Notes to Consolidated Financial Statements - Barbados Investment ...

BARBADOS INVESTMENT AND DEVELOPMENT CORPORATION ANNUAL REPORT 2009 1

Contents 

MISSION & VISION 4 

LETTER OF TRANSMITTAL 5 

BOARD OF DIRECTORS 6 

EXECUTIVE MANAGEMENT 7 

CHAIRMAN’S REPORT 8-10 

OPERATING ENVIRONMENT 11-14 

REPORT ON OPERATIONS 15 

• ENTREPRENEURIAL DEVELOPMENT 19 

• CRAFT DEVELOPMENT 20 

• BUSINESS DEVELOPMENT 20-23 

• TECHNICAL ASSISTANCE 24 

• PROPERTY MANAGEMENT 24 

• RENT COLLECTION 25 

• HUMAN RESOURCE DEVELOPMENT 25-26 

LOOKING TO THE FUTURE 26 

AUDITORS’ REPORT 

BALANCE SHEET 

STATEMENT OF CHANGES IN EQUITY 

STATEMENT OF REVENUE AND EXPENDITURE 

STATEMENT OF CASH FLOWS 

NOTES TO FINANCIAL STATEMENTS 


Mission 

To be a dynamic Business Development Agency 

contributing to the successful and sustained 

development of the Manufacturing and Small Business 

sectors in Barbados. 

Vision 

A Barbados with vibrant, competitive Manufacturing 

and Small Business sectors characterized by emerging 

and financially strong companies committed to 

originality and continuous growth. 

4 

BARBADOS INVESTMENT AND DEVELOPMENT CORPORATION ANNUAL REPORT 2009

Letter Of Transmittal 

P.O. Box 1250 

“Pelican House” 

Princess Alice Highway 

BRIDGETOWN BB11000 

2nd June, 2009 

The Honourable Dr. David Estwick, M.P. 

Minister of Economic Affairs, Empowerment, Innovation, Trade, Industry and Commerce 

MINISTRY OF ECONOMIC AFFAIRS, EMPOWERMENT, INNOVATION 

TRADE, INDUSTRY AND COMMERCE 

Reef Road 

Fontabelle 

St. Michael 

Dear Minister: 

In pursuance of Section 18(1) of the Barbados Investment and Development Corporation Act, 1992, I have the 

honour to submit the Report and Statement of Accounts for the period 1st April, 2008 to 31st March, 2009. 

Yours faithfully 

……………………………………………… 

A. DeVere Browne 

(Chairman) 


Board Of Directors 

Members of the BIDC Board of Directors are (standing L to R) Mrs. Monica Mason-Critchlow (Legal Officer/Board Secretary), Mr. Ian Pickup, Mr. Kevin 

Boyce, Mr. Basil Lavine (CEO Ag.), Mrs. Veronica Griffith, Mr. David Stoute, (seated L to R) Mr. Villeneuve Greaves (Deputy Chairman), Mr. DeVere Browne 

(Chairman) and Mrs. Muriel Robertson. Inset Mr. Henderson Holmes. Missing is Mr. Lewis Kirton. 

(February 2008 – January 2009) 

Mr. Mark, B. A. Thompson, R.A. - Chairman 

Mr. Lindell Nurse, FCCA, CA – Deputy Chairman 

Mrs. Veronica P. Griffith, B.Sc. – Representative, 

Barbados Workers Union 

Mr. James Husbands, GCM – Representative, 

Barbados Manufacturers Association (BMA) 

Mrs. Muriel Robertson, ADID, BED 

Ms. Myrna Greaves, B.A., Dip Banking and Finance 

Mr. Villeneuve Greaves, B.A., Gen. (Econ.) 

Mr. Kevin Boyce, LL.B, LEC 

Mr. Ronald Davis 

(January 2009-Present) 

Mr. A. DeVere Browne, B.A., Dip. A -Chairman 

Mr. Villeneuve Greaves, B.A.,Gen. (Econ.)- Deputy Chairman 

Mrs. Veronica P. Griffith, B.Sc. – Representative, 

Barbados Workers Union 

Mr. Ian Pickup, B.Sc. - Representative, 

Barbados Manufacturers Association (BMA) 

Mrs. Muriel Robertson, ADID, BED 

Mr. Kevin Boyce, LL.B, LEC 

Mr. Henderson Holmes, B.A 

Mr. David Stoute, B.Sc. 

Mr. Lewis Kirton, J.P 

6 


Executive Management 

Mr. Wilbur T. Lavine, B.Sc., M.Sc. 

• Director, Research & Information Services Division 

• Chief Executive Officer (Ag.) (with effect from October 1, 2008) 

Ms. Cora D. Clarke, B.Sc. 

• Director, Business Development Division 

Mrs. Sonja S. Trotman, B.Sc., A.C.I.S., LL.M 

• Manager, Research & Information Services Division 

• Director (Ag.), Research & Information Services Division (with effect from October 1, 2008) 

Mr. James Campbell, DPA (Hons.), C.M.A., A.C.I.S., F.C.A., M.B.A (Dist.) 

• Director, Entrepreneurial Development Division 

Ms. Diana C. Brooks, C.M.A, F.C.A., A.C.I.S. 

• Chief Accountant, Administration Division 

• Director, Administration (with effect from July 14, 2008) 

Mrs. Michelle Moore, B.Sc. (Hons.), M.B.A 

• Assistant Accountant, Administration Division 

• Chief Accountant (Ag.), Administration (with effect from August 12, 2008) 

Ms. Fern Gooding B.Sc. 

• Senior Research Officer, Research & Information Services Division 

• Manager (Ag.), Research & Information Services Division (with effect from October 1, 2008) 

Mr. Henderson R. G. Clarke, B.A., J.P 

• Manager, Export Promotion Division 

Mr. David H. Parris, B.Sc., M.Sc. 

• Manager, Human Resources Department 

Mr. Michael L. Piggott, B.A., ANSCAD 

• Manager, Design Department 

Mr. Neville Rice, B.Sc., M.Sc. 

• Manager, Property and Estates Department 

Mrs. Monica Mason-Crichlow, LL.B, LEC 

• Legal Officer 

• Secretary to the Board (with effect from July 2008) 


Chairman’s Report 

The Year in Review 

The Barbados Investment and Development Corporation (BIDC) 

commenced its fiscal year April 1, 2008-March 31, 2009, endeavouring 

to transition from an agency with the traditional mandate of 

promoting exports, attracting investment, bolstering industrial 

growth and administering a range of technical assistance to over 

1000 clients, to a restructured entity that would be more focused and 

dedicated to fewer, yet equally demanding responsibilities. The new 

mandate sought to accelerate the development of the indigenous 

manufacturing and related services sectors with special recognition 

given to the developmental needs of the craft and other small business 

sub-sectors. 

The Corporation’s strategic goals and objectives were set in September 

2007 within the context of a stable economic environment. Over 

the past year however, the global economy has been engulfed by 

a deepening crisis in financial markets, by major corrections in the 

housing markets of a number of advanced economies and sharp surges 

in commodity prices. Faced with increasingly difficult conditions, the 

global economy slowed markedly. The Barbados economy was no 

exception. 

In the face of the weakening investment and business climate, 

Barbados registered an increase of only 0.7% in real output in 2008, 

compared to the 3.3% expansion registered in the previous two years 

and the 3.1% five-year average. According to the Central Bank of 

Barbados, this was the first year since 2002 that Barbados’ Gross 

Domestic Product (GDP) rose by less than 1%. Given the disruptions 

in the economies of Barbados’ major trading partners, activity in the 

traded sectors declined by 1%. The 1.2% expansion in the nontraded 

sectors was just enough to overshadow that decline. All this 

made for an exceptionally tenuous economic climate which impeded 

the Corporation’s efforts to realise some of its major objectives. 

Significant changes were also experienced within the Corporation itself 

both at the Executive and Governance levels. Former Chief Executive 

Officer Mr. Anthony Sobers, came to the end of his contract of service 

and a new Board was instituted following a re-assignment of ministerial 

portfolios within the Cabinet. At the same time Government’s annual 

subvention to the Corporation was reduced and this meant some 

initiatives had to be curtailed. That along with a shortfall in revenue 

from rents, seriously constrained efforts to advance the capital 

works programme and to complete major projects as scheduled. The 

Corporation had already seen a major setback in capital works as a 

result of the July 2008 fire at the Grazettes Industrial Estate, which 

resulted in the loss of 56,000 sq.ft. of viable factory space. 

In spite of the circumstances, the Corporation was able to continue 

its developmental work with companies in the manufacturing and 

services sectors through its Special Technical Assistance Programme. 

The programme continued to be an important vehicle in providing 

companies with the resources necessary to build export capacity and 

international competitiveness and proved crucial in the midst of the 

volatile economic conditions. Barbadian enterprises have used the 

programme to market their products, enhance operations, achieve 

international quality standards and certification (including the HACCP 

and ISO), improve product design and undertake professional training. 

During the year, a total of Bds$6.08 million was disbursed from the 

Fund to 141 beneficiaries. The major portion of funding was dedicated 

to marketing, equipment, systems and process upgrades. 

While the BIDC’s mandate did not include export promotion during 

the period under review, the Corporation nevertheless continued 

to develop and maintain some of the export expansion and market 

development initiatives executed previously. The Export Expansion 

project yielded positive results for much of the 2008/2009 year. As 

the global economic condition worsened however, much of the gains 

made were eroded during the latter months of the fiscal year. The 

Corporation’s efforts in export development were aimed largely at 

capacity building in terms of competitive enhancement of medium 

and large enterprises, and facilitation services for special technical 

8 


assistance aimed at overall export growth. This extended to both 

exporters and entities with export potential. 

As part of its industrial sector capacity building effort, the Corporation 

facilitated over 350 client visits during the year. Through specific 

programmes and initiatives the BIDC sought to enhance the quality and 

range of products offered by existing exporters and small businesses 

with the potential for export. Fifteen (15) companies were drafted into 

the Corporation’s ‘Export Ready’ programme during the year. Given 

the importance of new product development to exploiting market 

access opportunities, work continued during the year in developing 

five new areas of enterprise, most notably fruit wine production, 

botanicals, fish processing, fish leather craft, electronic games and 

online educational teaching materials. 

The Corporation also explored new ways to broaden the exposure of 

craft persons and increase their revenue earning potential in both the 

local consumer and tourist market segments. Several of the initiatives 

identified in the redevelopment plan for the Craft Sector were started 

during the year. Efforts to bolster the performance of small business 

producers through capacity building and institutional strengthening 

initiatives such as its Special Technical Assistance, Basic Industries and 

Incubator programmes were sustained. 

Future Prospects and Direction 

Acknowledging the current challenges, BIDC’s Management and 

Board have committed to constantly reviewing the Corporation’s 

performance to gauge its effectiveness in combating these difficulties. 

In an effort to minimize any negative impact, the Corporation has 

been undertaking further restructuring and upgrade that should allow 

for improved efficiency and responsiveness to client needs. 

revenues and profits and increased operational costs and debt-servicing 

problems. The Corporation is seeking to implement initiatives aimed 

at reducing costs to businesses to ensure they remain competitive; 

maintaining and where possible increasing export sales; identifying 

new product niches; maintaining local market share and sustaining 

employment levels. 

