Prime Minister Perry Christie says climate change “threatens the existence of the Bahamas as we know it”. So what does the recent Paris agreement to tackle climate issues mean for the Bahamas - and the rest of the world?
In case you didn’t know, almost 200 countries spent two weeks at the end of last year crafting the world’s first universal agreement - one that signals the end of the fossil fuel era.
The goal is to peak greenhouse gas emissions “as soon as possible” in order to keep global temperatures from rising more than 2 degrees celsius above pre-industrial levels.
Christie was among those in Paris pushing for more - arguing that warming should be kept below 1.5 degrees. "The Bahamas and other small developing island states are seeing…life-threatening impacts, and the science tells us we can only expect more over time,” he said.
On October 7, four days after the exit of Hurricane Joaquin, the Utilities Regulation and Competition Authority (URCA) announced a $1million-plus donation to official relief efforts.
Given the collective national shock at the devastating aftermath of Joaquin, few paid any attention to the media announcement or the televised press conference at the Office of the Prime Minister, likely dismissing it as a generous gesture on the part of URCA.
This "gesture" however, for those who appreciate the purpose and functions of a regulator, amounted to a wholesale misuse of the proper purpose of the utilities regulator.
It is difficult to remain non-committal in the face of the farcical statements, righteous indignation and blame-naming by so many who have long known the facts concerning the present redundancies at BTC.
Whilst it is regrettable that employees must lose their jobs at BTC or anywhere else for that matter, particularly in these difficult economic times, it is well known that competition in telecoms and lower prices for services come firstly at the expense of cutting operating costs, and specifically, lower staff costs.The redundancies should therefore not be a surprise to anyone because the history of the long road to rightsizing BTC is well documented in the public space.
In March 1997, the FNM was returned as the government with an impressive majority in Parliament. Included in the FNM's platform for its second term was the privatization of the then monopolist telecommunications Corporation, in keeping with international practices of the day.
Being the Bahamians that we are, few of us noted this inclusion in the party platform and even fewer of us understood the concept of privatization and what it would involve, nor, in the heat of the campaign did we even care.
A year later, in March 1998, when the Cabinet engaged Deutsche Bank as the lead consultant for the Corporation's privatization preparation, scant attention was again the order of the day, until September of 1998 when Deutsche produced its report.
The report was a reality check, a dash of cold water in a complacent and bloated corporation that provided its 2,200 employees with a cradle to grave financial security system,thanks to powerful unions which ensured employee compensation, regardless of competency or work ethics.
The Baha Mar saga is an epic and cautionary tale. It is a story of grand ambition, hubris and spectacular miscalculations by three major players now desperately seeking to rescue their reputations amidst the unravelling of one of the biggest single tourism projects ever in the Western Hemisphere.
While none of the players will come out as clear winners, the clear losers from the fallout of the unravelling are the Bahamian people who are watching in horror and anxiety as the country heads toward a possible recession and the potential loss of thousands of jobs.
And while all of the players bear responsibility for the current mess at Baha Mar, the party most responsible for protecting the country’s interests is the government of the day headed by a prime minister even more delusional and grossly incompetent than even his fiercest critics imagined.
The Baha Mar saga will be retold in books and studied in university classrooms. It is a case study in international relations and high finance in the 21st century, bringing together a small country, the Chinese state and a foreign investor in a relationship which began in mutual accord but that descended into recrimination amidst misunderstanding and misjudgement, and emerging questions of greed and mass corruption.
Well, we all know by now that the prospect of Baha Mar opening without untold collateral damage to our tourism brand, our national reputation and investor confidence, is more and more unlikely.
In the works since 2005, the "greatest development in the western hemisphere” - the project that was supposed to rescue our economy and solidify Perry Christie’s legacy - has now become a millstone around our collective necks.
After ramping up staff and supplies, and booking guests for the anticipated March opening (already postponed from December by the contractor), construction came to a grinding halt, and Baha Mar was left twisting in the wind - with no income to pay refunds, salaries or operating expenses.
Under such circumstances, there was no way that anyone close to the situation could have been unaware of the likely eventual outcome. But that was the political line promulgated by the government, which also claimed it was not about to take sides in a private dispute.
