Visit to London, Isle of Man and Edinburgh by Governor Lai of the Penghu County Government, Taiwan.
Monday 21st June 2004 World Travel and Tourism Council This organisation restricts its Membership to 100 people and they are made up of the good and the great in the Tourism and Travel Industry. They are headquartered in London, because London is the principal financial centre for Global Tourism Development. Their Membership includes the Chairman and CEO of Hilton, Marriott and most of the major airlines, Kerzner International, and many, many others. The World Travel and Tourism Council is approached by Governments and asked to produce country reports outlining the marginal benefit that can accrue to a given country, or region, by proper sustainable development of tourism. These reports are then distributed, in a marketing sense, to the Members of the World Travel and Tourism Council and, in most cases, this results in positive development being undertaken. My colleague, Tim Potter, and I are firmly of the view that a Regional Report produced on Penghu would have an entirely positive impact on the sustainable development of the Penghu Islands in the short to medium term. The purpose of the meeting was to receive, from Ufi Ibrahim, a presentation outlining what could be achieved by such a report and to attempt to understand the milestones involved. The presentation was very well received, although I do think that undue focus was placed on the cost aspects of an appropriate report being produced. The cost of the report is about US$150,000 but that is dependent upon there being a suitable flow of data available. Where no such data is available there would be an additional cost. World Travel and Tourism Council use the Oxford Foundation for the production of, and the collation of, suitable data and, by pure co-incidence, my colleague Ashley Hines, is well acquainted with this Organisation. Despite the initial hang-up about the costs involved we were able to persuade Governor Lai that the benefits that would accrue to Penghu far outweigh any cost considerations and this was, in the end, accepted. I am of the view that this particular meeting was probably the most important of those planned and a positive move forward with the World Travel and Tourism Council would be of immense benefit to us as a Company, and to Penghu in general. It was suggested that perhaps Ufi could make a field trip to Penghu in order to further progress matters and this was generally accepted. Taipei Representative Office in the UK We returned from the World Travel and Tourism Council to the Caledonian Club from where we walked round to meet with Ambassador Tien, who is the Representative of the Taiwan Government in the UK. This was a courtesy visit, semi formal in nature, and we were very well received by him. There were no specific action points arising from this meeting although I did subsequently meet with the Ambassador over dinner in the evening and he has asked to be kept fully advised of our progress, and this I will do. Tuesday 22nd June 2004 J. M. Finn & Co I had arranged for the party to meet with J. M. Finn & Co, Stockbrokers with whom we are working regarding the possible floatation of our Company on the Alternative Investment Market (AIM) of the London Stock Exchange, possibly later this year or early next year. The true purpose of the meeting was to receive from J. M. Finn & Co a presentation outlining their capabilities and, more particularly, the capabilities from the wider community within the City of London regarding the assistance they can give to our Company, as well as the wider assistance they, and London, can give to the Penghu Islands. The presentation was very well received and I was pleasantly surprised at the positive comments that were made by Governor Lai following this presentation. He drew a very meaningful analogy, saying that he is his father’s son, with his father being the Federal authorities in Taipei. He went on to emphasise that he has a very close relationship with his father and that, properly handled, he can persuade his father to give him the requisite support to progress matters in Penghu as he sees fit. Governor Lai, unprompted, made specific reference to Gaming and the need to develop a proper Gaming Strategy for Penghu. I was particularly pleased at the manner in which this meeting went and,
as a result, I think we are now very well placed regarding our emerging relationship with J M Finn & Co. Wednesday 23rd June 2004 Chief Minister I was not expecting a great deal from this meeting, other than a simple exchange of courtesies, but I was quite taken aback at the manner in which it was conducted and the highly positive approach that was taken by Mr Corkill towards Governor Lai, in particular, and the Penghu Islands, in general. It transpired that both Mr Corkill and the Governor are Chemistry Graduates and that they had a lot in common. It very quickly became clear that the position of the Penghu Islands today is where the Isle of Man was some 25-30 years ago and the meeting that we had with the Chief Minister set the tone for the rest of our time in the Isle of Man in that in clearly showed a desire to assist us, that is the Penghu Islands, in moving down the road that the Isle of Man has gone down these past few years. Meeting with Professor Roger Carey, Isle of Man International Business School The International Business School is located just outside Douglas in a small stately home with grounds surrounding the School, which, by all accounts, the party from Penghu found most impressive. The International Business School has been formed to provide a series of courses, aimed at supporting the business community in the Isle of Man and, to this extent, it has been highly successful. The School runs MBA courses, and other similar courses, either on day release or as a sandwich course, that is to say an intense period of work for a short period of time. It is hoped that as the reputation of the School develops they will be able to do Degree Courses and they may, in due course, obtain University Status, albeit that their particular field would be restricted. We had a very useful and formal discussion with Roger Carey and it became clear that the International Business School and the Manx Offshore Financial Centre are inexorably interlinked. In short to have