Many of the initiatives will be executed through the Corporation’s 

Special Technical Assistance Programme. Attention will also be 

given to making more funding available for marketing in both local 

and overseas markets as a means of safeguarding and capturing 

product niches. Efforts will in addition be concentrated on enhancing 

marketing efforts. More consideration is to be given to new product 

development and in support of this, work under the Corporation’s 

Innovation Programme will be stepped up. 

The manufacturing sector has weathered many difficult storms in the 

past. We have always emerged more determined and committed to 

the survival and prosperity of this critical area of economic activity. 

The future at this time may appear shrouded with difficulties and 

challenges previously unencountered, but the value and viability of 

manufacturing remain positive. The BIDC wants to see manufacturing 

emerge from these challenging times stronger and fitter than 

before. The Corporation is therefore committed to building the best 

framework of support and creating an environment in which Barbadian 

manufacturing companies can seize new opportunities. Much the 

same will be accorded services companies within our portfolio. We 

recognize that our future as a country lies in a mixed and balanced 

economy with manufacturing and services reinforcing each other. The 

BIDC is therefore committed to playing its part in the development of 

such a diversified economy. 

Having assessed the likely impact of the crisis on the local productive 

sector, the BIDC is devising schemes to mitigate the negative impact 

on employment, investment and growth rates, lower export sales, 

………………………… 

A. DeVere Browne 

Chairman 


Operating Environment 

Global Industry 

beverages and electronics rose by 7% and 3.5%, respectively 3 . 

Following a favourable performance in 2007, manufacturing output 

declined in most economies in 2008. The deteriorating conditions 

in the global manufacturing sector mainly reflected the onset of the 

world economic downturn and ongoing financial market turmoil. 

The far-reaching impact of this was reflected in the results of national 

manufacturing surveys, which all reported record declines in output 

and new orders. The weakness of the global manufacturing sector 

was again predominantly centered on the developed economies. The 

Eurozone and the UK saw output and new orders contract at the fastest 

pace while, in the US, rates of decline accelerated to the steepest 

since mid-1980. The latest data also indicated that the contraction in 

emerging markets gathered pace and broadened. 1 

While the industrial sector is relatively small in the Caribbean, accounting 

for generally less than 10% of GDP, its contributions to employment 

and foreign exchange are nevertheless invaluable. Regional production 

is limited mainly to construction materials, beverages, garments, jams 

and jellies, pharmaceuticals and detergents. The performance of these 

sectors this year was adversely affected by slower global demand, and 

higher input costs, namely fuel and imported raw materials. Several 

manufacturers were faced with tightening credit conditions imposed 

by foreign suppliers who were demanding upfront payment or more 

stringent settlement terms for raw materials. 2 

In Barbados, manufacturing output contracted by a marginal 0.4%, 

following a decrease of 2.9% in 2007 and an increase of 1.1% in 2006. 

A reduction of 1.3% in miscellaneous manufacturing coupled with 

downturns in chemicals (5.2%), non-metallic mineral products (1.1%) 

and furniture production (4.3%), outweighed improvements in other 

key sub-sectors. Food production was up by 1.6%, whereas output of 

The Caribbean Development Bank has warned that manufacturers need 

to prepare for a tough year in 2009 in all aspects of their operations. 

According to the Bank, exports will be severely constrained by the 

global downturn, with a recession likely in many important countries. 

Financial constraints will be exacerbated by a lack of working capital 

from the hard-pressed financial sector. Domestic demand, even in 

countries that display resilience in the face of global downturn, will 

slacken. Employment growth globally will be weak at best, with many 

countries cutting their manufacturing labour force in 2009. Firms 

will find it extremely difficult to raise selling prices, although recent 

retreats in commodity prices will help to reduce the pressure to pass 

on cost increases. 

International Trade 

The World Bank is predicting that global trade volumes will contract in 

2009 for the first time since 1982.This decline, according to the Bank’s 

forecast, is being driven by a sharp drop in demand, as the global 

financial crisis imposes a rare, simultaneous recession in high-income 

countries and a sharp slowdown across the developing world. 

The commodity price boom that began in 2003 came to an end in 

July 2008. Apart from strong demand, a number of factors drove 

prices higher, including a weak dollar, low pre-boom investment in 

extractive industries, supply disruptions, biofuel mandates, investment 

fund activity, and (during 2008) government policies such as export 

taxes and bans on several food commodities. Many of these factors 

reversed at mid-year 2008, as the slowdown in economic activity and 

fallout from the financial crisis induced massive price declines across 

all commodity sectors. By December 2008, crude oil prices dropped 

1 JP Morgan, Global Manufacturing Index PMI, www.reuters.com 

2 Caribbean Development Bank, Highlights of CDB’s Activities in 2008, Economic Background and Prospects 

3 Central Bank of Barbados Review of the Economy 2008 

4 Global Economic Prospects 2009, World Bank, DEC Prospects Group 

10 


to US$41/barrel —down nearly 70% from July peaks—while nonenergy 

prices fell nearly 40%. Demand for most commodities slowed 

or declined. 

According to the World Bank’s assessment, Europe and Central Asia 

have been most adversely affected by these developments. Following 

a 4.2% growth in 2008, GDP in this region is expected to contract 2% 

in 2009. The US economy expanded by only 1.4%, its slowest growth 

rate since 2001, and was accompanied by significant shedding of 

labour, particularly in the manufacturing and construction sectors. 

Economic growth is projected to decline by 1.6% in 2009. GDP in 

Latin America and the Caribbean, while expanding 4.3% in 2008 is 

also projected to contract by 0.6%. Several of these countries have 

strong ties with the U.S. financial system and many companies felt 

immediately the impact of the credit crunch. Terms of trade for 

commodity exporters are projected to plummet, pressuring budgets 

for a number of countries. Some of these countries had failed to build 

up sufficient buffers during the commodities boom, but had instead 

used the high commodity prices to overheat their economies. 

was largely the result of two major factors: 

1. The capability of firms to invest has been reduced by a fall in 

access to financial resources, both internally due to a decline in 

corporate profits) and externally due to lower availability and 

higher cost of finance. 

2. The propensity to invest has been affected negatively by 

economic prospects, especially in developed countries that are 

hit by a severe recession. 

In addition, a very high level of risk perception led companies to 

extensively curtail their investment plans. 

The growth rate of FDI inflows to developing countries, while lower 

than in 2007 (when it exceeded 20%), however remained positive 

for 2008 at an estimated 4%. FDI flows to Latin America and the 

Caribbean showed significant resilience to the world economic 

slowdown and were estimated to have increased by 13% in 2008 to 

reach US$142.3 billion. 

On the whole global GDP is expected to contract by 1.7% in 2009. 

The Organisation for Economic Cooperation and Development (OECD) 

member economies are likely to contract 3% and other high-income 

countries 2%. GDP among developing economies should register 

at around 2.1%. Volumes of world trade in goods and services are 

expected to drop 6.1% in 2009, with a significantly sharper contraction 

in trade volumes of manufactured products 4 . 

Global Investment 

The year 2008 marked the end of a growth cycle in international 

investment that started in 2004 and saw world foreign direct investment 

(FDI) flows reach a historic record of US$1.8 trillion in 2007. 

Due to the impact of the on-going worldwide financial and economic 

crisis, FDI flows declined by an estimated 15% in 2008. The decline 

Declines in investment were however registered for Barbados. 

According to the BIDC’s quarterly Employment & Investment survey, 

foreign investment in the manufacturing and services sectors fell from 

BDS$7.9 million to BDS$7.2 million during the period April 2008 to 

March 2009. 

A further decrease in FDI flows is projected for 2009. In the face of a 

global economic recession, tighter credit conditions, falling corporate 

profits, gloomy prospects and uncertainties for global economic 

growth, many companies have announced plans to curtail production, 

lay off workers, and cut capital expenditures, all of which tend to 

reduce FDI. The impact of the crisis is projected to continue to vary 

widely depending on region and country. Central America and the 

Caribbean, which are traditionally highly dependent on the United 

States economy, are expected to register a decline in FDI flows in the 

coming year. 


FIGURE 1 

DISTRIBUTION OF INVESTMENT - 2007/08 and 2008/09 

(BDS$) 

Source: Barbados Investment and Development Corporation 

TABLE 1 

COMPARATIVE SECTORAL DISTRIBUTION OF INVESTMENT FOR 

FISCAL YEARS 2007/08 AND 2008/09 

BDS$ 

SUBSECTOR 2007-2008 2008-2009 P Net Change % Change 

FOOD, BEVERAGES & TOBACCO 25,514,649 16,739,459 (8,775,190) -0.3 

TEXTILES, APPAREL & LEATHER 857,119 1,218,735 361,616 0.4 

WOOD, WOODEN PRODUCTS & FITTINGS 727,452 326,317 (401,135) -0.6 

PAPER PRODUCTS & PRINTING 1,522,706 897,778 (624,928) -0.4 

CHEMICALS & CHEMICAL PRODUCTS 1,234,432 1,057,367 (177,065) -0.1 

PLASTIC PRODUCTS 67,154 1,328,394 1,261,240 18.8 

NON METALLIC MINERAL PRODUCTS 16,100,023 17,193,922 1,093,899 0.1 

FABRICATED METAL PRODUCTS 3,185,212 2,067,343 (1,117,869) -0.4 

PRECISION INSTRUMENTS 245,000 44,683 (200,317) -0.8 

ELECTRONIC COMPONENTS 1,083,891 734,350 (349,541) -0.3 

HANDICRAFT 76,272 28,380 (47,892) -0.6 

OTHER MANUFACTURING 2,095,612 228,180 (1,867,432) -0.9 

Sub-Total 52,709,522 41,864,908 (10,844,614) -0.2 

INFORMATION SERVICES 2,879,829 419,205 (2,460,624) -0.9 

OTHER SERV 4,654,475 5,860,156 1,205,681 0.3 

Sub-Total 7,534,304 6,279,361 (1,254,943) -0.2 

Total Surveyed 60,243,826 48,144,269 (12,099,557) -0.2 

P 

Provisional 


12 


Report On Operations 

PERFORMANCE ENHANCEMENT INITIATIVES 

thrust. Work is expected to continue in this area. 

Operating under a new organizational structure, the BIDC in 2008 

focused much attention on developing and nurturing home-grown 

solutions to the challenges confronting the local productive sectors. 

Investigations commenced during the year to identify new incentives 

to improve the business environment. At the same time work 

continued in seeking out new growth prospects and opportunities 

for investment. Considerable progress was made in conceptualizing 

a botanicals project which explored the establishment of a research 

lab and facility for the production and marketing of Botanicals 

products in Barbados. Feasibility research was also undertaken on the 

establishment of a facility to improve the processing and marketing of 

fish products, including items crafted from fish leather. These projects 

will continue into 2009-2010. 

Research proposals were also prepared on knowledge-based industries, 

in particular, online educational teaching materials, electronic games 

and interactive media. The BIDC is presently collaborating with the 

Barbados Community College to advance the development of this 

project. Proposals for fruit wine processing and the use of Sea Island 

Cotton in the local fashion and design industry were developed and 

are currently being reviewed for further action. 