Within days, all pretense at impartiality and civility had vanished, and the attorney-general was in court attacking Baha Mar in concert with the Chinese, while offering to pay the salaries of employees for a month to avoid a political backlash.
Clearly, relations between the parties had broken down completely. And things only worsened this week. A PLP-oriented website not run by Foreign Minister Fred Mitchell has called explicitly for the government to deport Izmirlian. And consider these late Monday-night shenanigans:
Back in 2006 most analysts believed little would change in the immediate aftermath of Fidel Castro's departure as Cuba's pre-eminent leader.
At the time, Fidel had just stepped down as president due to failing health, ceding power temporarily to his younger brother Raul, the armed forces chief. Just two years later - in 2008 - he made his resignation permanent.
Two years after that, I visited Havana and had this to say: “As the largest island in the Caribbean, Cuba has mountain ranges, fertile plains and valleys, and a 2300-mile coastline with deep harbours, coral islands and miles of beaches. Cuba also offers a proud history and culture blending Spanish and African influences."
And Havana - with a population of over 2 million - is the Caribbean's major metropolis, as well as Cuba's greatest attraction. In 2010, Cuba already received a million more stopover visitors than the Bahamas. It now has over 60,000 hotel rooms (compared to under 15,000 here), and thousands more are said to be on the way.
At the time of my Havana visit, the competitive threat to Bahamian tourism from the inevitable opening of Cuba to the closed US travel market was still years in the future. But those portentous changes are now much closer to reality.
Castro took control of Cuba in 1959 after an armed revolt against a military dictatorship. One of his first acts was to shut down casinos, brothels and hotels, many of which were owned by American organised crime figures.
When foreign businesses were nationalised, the US imposed trade restrictions. And in 1962 the embargo was formalised, preventing most Americans from visiting an island which is less than 100 miles from Florida. Those international tourists who did come were segregated from the general population.
Cuba settled into a defiant role as a member of the communist bloc. But after the collapse of the Soviet Union in 1991, Castro allowed limited reforms to encourage tourism and earn hard currency. The Clinton administration eased travel restrictions, but they were reinforced by the Bush administration in the 2000s.
In 2010, Raul Castro embarked on a long-term reform of the country's political and economic system. And analysts say Cuba looks much different today than it did in 2006, when Fidel stepped down.
An article in the US magazine Foreign Affairs says: “the emerging Cuba might best be characterized as a public-private hybrid in which multiple forms of production, property ownership and investment, in addition to a slimmer welfare state and greater personal freedom, will coexist with military-run state companies in strategic sectors of the economy and continued one-party rule."
Since the election of Barack Obama and the start of Raul's reform process, relations between Cuba and the United States have improved. A few months after he assumed office in 2009, Obama began rolling back the Bush-era sanctions. And last December, he opened up travel to Cuba as much as his executive authority would allow.
Today, travel service providers can arrange trips to Cuba for US citizens without a government license – but only if the travel conforms with restrictions in current law. General tourism remains banned under the embargo.
A bipartisan group of legislators is pushing for passage of a Freedom to Travel to Cuba Act in the US Congress, but the law is stuck in committee and not expected to be enacted. A full lifting of the embargo will probably have to wait until after the 2017 presidential election.
The American Society of Travel Agents strongly supports normalisation of relations with Cuba, estimating that at least two million more Americans would visit the island by 2017 if restrictions were lifted. Last year, about half a million US residents visited Cuba, mostly Cuban-Americans visiting family.
The key point for us to keep in mind is that, even in its present run-down condition, Cuba manages to earn some $2.5 billion a year from 3 million visitors, and it is seeking to double those numbers. Despite an inefficient, government-operated and expensive product, the island has a lot to offer. It is a competitive threat that we should not ignore.
Former Bahamas tourism minister Vincent Vanderpool-Wallace, who is now a private consultant and board member of the Caribbean Hotel and Tourism Association, recently helped draft a position paper for the CHTA on Cuba's competitive threat.