one without the other is just doing half of the job. Governor Lai has a very strong emphasis on education and he was particularly encouraged by this trip to the International Business School. This was the first of our ‘business’ meetings of the day and it also set the tone in that there was a genuine desire, on the part of Professor Carey, to follow things up with us in Penghu, and whilst I am not clear at this stage how that follow-up should be undertaken I am clear that there should be some form of follow-up. Hilton Casino Following the lunch Bill had arranged for us to meet with Adrian Brockhouse, Managing Director of Gala Casinos, that operate the only Casino in the Isle of Man, which is based at the Hilton Hotel, where we had just had lunch. The Casino in the Isle of Man is quite small, by international standards, but unlike the rest of the UK they are able to give the sort of prizes that would be acceptable in Las Vegas. In short there is not the same gaming restrictions as currently exist in the UK. The Casino is only open from 7pm in the evening until 4am in the morning so, when we were shown round, the Casino itself was closed. The presentation from Adrian was well received by Governor Lai and it was clear from the questions that they asked that he was well tuned in to the benefits that could accrue from a Casino being operated in Penghu. I am particularly indebted to Adrian for his assistance in this regard and I will write him a letter of thanks. We also arranged, whilst we were with Adrian, for Governor Lai, Hung and myself to return the following evening, as Governor Lai expressed an interest in playing some of the machines. Financial Supervision Commission Our final business meeting of the day was with the Financial Supervision Commission, where we met with John Aspden, the Chief Executive, together with Paul Eccles, the Head of Enforcement and Michael Walden, the Head of Supervision. It was becoming clear to me by this time that Governor Lai had readily accepted the need for proper controls in order to have a viable Financial Services Industry. The timing of the presentation that we received from John Aspden and his colleagues could not have been better, and I would suggest that the reaction from Governor Lai was like switching on a light bulb. I, personally, was quite pleasantly surprised at the modest costs involved with operating the Financial Supervision Commission, and indeed we received from John a set of the Accounts which showed the
costs of the operation to be some £2.5 million which, when set against the funds under management in the Isle of Man, is a fairly modest cost, in my opinion. It very quickly became clear, during these discussions, that John Aspden and his colleagues would be more than willing to work with us in trying to set up a similar operation in Penghu, and this is something that I would wish to follow up in the coming months. This is an extremely complicated structure for Governor Lai and his colleagues to take on board and, in my view, they would need some full time assistance in this regard in Penghu. I think we, all of us, need to put a great deal of thought into how we can take this forward, but for the time being the only action point is to write a thank you letter to John Aspden and this I will undertake. Thursday 24th June 2004. Isle of Man Marine Administration We received a presentation from Anne Blythe regarding the use by International Shipping of the Isle of Man as a Flag for their operations. To the credit of the Isle of Man they have almost as large a merchant shipping fleet as the UK and they currently operate all the tankers for Shell and BP. There is no specific benefit to the Isle of Man government from this set-up, other than the provision of good quality jobs, but the spin-off benefit that accrues to the Financial Services Industry is significant as a great many of the ships operating under the Isle of Man flag have their mortgage financing arrangements dealt with in the Isle of Man. I, personally, was quite taken aback at the extent of this business opportunity progressed during recent years by the Isle of Man. There was a small presentation pack given to us but there is no specific follow up at this time other than a letter of thanks from me to Anne. I also think that this may be something we can incorporate into a follow on trip from the authorities in the Isle of Man to Penghu. Isle of Man Film Ltd We received a presentation from Hilary Dugdale, Development Manager of the Isle of Man Film Ltd. The principal reason why this activity was commenced in the Isle of Man was to provide employment for young people on the Island. Film companies organising movies tend to come in with large amounts of money, but only stay for a finite period of time therefore there is no need to provide housing or other associated requirements that one might expect with a more permanent industry. The challenge is, of course, to maintain a steady flow and this, to a large extent, they have been able to achieve. Again we received a pack of information and it is clear that the Isle of Man Film Industry is alive and well. The Isle of Man government also provide loans to particular developments in order that a movie can take place and the creative manner in which they approach this is to their credit. Again there is no specific follow-up other that a letter of thanks from me to Hilary, but I do think we should include these people in any follow up we make to the Penghu Islands from the Isle of Man. Freeport We received a short presentation from Neil Corlett of the Department of Trade and Industry regarding the establishment of the Isle of Man Freeport. The Freeport is located out by the Airport, and, to be candid, it has not developed in quite the manner in which they had envisaged. Neil indicated all that they had done to make the Freeport a success but, to date, it is not proceeding as they would have liked. That said, the have attracted business from De Beers, the Diamond Mining people, who airfreight in large amounts of diamonds from South Africa for onward processing and delivery to the European Marketplace. My own view, however, was that these people came to the Isle of Man because it was a useful location from which to penetrate the European Marketplace, with minimal tax and other regulatory interference, and I am not convinced that the Freeport made that much difference to De Beers decision. I do, however, think that the model, which the Isle of Man has set up for the establishment of a Freeport would have value if applied in Penghu and, for that reason alone, I do think it is worth following up. I will therefore write a letter of thanks to Neil Corlett and again we can add his name to the others that we intend to go forward with. E-Gaming The final presentation that we received was from John Gilmore who has been responsible for establishing Electronic Gaming in the Isle of Man. John has spent his working career in the Gaming Industry having established many Casinos throughout the world and was recently hired by the Isle of Man government to establish electronic gaming from the Manx jurisdiction. He has been, indeed the Isle of Man has been, successful in establishing the framework, although, to date, they have not yet