Through specific programmes and initiatives, the BIDC also sought to 

enhance the quality and range of products offered by existing exporters 

and small businesses with export potential. Fifteen (15) companies 

were enrolled into the Corporation’s ‘Export Ready’ programme 

during the year. To give further impetus to this programme, the BIDC 

provided assistance in the critical area of product design and quality 

enhancement. By the end of the fiscal year, the Corporation had 

completed new product designs in the areas of furniture, ceramic 

tableware, games, bajan confectionery, and glassware. 

A conceptual framework for a national research and science council 

was developed by the BIDC as part of the national innovation policy 

To assist in the development of the local manufacturing sector, the 

Ministry of Finance announced that effective November 1, 2008 

all imports of raw materials, packaging and equipment used by 

registered manufacturers would be zero-rated for Value Added Tax 

(VAT) purposes. 

Effective February 2009, the Central Bank announced a widening of 

the range of entities eligible for credit guarantees under the Small 

Business Guarantee Scheme to include medium sized companies in 

the tourism and manufacturing sectors. Companies with capital of 

BDS$2 million (formerly 1 million) and companies with gross revenue of 

BDS$4 million (formerly (BDS$2 million) are now eligible to access the 

facility. In addition, the Central Bank announced that it will guarantee 

technical assistance loans up to a limit of BDS$50,000 for any one 

borrower (i.e. within the overall cost of BDS$300,000 for medium 

term facilities), where such facilities are for the purpose of market or 

product research, marketing, product costing, promotion, production/ 

plant layout, accounting and/or information systems, staff training, 

management/entrepreneurial training, business re-organisation/ 

restructuring or any other relevant areas of technical assistance. 

The Central Bank introduced also in February 2009, a Technical 

Assistance Grant to be administered under the Industrial Credit Fund 

(ICF). Grants can be given for up to BDS$5,000 and not exceeding 

50% of the cost of the business plan, market research. 

To stimulate further growth in manufacturing and export activity, 

Government announced the following initiatives: 

1. The preparation of adequate plans for the sustainable 

redevelopment of the indigenous pottery industry through 

improving design, technology, quality, marketing and sales 

and distribution, and through creating incentives for local 

pottery to be used in local establishments. 


2. The development of a viable, high fashion, high quality textile 

and garment industry based on sea-island cotton, with world 

class design and world class manufacturing quality, through 

joint venture and franchise arrangements. It is expected that 

some growth in the manufacturing sector will be driven by 

the initiatives to be taken with respect to the manufacture of 

sea-island cotton garments and products. 

3. The creation of incentives for hotels and restaurants and shops 

and real estate developments that use or sell more locally 

manufactured goods, in particular furniture. 

4. Government is also looking to put in place adequate 

arrangements at the appropriate time to increase the export 

promotion effort for locally produced goods. 

5. The establishment of the Barbados Quick Response Revolving 

Seed Capital Fund (SCF). The SCF will be used for creating 

innovative ideas from a “blank sheet”; strategic visioning 

retreats; massaging ideas into more sturdy concepts; assisting 

the entrepreneur with a potentially high performance idea, to 

survive as the idea is developed; providing funds to address 

operational emergencies; product development; market 

research; business plan development; and sourcing investment 

capital. It is proposed that this fund will be a government 

financed but private sector managed fund with adequate 

public accounting by the private sector to Government for the 

management of the fund. It is proposed that the contribution 

by Government should be BDS$500,000 per year for three 

years. 

6. The establishment of the Barbados Quick Response Venture 

Capital Fund (VCF). The Venture Capital Fund will be used 

to make the initial investment in the implementation of the 

business plan and will provide a stimulus to attract other 

equity investment. It is proposed that the venture capital fund 

will be funded by equity investment from individual investors, 

trade unions, commercial banks, private sector companies, the 

Barbados Diaspora and the government. The fund will provide 

an investment stimulus by contributing, say, 20% of the equity 

needs of the business. This initial investment will attract other 

investment partners to complete the capitalization of each 

business. Government will provide incentives such as attractive 

tax credits to encourage private sector investors to participate. 

Equity agreements will be developed which will include a 

profitable exit strategy for investors. The benefits to investors 

will be an appealing return on investment and the benefits to 

the country as a whole will be enterprise development and 

economic growth. It is proposed that the VCF fund will be 

managed by a committee, which would include representatives 

from the private sector and the government. These funds are 

designed to meet the needs of clients that have potentially 

profitable and sustainable high-growth business ideas but find 

it difficult, on a timely basis, to access all the seed and venture 

capital finance required to meet their needs, from traditional 

Venture Capital or other Private Equity financial institutions in 

Barbados. 

7. Government will provide BDS$1 million to facilitate the cotton 

industry in pursuing investment opportunities as well as for 

payment of seed cotton. It is being proposed that funding be 

provided in support of the preparation of a feasibility study and 

the commercialization of cassava production with BDS$400, 

000 being provided for this purpose. 

8. The creation of a separate allowance called the Energy 

Conservation and Renewable Energy Deduction. This will 

allow deductions of a maximum of BDS$5,000 per year over 

each of five (5) years to cover the costs of an energy audit and 

fifty per cent of the cost of retrofitting a residence or installing 

a system to produce electricity from a source other than fossil 

14 


fuels. This applies also to businesses whether incorporated or 

unincorporated. 

developmental initiatives either through joint staging of events or 

through consultations. 

9. For those manufacturers who export their goods they will 

qualify for a rebate of the environmental levy on the exports. 

STRATEGIC PARTNERSHIPS 

The BIDC continued to involve all of the relevant umbrella 

organizations and industry partners in various promotional and 

Joint initiatives were facilitated with the Caribbean Export and 

Development Agency (CEDA) and the North South Project of Canada 

in product design and development for craft persons. The BIDC also 

collaborated with CEDA to facilitate the participation of nine (9) 

craft persons in the Caribbean Gift and Craft Show. In addition the 

Corporation participated in a working group with TVET on designing 

a National Vocational Qualification in Entrepreneurship. A new 

TABLE II 

EMPLOYMENT IN SUB-SECTORS SURVEYED BY BIDC 

AT MARCH 2008 AND MARCH 2009 

SUBSECTOR March 2008 March 2009 Net Change % Change 

FOOD, BEVERAGES & TOBACCO 3,634 3,561 -73 -2.01 

TEXTILES, APPAREL & LEATHER 727 561 -166 -22.83 

WOOD, WOODEN PRODUCTS & FITTINGS 423 396 -27 -6.38 

PAPER PRODUCTS & PRINTING 778 766 -12 -1.54 

CHEMICALS & CHEMICAL PRODUCTS 402 399 -3 -0.75 

PLASTIC PRODUCTS 256 221 -35 -13.67 

NON METALLIC MINERAL PRODUCTS 1,244 1,120 -124 -9.97 

FABRICATED METAL PRODUCTS 932 848 -84 -9.01 

PRECISION INSTRUMENTS 169 173 4 2.37 

ELECTRONIC COMPONENTS 297 286 -11 -3.7 

HANDICRAFT 149 128 -21 -14.09 

OTHER MANUFACTURING 125 133 8 6.4 

Sub-Total 9,136 8,592 -544 -5.95 

INFORMATION SERVICES 2,135 2,241 106 4.96 

OTHER SERVICES 2,728 2,655 -73 -2.68 

Sub-Total 4,863 4,896 33 0.68 

Total Employed 13,999 13,488 -511 -3.65 



partnership was developed with the Business Development Company 

Ltd of Trinidad and the University of the West Indies (UWI) in planning 

developmental workshops for those with creative and viable business 

opportunities. The BIDC also moved to increase its collaborative work 

with the National Council for Science and Technology (NCST) and 

other agencies involved in innovation development. 

SUSTAINING AND CREATING JOBS 

There was a marked decline in employment within the companies 

surveyed through the BIDC’s quarterly Survey of Employment & 

Investment at March 2009 when compared to March 2008. Total 

employment at March 2009 was 13,488, a decrease of 511 jobs 

when compared with the corresponding period in 2008. Employment 

in the manufacturing sector at March 2009 was 8,592, 6.0% less 

than the 9,136 recorded at March 2008. There was however a slight 

increase in jobs in the services sector. Employment totaling 4,896 at 

March 2009 was 33 or 0.7% more than the 4,863 recorded for the 

corresponding 2008 period. 

Total jobs created for the year April 2008 to March 2009 were 899. 

This is 1,352 fewer than in the period April 2007 to March 2008 when 

2,251 job opportunities were created. Some 51.3% of the new jobs 

created were registered within the food, beverages, and tobacco 

sub-sector. In the services sector, the information services sub-sector 

recorded 48.7% or 436 of the jobs created in this period. The period 

January to March 2009 was the most productive, creating a total of 

301 jobs or 33.5% of all jobs created. 

ENTREPRENEURIAL DEVELOPMENT 

Historically, small businesses have been the fuel to propel economies out 

of recession. By reason of the agility and flexibility that is characteristic 

of these businesses they have proven to be major providers of jobs 

and opportunities for economic growth. During the year therefore, 

the BIDC, through its Entrepreneurial Development Division (formerly 

known as the Small Business and New Enterprise Division), sought 

to provide small entrepreneurs with a suite of professional services 

and resources to assist them in overcoming challenges emerging in 

the market. The Division, renamed during the corporate restructuring 

programme to better reflect its entrepreneurial development functions, 

welcomed new personnel to provide additional resources necessary to 

support the Corporation’s objectives. 

Much of the assistance given was aimed at capacity building of small 

businesses, improving their viability, market share, productivity levels, 

implementing adequate and efficient operating systems, creating 

sustainable business models and enhancing profitability. Training was 

also provided in customer service and grants were given for packaging 

and labeling. A number of business plans and development plans 

were also completed. These efforts yielded some success with the 

establishment of 21 new small businesses and the creation of 39 new 

jobs. Investment from these new businesses totaled BDS$556 000. 

Recognising that emerging opportunities must be mined through 

greater creativity and innovation, the Division moved to implement 

an expanded Innovation Programme. An Innovation Screening and 

Review Committee was established and a new innovation strategy 

developed. The corporation also facilitated training in intellectual 

property management and investment readiness for businesses in the 

Innovation Programme. 

The BIDC continued to provide a support framework for startup 

companies through its Incubator Programme. Efforts were 

concentrated on more focused development of the companies in the 

Incubator through a revitalised mentorship programme. During the 

period under review, seven (7) incubatees were partnered with mentors. 

All incubatees were given technical assistance in accounting services, 

website development, and marketing and promotion. Development 

plans were finalised and implemented for three businesses in the 

Incubator. Technical assistance in intellectual property management 

was also offered to a number of small innovators. Some entrepreneurs 

16 


were in addition able to obtain equipment grants through the Turn 

Around Management Programme. 

A number of community outreach programmes aimed at developing 

and nurturing an entrepreneurial culture were also initiated. BIDC 

personnel made presentations to local schools, churches and youth 

groups. In addition, a special session was hosted with the Rural 

Development Commission (RDC) and another was executed for staff 

of an organization undergoing restructuring. Through the Schools 

Business Plan Competition the Corporation continued to work with 

secondary schools to stimulate their interest in entrepreneurship. 