The CHTA is a regional federation of 32 national hotel associations with more than 600 member hotels and over 300 allied members. According to its president, Emil Lee of St Maarten, the organisation is not opposed to the lifting of the US embargo, because it would "eliminate a significant barrier to regional cooperation."
But in its position paper the CHTA warned that the opening of Cuba to the huge US travel market would be "the biggest and most disruptive pebble to be dropped into the Caribbean pool in 50 years.” In fact, most analysts conclude that the impact on Caribbean tourism will be “unprecedented."
The CHTA document also sounded a hopeful note that “the coming Cuban disruption just might be the tonic (we) need to build the kind of strategic approaches to tourism development that will yield sustainable results."
As far as the Bahamas is concerned, the impact will be four-fold. First, Cuba will siphon off visitors who have up to now travelled impulsively to the Bahamas from Florida. This market has traditionally provided over 20 per cent of Bahamian visitor arrivals.
Second, the opening of Cuba can be expected to have an immediate impact on the cruise industry, which has been lobbying Caribbean destinations like the Bahamas to develop new products and experiences beyond the traditional sun, sand, sea and t-shirts.
"The likelihood that cruise lines will drop some existing ports to accommodate Cuba visits is real and the proximity of Cuba to the US…can easily impact itineraries to near markets such as the Bahamas,” the CHTA document says.
Third, the airline industry’s willingness to absorb low fares and passenger volumes in order to build routes and market share in Cuba could be disastrous for the region, the CHTA warned, "especially if it also results in US carriers shifting aircraft to new Cuba routes upon the lifting of the embargo."
And finally, the opening of Cuba will also impact the investment outlook for the region. It is likely to have a chilling effect on investment flows as investors take a wait and see position on the opportunities that Cuba may present. But much will depend on the enabling policies of the Cuban government in attracting US capital.
"The fact that Cuba saw over $800 million in hotel-related investments in 2013 is a sobering thought,” the CHTA position paper said. "The Caribbean and its industry will find itself not only competing for American tourists but also for investment dollars.”
According to CHTA chief executive Frank Comito (a former director of the Bahamas Hotel and Tourism Association), "If we continue to operate business as usual, and we all draw from the same pie and Cuba is in the equation...there will be serious economic and employment consequences."
So what does the CHTA recommend? Principally, it urges the creation of a Caribbean Basin Tourism Initiative to help boost investment in regional tourism development. The initiative would promote policy and technical support for the region, in partnership with private sector entities.
“We've developed a draft framework for a regional public-private sector tourism action agenda which would embody some of these elements, but that is still being vetted,” Comito told me. "We’ve advanced the Caribbean Basin Initiative concept as a starting point for collaboration to define together what the actual elements would be."
Among the items that will be reviewed are the removal of visa and travel barriers within the region, the reduction of high air travel-related taxes and fees, speeding up visitor clearance and processing times, and supporting a more co-operative approach among industry stakeholders.
And the CHTA says “we need to look at those factors which have contributed to Cuba's success – product diversity, infusing culture and history into the visitor experience, investments in education and training, competitive pricing, and lower operating costs. We need policies and practices which drive business, and do not drive away business.
"The CHTA believes that by working together, heads of government with heads of industry, hundreds of thousands of tourism-related jobs and hundreds of tourism-related businesses can be created. The indirect impact which tourism has on our broader economies cannot be understated.”
Meanwhile, Bahamas Tourism Director Joy Jibrilu told me she was working with Havanatur to create combination tour packages to both Nassau and Havana. "Folding our arms is not an option, so we will work as partners - not opponents. We have a brand that has global recognition and appeal and we will continue to position ourselves as such.”
Adding that she was not glossing over the potential fall-out suggested in the CHTA position paper, Jibriulu said that “by working with the Cubans we can pick up visitors who want to get two experiences on one vacation. There are daily one-hour flights between Nassau and Havana and no visa requirements for Chinese visitors. I am looking to maximise that opportunity."
It was more than a quarter century ago when the Berlin Wall came down, in one of the most disruptive events of our lifetime for many countries. Some improvements happened immediately, but others took time, effort and resources to become evident.
