Kerzner's concerns on Baha Mar project
By PAUL G TURNQUEST
Tribune Staff Reporter
pturnquest@tribunemedia.net
A NEW day is dawning in the Bahamas. An entity that was once only talked about will soon become a reality on Cable Beach - Baha Mar.
At an estimated value of over $2.6 billion, it is considered by all estimates to be a monolithic project. To some it is considered a monstrosity that will consume all that was here before it. To others it is a golden egg.
To the chairman and CEO of Kerzner International, Sir Sol Kerzner, it is something else altogether.
Last week, Sir Sol made a rare appearance in the local press by issuing a statement to the media on the impending approval of Bah Mar.
In his statement, Sir Sol said that while they welcomed any project that would enhance and improve the tourism sector in The Bahamas, "the proposed terms of the Baha Mar project violates the Kerzner Heads of Agreement with The Bahamas." He promised that Kerzner International would discuss with the Government how to address this "breach" in their "most favoured nation" clause.
Principle
Since this statement there has been much talk in the press about what exactly a most favoured nation clause is. According to the Minister of State for Finance, Zhivargo Laing, a MFN classification is an internationally established economic principle, centrally recognized by the World Trade Organization (WTO), which seeks to establish a level playing field between mutual parties.
"The term is counter intuitive," Minister Laing explained.
"The name suggests that you treat the entity with MFN status more favourably than others, but what it really means is that you treat everyone alike; you don't treat anyone more favourably," he said.
Based on the MFN principle, if one MFN entity is granted special Customs rates, for example, then all MFN entities should be granted special Customs rates. The specific rates would be established by government policy or law.
In the case of the Bahamas, the Hotels Encouragement Act addresses the issue of concessions, while allowances for labour are specified in government policy, he said.
In order to establish whether a breach of MFN privilege exists, Mr Laing suggested one would have to assess a competing agreement "in its totality" and not compare a single line item. He said the question of a breach is "not so simple from the government's point of view."
In fact during the Prime Minister's wrap up on the Baha Mar debate he said, "I do not concede that we would be in breach of the deal with Kerzner. The relationship between the Bahamas and Kerzner has been mutually beneficial," Prime Minister Ingraham said.
Sir Sol, however, has taken the conversation to another level when he revealed during a teleconference with the press last week that if Baha Mar were to be approved in its current state the jobs of over 8,000 employees at Atlantis could be put at risk.
"It seems to me pretty ridiculous in this current environment, even if the economic environment were a lot better to look to come in and double the current number of rooms overnight. It seems to me pretty irresponsible. I also believe that one should take into account that we have 8,000 people working with us, and if this were to move forward the likelihood is that people's jobs would have to be threatened. It is just impossible, practically impossible to double the size of the market.
Pressure
"As we said in our statement, last year was a tough year and occupancy was under pressure. Well guess what, this year is even tougher. So it seems pretty ridiculous to me that these folks are wanting to move forward," he said.
And move forward they have. The Baha Mar labour resolution was passed unanimously before the House of Assembly (36 voting for, with four absent), which allows for 8,150 foreign workers, but no more than 5,000 at one time to be employed on the Baha Mar Cable Beach project.
Following this unanimous vote in the House of Assembly last week, Baha Mar's senior vice-president of external affairs, Robert "Sandy" Sands said that construction for the single-phase $2.6 billion Baha Mar development project could break ground as early as January, pending the close of the Export Import (EXIM) Bank of China loan.
Contractors have already been chosen for the first six construction packages, totaling $60 million, which will include the new Commercial Village contracts and the new West Bay Street.
According to Mr Sands, the initial payout will cover construction contracts and also includes numerous Bahamian architects, engineers, quantity surveyors, suppliers and many other related parties who will participate in these first six contract packages.
Prior to the approval of this massive project, Sir Sol said that he did not want to speculate on what he would do if Baha Mar was approved without at least the development being "phased" in as his Atlantis properties were. Now that the project has been pushed through the proverbial pipeline, the question remains: What will Atlantis do in response?
Addressing these concerns, Prime Minister Hubert Ingraham informed the nation that he was confident that Sir Sol's concerns about Baha Mar could be resolved satisfactorily.
He also publicly proclaimed his respect and gratitude for Sir Sol's contributions to the country, adding that he will do anything in his power to ensure the Atlantis product remains successful on Paradise Island. However this commitment, he said, does not mean he will not be fair to other developers.
"We were always concerned, when we came to office that there was nothing in the Baha Mar deal that would have given them a better deal than Kerzner. I think I can say that the thing that ticked Kerzner (off) more than anything else is a statement by Perry Christie to the effect that Baha Mar only wants to get what Kerzner got," said Mr Ingraham on the radio show Issues of the Day.
