Learning Lessons from Baha Mar

by Simon

At one time in their relationship Prime Minister Perry Christie and Baha Mar developer Sarkis Izmirlian were as thick as old comrades.  They cooed compliments and encomiums to each other.  

The prime minister and the developer saw Baha Mar as a shared grand legacy.  Izmirlian lauded the prime minister who in turn praised the developer for his vision.  

The love match has ended in mutual recrimination, anger and wounded pride, as employees of the resort are devastated with many facing dire consequences in an economy in which there is a high rate of unemployment.  Employee anxiety and frustration grow by the week.  

Even as the PLP has ramped up its nationalistic rhetoric in the Baha Mar saga, they were seemingly content when Izmirlian employed the rhetoric of Baha Mar nation and Baha Mar citizens, expressions which rankled many.

Christie was content to give a ride in his official vehicle to his former client and the former owner of the Crystal Palace resort and casino Phil Ruffin, who, in recent interviews in the print and broadcast media referred to the prime minister as “Perry”, a mark of disrespect to Christie.

Too much familiarity between any prime minister and foreign developer is inappropriate, with potential downsides for the country.

Christie has often been too chummy with certain foreign developers, such as Ruffin, who sees no problem in referring in public to the prime minister by his first name.   This is the same Ruffin who had not paid certain casino taxes owed the government.   

Christie’s relationship with Peter Nygard is another example of an inappropriate familiarity with certain foreign individuals.  

The prime minister has been entertained at Nygard’s home.  He has lauded the colorful millionaire who is in mad pursuit of perpetual youth, and who claims to have given the PLP $5 million in campaign contributions and claimed also to have drafted stem cell legislation for the government.

At one point it was obvious that Bobby Ginn was the prime minister’s favorite foreign knight in shining armour come to do great things in the Bahamas.

NATIONALISTIC

Then there was Christie’s relationship with Mohamed Harajchi who also claims to have given the PLP millions.  It seems only when Christie and the PLP fall out with certain foreign individuals that they ramp up their nationalistic rhetoric.  

But if the PLP has a good relationship with a foreigner who may be embarrassing the country or doing things not in the interest of the Bahamian people, the PLP remains quiet, their nationalistic rhetoric silenced by donations to the party and various individuals.  It is a convenient nationalism.

If a Bahamian prime minister wants respect he or she must demand such respect and act in an appropriate manner in their relationships with foreign developers and investors.

Even before Baha Mar filed for Chapter 11 bankruptcy, Christie and Izmirlian were trading public insults as their relationship began to unravel.  The acrimony may in large part be driven by things unknown to the public.   

In filing for Chapter 11 bankruptcy in an American court, Izmirlian likely thought that he had the government over a barrel and could push Christie and his administration in a direction favoring the developer.  

Whatever the motives for Izmirlian’s actions, they backfired.   Izmirlian may have seen Christie as a pushover.  But Christie, seemingly steeled by certain cabinet colleagues, is pushing back hard against Izmirlian.    

Every week since the bankruptcy filing over a month ago, the government and Izmirlian have exchanged poisonous barbs and ramped up public relations efforts and strategies in court to confront each other.   

While both sides have expressed a fervent desire to have Baha Mar completed and opened, their intense wrangling ensures that the completion and opening of the megaresort is likely quite some time away.

Each news cycle brings new revelations.  There are reports that a senior member of the cabinet is financially heavily invested in Baha Mar through a company or companies which have done work at the resort.

Is Christie knowledgeable as to whether such reports are accurate?  Does he believe an investigation should be launched into such reports?

EMBARRASSING

Upping the ante, Izmirlian now seems set to get into the public domain the communications between the Bahamas and the China Export Import Bank and China Construction America.  Some of those communications could prove highly embarrassing to the government in general and in particular to certain ministers and officials.

The lack of answers to questions swirling around Baha Mar has produced great anxiety among employees at the resort, those financially invested in the project and Bahamians in general.