CRAFT DEVELOPMENT 

Emphasis was placed on the advancement of the craft sector during 

the year. The Pelican Craft Centre was the main hub of marketing 

activities and special events undertaken to put local craft in the 

spotlight. In addition to the Pelican Las’ Lap and the Nova Culture 

Fest, an exhibition featuring the work of craft persons trained by the 

BIDC in textiles, jewelry and glass works was hosted. 

Additional personnel were also dedicated to the Centre. One staffer 

was recruited and another reassigned to assist in executing initiatives 

for the craft sector and improving the efficiency of the Centre as a 

market facility. One such initiative, “Pelican on the Road”, was launched 

to take craft persons out of their work environment to potential 

customers. The “Pelican Half Hour” radio show was introduced to 

give craft persons an opportunity to showcase their products. 

Substantial resources were directed to training. A special basic 

woodwork workshop for women was hosted and attracted 45 

participants. Two workshops in basic leather crafts were conducted for 

24 persons and another in basic pottery was offered for 12 persons. 

Four persons also received training under the Aid to Artisan initiative 

in New York as part of the Market Readiness Programme. They were 

drawn from the textiles, jewelry, botanicals, and fashion sub-sectors. 

One person also received training in California in glass works. 

Apart from the joint initiatives with the Caribbean Export and 

Development Agency (CEDA) and the North South Project of Canada 

which were aimed at improving product design and development 

among craft persons, the Corporation was invited by CEDA to 

participate in a Cariforum working group on product design. BIDC 

also collaborated with CEDA to facilitate the participation of nine 

(9) craft persons in the Caribbean Gift and Craft Show. Assistance 

in gaining product exposure was offered to six (6) clients who were 

sponsored to attend the Barbados Beauty and Fashion Market. 

The Corporation’s Craft Development Unit also facilitated technical 

assistance in packaging and labeling, management and design for 

crafts persons. 

BUSINESS DEVELOPMENT 

Export promotion was not a core function of the Corporation during 

the year. The BIDC however continued to champion the national effort 

aimed at promoting the export of Barbadian goods and services, while 

the plans to introduce a dedicated national export promotion agency 

were being advanced. The period under review was therefore marked 

by reduced activity in key export markets. 

During the fiscal period, total domestic exports, exclusive of Crude 

Petroleum, were valued at BDS$427.0 million. This represented a 

decrease of 1.0% over the corresponding figure for 2007/08. This 

decrease was due largely to adverse performances in domestic exports 

in the categories of Inedible Crude Materials which declined 26.3% 

to BDS$11.8 million; and Chemicals which fell 27.7% to BDS$58.3 

million. 

The Corporation’s strides in export development have been aimed 

largely at (a) capacity building in terms of competitive enhancement 

of medium and large enterprises, including exporters and entities 

with export potential, and (b) facilitation services for special technical 


assistance aimed at overall export growth. As part of its capacity 

building effort, the Corporation facilitated over 350 client visits during 

the year. 

generally considered best practices in world-class furniture outfits and 

thereby positively influence their marketing, production, planning and 

designing decisions. 

The BIDC also concentrated efforts on enhancing the quality and 

range of products offered by existing exporters and small businesses 

with the potential for export. Fifteen (15) companies were drafted 

into the Corporation’s ‘Export Ready’ programme during the year. To 

give further impetus to this programme, the BIDC provided assistance 

in the critical area of product design and quality enhancement. By the 

end of the fiscal year, the Corporation had completed new product 

designs in the areas of furniture, ceramic tableware, games, Bajan 

confectionery, and glassware. 

The Export Expansion Project was also continued. The performance of 

companies within this initiative was however affected by developments 

in the weakening global economy. 

The BIDC also continued to work with a cadre of highly talented 

designers to expand and refine their portfolios as part of the Integrated 

Programme for Fashion. This programme has seen significant emphasis 

being placed on developing and strengthening the skills base within 

the fashion industry to facilitate production according to internationally 

recognized and accepted standards. The Portfolio Project, an integral 

part of the programme, was instrumental in facilitating ten (10) 

Barbadian designers in meeting the requirements for successful 

marketing of their brands. Phase II of the project however had to 

be delayed due to a lack of funds. It is anticipated that activities in 

support of this project will be continued during the 2009/2010 year. 

TECHNICAL ASSISTANCE 

The Corporation continued to devote special attention to Barbados’ 

traditional industries during the period under review, through the Basic 

Industries Programme. Conceptualized in 2005/06 as a mechanism to 

provide special development funds to assist the furniture, beverages 

and textiles subsectors, which were traditionally the core of Barbadian 

manufacturing, the programme has since seen some expansion of 

the recipient categories to incorporate food categories, most notably 

condiments. 

During the year, plans were advanced on developing a procurement 

centre for the condiments sub-sector as well as a multi-purpose, 

state-of- the-art production facility for the furniture sub-sector. A 

mission to Vancouver, Canada was also undertaken as part of the 

programme of assistance to the furniture sector. The contingent 

included representatives of the BIDC, eleven (11) manufacturers, along 

with representatives from the Samuel Jackman Prescod Polytechnic 

and the Barbados Vocational Training Board. The objectives of the 

mission were to expose the Barbadian manufacturers to what is 

In this unstable business environment, the Corporation’s Special 

Technical Assistance Programme (STAP) proved crucial to maintaining 

the viability and competitiveness of Barbadian companies. Originally 

implemented in 2001 for the benefit of the manufacturing sector, the 

STAP has since been made available to the services sector. Companies 

benefitting from the STAP are exposed to a comprehensive evaluation, 

including a diagnostic survey and a benchmarking exercise. A threeyear 

development programme is then devised and implemented to 

address any deficiencies. 

The programme, since inception, has provided assistance to the value 

of BDS$39.6 million. Despite a reduction in the funds available for the 

programme during the period April 2008–March 2009, approximately 

BDS$6.1 million was disbursed this year. This represented a 7.2% falloff 

in assistance from the previous year. The majority of the funds 

disbursed assisted companies with marketing and the upgrade of 

their systems, procedures and equipment. STAP funds also supported 

an intensification plan for exports through an expanded Market 

18 


Development Programme. It was encouraging to note an increase in 

the level of technical assistance disbursed to companies seeking to 

enhance their competitiveness in domestic and international markets 

by upgrading their operations to international standards. For the 

April 2008-March 2009 period, the BIDC disbursed approximately 

BDS$260,975 for the purpose of international standards certification 

compared with BDS$51,099 for a similar period in 2007/2008. 

PROPERTY MANAGEMENT 

The BIDC remains committed to providing physical accommodation 

in its industrial estates which favourably compares with that offered 

in the industrial nations of the world. To this end, the Corporation 

has strengthened its in-house capabilities to more effectively manage 

the twelve (12) industrial estates under its portfolio. The upgrade 

and refurbishment of estate properties also continued to be a priority 

Table lll 

SELECTED DOMESTIC EXPORTS 

FISCAL YEARS 2007/08 and 2008/09 

(BDS$ Million) 

SELECTED EXPORTS 2007/08 R 2008/09 P % Change 

Electronic Components 22.1 22.1 0.15 

Soaps & Detergents 0.6 0.7 19.31 

Insecticides, Fungicides & Disinfectants 11.5 0.1 -99.28 

Portland Cement 25.8 31.7 23.02 

Garments 1.5 0.9 -43.04 

Paints & Varnishes 8.2 7.5 -8.69 

Metal Cans (cap. < 50 L) 13.8 11.5 -17.08 

Hand Tools 0.1 0.3 149.13 

Paper Products 3.4 3.4 -0.24 

Printed Material 18.7 21.5 14.92 

Biscuits 11.7 13.5 15.26 

Margarine/Lard 16.5 19.1 15.94 

Non-alcoholic Beverages 7.3 8.7 18.85 

Sugar 37.1 33.4 -10.08 

Rum 59.5 69.7 17.18 

Other Foods & Beverages 36.3 34 -6.29 

Furniture and Parts thereof 2.8 2.1 -22.37 

Petroleum 45.4 0.0* -100 

SELECTED EXPORTS 322.4 280.2 -13.08 

DOMESTIC EXPORTS 513.9 460.4 -10.41 

R 

– Revised 

P 

– Provisional * - This figure is not yet available 

Source: Barbados Statistical Service 


Table lV 

DOMESTIC EXPORTS TO CARICOM BY MARKETS 

FISCAL YEAR 2007/08 AND 2008/09 

(BDS$) 

CARICOM MARKETS 2007/08 R 2008/09 P % Change 

ANGUILLA 2,656,813 3,418,594 28.67 

ANTIGUA 16,301,046 19,185,179 17.69 

BELIZE 4,295,816 4,112,874 -4.26 

DOMINICA 8,663,513 9,270,926 7.01 

GRENADA 17,752,758 17,088,039 -3.74 

GUYANA 19,706,640 26,848,991 36.24 

JAMAICA 32,859,659 29,943,487 -8.87 

MONTSERRAT 569,091 411,414 -27.71 

ST. KITTS/NEVIS 10,048,687 13,320,565 32.56 

ST. LUCIA 38,759,984 41,063,172 5.94 

ST.VINCENT 25,362,527 22,076,371 -12.96 

SURINAME 9,862,104 7,297,024 -26.01 

TRINIDAD & TOBAGO 80,458,629 32,689,855 P -59.37 

TOTAL 267,297,267 226,726,491 -15.18 

R 

– Revised 

P 

– Provisional 


TABLE V 

DOMESTIC EXPORTS TO MAJOR MARKETS BY VALUE AND PERCENTAGE SHARE 

FISCAL YEAR 2007/08 AND 2008/09 

(BDS$) 

2007/08 R 2008/09 P 

MARKETS $ BDS % Share $ BDS % Share 

CARICOM 267,297,267 52.02 226,726,491P 49.25 

USA 78,997,493 15.37 81,319,609 17.66 

Canada 15,525,315 3.02 19,402,121 4.21 

EU 75,640,386 14.72 73,272,999 15.92 

Dominican Republic 2,227,736 0.43 3,577,085 0.78 

Other 74,186,803 14.44 56,082,567 12.18 

TOTAL 513,875,000 100.00 460,380,872 100.00 

R 

– Revised 

P 

– Provisional 


20 


during the period under review. Approximately BDS$4.5 million 

was spent on maintenance. The capital works programme however 

suffered a major setback in July 2008 when fire destroyed a number 

of units and damaged several others at the Grazettes Industrial Park. 

As a result of the fire, some 44,000 square feet of viable space was 

placed out of use. 

Prompt response by BIDC personnel mitigated dislocation to the 

affected businesses and a number of them were relocated shortly 

thereafter and were able to continue their operations. The BIDC 

has committed itself to the installation of sprinkler systems in high 

risk buildings and to the reduction of all fire risks. In addition the 

corporation is working with the Chief Fire Officer to certify that all its 

buildings are safe. 

As part of the capital works programme, construction resumed on the 

completion of the buildings at Newton Business Park. This followed 

the appointment of a new contractor in January 2008. At the end 

of March 2009, approximately 80% of the construction work was 

completed. This was despite a number of delays due to unforeseen 

engineering problems that needed to be corrected. This phase of the 

project now has an anticipated completion date of June 2009. 

