Caribupdate Weekly, 13 November 2014
The troubled economies of the Caribbean region — from Jamaica in the north, to Trinidad, Grenada and Guyana in the south — could be inflicted with some additional heavy body blows with the news emanating from Bank of Nova Scotia, Cable and Wireless Communications (CWC) and Columbus Communications International, which is also known as FLOW.
The Grenadian and Caribbean public, as well as the rest of the world, was informed last week that an agreement was reached on a CWC buyout of FLOW. A joint statement from the companies said the proposed acquisition was valued at US$3.025 billion.
The statement said the acquisition will enable the combined CWC/FLOW company to improve service delivery to customers in the region; offer customers a comprehensive portfolio of high-quality products and services; and strengthen their position against larger competitors.
However, there are other viewpoints on the acquisition; one of them is from the perspective of employment and potential job losses.
Unemployment in the Caribbean has always been high; in some years, the situation is better or worse than at other times. But, the indisputable fact is that, since our people fought to end slavery in the 1830s and claimed the right to pay-for-work, we have never been able to employ all, or even most, of our employable populations — and employ them at consistent, decent, livable wages.
And now, the unemployment situation that has been excruciatingly painful since the onset of the global economic recession seven years ago, seems headed for a further tailspin in 2015.
The shareholders of CWC and FLOW must be smiling for ear to ear. They’re in the business of making money — more money — and there is a lot of cash to be generated from the deal between the two companies.
However, let’s not kid ourselves. Private sector officials want to get rich and richer, notwithstanding all and sundry constantly proclaiming their adherence to “good corporate citizenship’’, and to making a donation here and there to a charity; and to offering a scholarship to some poor native each year. The prime business of the private sector is money-making; everything else is secondary.
As nationals and Caribbean citizens, we expect the governments we elect, and the agencies they set up, to protect us and to look out for our interests.
The promises of CWC and FLOW, such as improvement in service delivery to customers, may all come true. But the companies also are acutely aware that, for the poor and working people of the Caribbean, their top priority is having a job.
“We do know that change comes with some degree of (job) anxiety,’’ admitted Grace Silvera, CWC’s Global Director of Communications and Culture. “At this time we have not made any decisions around people as a result of the proposed merger. When decisions become clear, we will communicate with everyone in a timely manner and also ensure that we remain transparent and respectful throughout the process.”
The proposed acquisition of FLOW by CWC is conditional on approval by regional regulatory authorities. But, the companies are hoping that the deal will be finalized by the first quarter of next year.
Thus far, only a few established entities and one prime minister have spoken out publicly about the proposed takeover of FLOW by Cable and Wireless.
The Grenada Technical and Allied Workers’ Union has expressed concern, saying “the buyout of FLOW by Cable and Wireless Ltd. may result in job losses at FLOW, as Cable and Wireless is certain to outsource some of the current operations at FLOW Grenada. While this merger may be good for the company, it spells uncertainty and instability of tenure for many employees’’.
Vincentian Prime Minister Ralph Gonsalves says the acquisition “raises questions which have to be satisfied’’, pointing out that in 2001 St Vincent “opened the door for competition, to move away from Cable and Wireless having a monopoly. What we are now having is a monopoly in the country — the internet services’’.
The Communications Workers Union, which represents workers at the Telecommunication Company of Trinidad and Tobago, says the CWC/FLOW move is tantamount to corporate raiding, and could lead to a decline in telecommunications competition across the region and anti-competitive behaviour in T&T.
We are yet to hear of a comment from ECTEL — the Eastern Caribbean Telecommunications Authority — which is the regulatory body for telecommunications in Grenada, St Vincent and the Grenadines, Dominica, St Kitts and Nevis, and St Lucia.
Last week’s CWC/FLOW announcement coincided with reports that Scotiabank is closing 35 branches in the Caribbean.
The Canada–based banking institution says the decision is aimed at reducing structural costs and duplication of services.
The worst part of the Scotiabank announcement, as far as workers are concerned, must be this: 1,500 employees will be sent home with the branch closures.