Tag Archives: The Savannah Hotel

Lessons from GEMS Hotels & Resorts Limited: Government is always bad at business, corrupt Government is worse.

Hotels & Resorts Limited product is so bad, the Barbados Government is having difficulty exiting the business

by Nevermind Kurt (with Clive & Marcus)

Barbadians have no idea how much money they poured into the doomed-to-fail-from-the-start attempt to nationalize the hotel industry known as “GEMS”, Hotels & Resorts Limited. When you include the “free” air subsidies and “free” marketing support from the Barbados Tourism Authority it is surely a billion dollars poured down that hole and probably much, much more.

Not to forget that all the while the other hotels on the island were having to compete with a heavily subsidized nationally-owned chain. And Owen Arthur wondered why no investors wanted to build new facilities! To compete against government subsidized hotels? Cha! What… you think foreign investors are crazy?

Corruption, Foreign Bank Accounts, ZERO Accountability

Then there was the matter of the supply chain for GEMS Hotels. For many years everything for all the hotels ran through central suppliers. Yup, sourced out of Miami and New York probably through a few little “handling” companies that took 5% of everything and forwarded the profits to the owners’ foreign bank accounts.

The goods never went through Miami though: only the invoices and payments. Continue reading

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Filed under Barbados, Barbados Tourism, Business & Banking, Corruption, Offshore Investments