When might the resort possibly open?  Will Izmirlian be pushed out? Does the government have other potential investors in mind?  Will the project be split into a variety of entities?

There are at least two other fundamental questions, one about the sustainability of Baha Mar, the other about lessons learned.

A number of experts believe that even if Baha Mar opens, it may not be sustainable in terms of making a profit, given its monthly operating expenses and its high debt-servicing.

One scenario is that a new developer or consortium of developers may get the resort at a deeply discounted price with the China Export Import Bank restructuring the debt.  

Another scenario may be that certain Chinese interests take ownership of the resort, meaning that it would effectively be owned by the Chinese government, a prospect that worries Bahamians of all political stripes.

Another fundamental question is whether we will learn various lessons relative of Baha Mar.  Perry Christie and Sarkis Izmirlian had the wrong vision for the development of Cable Beach.

That Christie courted and allowed the inexperienced Izmirlian to become the redeveloper of Cable Beach was inexplicable and a colossal mistake that threatens to wreck our economy.

It isn’t as if Christie was not warned that Izmirlian was the wrong developer and that the project was too big.  He ignored many warnings and argued that the naysayers were wrong. 

REGRESSIVE

Christie’s regressive developmental and economic philosophy has wreaked havoc on the country from Mayaguana to Bimini to Cable Beach.  Yet it is unlikely that Christie has learned his lesson about the kinds of tourism projects best suited to today’s Bahamas.  

The prime minister is still stuck in the past, poorly guided by certain mandarins wedded to handing out massive concessions – including land -- to foreigners.

The tragedy is the Cable Beach could have been developed differently.  The one billion dollars in concessions could have been directed differently at the iconic Cable Beach.

But Christie handed over to a developer out of his depth some of the more prime tourist real estate in the Caribbean.  Together, Christie and Izmirlian created a disaster for which the country is now paying dearly.     

Christie’s anchor project concept, recycled from a bygone era, is in keeping with his narrow vision for economic development.  It is in keeping with his blinkered illogic that he can claim to be concerned about climate change while serving as an oil company consultant and promoting oil drilling. 

The country needs a more sustainable vision and model of touristic and economic development including diversification within the tourism sector and investments in other areas.  By example, a recent report noted how far behind the Bahamas is of most of the Caribbean in renewable energy.

As it turns out Perry Christie has a vision for the Bahamas, even if by default lazy thinking and a dearth of intellectual curiosity.

Sadly his vision and some of the foreign individuals he has chosen as development partners are bad for the country, with the disaster at Baha Mar the single biggest mistake made by Christie in his 40 plus years public career.

Christie lacked and lacks the insight to understand the developmental needs of a 21st century Bahamas and lacks the wisdom not to dance to the tune of certain investors who come along piping grand ideas and glitzy dreams which are best left to the world of make-believe.

Sadly, it is the employees of Baha Mar and the Bahamian people who are paying dearly for Christie’s giddy notions, grand mistake and inability to stay focused and to complete a given project in a timely and correct manner.

Comments

[Leandra Esfakis]

Doing the right thing at the right time remains the holy grail for our polticians, professionals and project managers.
I believe it is true to say that on a per capita basis, the Bahamas ranks 2nd in the world of having the most Olympic medals.
The vision, discipline, dedication and integrity put into those achievements by our athletes are examples to all Bahamians. It is not enough to stand by and cheer when our team brings home another Olympic medal. If we want to be truely proud of being Bahamian, we would carve out a healthy and sustaninable vision, and apply the same standard of excellence and integrity to our national endeavours, and each of our individual jobs, whatever they may be.

[Bill]

The only qualification that "developers" have needed is an image of having money, and a wild fantasy. Nobody ever checked on their competence, experience, or true financial backing. That is why the country is full of failed projects, and undeveloped land occupied by speculators who are taking their time to pursue outlandishly high prices while not being required to pay their annual property taxes.
Can there be any doubt why a country with priceless natural assets is stagnating?

[carl]

Knowing one of these parties personally, i can say they hve "never" and "will never" be thick as comrades.....