"There is no question in my mind of my high regard for Sol Kerzner and what he has done for the Bahamas. I was berated by many when he came in 1994 and what he has done for the Bahamas has transformed our tourism industry.
"He has provided us with 2,000 more jobs than he committed to, he has a very successful project on Paradise Island and I will do all I can, for as long as I can, to ensure that his project is successful."
"That has nothing to do with whether I will be fair to anybody else. (But) I will not knowingly give anybody else a better deal than Kerzner got," stated the nation's chief.
During his live radio interview, Mr Ingraham also accused the former Christie administration of engaging in secret deals with Baha Mar by promising them concessions not included in their contract.
He said these secret concessions are part of what government is trying to renegotiate.
"The PLP government gave Baha Mar a deal over and above what they signed in the contract. So on the same day that they signed the contract they issued what was called side letters offering Baha Mar more.
"We tried to pull those things back. We are now doing an analysis to see the extent to which we have been successful, we think we have been somewhat successful in ensuring that there is equity and balance between the two."
Hopefully this "equity" and "balance" between the two resorts will eventually allow the two properties to complement each other, without there being any cannibalism in the marketplace, he said.
However, this appears highly unlikely if both hotels will be aiming for the same dwindling number of "high-end" visitors.
At this stage it is not easy to dismiss Atlantis' concerns as a mere fear of competition when one considers that our air arrivals have not actually been booming over the past few years. With a global recession still wreaking havoc on our tourism industry, no "expert" is willing to guess on when things are expected to turn around in that sector.
Maybe, like the haunting voice in the Hollywood film "A Field of Dreams," if Baha Mar builds it, the tourists will come.
November 22, 2010
Tribune242 Insight
A political blog about Bahamian politics in The Bahamas, Bahamian Politicans - and the entire Bahamas political lot. Bahamian Blogger Dennis Dames keeps you updated on the political news and views throughout the islands of The Bahamas without fear or favor. Bahamian Politicians and the Bahamian Political Arena: Updates one Post at a time on Bahamas Politics and Bahamas Politicans; and their local, regional and international policies and perspectives.
Monday, November 22, 2010
Prime Minister Hubert Ingraham: I will not knowingly give anybody else a better deal than Kerzner got...
PM responds to Kerzner’s claims
By KRYSTEL ROLLE
Guardian Staff Reporter
krystel@nasguard.com
Prime Minister Hubert Ingraham said yesterday that he is not concerned with the statements made by Kerzner International’s Chairman and CEO Sol Kerzner that thousands of jobs may be at risk as a result of the Baha Mar project.
Kerzner told reporters on Thursday that the 8,000 jobs at the Atlantis Resort on Paradise Island would be placed in jeopardy if the government approves the Baha Mar project in its current form.
“It’s a deal that makes no sense,” Kerzner said. “It’s a deal that could be harmful to the people of The Bahamas and certainly to future investors and indeed ourselves.”
Kerzner has also argued that the deal between the government and Baha Mar violates the most favored nation status clause his company agreed to with the government in successive agreements.
Under these agreements, no investor should receive more favorable terms with the government than Kerzner’s company.
Ingraham said he thinks the issue with Kerzner will come to a satisfactory conclusion.
“I have many discussions with Mr. Kerzner,” said Prime Minister Ingraham, who was a guest on Love 97’s radio talk show Issues of the Day. “I think that we will resolve this issue satisfactorily. I think so.”
Despite the public criticisms of the Baha Mar deal by Kerzner, the House of Assembly unanimously approved the Baha Mar resolution on Thursday.
The company is seeking 8,150 work permits for non-Bahamian construction workers. The government brought the resolution to the House in order to get the ‘blessing’ of members before it finally approves the project, likely by the end of the month.
“We were always concerned that when we came to office that there was nothing in the Baha Mar deal that would give them a better deal than Kerzner, ”?Ingraham said yesterday. “I think I can say that the thing that ticked Kerzner more than anything else is a statement made by (Progressive Liberal Party Leader) Perry Christie to the effect that Baha Mar only wanted to get what Kerzner got. And he (Kerzner) was of the view that Baha Mar was getting more than him. And he was very hurt that Christie would make such a statement.”
Ingraham said Kerzner is concerned about Baha Mar’s lower construction labor costs, as compared to his company’s construction labor costs. Baha Mar will be mostly using Chinese labor to build its resort. Kerzner used more Bahamian labor at his property, increasing costs.
According to Ingraham, Kerzner is also concerned about the sum Baha Mar paid for the land the development is located on.
Ingraham said one of the reasons why they insisted there had to be a substantial increase to the contract value for Bahamian contractors was to help to offset any question about Kerzner’s concerns.
As a result of negotiations between Ingraham and the Chinese, and subsequent negotiations between the Chinese and Baha Mar, subcontracts to Bahamians in connection with the Baha Mar project will increase from $200 million to $400 million.