Efforts to lease and sell properties within the industrial estates it 

is believed will further enhance the corporation’s performance in 

property management. Proceeds from the sale of properties will 

provide funds for capital expansion and refurbishment and will at the 

same time provide equity for manufacturers who on purchasing would 

be the owners of the properties. Two properties were sold during the 

period under review, and proceedings for the sale of another two 

have started. 

RENT COLLECTION 

The collection of rents is a key revenue generating activity for the 

Corporation. The efforts of the Accounting Services Department 

during the review period realized BDS$10.0 million in rent, up 

1.01% from the BDS$9.94 million collected in the previous year. This 

represents a collection rate of 90% of billings as compared with 95% 

in the previous year. While revenues increased as a result of increased 

occupancy and as additional space was made available during the 

review period, the number of clients failing to service their rental 

obligations also increased. 

The BIDC remains committed to assisting companies in meeting their 

rental commitments and continues to work with tenants to identify 

alternative payment plans that redound to the benefit of all parties. 

The Corporation will at the same time seek to expand its space recovery 

program in the upcoming fiscal period. 

HUMAN RESOURCE DEVELOPMENT 

As part of efforts to respond more effectively to the challenges emerging 

within the indigenous manufacturing and services sectors and in 

support of its revised mandate, further organizational restructuring 

was undertaken during the period under review. The process of staff 

reassignments and filling approved positions was mostly completed. 

The staff training programme was continued in support of the 

restructuring process. This ensured that employees were well prepared 

to effectively perform their assigned duties and were better positioned 

to accomplish organizational objectives. Over 90% of agreed training 

programmes were completed, but as a result of financial constraints in 

the last quarter activity in this area had to be restricted. 

In support of organizational and staff development, a Human 

Resource Information System was acquired and will be implemented 

in the new financial year. This system will facilitate effective planning 

and implementation of training programmes, increased use of human 

resource metrics and other related activities. During the year, the 

Corporation also implemented a revamped Performance Management 

System with no major concerns being reported. Some 99% of staff 


appraisals were completed. 

Emphasis continued to be placed on achieving organizational 

compliance with the requirements of the proposed Safety and Health 

at Work Bill. The Corporation’s Safety and Health Committee was 

restructured in accordance with the legislation and required training in 

areas related to first aid and occupational safety and health continues 

for members. 

In keeping with the bid to enhance occupational safety and health 

within the Corporation, an ergonomic assessment was completed at 

all BIDC offices. Implementation of agreed recommendations from 

the report will commence in the new financial year. In support of 

Government’s efforts to promote health and wellness as a national 

priority, the Corporation staged a Heath Fest to sensitise employees, 

clients and business persons in the Harbour and Pelican Industrial 

Estates about the benefits of maintaining healthy lifestyles. In addition 

to lectures delivered by health professionals throughout the day, free 

health checks, literature and product samples were offered. 

During the review period, emphasis continued to be placed on 

improving staff relations and the quality of work life. A number of 

events were held in support of this. A special presentation, BIDC – 

The Other Side, as well as the annual Independence and End of Year 

celebrations, allowed members of staff to showcase their creative 

talent. Participation in national fitness events like the Nation Fun 

Walk were encouraged. Long-serving members of staff as well as 

outstanding employees were honoured during the Christmas party 

and awards ceremony. 

22 



2008/09 IN PICTURES 

The BIDC’s booth at BMEX 2008 highlighted the Corporation’s 

business development services from which the local productive 

sector can benefit. 

BIDC personnel (from Left) Director of Entrepreneurial 

Development, James Campbell, Manager, Michael Bynoe and 

Business Development Officer, Sheena Thorne during one 

of the seminars hosted to promote the development of an 

entrepreneurial culture. 

Construction continued to bring work on the 

Newton Business Park closer to completion. 

One of the buildings gutted by the fire at the Grazettes Industrial 

Park. Some 56 000 sq. ft. of space was lost. 

BIDC officials and health professionals came together to host 

Health feast 2008, an event intended to promote health and 

wellness among BIDC employees, clients and neighboring 

businesses. 

The BIDC partnered with the Barbados Private Sector Trade Team 

to host the Dr. Lawson Nurse Memorial Lecture. Guest Speaker 

Mr. David Jessop chats with Mrs. Donnette Strickland-Nurse, 

widow of the late Dr. Lawson Nurse. 

24 


Nova Culture fest, hosted at the Pelican Craft Centre highlighted 

the best of Bajan craft, fashion and entertainment. Attendees 

were treated to a performance from the Royal Barbados Police 

Force. 

BIDC’s outstanding employees honored during the annual 

Christmas party and awards ceremony are (from left) Shelly 

Burgess, Samuel Harrison and Leslie Austin. 

The BIDC hosted Minister of Economic Affairs, Empowerment, 

Innovation, Trade, Industry and Commerce, Dr. David Estwick, 

along with Chairman, Mr. DeVere Browne in an official visit and 

tour of the Corporation. 

The BIDC rewarded outstanding students in the 2008 Student’s 

Business Plan Competition. First prize winner Ezron Alleyne 

(right) was congratulated by CEO Ag. Basil Lavine. 

Dr. Lianxi Zhou, an associate professor of marketing and 

international business at Brock University in Canada, was 

engaged by the BIDC to host a seminar on Marketing Your 

Business to Succeed. 

One of the participants in the basic woodwork workshop for 

women which was offered by the BIDC as part of training to 

promote craft development. 


26 BARBADOS INVESTMENT AND DEVELOPMENT CORPORATION ANNUAL REPORT 2009

Looking to the Future 

Barbados as a small, developing nation is all too familiar with achieving 

great things despite the odds. In previous crises we have met the 

challenges and have overcome. However daunting this particular crisis 

might be, we believe that we have the wherewithal to overcome. The 

key to rising beyond the adversity lies in finding creative responses to 

whatever challenges might be confronting an enterprise or a nation 

at a particular time. 

To this end, there are plans to develop a new business model under which 

the BIDC will operate. The model will better reflect the organization’s 

new way of thinking and better position the Corporation to tackle the 

challenges emerging in today’s operating environment. It will reflect 

a two-dimensional management thrust; one aimed at managing the 

existing environment and another aimed at managing for the future. 

The BIDC will seek to maximize agility by overcoming the constraints 

to our ability to respond to markets changes. At the same time the 

Corporation will aim to guide future growth in the sectors under our 

mandate with a revised industrial policy, currently in the works. 

It is our intention to put increased emphasis on nurturing a culture of 

innovation and encouraging Barbadian businesses to better identify 

areas of commercial opportunity, utilise technological advancements 

and develop the capabilities to really take charge of manufacturing the 

future. We anticipate there will be new challenges but we must stand 

ready to confront them. Similarly, new opportunities will emerge and 

we must ensure that we are prepared to seize them. 


Auditors’ Report 

To the Board of Directors Barbados Investment and Development Corporation 

We have audited the accompanying consolidated financial statements of the Barbados Investment and Development Corporation (the “Corporation”), 

which comprise the consolidated balance sheet as at 

March 31, 2009, the consolidated statements of changes in equity, 

revenue and expenditure and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes. 

Management’s Responsibility for the Financial Statements 

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International 

Financial Reporting Standards. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation 

and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error; selecting and applying appropriate 

accounting policies; and making accounting estimates that are reasonable in the circumstances. 

Auditors’ Responsibility 

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance 

with International Standards on Auditing. Those standards require that we comply with relevant ethical requirements and plan and perform the 

audit to obtain reasonable assurance whether the financial statements are free of material misstatement. 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures 

selected depend on our judgment, including the assessment of the risks of material misstatement of the financial statements, whether due 

to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation and fair presentation of the 

financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion 

on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting principles used and 

the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. 

Opinion 

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Corporation as at March 

31, 2009, its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards. 

Chartered Accountants 

Bridgetown, Barbados 

28 


Consolidated Balance Sheet 

As at March 31, 2009 

with comparative figures for 2008 

(Expressed in Barbados dollars) 

2009 2008 

$ $ 

Assets 

Current Assets 

Cash and cash equivalents (note 4) 4,020,416 16,124,972 

Accounts receivable (note 5) 2,135,687 3,294,885 

Investments (note 6) 14,000 15,640 

Staff loans 155,044 276,430 

Inventory 205,979 149,101 

Prepaid expenses 65,732 55,789 

6,596,858 19,916,817 

Staff loans 411,818 242,544 

Sinking fund investment (note 7) 1,430,412 1,703,410 

Development projects (note 8) 144,690,419 135,093,191 

Property, plant and equipment (note 9) 2,244,854 2,273,870 

Total Assets 155,374,361 159,229,832 

Liabilities and Equity 

Current liabilities 

Accounts payable and accrued liabilities 7,570,195 6,710,125 

Bank overdraft 1,657,005 - 

Current portion of long term debt (note 10) 3,062,995 3,303,511 

Land conveyance deposit (note 11) - 100,000 

12,290,195 10,113,636 

Due to Government of Barbados (note 12) 15,797,427 14,713,102 

Long term debt (note 10) 56,725,854 59,748,773 

Deferred capital grants (note 13) 43,680,073 46,068,283 

Special Technical Assistance Fund (note 14) 3,913,739 5,960,946 

Deferred revenue grant (note 15) - 79,581 

132,407,288 136,684,321 

Equity 

Capital contributed by Government of Barbados (note 16) 7,504,087 7,504,087 

Minority Interest - - 

Fair value reserve 7,740 10,440 

Sinking Fund (note 7) 3,430,442 1,703,410 

Accumulated excess of revenue over expenditure 12,024,804 13,327,574 

22,967,073 22,545,511 

Total Liabilities and Equity 155,374,361 159,229,832 

See accompanying notes to consolidated financial statements. 