"We can only hope that fall of the US embargo and the consequential great Cuban disruption will be as good for the countries of the Caribbean,” the CHTA position paper said.
The Baha Mar resort has been in the works so long that it is easy to forget the way we felt about this massive development at different points along its ponderous trajectory.
The 1,000-acre project was announced in November 2005 - almost a decade ago - as “the largest single-phase development in Caribbean history”. The initial investment was put at $1.6 billion, but it has more than doubled since then.
The original opening was set for 2010, but five years later it has still not opened. Financing and construction delays keep pushing an opening further and further into the unknowable future.
The story goes way back to the 1990s, when Perry Christie was the lawyer for American investor Phil Ruffin. Christie helped Ruffin buy up a large portion of Cable Beach, including the Nassau Beach and Crystal Palace hotels. In the early 2000s, when Christie became prime minister for the first time, he persuaded Ruffin to sell out to new investors headed by Lyford Cay financier Sarkis Izmirlian.
In her examination of the irregularities surrounding the so-called Bahamas Agricultural and Marine Institute on Andros this week, NassauGuardian news editor Candia Dames said Bahamians have had enough of the government’s negligent handling of the country's affairs.
“The tolerance for our officials’ flippant and arrogant responses to critical issues is waning,” she said. “The culture of slackness (will) only be addressed if there are clear messages that those responsible for abuse are held to account."
Punch columnist Catherine Kelly went further: “You can hear the frustration as Bahamians call in to radio talk shows, trying to articulate why they think everything has gone so horribly wrong for their tiny country...They point to widespread corruption, criminality and violence…Clearly the people are at the breaking point and the Christie administration seems powerless to diffuse the ticking time bomb."
And fellow Punch columnist Nicki Kelly pointed out that “the fire at BAMSI exposed the lies and illegalities that have become a hallmark of this project since it was first conceived.”
Health Minister Dr Perry Gomez says the government has contracted Costa Rican-based consultants to help implement the national health plan which will be phased in sometime next year.
Gomez has put Bahamian healthcare spending today at almost 10 per cent of our $8 billion GDP. That represents some $800 million in total annual spending - including public and private as well as overseas health spending. The private sector accounts for about half of this money, experts say.
In 2004 Gomez chaired the commission which recommended that the Bahamas adopt a financing system called social health insurance, which pools payments from all residents to pay for universal healthcare. Individuals could still buy private insurance to cover areas ineligible for reimbursement by the public system.
This is the system operating in many countries around the world, including highly rated models like the French and Singaporean healthcare services. But the bottom line is this: Ideological arguments notwithstanding, experts say there is no single type of system "that performs systematically better in delivering cost-effective healthcare."
According to the 34-nation OECD, both market-based and command-and-control systems have their strengths and weaknesses. "It seems to be less the type of system that matters, but rather how it is managed."
And that is the key to the success of NHI in the Bahamas. Proper management is critical to the future health of our economy, as well as that of our citizens.
Bahamians celebrated Greek Fest this past weekend while the new Greek government was feverishly putting together a list of structural reforms it will pursue. Greece is under heavy pressure from the European Union to reform its government in return for financial aid to keep its economy afloat. Here’s a partial list of the Greek reforms—they are equally vital for the Bahamas:
1. Create a new culture of tax compliance to ensure that all sections of society, and especially the well-off, contribute fairly to the financing of public policies.
2. Improve tax collection, broaden the definition of tax fraud and fight evasion.
3. Provide a higher degree of financial and budgetary accountability.
4. Enhance the openness and transparency of tax and customs administration.
5. Strengthen the independence of the public revenues agency while guaranteeing full accountability and transparency of its operations.
6. Review and control spending in every area of government.
7. Review non-wage benefits expenditure across the public sector and reform the public sector wage gird.
8. Modernise the pension system by establishing a closer link between pension contributions and income, and by streamlining benefits.
9. Turn the fight against corruption into a national priority.
10. Reduce the number of Ministries (from 16 to 10), and the number of ‘special advisors’ in general government.
11. Establish a transparent, electronic, real time institutional framework for public tenders/procurement.
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