Ingraham said he wants to be sure that the government is not giving Baha Mar a better deal than Kerzner.
He added that when the Free National Movement (FNM) government negotiated a deal with Baha Mar in 2008, it did not give Baha Mar some of the concessions the Christie administration had agreed to.
“They issued side letters offering Baha Mar more. We tried to pull those things back. We think we have been somewhat successful ensuring that there is equity and balance between the two,” Ingraham said.
In response to criticism that he treats Kerzner with more regard than he does other developers, Ingraham didn’t shy away from the relationship he shares with the hotel developer. However, he added that all developers are treated fairly.
“There’s no question of my high regard for Sol Kerzner for what he has done for The Bahamas,” Ingraham said adding that Kerzner provided The Bahamas with 2,000 more jobs than he committed to.
“I will do all I can for as long as I can to ensure that his project is successful, but that has nothing to do with whether I will be fair to anyone else. But I will not knowingly give anybody else a better deal than Kerzner got,” he said.
Ingraham added that the Baha Mar project is only going forward because of his government.
He said there was no means by which Baha Mar’s CEO Sarkis Izmirlian could get the funding from the Chinese unless the government gave the Chinese the go ahead.
China Export-Import Bank (China Eximbank) is extending a $2.45 billion loan to Baha Mar.
11/21/2010
thenassauguardian
By KRYSTEL ROLLE
Guardian Staff Reporter
krystel@nasguard.com
Prime Minister Hubert Ingraham said yesterday that he is not concerned with the statements made by Kerzner International’s Chairman and CEO Sol Kerzner that thousands of jobs may be at risk as a result of the Baha Mar project.
Kerzner told reporters on Thursday that the 8,000 jobs at the Atlantis Resort on Paradise Island would be placed in jeopardy if the government approves the Baha Mar project in its current form.
“It’s a deal that makes no sense,” Kerzner said. “It’s a deal that could be harmful to the people of The Bahamas and certainly to future investors and indeed ourselves.”
Kerzner has also argued that the deal between the government and Baha Mar violates the most favored nation status clause his company agreed to with the government in successive agreements.
Under these agreements, no investor should receive more favorable terms with the government than Kerzner’s company.
Ingraham said he thinks the issue with Kerzner will come to a satisfactory conclusion.
“I have many discussions with Mr. Kerzner,” said Prime Minister Ingraham, who was a guest on Love 97’s radio talk show Issues of the Day. “I think that we will resolve this issue satisfactorily. I think so.”
Despite the public criticisms of the Baha Mar deal by Kerzner, the House of Assembly unanimously approved the Baha Mar resolution on Thursday.
The company is seeking 8,150 work permits for non-Bahamian construction workers. The government brought the resolution to the House in order to get the ‘blessing’ of members before it finally approves the project, likely by the end of the month.
“We were always concerned that when we came to office that there was nothing in the Baha Mar deal that would give them a better deal than Kerzner, ”?Ingraham said yesterday. “I think I can say that the thing that ticked Kerzner more than anything else is a statement made by (Progressive Liberal Party Leader) Perry Christie to the effect that Baha Mar only wanted to get what Kerzner got. And he (Kerzner) was of the view that Baha Mar was getting more than him. And he was very hurt that Christie would make such a statement.”
Ingraham said Kerzner is concerned about Baha Mar’s lower construction labor costs, as compared to his company’s construction labor costs. Baha Mar will be mostly using Chinese labor to build its resort. Kerzner used more Bahamian labor at his property, increasing costs.
According to Ingraham, Kerzner is also concerned about the sum Baha Mar paid for the land the development is located on.
Ingraham said one of the reasons why they insisted there had to be a substantial increase to the contract value for Bahamian contractors was to help to offset any question about Kerzner’s concerns.
As a result of negotiations between Ingraham and the Chinese, and subsequent negotiations between the Chinese and Baha Mar, subcontracts to Bahamians in connection with the Baha Mar project will increase from $200 million to $400 million.
Ingraham said he wants to be sure that the government is not giving Baha Mar a better deal than Kerzner.
He added that when the Free National Movement (FNM) government negotiated a deal with Baha Mar in 2008, it did not give Baha Mar some of the concessions the Christie administration had agreed to.
“They issued side letters offering Baha Mar more. We tried to pull those things back. We think we have been somewhat successful ensuring that there is equity and balance between the two,” Ingraham said.
In response to criticism that he treats Kerzner with more regard than he does other developers, Ingraham didn’t shy away from the relationship he shares with the hotel developer. However, he added that all developers are treated fairly.
“There’s no question of my high regard for Sol Kerzner for what he has done for The Bahamas,” Ingraham said adding that Kerzner provided The Bahamas with 2,000 more jobs than he committed to.
