government trade policies are designed for the betterment of the local economy and not any individual in particular. These last four years under Donald Trump we have witness that more than ever before. He ripped up trade deals with NAFTA and with China and also Europe. In fact he threatens all that take advantage of the USA to put high tariffs of their goods. Like China has experience. And NAFTA yes eve Trudeau and Mexico had to come to the table to sign a better deal for the USA. When I was last in Canada I visited a winery and as I was doing my wine tasting and they have a restaurant attached to it, I was talking to the owner about selling the wines to USA. And she told me that Canada could not export to the USA because of trade restrictions that were imposed by the USA government. I was very surprised and told her but the USA is in NAFTA and you guys are neighbors and you are right here by the border. She made a sigh and shook her shoulders and said well that is how things are. I mean the government putting this in place want to give the local manufacturer whom ever that is or whom ever they are to have a change of surviving against foreign import. If that is bad than sorry. Start a plant here as well, rather then to import ready made paint, manufacture it here as well. I have lots of supplier whom I tell the same thing. All they want is to export to Antigua. I said to many of them have you ever considered putting up a small assembly plant here, I said the government would more welcome that then you just importing and taking out our foreign exchange. Barrett is starting his own farm as he sees the need to stop all that import and keep the dollars here and provide more economic growth for the country. We need to change our mindset with only importing and selling stuff and start manufacturing things. And believe I understand economies of scale is going to be the big set back, but their has to be some consideration given to us being producers and not just consumers of things.
    Mr. Green keep doing what is in the best interest for Antigua and Barbuda and don’t be concerned about a few importers that feel a little pinch in their pocket. Cause I really don’t want to believe that paint is all that they sell, or that the sail of point is their largest revenue earner. If so it is high time they too start building a plant and start manufacturing it right here.
    By the way we saw the same sort of cry when government allow people to bring in second hand cars in duty free. There doors are still open. And some people are still buying their new cars. In fact they will now go the extra mile when you want to purchase a new car. They will take your warrant to the minister to get it signed for you to get duty free.

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