Americans’ Investment Report Damning Of National Affairs
Let’s be real, the US State Department’s 2014 Investment Report on the Bahamas is damning, condemnatory and a downright indictment of the state of affairs in this country.
Amongst a plethora of worrisome criticisms, most notably the State Department underscored the Bahamas’ loss of its competitive edge as an investment destination when compared to other small island developing countries in the region; that the Christie administration has failed to live up to many of its campaign promises since being elected more than two years ago; the report cited the need for a broader revenue stream; criticism was levelled at the government’s bidding and contract issuance processes, noting that the Bahamas government never interferes in the US’ domestic issues; highlighted the bureaucratic hurdles that undermine investing in the Bahamas, citing the lack of legislation governing competition policy, antitrust policy and government procurement; and, perhaps most notably, spoke to the gleaming lack of transparency in the Bahamas. Indeed, the United States seems to have decided to set aside the usual muted diplomatic tones in favour of using stronger language in order to alert the government and the populace that one is being observed must certainly raise red flags.
Clearly, the lack of transparency and corruption is of increasing concern among Bahamians. The Bahamas appears to be once again spiralling towards a very dark place when daily the conversation on talk shows and among business people speaks to heightened instances of cronyism in the distributions of government contracts, kickbacks and other forms of corrupt practices. If one were to be honest—and merely listen to the conversations on the radios, at bars and outings and elsewhere—one could easily say that the State Department’s assessment only affirms that which we already know. Are there any Bahamians who could honestly say that they do not believe that there has been/is undue interference by the government ministers when awarding contracts? There have always been some in our nation who are merely pirates, engaging in corrupt practices relative to contract administration and awards and padding their own pockets whilst pretending to be honourable. The problem today is that too many Bahamians are too afraid or simply unprepared—for fear of victimisation—to rat out those individuals involved in such activity.
The dismissive, flippant comments made by the government about the report are simply intellectually insulting. At least one government minister has gone as far as claiming that the State Department report was produced by the FNM, presumably because the name of the son (Hank Ferguson) of FNM politician Johnley Ferguson is listed—at the end of the report—as the contact person relative to public inquiries. To believe that the United States would not have conducted its research and written its report jointly and vetted that report is nothing short of silly. I think that there are some in the government who merely see this as a political game, hence the asinine responses.
As a young businessman, I would say that the Bahamas is lucky to only be ranked 84 out of 189 in the World Bank’s Doing Business Report, which was also referenced by the State Department. It is no easy feat to start a business in the Bahamas and, as was rightly observed by the 2013 Index of Economic Freedom Report (also cited by the State Department), this coupled with exorbitant tariffs as well as “lengthy and bureaucratic approval process(es), hinder investment and undermine the development of a vibrant private sector. I intend to discuss the difficulties of starting a business in the Bahamas in a future column, within the next four weeks. I can certainly give a first-hand account of how many businesses in the private sector are exposed to the heavy handedness of shady government officials, as some public servants demand to be tipped in order for them to hasten applications and remove unnecessary bureaucratic red tape.
Over the years, I become convinced that there is an unaccountable elite in this country. For some time now, several past and current (elected) politicians have been known to use their position in government to shaft the public/investors and amass cash and valuables that are stockpiled in bulging secret bank accounts/safes. Here, corruption among politicians and public officials vary and is inclusive of bribery, embezzlement, graft, nepotism, patronage, extortion, cronyism, kickbacks and bid-rigging. Yes, bid rigging!
Today, there is a general lack of transparency, fair play and accountability is governance. When was the last that contractors were invited to attend the openings of the bids at the Ministry of Finance? And, was it General Electric—an American company that won a $35 million bid to supply medical equipment to the new Critical Care Unit at the Princess Margaret Hospital that complained to the State Department about government interference and corrupt practices as that company has now been allegedly pressured to supply the new block with the medical equipment through a company helmed by a former PLP minister?
I am one of those persons who endorsed the Bahamas Agricultural Marine and Science Research Institute (BAMSI) and what if could represent for our food security and agricultural and marine resources industry if properly administered. But, how in the heck is more than $20 million in no-bid contracts shelled out in connection with this project in Andros? Where’s the transparency? Where’s this notion that the Bahamas is a land for all Bahamians and not just a select few? One wonders how much of that money is being kicked back to line the pockets of some greedy politician! Whilst I’m at it, let’s not forget the recent Holiday Industrial Builders International Ltd fiasco, concerning a purported no-bid contract awarded to a company that had been previously fired for unsatisfactory works?
The privatisation of garbage collection happened virtually overnight here in New Providence and one would like to know who the beneficiaries are of these most recent contracts? Are any Cabinet ministers affiliated with any of the entities awarded these contracts?
On a separate issue, the secret award of a contract to foreign-owned company Renew Bahamas to remediate the New Providence Landfill has also left a bad taste in the mouths of Bahamian business operators who claim that the government was not forthcoming during the bidding/proposal process. Ginny McKinney, a principal in the waste management company Waste Not, also told The Tribune that her company invested over $500,000 in consultant fees for the drafting of its proposal, adding that the company was willing to adjust its proposal to accommodate the government’s demands. A representative of another company, Dynamis Energy, also emailed The Tribune last month to express dissatisfaction about the process that led to Renew Bahamas’ selection.
And then there’s National Health Insurance, where Minister of Labour and National Insurance Shane Gibson has said that although the government will receive a report in July from international consultants providing the projected cost of National Health Insurance, the government would withhold that information from the public until after the scheme is fully implemented in January 2016. Well blow me down!
Indeed, as is widely believed to be the case with the web shops, opportunities for purchasing influence in government abound and such practices range extend beyond the electoral process to include contracts and the brokering of corrupt transactions.
Corruption can have ominous, far-reaching affects upon a society, such as poverty, economic collapse, underdevelopment, abuse of the public’s purse, the loss of life, unemployment and even result in a country being blacklisted. Corruption undermines democracy and retards economic development!
The Bahamas has a large public sector which, due to its size, is ripe for corruption. Many government-owned corporations are hotbeds teeming with political cronies, as referenced by the State Department report. Is there any wonder why all of our state operated enterprises have not been able to demonstrate sustained profitability (BTC being excluded as it is no longer state run)?
No government should take such a report lightly, dismissing it as if it’s some bar room chat on Kemp Road.
Yesterday, Moody’s announced a reduction in the expected rate of growth of our economy; that, coupled with the State Department report, should make any caring and responsible government take stock and reassess itself. It is shameful enough that Transparency International’s 2014 Corruption Index refers to corruption as remaining “a problem at all levels of government with top officials frequently facing allegations of administrative graft, domestically and from abroad.”
Whatever happened to the Prevention of Bribery Act? Over the years, we have had more than enough accounts of bribery of public officials and yet no one has been prosecuted under this Act.
I will wait to see if there will be a realization of the inherent truths to be found in the State Department’s report or if the government will continue on with its charade of smoke and mirrors in hopes of fooling the Bahamian public.