“I will do all I can for as long as I can to ensure that his project is successful, but that has nothing to do with whether I will be fair to anyone else. But I will not knowingly give anybody else a better deal than Kerzner got,” he said.
Ingraham added that the Baha Mar project is only going forward because of his government.
He said there was no means by which Baha Mar’s CEO Sarkis Izmirlian could get the funding from the Chinese unless the government gave the Chinese the go ahead.
China Export-Import Bank (China Eximbank) is extending a $2.45 billion loan to Baha Mar.
11/21/2010
thenassauguardian
Sunday, November 21, 2010
Streets, Suites and Social Parasites
The Bahama Journal Editorial
Sadly and regrettably – this weekend past was like most we have experienced over the course of the past two decades and more; being dreadfully the same as thugs and other social parasites went out their business of looting, shooting, raping and killing.
For some of these people – the crimes begin on Thursday; are rampant on Friday and come to full throttle on Saturdays.
And so, it was this weekend past; the Princess Margaret’s Hospital was awash in blood; people wailed as their loved ones were rolled in on gurneys and stretchers; and one or two others stood in mute horror as the remains of this or that person were rolled away.
Saturday’s crescendo witnessed the death of a youth in Bain Town and the presentation of a tableau that show-cased Rambo-styled police-officers; armed to the teeth and [evidently] ready for some action.
Thankfully and mercifully, Police Commissioner Ellison Greenslade was in place and brought calm to what could have been a scene of bloody carnage. He is to be thanked for the maturity he brought as he spoke to a distraught community of men, women and youth – residents in that heartland community.
We listened in as he underscored the importance of label and interpretation whenever an event transpires and which attracts the attention of the police.
Here the Commissioner went to some lengths to make the point that no riot had taken place in Bain Town; and that while a youth was killed, there was never any reason for anyone to interpret neighborhood anger and regret [and even rage] as precursors to a riot.
Evidently, it is important to note that the Commissioner himself - as a product of Bain Town- knows the heart and spirit of that community better than most of his peers in the field of policing – and very many others, inclusive of some of our policymakers.
None of this should be taken to suggest that the Police Commissioner is enveloped in a thicket of illusions; indeed, to the contrary – there is every suggestion that, Ellison Greenslade’s calming presence made a major difference to a situation that could have been seriously ugly.
Evidently, this man’s hands are full with what happens to be his mandate; to help rid this society of the handiwork of any number of people who can and should be described as thugs and parasites run amok.
Here we would suggest that, as in any other occupation, there seems to be a species of division of labor in the ranks of those thugs and parasites who bedevil the rest of our society; with that division of labor consisting of those men and women who specialize in selling guns and ammunition; the men who rape; the men and women who rob others; those who specialize in home invasions; the rapists; those who specialize in abusing girls and boys and [of course] those who kill and get away with this most dastardly of crimes against the human person.
And then, there is that very special category of criminals – those medical practitioners and their patients who [as we are told] routinely abort fetuses alive in the womb.
This work is routinely and euphemistically described as ‘a procedure’. In instance after instance, the procedure is little more than a slick way of covering up the deliberate killing of that being who would – in the fullness of time- have become a living, breathing human person.
That this act is invariably illegal in The Bahamas underscores its violence and further serves to illuminate how coarse things have become for so very many Bahamians.
Evidently, these people are fulsomely deserving of the epithet, ‘thugs and assassins’.
This is how they should be described, notwithstanding their elevated social status as professionals.
Simply put, their crimes stink to high heaven!
And to be quite honest about the matter at hand, there are instances where – as we have been told- some of this nation’s most successful criminals routinely out-think, out-maneuver and who are able to baffle the police. These are the criminals who have succeeded.
Yet again, some of these people are well-educated; with some of them being lawyers, doctors, accountants, nurses, teachers and other so-called respectable people.
Some of these criminals work from the safety of their suites; thus having the safest of distance from the ruder and cruder kind of criminal whose work is done –as it were- in the raw.
While these criminals are the ones who are seen on a daily and nightly basis; there is reason to believe that some of these hard men and women are in the indirect employ of some of the hard men and women who do their stuff from on-high.
It is this aspect of that matter that involves thugs and social parasites that should also engage the urgent attention of Police Commissioner Greenslade and some of his officers.
November 22nd, 2010
The Bahama Journal Editorial
Sadly and regrettably – this weekend past was like most we have experienced over the course of the past two decades and more; being dreadfully the same as thugs and other social parasites went out their business of looting, shooting, raping and killing.
For some of these people – the crimes begin on Thursday; are rampant on Friday and come to full throttle on Saturdays.
And so, it was this weekend past; the Princess Margaret’s Hospital was awash in blood; people wailed as their loved ones were rolled in on gurneys and stretchers; and one or two others stood in mute horror as the remains of this or that person were rolled away.
