Brewery $20 Million Plan If Govt Offers ‘Certainty’

Originally Published in The Nassau Guardian

June 26th, 2014

By: Alison Lowe

 

A Freeport brewery has committed to undertaking a $20 million, 15-year 
expansion if the government will enter into a heads of agreement with it that will 
provide it with “longer term” stability in its business environment. 
 
The Bahamian Brewery and Beverage Co. (BBBC), which yesterday signed a $2 
million contract with Frecon Construction Ltd. to expand its storage and 
production facilities, has already drawn up plans for a special facility to 
accommodate tours at the site and has more investments in the pipeline. 
 
“We are in talks with the government to establish a longer term commitment. I 
need that commitment to grow this company. Our competitor (Commonwealth 
Brewery) had 20 years (of tax advantage) as a foreign company and here I am 
as a Bahamian who would hope to receive the equal opportunity. So far I must 
say the government has been most understanding,” said Jimmy Sands, president 
of the company. 
 
The decision to relaunch the expansion of the BBBC’s storage and production 
facilities comes after Sands shelved the project in August 2013, after being 
warned by the government that it intended to increase the duty the company 
pays per gallon of beer produced, a move which would have slashed the 
company’s tax advantage and threatened its survival, claimed Sands at the time. 
 
That tax increase did not ultimately take place, said Sands yesterday, and the 
brewery was further reassured when it received no mention in the 2014/2015 
budget communication. 
 
The beer executive, whose company produces Sands, High Rock, Strong Back 
and Bush Crack, said that further expansion beyond yesterday’s $2 million 
commitment will require the government to sign a heads of agreement with the 
company. 
 
“We’ve presented that to the government. They are in receipt of that, but we 
haven’t gone any further than that. We want to know what kind of business 
environment we’d be working in. At the end of the day, one has to know what to 
expect tomorrow to run this company; you can’t run it when the rules are 
changing day to day,” he said. 
 
Among the plans which the BBBC has in the short term is the construction of a 
new facility to better accommodate tours of the company launched last year. 
 
“We’ve been doing very well with them. We receive probably about 100 to 150 
people a day. Right now we want to put up a facility adjacent to us, where we 
own the property, and that would be another major investment. All of the 
drawings have been drawn and approved, all that is in place. All I have to do is 
push the button. It would be at least another $1 million (investment),” said Sands. 
 
Asked about how he views the potential impact of value-added tax (VAT), set to 
come into effect in January 2015, the executive said: “It’s not going to help us but 
at the same time the country needs money. Whether it’s VAT or income tax, they 
need money. We’re all in the same boat together. Don’t ask me what’s the right 
thing to do, but I think with all the dialogue that has taken place it’s very good. I 
think the business sector and the government has been most cooperative in 
trying to reach an amicable solution.” 
 
Read original article here
 

 

Created by:Barefoot Marketing
Date created:June 27, 2014