been able to establish an online Casino per se. The main reason for their failure in this regard has to do with decisions taken in the United States, where Gaming outwith the USA, over the Internet, is simply not allowed. There may well be moves to change this over the next few months and, if so, then the Isle of Man is extremely well placed to proceed with the E-Gaming initiative. The main reason why the Isle of Man is so well placed has to do with the regulatory framework that is adopted which, in turn, is built upon the positive reputation of the Isle of Man. Again there is no specific follow-up other than a thank you letter to John Gilmore and I will action this. Isle of Man Gambling Control Commissioners We met with Norman Teare, the Chairman of the Isle of Man Gambling Control Commissioners, together with Charles Faragher one of the Commissioners, Mr Mike Coleman, one of the other Commissioners and Mr Derek Cannon, one of the Inspectors. The Gambling Control Commissioners are responsible for all betting on the Isle of Man, which ranges from fruit machines in pubs and clubs through to Licences Betting Offices and also the Casino. The actual Commission itself is made up of lay people, appointed by the Isle of Man government, but independent from them, and, the way in which it is set up, it is normally always chaired by someone with a legal background. In the past a QC has chaired the Commission, that is to say someone from the government legal side of things, but in this case Norman Teare is a Lawyer in the Isle of Man, with no specific government attachment. The Gaming Control Commissioners are independent, and seen to be independent from the Isle of Man Government. They meet on a monthly basis and the compensation that they receive for their services is, to put it mildly, modest. In short it is people of standing within the community who are, so to speak, doing something as a return to the community. Governor Lai asked a great many questions relating to the Commission and the manner in which they operate and it became clear that he accepted the need for such a Commission as being an integral part of the establishment of a Casino in Penghu. Indeed I was particularly indebted to the Chairman, Norman Teare, for stating quite clearly that, in his view, in order to establish something sensible in Penghu three distinct parties would be needed, all of who trusted one another. The parties being the Operator, which we clearly have in Larry Wolf; plus a group of Commissioners with whom the Operator has total respect and trust, and finally a Government Authority, in our case Governor Lai and the Penghu County Government, with whom we have total and complete trust. In short if there is a triangular working of trust between these three parties then the establishment of a properly operated Casino in Penghu can be achieved. Towards the end of our meeting I asked the Chairman if they might be willing to assist us, clearly for a fee, in establishing a suitable regulatory framework in Penghu and he indicated that this was indeed a possibility. He then gave us a copy of their regulatory framework and this I am now forwarding to Governor Lai, Hung, Tim and Ashley in Penghu. This meeting particularly encouraged me and it is clear that there is an appetite from the Gaming Commissioners to work with us. Friday 25th June 2004 This day was set aside for a private visit around the Isle of Man. Saturday 26th June 2004 Despite the weather we had a very successful private tour around Edinburgh and, by pure coincidence, ended up taking Governor Lai and his party to a Chinese Restaurant, which we have always regarded as one of the best in Edinburgh, only to find it is actually owned by someone from Taiwan. We were entertained on the Saturday evening by Jane Cheng, who is Director General of the Taipei Representative Office in the UK, and we also met with her colleague Christine Tsai. This particular meeting was a rather unexpected bonus at the end of what has been a very successful trip and I was particularly taken with Jane. I also learned, to my amazement, that she does not report to Ambassador Tien, whom we had previously met with in London. Jane reports directly to the Foreign Affairs Bureau in Taipei and her sphere of operations extends from a line drawn from Newcastle to Carlisle and all points north, which will include, in my view, the Isle of Man. Jane was particularly pleased by our discussions over dinner and she has asked for me to make a specific presentation to her over the next couple of weeks, which I will do. Therefore there are two action points arising from the dinner, one for me to contact Jane with a view to arranging a presentation, and two for me to write a letter of thanks, which I will do in due course.
Sunday 27th June 2004 I drove the party through to Glasgow early in the morning in time to catch their onward flight up to Reykjavik, Iceland. Conclusion There is a lot to digest in this report but my overall conclusion is that we have completed a highly successful trip and I believe that the prospects for a wider meeting of minds between the Isle of Man and Penghu has got off to a very good start. I suspect that over the next few weeks we will establish some sort of forum to further explore how to develop these relationships and, in due course, I suspect there will be a delegation taken out to Penghu, and Taiwan, to meet with appropriate officials in that area. Ian Irvin