Saturday’s crescendo witnessed the death of a youth in Bain Town and the presentation of a tableau that show-cased Rambo-styled police-officers; armed to the teeth and [evidently] ready for some action.
Thankfully and mercifully, Police Commissioner Ellison Greenslade was in place and brought calm to what could have been a scene of bloody carnage. He is to be thanked for the maturity he brought as he spoke to a distraught community of men, women and youth – residents in that heartland community.
We listened in as he underscored the importance of label and interpretation whenever an event transpires and which attracts the attention of the police.
Here the Commissioner went to some lengths to make the point that no riot had taken place in Bain Town; and that while a youth was killed, there was never any reason for anyone to interpret neighborhood anger and regret [and even rage] as precursors to a riot.
Evidently, it is important to note that the Commissioner himself - as a product of Bain Town- knows the heart and spirit of that community better than most of his peers in the field of policing – and very many others, inclusive of some of our policymakers.
None of this should be taken to suggest that the Police Commissioner is enveloped in a thicket of illusions; indeed, to the contrary – there is every suggestion that, Ellison Greenslade’s calming presence made a major difference to a situation that could have been seriously ugly.
Evidently, this man’s hands are full with what happens to be his mandate; to help rid this society of the handiwork of any number of people who can and should be described as thugs and parasites run amok.
Here we would suggest that, as in any other occupation, there seems to be a species of division of labor in the ranks of those thugs and parasites who bedevil the rest of our society; with that division of labor consisting of those men and women who specialize in selling guns and ammunition; the men who rape; the men and women who rob others; those who specialize in home invasions; the rapists; those who specialize in abusing girls and boys and [of course] those who kill and get away with this most dastardly of crimes against the human person.
And then, there is that very special category of criminals – those medical practitioners and their patients who [as we are told] routinely abort fetuses alive in the womb.
This work is routinely and euphemistically described as ‘a procedure’. In instance after instance, the procedure is little more than a slick way of covering up the deliberate killing of that being who would – in the fullness of time- have become a living, breathing human person.
That this act is invariably illegal in The Bahamas underscores its violence and further serves to illuminate how coarse things have become for so very many Bahamians.
Evidently, these people are fulsomely deserving of the epithet, ‘thugs and assassins’.
This is how they should be described, notwithstanding their elevated social status as professionals.
Simply put, their crimes stink to high heaven!
And to be quite honest about the matter at hand, there are instances where – as we have been told- some of this nation’s most successful criminals routinely out-think, out-maneuver and who are able to baffle the police. These are the criminals who have succeeded.
Yet again, some of these people are well-educated; with some of them being lawyers, doctors, accountants, nurses, teachers and other so-called respectable people.
Some of these criminals work from the safety of their suites; thus having the safest of distance from the ruder and cruder kind of criminal whose work is done –as it were- in the raw.
While these criminals are the ones who are seen on a daily and nightly basis; there is reason to believe that some of these hard men and women are in the indirect employ of some of the hard men and women who do their stuff from on-high.
It is this aspect of that matter that involves thugs and social parasites that should also engage the urgent attention of Police Commissioner Greenslade and some of his officers.
November 22nd, 2010
The Bahama Journal Editorial
Saturday, November 20, 2010
Prime Minister Hubert Ingraham insists that the Government of The Bahamas will not concede a breach of contract that Kerzner International is alleging will be made - if the Baha Mar project is approved
PM: Govt will not concede breach of Kerzner contract
By CHESTER ROBARDS
Guardian Staff Reporter
chester@nasguard.com
The Government of The Bahamas will not concede a breach of contract that Kerzner International is alleging will be made if the Baha Mar project is approved, Prime Minister Hubert Ingraham insisted last night during his contribution to debate in the House of Assembly. The House unanimously passed the resolution to move forward with the Baha Mar project late last night.
Ingraham urged that Kerzner International, owners of the Atlantis Resort on Paradise Island, should outline why it thinks The Bahamas has breached the ‘Most Favored Nation’ (MFN) clause in its agreement with Kerzner, and put it to his government.
“On behalf of the government, I do not concede that we have breached our agreements with Kerzner,” said Ingraham.
“I await receipt of the particulars of Kerzner’s claim which we will review and determine.
“We always honor our deals. And the arrangement with Kerzner is no exception.”
Kerzner charged in a press release issued Wednesday that the government of The Bahamas has given the Baha Mar developers more favorable labor terms than they received during the development of Atlantis, which violates the MFN clause.
However, Ingraham insisted last night that Baha Mar has not been offered certain concession given Kerzner during their development phases.
He argued that The Bahamas over the years has been just as good to Kerzner as Kerzner has been to the Bahamian people and economy.
“The entry of Kerzner in The Bahamas has been good, indeed very good for The Bahamas,” said Ingraham.
“Kerzner has created as many as 2,000 more new and additional jobs to that required under the terms of the various agreements concluded with the government.