Approved on behalf of the Board: 

............................................ Director ............................................ Director 


Consolidated Statement of Changes in Equity 

For the year ended March 31, 2009 



Capital 

Contribution 

Accumulated 

by Fair excess of 

Government value Sinking Minority revenue over 

of Barbados reserve fund interest expenditure Total 

$ $ $ $ $ $ 

Balance - March 31, 2007 7,504,087 8,800 - 776 10,953,895 18,467,558 

Excess of revenue over expenditure for the year - - - (776) 4,044,361 4,043,585 

Appropriation to sinking fund (note 7) - - 1,670,682 - (1,670,682) - 

Interest earned on amounts invested (note 7) - - 32,728 - - 32,728 

Fair value adjustment - 1,640 - - - 1,640 

Balance - March 31, 2008 7,504,087 10,440 1,703,410 - 13,327,574 22,545,511 

Excess of revenue over expenditure for the year - - - (14,955) 382,867 367,912 

Appropriation to sinking fund (note 7) - - 1,670,682 - (1,670,682) - 

Interest earned on amounts invested (note 7) - - 56,350 - - 56,350 

Amount transferred to retained earnings - - - 14,955 (14,955) - 

Fair value adjustment - (2,700) - - - (2,700) 

Balance - March 31, 2009 7,504,087 7,740 3,430,442 - 12,024,804 22,967,073 


30 


Consolidated Statement of Revenue and Expenditure 




2009 2008 

$ $ 

Revenue 

Factory space rental 9,799,078 9,392,171 

Retail Gross Profit (note 17) 498,690 247,848 

Other (note 18) 562,573 1,351,631 

10,860,341 10,991,650 

Revenue grant from Government of Barbados (note 19) 14,421,144 15,090,165 

Gain/(loss) on disposal of plant and equipment 6,211 (4,323) 

Gain on disposal of development projects 5,418 - 

25,293,114 26,077,492 

Expenditure 

Industrial estates 9,758,051 8,816,582 

Administration (note 20) 10,704,364 9,719,281 

Industrial and training grants 804,898 695,994 

Bad debts 409,456 1,230,007 

Interest expense 1,783,891 142,976 

23,460,660 20,604,840 

Excess of revenue over expenditure before the following items 1,832,454 5,472,652 

Depreciation (notes 8 & 9) (3,852,752) (3,817,277) 

Amortisation of capital grants (note 13) 2,388,210 2,388,210 

Excess of revenue over expenditure for the year 367,912 4,043,585 

Attributable to: 

Equity holder of the parent 382,867 4,044,361 

Minority Interest (14,955) (776) 




Consolidated Statement of Cash Flows 




2009 2008 

$ $ 

Cash flows from operating activities 


Adjustments for: 

Depreciation 3,852,752 3,817,277 

Amortisation of capital grants (2,388,210) (2,388,210) 

Deferred revenue grant (79,581) - 

Revenue grant reversed 31,460 - 

(Gain) loss on disposal of plant and equipment (6,211) 4,323 

Gain on disposal of development projects (5,418) - 

Interest income (68,099) (915,516) 

Interest expense 1,783,891 142,976 

Operating excess of revenue over expenditure 

before working capital changes 3,488,496 4,704,435 

Decrease (increase) in accounts receivable 1,159,198 (295,004) 

(Increase) decrease in inventory (56,878) 56,878 

Increase in staff loans (47,888) (61,780) 

Increase in prepaid expenses (9,943) (3,048) 

Increase in accounts payable and accrued liabilities 860,071 953,858 

Cash generated from operations 5,393,056 5,355,339 

Interest paid (2,639,217) (123,482) 

Net cash from operating activities 2,753,839 5,231,857 

Cash flows from investing activities 

Redemption/(purchase) of sinking fund investments 272,998 (1,670,682) 

Additions to development projects - net (13,326,915) (42,599,920) 

Additions to property, plant and equipment - net (317,053) (423,697) 

Proceeds on disposal of development projects 1,081,319 - 

Proceeds on disposal of plant and equipment 7,826 1,670 

Interest received 72,325 905,315 

Net cash used in investing activities (12,209,500) (43,787,314) 

Cash flows from financing activities 

Increase in balance due to Government of Barbados 1,084,325 1,085,799 

Decrease in Special Technical Assistance Fund (net) (2,047,208) (4,648,336) 

Decrease in deferred revenue grant (79,581) - 

Long term loan instalments paid (3,263,436) (2,078,949) 

Long term loan received - 24,493,647 

Net cash (used in) from financing activities (4,305,900) 18,852,161 

Net decrease in cash and cash equivalents (13,761,561) (19,703,296) 

Cash and cash equivalents - beginning of year 16,124,972 35,828,268 

Cash and cash equivalents - end of year (note 4) 2,363,411 16,124,972 

Represented by: 

Cash and cash equivalents 4,020,416 16,124,972 

Bank overdraft (1,657,005) - 

2,363,411 16,124,972 


32 


Notes to Consolidated Financial Statements 

March 31, 2009 


1. Establishment. Principal Activity and Principal Place of Business 

The Corporation was established under the Barbados Investment and Development Corporation Act 1992-30 for the purpose of developing Barbados’ 

industrial, off-shore financial, export and other related activities. The consolidated financial statements for the year ended March 31, 2009 comprise the 

corporation and its subsidiaries. 

The Corporation’s subsidiary, Islandcrafts (Barbados) Inc. was incorporated under the Companies Act of Barbados on September 03, 1998, and commenced 

operations on April 19, 1999. The principal activity of the subsidiary is the sale and marketing of indigenous handicraft items. The Corporation’s subsidiary, 

Newton Business Park Project Company Limited, was incorporated on June 12 , 2001 as the Special Purpose Vehicle Company established under a Build Own 

Transfer (BOT) arrangement set up to carry out construction works at the Newton Business Park Project – Phase 1. 

The Corporation’s principal place of business is located at Princess Alice Highway, St. Michael. 

2. Significant accounting policies 

These consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) and its interpretations adopted 

by the International Accounting Standards Board (IASB). These consolidated financial statements were approved by the Board of Directors on September 9, 

2009. 

During the year, the Corporation adopted IFRS 7 Financial Instruments: Disclosures and IAS 1 Presentation of Financial Statements – Capital Disclosures. The 

adoption of IFRS 7 and the amendment to IAS 1 impacted the type and amount of disclosures made in these financial statements, but had no impact on the 

reported income or financial position of the Corporation. In accordance with the transitional requirements of the standards, the Corporation has provided full 

comparative information. 

The accounting policies adopted by the Corporation are consistent with those of the previous financial year have been applied consistently by the Group 

entities. These are as follows: 

(a) Basis of preparation 

These consolidated financial statements have been prepared on the historical cost basis. 

(b) Use of estimates and adjustments 

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that could affect the reported 

amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of 

revenues and expenditure during the year. Actual results could differ significantly from those reported. 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the 

estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future 

periods. 

(c) Basis of consolidation 

(i) Subsidiaries 

Subsidiaries are entities controlled by the Corporation. Control exists when the Corporation has the power, directly or indirectly, to govern the financial 

and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are exercisable or 

convertible are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control 

commences until the date that control ceases. 

(ii) Transactions eliminated on consolidation 

Intragroup (corporation and subsidiary) balances and transactions, and any unrealized losses on income and expenses arising from intragroup transactions, 

are eliminated in preparing the consolidated financial statements. 



March 31, 2009 


2. Significant accounting policies, continued 

(d) Cash and cash equivalents 

Cash and cash equivalents are carried in the balance sheet at cost. For the purposes of the statement of cash flows, cash and cash equivalents comprise cash 

on hand and deposits held at call with other banks with original maturities of 90 days or less. 

(e) Revenue recognition 

Revenue from factory space rental and related interest charges is recognized on an accrual basis. Revenue from the sale of goods is recognized in the income 

statement when the significant risks and rewards of ownership have been transferred to the buyer. 

Other revenue is recognized at the point of delivery of the service. 

(f) Property, plant and equipment and development projects 

Property, plant and equipment and development projects are stated at cost less accumulated depreciation and impairment losses. Depreciation on property, 

plant and equipment and development projects is provided on the straight line method at rates which are calculated to write the assets off over their expected 

useful lives as follows: 

Buildings 

Furniture and fittings 

Computer hardware 

Computer software 

Machinery and equipment 

Vehicles 

2.5% per annum 

10% per annum 

33.3% per annum 

100% per annum 

10% per annum 

20% per annum 

Depreciation methods, useful lives and residual values are reviewed at each reporting date. 

Assets taken over from the former BIDC and the former BEPC are being depreciated over their remaining useful lives. 

Building repair and maintenance costs are charged to current operations and the cost of improvements capitalised. 

(g) Inventories 

Inventories are valued at the lower of cost and net realizable value. Cost is based on the first-in-first-out method. 

(h) Revenue and capital grants 

Revenue grants received from Government are taken to income in the period in which the related expenditure is incurred. 

Grants received from Government for capital expenditure are treated as deferred grants and amortised over the useful life of the assets purchased with grant 

funds. (See note 13) 

(i) 

(j) 

Capitalisation of interest 

Interest on loans obtained for the construction of development projects is capitalised during the period of construction. 

Pension scheme 

The Corporation operates a fully insured purchased annuity pension scheme for certain of its employees. The scheme takes the form of a defined contribution 

pension scheme. Pension costs are accounted for on the basis of contributions payable in the year. (Note 21) 

(k) Impairment 

The carrying amounts of the Group’s assets are reviewed at each balance sheet date to determine whether there is an indication of impairment. If any 

such indication exists, the asset’s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset or its cashgenerating 

unit exceeds its recoverable amount. Impairment losses are recognised in the income statement. 

For goodwill, assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated at each 

balance sheet date. 

34 



March 31, 2009 



(l) 

Accounts receivable 

Tenants’ rent receivables are carried at original invoice amount less an estimate for doubtful receivables based on a review of all outstanding amounts at the 

year end. The provision for doubtful receivables is based on the specific identification of doubtful receivables. Additions to the provision are charged to current 

operations. As receivables become uncollectible they are written off against the provision. 

(m) Interest-bearing borrowings 

Interest-bearing borrowings are recognized initially at fair value less attributable transaction costs. They are subsequently stated at amortized cost with any 

difference between cost and redemption value recognized in the income statement over the period of the borrowing on an effective interest basis. 

(n) Investments 

The Company’s investments in equity are classified as available-for-sale financial assets. Subsequent to initial recognition, they are measured at fair value and 

changes therein, other impairment losses and foreign exchange gains and losses on available-for-sale monetary items are recognized directly in equity. When 

an investment is derecognized, the cumulative gain or loss in equity is transferred to profit or loss. 

(o) New standards and interpretations not yet adopted 

A number of new standards, amendments to standards and interpretations are not yet effective for the year ended March 31, 2009, and have not been applied 

in preparing these financial statements: 

• Revised IFRS 3 Business Combinations (2008) incorporates the following changes that are likely to be relevant to the Group’s operations: 

– The definition of a business has been broadened, which is likely to result in more acquisitions being treated as business combinations. 

– Contingent consideration will be measured at fair value, with subsequent changes therein recognised in profit or loss. 

– Transaction costs, other than share and debt issue costs, will be expensed as incurred. 

– Any pre-existing interest in the acquiree will be measured at fair value with the gain or loss recognised in profit or loss. 

– Any non-controlling (minority) interest will be measured at either fair value, or at its proportionate interest in the identifiable assets and liabilities of 

the acquiree, on a transaction-by-transaction basis. 

Revised IFRS 3, is effective for periods beginning on or after July 1, 2009. 

• Amendments to IAS 32 Financial instruments: Presentation and IAS 1, Presentation of Financial Statements is effective for annual periods beginning on or 

after January 1, 2009. The amendments allow certain instruments that would normally be classified as liabilities to be classified as equity if certain conditions 

are met. Where such instruments are reclassified, the entity is required to disclose the amount, the timing and the reason for the reclassification. 

• Amendment to IFRS 2 Share-based payment – Vesting Conditions and Cancellations is effective for annual periods beginning on or after January 1, 2009. 

Under the amendment, non-vesting conditions are taken into account in measuring the grant date fair value of the share-based payment and there is no 

true-up for differences between expected and actual outcomes. 

• IFRS 8 Operating Segments introduces the “management approach” to segment reporting. IFRS 8, is effective for periods beginning on or after January 1, 

2009, and will require a change in the presentation and disclosure of segment information based on the internal reports regularly reviewed by the Group’s 

Chief Operating Decision Maker, in order to assess each segment’s performance and to allocate resources to them. 



