Monday, January 01, 2007A Modern Day BVI

Ermin Penn20th Century Business Development

The story of 20th century business development in the British Virgin Islands must be set against the broad historical context of the BVI. This context is the historical fact that once the subsistence socio-economy of the newest incoming Amerindians, the Arawaks and the Caribs, had been crushed in the Virgin Islands, Europeans in the 17th Century introduced the capitalist mode of production by means of slavery, the produce of which earned its profits on the continental markets of Europe and, locally, established a rigid class structure of that day.

Within this context, there are three main peculiarities of the Virgin Islands’ experience, which colour the tale of business development in the 20th Century. They are: Unlike elsewhere in the British Caribbean Colonies, the planters left the Virgin Islands in 1838, the fourth year of financial failure of the legally enforced apprenticeship scheme (which replaced slavery). Sixty-two years later, in 1900, each family of the Virgin Islands had been able to buy at least a plot of the former estates from the Crown, who had compensated the planters on their departure. Population growth within the native community has always been at a low rate: at the dawn of the 20th Century there were about 6,000 people who were of basic good health with life expectancy on the average beyond three score and ten. They worshiped as Methodists or Anglicans. Unique in British colonial history is the fact that Great Britain implemented in 1902 its wish (which was conceived in 1872) that the Legislative Council of the Virgin Islands would no longer be permitted to sit in the Virgin Islands. Instead, the Monarch’s Official and a selected member of the Executive Council would attend and participate in meetings in Antigua of the Federal Legislative Council.

These factors led to the genuine development from 1834 to about 1960 of a native-owned and well-sustained subsistence economy. This economy enjoyed modest monetary input from three sources: the British Government’s annual allocation for the Territory, sums of money repatriated by family members who had emigrated, and income from mostly agricultural goods which were sold in St. Thomas.

The British allocation, called Grant-in-Aid, paid for its less than two dozen Public Servants and for its projects, such as the cotton industry of 1900 to 1915, which was designed to create employment or commissions to native shipwright, Leopold Smith, to build official boats, each holding a name such as the Lady Kate and St Ursula.

Members of those families who had opted to emigrate to the United States Virgin Islands, the USA, Hispaniola, or Cuba sent small amounts of repatriated funds.

Trade with the neighbouring U.S. Virgin Islands was probably the most significant source of income during the subsistence period. The lively engagement of native shipwrighting by native shipwrights like Claremond Floyd Davies and Daniel Smith, and, as a complement, the mariner services by outstanding natives like Milton Thomas, Ernest Pickering, James Smith, Elvin Flax and Wallace Chinnery enabled the trade at Tortola Wharf in St Thomas. Trade was conducted in products such as ground provisions, animals and charcoal produced by noble farmers like Miss Catherine Malone and Joshua Leonard; straw work by craftswomen like Catherine Lettsome; and gravel picked from Norman Island, as Haldane Floyd Davis records, and sold to those who held contracts to build Bourne Field (land reclaimed for the airport in St Thomas) in the 1940s.

The mariner’s return sail would bear cargo such as flour, cornmeal, lard, cloth, thread, paint, brushes, oakum, nails, lumber, cosmetics such as powder and bath soap as well as essential products for health such as Cod Liver Oil and Bay Rum for the native owned and shops started in the late 19th and early 20th Centuries such as J.E.W. Georges, J.R. O’Neal Ltd., de Castro’s, and for the first 20th Century hotel service, the Social Inn, which was owned and operated by the native Creque family.

The native ability to harness the imported which could have been discarded, led to internally generated blacksmithing (soldering, as locally said) initiated by natives like Joshua Crabbe, who, would supply the local demand for utensils designed and molded from the cans emptied through sale of their lard, etc., which the mariner had brought.

A small amount of income was also derived from the infrequent expatriate financing of business ventures such as the Treasure Isle Hotel, which was started by the second generation of the Roy family, who had emigrated from England at the dawn of the Century; the post World War I Shark Oil industry in East End, Tortola; and infrastructure endeavours on Guana Islands and Diddle Doe. In the case of the former, a native sold it to an American for $60 in the 1930s and in the case of the latter; a native sold it for $30 to an American (who chose to publicise it as Marina Cay). There was also the incoming competition to native boat cleaning and maintenance services at Cleaning Hole from Wagner, a Polish citizen, at Trellis Bay.