“Kerzner’s impact on training – whether of workers involved in the construction of its various resort properties, or for workers engaged in the operation and maintenance of Kerzner’s properties is clearly evident. The impact of Kerzner International – of Atlantis, the Ocean Club and the Cove, with their themed park, marina, etc, is also evident.
“Yes, Kerzner is good for The Bahamas. It is also true that The Bahamas has been good to Mr. Kerzner.
“It has not been a one way street. The relationship has been mutually beneficial.”
The prime minister also lamented the fact that it took more than six years for Kerzner to bring its concerns to the table, which he insisted cannot stop Baha Mar’s development now.
“I note that Kerzner International is late in expressing its concern with the Baha Mar project; having not voiced those concerns in 2005 when the dimensions of this project would have been very widely covered in the Bahamian press, nor in 2007 when my government made the details of the various agreements concluded with Baha Mar public in this place,” he said.
“I believe, Mr. Speaker, that the horse has left the barn. I am fully confident that this honorable House will signal its approval for this project to proceed.”
Ingraham also took his alloted time in Parliament to reaffirm Baha Mar and China State Construction’s (CSC) commitment to increasing the amount of subcontracted work for Bahamians from $200 to $400 million, and creating an $8 million training program for construction workers, $1 million of which is to be a cash injection at the approval of the project.
Baha Mar and its Chinese partners have also agreed to develop a permanent training and service academy that will prepare Bahamians for the resort properties’ opening and beyond, Ingraham said.
He tabled e-mails and a letter from CSC and Baha Mar bolstering their support for these services.
According to him, the net benefit of this deal for Bahamians and the Bahamian economy far outweigh the counter-arguments to such a large development.
Baha Mar released a statement last night, following the government’s passage of the resolution, thanking it for its support and ensuring that, following their receipt of the final government approvals, they will commence the project by awarding contracts immediately to Bahamian contractors.
The development’s Chairman and CEO Sarkis Izmirlian said his company is dedicated to the project and the economic benefits it promises to The Bahamas.
“The Baha Mar team is delighted with today’s unanimous vote by Parliament,” he said.
“We are dedicated to delivering to The Bahamas this world class destination resort and the immediate and long term economic benefits, both from its construction and operation.
“The government and the Bahamian people are placing their trust in us, not just to have Baha Mar succeed as a business enterprise, but as importantly for Baha Mar to be a productive and exemplary member of the Bahamian community.
“Succeeding for The Bahamas is the key to Baha Mar’s success. This is what Baha Mar is about, and this is the guiding principle with respect to how we will run our business.
“We look forward to the tremendous positive benefits that Baha Mar will bring to The Bahamas.”
11/19/2010
thenassauguardian
By CHESTER ROBARDS
Guardian Staff Reporter
chester@nasguard.com
The Government of The Bahamas will not concede a breach of contract that Kerzner International is alleging will be made if the Baha Mar project is approved, Prime Minister Hubert Ingraham insisted last night during his contribution to debate in the House of Assembly. The House unanimously passed the resolution to move forward with the Baha Mar project late last night.
Ingraham urged that Kerzner International, owners of the Atlantis Resort on Paradise Island, should outline why it thinks The Bahamas has breached the ‘Most Favored Nation’ (MFN) clause in its agreement with Kerzner, and put it to his government.
“On behalf of the government, I do not concede that we have breached our agreements with Kerzner,” said Ingraham.
“I await receipt of the particulars of Kerzner’s claim which we will review and determine.
“We always honor our deals. And the arrangement with Kerzner is no exception.”
Kerzner charged in a press release issued Wednesday that the government of The Bahamas has given the Baha Mar developers more favorable labor terms than they received during the development of Atlantis, which violates the MFN clause.
However, Ingraham insisted last night that Baha Mar has not been offered certain concession given Kerzner during their development phases.
He argued that The Bahamas over the years has been just as good to Kerzner as Kerzner has been to the Bahamian people and economy.
“The entry of Kerzner in The Bahamas has been good, indeed very good for The Bahamas,” said Ingraham.
“Kerzner has created as many as 2,000 more new and additional jobs to that required under the terms of the various agreements concluded with the government.
“Kerzner’s impact on training – whether of workers involved in the construction of its various resort properties, or for workers engaged in the operation and maintenance of Kerzner’s properties is clearly evident. The impact of Kerzner International – of Atlantis, the Ocean Club and the Cove, with their themed park, marina, etc, is also evident.
“Yes, Kerzner is good for The Bahamas. It is also true that The Bahamas has been good to Mr. Kerzner.
“It has not been a one way street. The relationship has been mutually beneficial.”
The prime minister also lamented the fact that it took more than six years for Kerzner to bring its concerns to the table, which he insisted cannot stop Baha Mar’s development now.