March 31, 2009 



(n) New standards and interpretations not yet adopted (continued) 

• IFRS 8 Operating Segments introduces the “management approach” to segment reporting. IFRS 8, is effective for periods beginning on or after January 1, 

2009, and will require a change in the presentation and disclosure of segment information based on the internal reports regularly reviewed by the Group’s 

Chief Operating Decision Maker, in order to assess each segment’s performance and to allocate resources to them. 

• Revised IFRS 3 Business Combinations and amended IAS 27 Consolidated and Separate Financial Statements are effective for annual periods beginning 

on or after July 1, 2009. The definition of business combination has been revised and focuses on control. All items of consideration transferred by the 

acquirer are measured and recognised at fair value as of the acquisition date, including contingent consideration. An acquirer can elect to measure noncontrolling 

interest at fair value at the acquisition date or on a transaction by transaction basis. New disclosure requirements have been introduced. 

• Revised IAS 23 Borrowing Costs removes the option to expense borrowing costs and requires that an entity capitalise borrowing costs directly attributable 

to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. The revised IAS 23 is effective for periods beginning on 

or after January 1, 2009. 

• Revised IAS 1 Presentation of Financial Statements (2007) introduces the term total comprehensive income, which represents changes in equity during 

a period other than those changes resulting from transactions with owners in their capacity as owners. Total comprehensive income may be presented 

in either a single statement of comprehensive income (effectively combining both the income statement and all non-owner changes in equity in a single 

statement), or in an income statement and a separate statement of comprehensive income. Revised IAS 1, is effective for periods beginning on or after 

January 1, 2009, is expected to have a significant impact on the presentation of the consolidated financial statements. 

3. Determination of fair values 

A number of the company’s accounting policies and disclosures require the determination of fair value, for its financial assets and liabilities. Fair values have 

been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the assumptions 

made in determining fair values is disclosed in the notes specific to that asset or liability. 

(i) 

(ii) 

Trade and other receivables: 

The fair value of trade and other receivables is estimated as the present value of future cash flows, discounted at the market rate of interest at the reporting 

date. 

Non-derivative financial liabilities: 

Fair value, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows, discounted at the 

market rate of interest at the reporting date. 

36 



March 31, 2009 


4. Cash and cash equivalents 

For the purposes of the statement of cash flows, cash and cash equivalents comprise: 

2009 2008 

$ $ 

Cash and bank balances 3,119,287 13,038,817 

Bank term deposits 901,129 3,086,155 

Cash 4,020,416 16,124,972 

Bank overdraft (1,657,005) - 

The following restrictions have been placed on certain bank and term deposit accounts: 

2,363,411 16,124,972 

a) two of the current accounts amounting to $1,224,503 (2008 – $5,989,203) have been restricted to provide special technical assistance to the manufacturing 

sector. 

b) one of the current accounts amounting to $1,657,005 (2008 – $6,764,277) has been restricted to capital projects. 

c) the car loan revolving account amounting to $124,716 (2008 – $195,645) has been restricted to car loans. 

The short term deposits earn interest at rates varying from 4.50% - 6.35% (2008 – 4.75% - 6.25%) per annum. 

5. Accounts receivable 

2009 2008 

$ $ 

Tenants rent receivable 7,004,765 6,434,883 

Other 2,819,025 3,621,310 

9,823,790 10,056,193 

Less: Allowance for doubtful accounts (7,688,103) (6,761,308) 

2,135,687 3,294,885 



March 31, 2009 


6. Investments 

The investment held by the Corporation is classified as available-for-sale and is stated at fair value, with any resultant gain or loss being recognised directly in 

equity. The investment is represented by shares held in a publicly listed entity. 

When the investment classified as available-for-sale is sold, collected or otherwise disposed of, or when the carrying amount of the investment is impaired, the 

cumulative gain or loss recognized in equity is transferred to the income statement. 

Investments available-for-sale are recognised/derecognised by the Corporation on the date it commits to purchase/sell the investments. 

7. Sinking fund investments 

Under the terms of the Prospectus issued in relation to the issue of $12,000,000 - 8 3/4% Investment and Development Bonds 2008, the Corporation was 

required to set up a sinking fund by half yearly appropriations from its resources in order to provide for the redemption of bonds surrendered or maturing under 

the bond issue. The bonds were redeemed on March 31, 2008. 

In April 2008, the Corporation set up a sinking fund by monthly appropriations from its resources to provide for the repayment of the principal on the RBTT 

$38 million loan (US$19 million) in the year 2022. 

The balance in the sinking fund account is made up as follows: 

2009 2008 

$ $ 

Balance at beginning of year 1,703,410 - 

Appropriation to Sinking Fund 1,670,682 1,670,682 

Interest earned on amounts invested 56,350 32,728 

3,430,442 1,703,410 

Cash transfers to Capital Account (to be replenished) (2,000,030) - 

Balance at end of year 1,430,412 1,703,410 


Investment in term deposits 1,430,412 1,703,410 

38 



March 31, 2009 


8. Development projects 

Land and 

Development Construction 

Buildings Cost in Progress Total 

$ $ $ $ 

Cost 

Balance at April 1, 2007 124,009,355 7,361,171 1,221,672 132,592,198 

Additions 531,716 1,243,258 40,099,559 41,874,533 

Transfers from construction in progress 

1,475,733 - (750,347) 725,386 

Disposals - - - - 

Balance at March 31, 2008 126,016,804 8,604,429 40,570,884 175,192,117 

Balance at April 1, 2008 126,016,804 8,604,429 40,570,884 175,192,117 

Additions 95,002 7,449 9,443,879 9,546,330 

Transfers from construction in progress 989,741 138,877 (40,590) 1,088,028 

Disposals (2,455,177) (19,196) - (2,474,373) 

Other costs - - 3,548,825 3,548,825 

Balance at March 31, 2009 124,646,370 8,731,559 53,522,998 186,900,927 

Accumulated Depreciation 

Balance at April 1, 2007 36,566,979 - - 36,566,979 

Charge for the year 3,531,947 - - 3,531,947 

Disposal of buildings - - - - 

Balance at March 31, 2008 40,098,926 - - 40,098,926 

Balance at April 1, 2008 40,098,926 - - 40,098,926 

Charge for the year 3,510,054 - - 3,510,054 

Disposal of buildings (1,398,472) - - (1,398,472) 

Balance at March 31, 2009 42,210,508 - - 42,210,508 

Net Book Value 

At April 1, 2007 87,442,376 7,361,171 1,221,672 96,025,219 

At March 31, 2008 85,917,878 8,604,429 40,570,884 135,093,191 

At April 1, 2008 85,917,878 8,604,429 40,570,884 135,093,191 

At March 31, 2009 82,435,863 8,731,559 53,322,998 144,690,419 



March 31, 2009 


9. Property, plant and equipment 

Furniture 

Computer 

Equipment 

Software Buildings and Vehicles Total 

$ $ $ 

Cost 

Balance at April 1, 2007 6,155 2,417,311 3,083,802 5,507,268 

Additions - - 354,724 354,724 

Work-in-progress - 68,973 - 68,973 

Disposals - - (963,391) (963,391) 

Balance at March 31, 2008 6,155 2,486,284 2,475,135 4,967,574 

Balance at April 1, 2008 6,155 2,486,284 2,475,135 4,967,574 

Additions - 89,133 227,920 317,053 

Work-in-progress - - - 

Disposals - - (88,119) (88,119) 

Balance at March 31, 2009 6,155 2,575,417 2,614,936 5,196,508 

Accumulated Depreciation 

Balance at April 1, 2007 6,155 838,017 2,521,601 3,365,773 

Charge for the year - 60,210 225,120 285,330 

Disposals - - (957,399) (957,399) 

Balance at March 31, 2008 6,155 898,227 1,789,322 2,693,704 

Balance at April 1, 2008 6,155 898,227 1,789,322 2,693,704 

Charge for the year - 63,238 281,219 344,457 

Disposals - - (86,507) (86,507) 

Balance at March 31, 2009 6,155 961,465 1,984,034 2,951,654 

Net Book Value 

Balance at March 31, 2007 - 1,579,294 562,201 2,141,495 



40 



March 31, 2009 


10. Long-term debt 

2009 2008 

$ $ 

a) Inter-American Development Bank 54,993 77,299 

b) CDB (4th loan) No. 4/SFR-OR-BDS 603,319 1,622,625 

c) RBTT $38.00M Bond 37,952,500 37,952,500 

d) Republic Finance and Merchant Bank Ltd. (FINCOR) 21,178,037 23,399,860 

59,788,849 63,052,284 

Less: instalments due within the next 12 months 

and shown under current liabilities (3,062,995) (3,303,511) 

56,725,854 59,748,773 

a) Inter-American Development Bank (lADB) 

This loan was taken over from the former BIDC which entered into an agreement with the IADB on March 8, 1992 for a loan of US$250,000 to partially 

finance an Embroidery Programme in Barbados. The Bank also agreed to make a non-reimbursable Technical Co-operation grant to the Corporation of 

US$55,000 to provide the technical expertise necessary for production efficiency and the quality and design of the products to be produced. 

The loan bears interest at the rate of 1% per annum payable semi-annually on November 15 and May 15 of each year on the outstanding balance and is 

repayable not later than November 15, 2011, by means of 40 semi-annual, consecutive and as far as possible equal instalments, the first of which was paid 

on May 15, 1992. 

b) Caribbean Development Bank (CDB) 

This loan was taken over from the former BIDC. On May 17, 1989, the Government of Barbados and the former Corporation entered into a loan agreement 

with the CDB for a loan of US$10,200,000 to partially finance the construction and renovation of factory shells and related works at certain industrial estates, 

at an estimated total cost of $22,997,300. 

The loan outstanding at year-end bears interest at the rate between 5.00% and 6.25%. 

Repayments are being made by the Government in US dollars not exceeding the equivalent of US$143,634 payable in sixty (60) equal quarterly instalments of 

blended principal and interest from December 31, 1994 to September 30, 2009. 

c) RBTT $38.00M Bond 

On March 29, 2007 the Corporation entered into a US$19,000,000 non-callable fixed rate bond to assist with its capital works programme. This bond matures 

on March 29, 2022, and bears an interest rate of 6.85% per annum. Semi-annual payments of US$660,345 are made in September and March and there is a 

moratorium on the principal until year 2022; a sinking fund has been set up from April 16, 2007 to facilitate full repayment in 2022. This bond is guaranteed 

by the Government of Barbados. 

d) Republic Finance and Merchant Bank Limited 

On October 6, 2007, Newton Business Park Project Company Limited entered into a Bds$24,493,647 loan agreement with the Republic Finance and Merchant 

Bank Limited (FINCOR), Trinidad, for the construction of Newton Business Park Project - Phase 1. Under a Build, Own, Transfer (BOT) arrangement, this loan 

expires on April 6, 2027 and bears an interest rate of 7% per annum. Semi-annual instalments of blended principal and interest of Bds$1,950,056 are made 

in April and October; the interest rates on the serial bonds are 5.75%, 7.00%, 7.75% and 8.25%. This loan is guaranteed by the Government of Barbados. 