The elimination of the local Legislative Council in 1902 tells of the unique exercise in British colonial constitutional authority. To his honour in local history, the Hon. Theodolph Faulkner, who was assisted by three other Virgin Islanders and supported by thousands, did convince the British to re-grant local legislative authority, and as from 5th December 1950, the Legislative Council of the Virgin Islands could re-site within the Virgin Islands!

From this constitutional experience sprang the surge of business in the last decades of the 20th Century. It imposed on the local mode of thought that the Virgin Islander must redefine what it means to survive financially in a global capitalist economy, while still under British governance. In the native consciousness, tourism, to be financed by expatriate input, was the answer. This conscious decision was the starting point from which evolved much significance in Virgin Islands business development after 1950.

First, it is critical to note that land had to be made available for the expatriate investor. This led to the British Government’s rendering in the 1960s, for the first time in its possession of the Virgin Islands, the cadastral survey of lands. At that time, the native Virgin Islander was the major shareholder, and for him the economic benefit was the ready expatriate investor’s sum for all or part of his land, the precise size of which he was learning for the first time after the cadastral survey. Such sums were used to facilitate, for the first time in the history of the native Virgin Islander, international bank financing of his house which was now considered best to be built mainly in concrete and show the marked absence of the traditional shutter or roof.

What is striking about the sale of native-owned estates of significant size so sold is that in many instances the new expatriate owner would sub-divide the fully acquired acreage into smaller pieces and sell each such smaller size at or above the price for which he had acquired the entire estate! Such parcels were used essentially for domestic purposes.

Another significant factor coming from the conscious decision on tourism to be financed by expatriate input was the reclamation drive of Road Town’s harbour cays in order to attain, in the expatriate’s view, flat space for hotels and other commercial activity. Negative native response was dynamic and caused the British Government to stop the Englishman’s project, pay him five million in Sterling, and commit the Virgin Islands Government to repay the sum to the United Kingdom treasury.

In addition, the socio-economic law and policy which since the 1960s have had to be revised to accommodate several factors, including: the labour in the range of skills, which had to be recruited from outside the Virgin Islands; measures in regards to imports, which had to be either revised or introduced; measures in regards to land and air space use which had to be introduced; and the introduction of bank services to facilitate the monetary economy.

Socio-economy actualities such as differences in levels of income, graded skills and age, social welfare demands, all of which are a natural out-growth of capitalism, had to have systems hither to uncalled for, being put in place, such as social security, retirement benefits, insurance, immigration, and tertiary level education.

In the fusion of the elements listed above one finds today what provokes the thought on the future of eco-tourism. In today’s Virgin Islands there is a population of about 30,000 people - a mixture of persons from at least 102 countries (in the 1960s, the population was about 11,000 and Virgin Islanders shared their land with perhaps as many as 100 persons from elsewhere). Within this cosmopolitan population are, hither to unknown within the native community, differences in level of income and command of life style. There is also the presence on the landscape, architectural forms which are alien to the traditional ones, as they host homes, public clinics, schools, offices which do not manage sugar and rum, shops, and worship places. There has been widespread carving of hills to accommodate multi-sized and weight vehicles, the reclaiming of the shoreline (Tortola, for example, no longer from its east point to its west point on its south coast shows Nature’s endowment, even its cays such as Lucust, which was placed in Mother Dipper Shallow between Nanny Cay and Tortola, was reclaimed to allow for easier access from Tortola to the incoming 1960s boatyard business), and the development of ports which handle aeroplanes and motor boats are in daily business.
Commercial services of every kind are available with the constant flow of the United States dollar, which at the request of the local government, became by Treaty in 1959 between the United Kingdom and the United States of America, the sole legal tender!

Progressive socio-economic growth had been achieved by the 1980s in a stable, self-governing (since 1967), British administered 59 square miles, thus here was an attractive market for a complementary service such as Financial Management, and so, within the last two decades of the century, one sees the influx of international trust companies, the employees of whom many are not Virgin Islanders.And so is business in the Virgin Islands in the early years of the third millennium.

Oyster Publications Inc, PO box 3369, Road Town Tortola, British Virgin Islands, VG1110