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Summit forges ties between S.C., Caribbean business communities
By Dan McCue
Staff Writer
Ken Boyea, chairman of The Boyea Group, a Caribbean-based conglomerate of supermarkets, fast-food restaurants and other business interests, had a problem.
It cost him as much as $6,000 to move a container of cargo between the Port of Miami and his company located in the Windward Islands. The low-volume importer of goods from the United States isn’t on any major trade routes, but for the same amount of money, he could ship a container around the world from Charleston to China
“The price keeps going up, up, up and the cost of shipping a container from the Caribbean and into the Port of Miami is even higher,” Boyea said. “That’s why every time he deals with an international shipment, my son, who is also my chief financial officer, loses a little more hair.”
Challenges like those facing Boyea, and the opportunities South Carolina-based businesses can seize from them, were the focus of the first Charleston-Caribbean Leadership Summit held in April at the Charleston Harbor Resort and Marina in Mount Pleasant.
The event, which featured two days of roundtable discussions between business executives, bankers, diplomats and members of the regions’ respective economic development communities, was hosted by the Free Enterprise Foundation.
Robert E. Freer Jr., president of the foundation, said the summit’s goal was to reinvigorate the historic connection between South Carolina and the Caribbean.
“We see this as a new beginning, and one from which we believe there’s much to be gained for both sides,” he said.
But in spite of connections harkening back to the 1600s, Freer acknowledged that awakening the South Carolina business community to opportunities in the Caribbean is a challenge.
“In a sense, we’ve tended to look farther afield, to India and China, and neglected opportunities in our own neighborhood,” Freer said.
Promising prospects
“One of the messages we’re hoping comes out of this summit is that the prospects in medical services, information services, information technology and logistics are promising. But you have to be aware of them before you can take the first step.”
Another prime mover behind the summit was Ron Scheman, former director general of the Inter-American Agency for Cooperation and Development.
Scheman is chairman and CEO of Charleston-based iMalls Global, a firm that promotes the use of e-commerce to provide businesses in emerging economies with access to global markets.
He said he hoped the summit would expand the lessons and awareness he’s acquired through both the public and private sector.
“What we hope to create are long-term, substantive programs that will foster an exchange in these areas,” Scheman said.
“We came into this effort knowing that challenges associated with forging business relationships between South Carolina and the Caribbean will not be resolved today,” he said.
“That said, we want to establish a mechanism that will hopefully open the door to more economic activity between these two regions, greater trade and greater opportunity.”
Many of the summit’s Caribbean participants said they found inspiration in a presentation by S.C. Commerce Secretary Joe Taylor, who told the group one of the aims of the state’s economic development efforts is raising the state’s per-capita income.
“That has long been one of our goals as well,” said Lincoln Price, private sector liaison with the Caribbean Regional Negotiating Machinery, an agency that facilitates trade and investment treaties. “Undoubtedly there are lessons we can draw from your experience. We want to find out what your secrets are.”
Among those sharing those secrets were Ernest Andrade, executive director of the Charleston Digital Corridor; Bill Mahoney, chairman and CEO of the S.C. Research Authority; Bernard S. Groseclose Jr., president and CEO of the S.C. State Ports Authority; and Phil Minard of the U.S. Commercial Service.
Meanwhile, Caribbean representatives like Kerston Coombs, chairman of the Trinidad-based Ventrin Petroleum Co., and Jerol C. Thompson, St. Vincent and the Grenadines’ minister of telecommunications, science, technology and industry, touted everything from low-sulfur diesel fuel to the region’s desirability as an untapped site for call centers and subcontracting facilities in the IT realm.
Price also cautioned U.S. businesses not to overlook opportunities that might grow out of the region’s frustrations.
“When people get fed up in a business situation, there’s an opportunity to make it right and to make money at the same time,” he said.
Maximize value
In Boyea’s case, he said exorbitant shipping fees have detrimental impacts on both his business and his customers.
To stay in business he needs to maximize the value of every load and can’t afford to receive partially filled cargo containers, he said.
“If someone is shipping a partial load of apple juice, for instance, I need to partner them with another supplier, so we’re not paying high fees for empty space in a container,” he said.
Organizing such combined shipments takes time, and many of these imported products are perishable, Boyea said. He also has to pass higher costs onto his customers to absorb the shipping fees.
“As a result, a product that might cost a dollar in South Carolina will cost as much as $6.40 in St. Vincent, and that has a dampening effect on all kinds of other economic activity,” Boyea said.
Reduce costs
But David Shimp, vice president of Maybank Industries LLC, the Charleston-based logistics management company, said before savings on shipments can be achieved, Caribbean nations need to do more to reduce the costs associated with conveying the cargo.
“It’s all about time and security, which translates to the bottom line,” he said.
According to Shimp, whose company used to operate barges in the Caribbean, shipping companies serving the region spend thousands of dollars annually on measures intended to thwart stowaways and their efforts to enter the U.S. illegally.
Another challenge Shimp said Maybank had to deal with was the high rate of turnover at Caribbean ports. “It was almost a day labor situation with very little stability,” he said. “That resulted in vessels spending longer in port, and again, added substantially to the cost of doing business there.”
Shimp said Maybank ultimately sold its barge service to the area.
But Price said such experiences underscore the opportunities that abound in the Caribbean.
“What people have to understand is that until recently, the economies of our nations were much more reliant on public money, and that to varying degrees, we’re all in a state of change,” he said. “Your experiences show that there’s a need for private investment and private enterprise know-how in areas that traditionally have relied on the government.”
Dan McCue is a staff writer for the Business Journal. E-mail him at dmccue@scbiznews.com.
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