March 31, 2009 


11. Land conveyance deposit 

A deposit of $100,000 was received in a previous period for the sale of lands at Wildey Industrial Park at a price of $1,000,000. This land was originally vested 

in the Corporation by the Government at no cost. The sale of the land had been completed in 2009. 

12. Due to Government of Barbados 

This represents principal repayments, interest and commitment fees paid on the CDB loan by Government. (Note 10 (b)) 

2009 2008 

$ $ 

Balance at beginning of year 14,713,102 13,627,303 

Paid by Government during the year: 

Interest 65,019 122,996 

Loan repayments 1,019,306 962,803 


This balance is interest free and has no fixed terms of repayment. 

13. Deferred capital grants 

Grants received 

2009 2008 

$ $ 

Balance - beginning of year 79,962,853 79,962,853 

Amortisation 

Balance - beginning of year 33,894,570 31,506,360 

Amortisation for the year 2,388,210 2,388,210 

Balance - end of year 36,282,780 33,894,570 

Net balance deferred - end of year 43,680,073 46,068,283 

Net balance deferred - beginning of year 46,068,283 48,456,493 

Deferred capital grants are amounts received from Government for capital expenditure. The grants are amortised over the useful life of the assets purchased 

with grant funds. (See note 2(h)) 

42 



March 31, 2009 


14. Special Technical Assistance Fund (STA) 

2009 2008 

$ $ 

Balance at beginning of year 5,960,946 10,609,282 

Received from Government during the year for Special 

Technical Assistance to the manufacturing sector (note 19) 4,000,000 2,982,522 

Disbursements from STA (6,047,207) (7,630,858) 



Cash at bank (note 4) 1,130,030 5,989,203 

Amount to be reimbursed from the Corporation’s capital account 1,500,000 - 

Other – Timing differences 1,283,709 (28,257) 

3,913,739 5,960,946 

15. Deferred revenue grant 

2009 2008 

$ $ 

Balance at beginning and end of year - 79,581 

The grant relates to funds made available by the European Development Fund (EDF) to the former BEPC for financing certain projects agreed with the EDF. 

16. Capital contributed by Government of Barbados 

2009 2008 

$ $ 

Balance at beginning and end of year 7,504,087 7,504,087 

The balance represents capital appropriations from Government for the purchase of land vested in the Corporation by the Government. 

17. Retail gross profit 

The amount represents the gross profit earned by the subsidiary on the sale of handicraft items. 

2009 2008 

$ $ 

Sales 671,647 539,135 

Cost of sales (172,957) (291,287) 

Retail Gross Profit 498,690 247,848 



March 31, 2009 


18. Other revenue 

2009 2008 

$ $ 

Documentation fees 79,324 77,820 

Interest on term deposits 68,099 915,516 

Sale of craft supplies 227,131 234,513 

Rental income – Training room 27,404 13,782 

Miscellaneous 161,615 110,000 

562,573 1,351,631 

19. Revenue grant 

2009 2008 

$ $ 

Revenue grant received from Government during the year 14,421,144 15,090,165 

Amount received from Government for Special Technical 

Assistance (note 14) 4,000,000 2,982,522 

18,421,144 18,072,687 

20. Administration expenses 

2009 2008 

$ $ 

Staff 7,383,353 5,569,691 

Premises 653,920 678,799 

Office 793,911 750,386 

Operational 530,397 529,361 

Promotional 1,050,763 2,165,099 

Miscellaneous 292,020 25,945 

10,704,364 9,719,281 

44 



March 31, 2009 


21. Pension scheme 

The Corporation has established a non-contributory pension scheme for certain employees with Sagicor Life Inc. (formerly Life of Barbados Limited). It is a fully 

insured purchased annuity pension scheme. The annual premiums paid to the insurance company are charged to operations and amounted to $1,018,960 

(2008 - $344,717), net of anniversary credits. 

The plan has been accounted for as a defined contribution plan because benefits due to employees would have been secured by the prior payment of 

premiums and the fact that the insurer has sole responsibility for paying the benefits. 

22. Approved capital expenditure 

The Directors have approved capital expenditure amounting to $16,000,000 for the year ending 

sheet date no contracts had been entered into in respect of this expenditure. 

March 31, 2010 (2009 - $50,500,000). At the balance 

23. Related party balances and transactions 

Key management personnel compensation paid during the year was as follows: 

2009 2008 

$ $ 

Directors 37,491 27,988 

Senior Management 716,631 658,664 

24. Contingent liabilities and commitments 

(a) A personal injury claim has been filed against the organization by a third party. The outcome of this claim is uncertain. 

(b) A writ was filed by a former employee on February 23, 1995 claiming $142,000 for wrongful dismissal. 

During 2004 the BIDC entered into an implementation agreement with Newton Business Park Project Company Limited and Hafeez Karamath Construction 

Limited (the contractor) to develop 6.5 acres of BIDC lands at Newton, Christ Church for the purposes of a business park. Under the terms of the Agreement, 

BIDC leased the land to Newton Business Park Project Company Limited for a term of 20 years. Newton Business Park Project Company Limited shall construct 

the business park and sub-lease it back to the BIDC for a term of 20 years less one day. 

25. Operating Leases 

The Corporation leased out its property held under operating leases. The future minimum lease payments under non-cancellable leases are as follows: 

2009 2008 

$ $ 

Less than one year 9,968,239 9,457,187 

Between one and five years 31,735,155 30,108,157 

More than five years - - 

41,703,394 39,565,344 



March 31, 2009 


26. Financial risk management 

Financial assets of the Corporation include cash and cash equivalents, accounts receivables, investments and staff loans. Financial liabilities include accounts 

payable and accrued liabilities and long-term debt. 

Overview 

The Corporation has exposure to the following risks from its use of financial instruments: 

• credit risk 

• liquidity risk 

• market risk 

This note presents information about the Corporation’s exposure to each of the above risks, the Corporation’s objectives, policies and processes for measuring 

and managing risk, and the Corporation’s management of capital. Further quantitative disclosures are included throughout these financial statements. 

The Board of Directors has overall responsibility for the establishment and oversight of the Corporation’s risk management framework. 

The Corporation’s risk management policies are established to identify and analyse the risks faced by the Corporation, set appropriate risk limits and controls, 

and monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the 

Corporation’s activities. The Corporation, through its training and management standards and procedures, aims to develop a disciplined and structured 

environment in which all employees understand their roles and obligations. 

Credit risk 

Credit risk is the risk of financial loss to the Corporation if a member or counterparty to a financial instrument fails to meet its contractual obligations, and 

arises principally from the Corporation’s receivables from customers. Credit risk on cash is limited as cash is comprised of current account balances held with 

reputable banks and cash floats held for cashiers. 

Trade and other receivables 

The Corporation’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The Corporation’s revenue is generated from 

the rental of leasehold properties and from government subvention. 

The aging of tenants’ rent receivables as at the reporting date was as follows: 

2009 2008 

$ $ 

Current 11,075 14,811 

1 – 180 days 1,770,040 1,109,139 

181 – 360 days 602,180 798,724 

> 360 days 4,621,470 4,512,209 

7,004,765 6,434,883 

The allowance for doubtful debts in respect of tenants’ rent receivables during the year was $6,281,120 (2008 – $5,914,673). 

46 



March 31, 2009 


26. Financial risk management; continued 

Liquidity risk 

Liquidity risk is the risk that the Corporation will not be able to meet its financial obligations as they fall due. The Corporation’s approach to managing liquidity 

is to ensure, as far as possible, that it has sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring 

unacceptable losses or risking damage to the Corporation’s reputation. 

The liquidity position is monitored daily; management seeks to maintain levels of cash deposits which are sufficient to meet reasonable expectation of its short 

term obligations. 

March 31, 2009 

Carrying Contractual Up to 1 1 to 5 Over 

Amount Cash Flows Year Years 5 Years 

$ $ $ $ $ 

Long term debt 59,788,849 70,211,491 4,529,509 14,518,237 51,163,745 

Accounts payable and 

accrued liabilities 7,570,195 7,570,195 7,570,195 - - 

March 31, 2008 

Carrying Contractual Up to 1 1 to 5 Over 

Amount Cash Flows Year Years 5 Years 

$ $ $ $ $ 

Long term debt 63,052,284 75,123,701 4,912,211 17,174,746 53,036,744 


accrued liabilities 6,710,125 6,710,125 6,710,125 - - 



March 31, 2009 


Market risk 

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Corporation’s income or 

the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable 

parameters, while optimising the return. 

(i) 

Currency risk 

The Corporation is exposed to currency risk on purchases that are denominated in a currency other than the functional currency of the Corporation. 

(ii) Interest rate risk 

The Corporation faces some risks associated with the effects of fluctuations in the levels of interest rates on certain financial assets and liabilities. The 

interest rates and terms of repayment of long-term debt are disclosed in note 10 to the financial statements, and are fixed for the most part. 

(iii) Capital management 

The Board’s policy is to maintain a strong capital base so as to maintain creditor and market confidence and to sustain future development of the 

business. 

There were no changes to the Corporation’s approach to capital management during the year. 

(iv) Fair values 

The fair value of cash and cash equivalents, accounts receivables, investments, staff loans, accounts payable and accrued liabilities and long term debt 

are determined not to be materially different from their carrying value due to their short term nature. Long-term debt is not materially different from its 

carrying amounts. 

Fair value estimates are made at a specific point in time, based on market conditions and information about the financial instrument. These estimates 

are subjective in nature and involve uncertainties and matters of significant judgment and therefore, cannot be determined with precision. Changes in 

assumptions could significantly affect the estimates. All non-financial instruments such as inventory are excluded from fair value disclosure. Thus the total 

fair value amounts cannot be aggregated to determine the underlying economic value of the Company. 

The basis for determining fair values is disclosed in note 3. 

26. Financial risk management; continued 

The fair values of financial assets and liabilities, together with the carrying amounts shown in the balance sheet, are as follows: 

2009 2008 

Carrying Fair Carrying Fair 

Amount Value Amount Value 

$ $ $ $ 

Cash and cash equivalents 4,020,416 4,020,416 16,124,972 16,124,972 

Accounts receivable 2,135,687 2,135,687 3,294,885 3,294,885 

Investments 14,000 14,000 15,640 15,640 

Staff loans 566,862 566,862 518,974 518,974 

Bank overdraft (1,657,005) (1,657,005) - - 


accrued liabilities (7,570,195) (7,570,195) (6,710,125) (6,710,125) 

Long term debt (59,788,848) (59,788,848) (63,052,284) 

(63,052,284) 

(62,279,083) (62,279,083) (49,807,938) (49,807,938) 

48 



March 31, 2009 


27. Taxation 

Under the Barbados Investment and Development Corporation Act, the Corporation is exempt from payment of all taxes on income. 

The Corporation’s subsidiary (Islandcrafts (Barbados) Inc.) is subject to corporation tax at a rate of 25%. Cumulative tax losses at March 31, 2009 were 

estimated at $515,158 (2008 – $390,943). These losses have to date neither been agreed or disputed by the Department of Inland Revenue. 

A deferred tax asset arising from tax losses has not been recognized in these financial statements. As the subsidiary does not have a history of taxable profits, 

it has not been deemed probable that future taxable profits will be available against which any tax assets can be utilized.

Notes to Consolidated Financial Statements - Barbados Investment ...

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