“I note that Kerzner International is late in expressing its concern with the Baha Mar project; having not voiced those concerns in 2005 when the dimensions of this project would have been very widely covered in the Bahamian press, nor in 2007 when my government made the details of the various agreements concluded with Baha Mar public in this place,” he said.
“I believe, Mr. Speaker, that the horse has left the barn. I am fully confident that this honorable House will signal its approval for this project to proceed.”
Ingraham also took his alloted time in Parliament to reaffirm Baha Mar and China State Construction’s (CSC) commitment to increasing the amount of subcontracted work for Bahamians from $200 to $400 million, and creating an $8 million training program for construction workers, $1 million of which is to be a cash injection at the approval of the project.
Baha Mar and its Chinese partners have also agreed to develop a permanent training and service academy that will prepare Bahamians for the resort properties’ opening and beyond, Ingraham said.
He tabled e-mails and a letter from CSC and Baha Mar bolstering their support for these services.
According to him, the net benefit of this deal for Bahamians and the Bahamian economy far outweigh the counter-arguments to such a large development.
Baha Mar released a statement last night, following the government’s passage of the resolution, thanking it for its support and ensuring that, following their receipt of the final government approvals, they will commence the project by awarding contracts immediately to Bahamian contractors.
The development’s Chairman and CEO Sarkis Izmirlian said his company is dedicated to the project and the economic benefits it promises to The Bahamas.
“The Baha Mar team is delighted with today’s unanimous vote by Parliament,” he said.
“We are dedicated to delivering to The Bahamas this world class destination resort and the immediate and long term economic benefits, both from its construction and operation.
“The government and the Bahamian people are placing their trust in us, not just to have Baha Mar succeed as a business enterprise, but as importantly for Baha Mar to be a productive and exemplary member of the Bahamian community.
“Succeeding for The Bahamas is the key to Baha Mar’s success. This is what Baha Mar is about, and this is the guiding principle with respect to how we will run our business.
“We look forward to the tremendous positive benefits that Baha Mar will bring to The Bahamas.”
11/19/2010
thenassauguardian
Perry Christie - Opposition Leader says: ... if the government considers itself a partner in the deal with Baha Mar, it should have dealt with the alleged breach with Kerzner outside of the House of Assembly
Christie: Issues with Kerzner should have been resolved first
By CHESTER ROBARDS
Guardian Staff Reporter
chester@nasguard.com
Leader of the Opposition Perry Christie admonished the government during his contribution to debate in the House of Assembly yesterday, for not moving to resolve their apparent breach of a ‘Most Favored Nation’ (MFN) clause with Kerzner International, before bringing the Baha Mar resolution to Parliament for a vote.
Christie said if the government considers itself a partner in the deal with Baha Mar, it should have dealt with the alleged breach with Kerzner outside of the House of Assembly.
According to him, when the government was made aware that Kerzner considered the allowance of 8,000 Chinese workers for the Baha Mar project a violation of MFN, the prime minister should have met with them to resolve the issue before yesterday.
“It looks like there is antagonism in the product, serious difficulties in the product, where the government is making a decision to breach an agreement,” said Christie.
“Because, if we are saying that we are going to approve it (Baha Mar) and he (Sol Kerzner) is saying we are in breach of it (MFN), Parliament should suspend itself, since we have been asked to come to this point to have a determination made as to whether or not we are in breach.”
According to him, the matter of a breach of contract is “a matter to do with partners” and “not to do with public relations of a government”.
He said he was taken aback when Member of Parliament for Marco City, Zhivargo Laing read the press statement in the House of Assembly that was issued by Kerzner International outlining what it considered to be a breach of MFN.
“I was shocked yesterday,” he said. “This (MFN breach) is essentially a major legal matter that has exercised the minds of lawyers here in the attorney general’s office and the Queens Counsel of England.”
Christie also used much of the beginning of his alloted time in the House to respond to the government’s accusations that his party was not an effective government when they were in power and with regard to the Baha Mar agreement.
He got extremely testy with his colleagues across the floor yesterday, reminding them to act like parliamentarians while addressing the House and each other, as Bahamians look to them as a good example.
“We are coming to a time in the country where we have to be careful that we do not begin applying in our country retribution and reaction,” he said.
“That is not good for this country and our leadership in this country must exercise the greatest care as we move forward, dealing with people's reputations.
“Recognize that as best we can, we will try to avoid the snaring remarks and try to focus on the issues at hand.”
11/19/2010
thenassauguardian
By CHESTER ROBARDS
Guardian Staff Reporter
chester@nasguard.com
Leader of the Opposition Perry Christie admonished the government during his contribution to debate in the House of Assembly yesterday, for not moving to resolve their apparent breach of a ‘Most Favored Nation’ (MFN) clause with Kerzner International, before bringing the Baha Mar resolution to Parliament for a vote.
Christie said if the government considers itself a partner in the deal with Baha Mar, it should have dealt with the alleged breach with Kerzner outside of the House of Assembly.
According to him, when the government was made aware that Kerzner considered the allowance of 8,000 Chinese workers for the Baha Mar project a violation of MFN, the prime minister should have met with them to resolve the issue before yesterday.
“It looks like there is antagonism in the product, serious difficulties in the product, where the government is making a decision to breach an agreement,” said Christie.
“Because, if we are saying that we are going to approve it (Baha Mar) and he (Sol Kerzner) is saying we are in breach of it (MFN), Parliament should suspend itself, since we have been asked to come to this point to have a determination made as to whether or not we are in breach.”
According to him, the matter of a breach of contract is “a matter to do with partners” and “not to do with public relations of a government”.
He said he was taken aback when Member of Parliament for Marco City, Zhivargo Laing read the press statement in the House of Assembly that was issued by Kerzner International outlining what it considered to be a breach of MFN.
“I was shocked yesterday,” he said. “This (MFN breach) is essentially a major legal matter that has exercised the minds of lawyers here in the attorney general’s office and the Queens Counsel of England.”
Christie also used much of the beginning of his alloted time in the House to respond to the government’s accusations that his party was not an effective government when they were in power and with regard to the Baha Mar agreement.
He got extremely testy with his colleagues across the floor yesterday, reminding them to act like parliamentarians while addressing the House and each other, as Bahamians look to them as a good example.
“We are coming to a time in the country where we have to be careful that we do not begin applying in our country retribution and reaction,” he said.
“That is not good for this country and our leadership in this country must exercise the greatest care as we move forward, dealing with people's reputations.
“Recognize that as best we can, we will try to avoid the snaring remarks and try to focus on the issues at hand.”
11/19/2010
thenassauguardian
Friday, November 19, 2010
Baha Mar; No Need for Acrimony
The Bahama Journal Editorial
That we live in a time and in a place where some who lead can be petty; can be vindictive and where there is more bile spewing than even the law should allow is today self-evident.
And for sure, that we also live in a time when Bahamians should come together in order to pull themselves up from under is also as clear as day. But as clear happens to be the fact that, there are still so very many Bahamians who – for whatever reason – relish in the politics of personal destruction.
As a direct result of this penchant to see politics as some kind of infernal blood-sport, there are those in parliament who routinely hurl invective and slander-tainted innuendoes at others; all in aid of supposedly winning in a debate.
Much of this is rooted in the fact that some of these people are simply ignorant of the fact that this is just not the way it should be in Parliament.
Here we take some little comfort in the fact that, where ignorance is bliss; ‘tis folly to be wise.
Notwithstanding our current chagrin, there is –yet- some comfort to be found in some of what is about to happen in the House of Assembly.
Here, the good news we have today concerns what seems a dawning consensus to the effect that, the Baha Mar Project should proceed.
We suspect that it will proceed precisely because it seemingly has the potential to help the Bahamas in this dread hour; when things are clearly set to pose any number of other challenges.
Evidently, the principals behind this Baha Mar project are to be given their kudos for having the fortitude to persist in a time and in a place where the going –as they say- was rough.
But yet again, in a world where all’s well that ends well, we are happy to report that, the Rt. Hon. Hubert A. Ingraham seems agreed that the Baha Mar project should and indeed, will proceed.
As this nation’s Chief notes: “...As a result of candid discussions with the Chinese Export Import Bank, the China State Construction Company, and following upon discussions between those companies and their partner, Baha Mar, I can advise that consensus has been reached on a number of significant issues related to the proposed Baha Mar Cable Beach Development...”
And as Mr. Ingraham went on to explain, “First, the construction value of works to be subcontracted to Bahamian contractors and subcontractors has been doubled from $200 million to $400 million. Bahamians will also work on elements of the Core Project... Second, China State Construction and Baha Mar have agreed to an extensive and comprehensive training and retraining programme...”
We also note that, “ Baha Mar has also agreed to establish a Training and Service Academy which will provide extensive training prior to the opening of the various hotels and other amenities. The Academy will be permanent, offering ongoing training opportunities for employees and prospective employees...”
This is surely some very good news for the Bahamian people, writ large. But even while all of this is well and good, we wonder why this eminently worthy project attracted so much venom and so much bile from so very many quarters.
Indeed, even as we send out praise-thanks for what has transpired concerning Baha Mar in the aftermath of the prime minister’s Asian foray and in particular, his visit to Beijing, we remain discomfited by some of what now emanates from Parliament as this matter is debated and digested by the nation’s law-makers.
Indeed, like lots of other Bahamians who routinely tune into some of what passes for debate in parliament; we are not impressed. Like others who believe that the people’s business should be handled with the highest degree of decorum and civility; we are just not impressed with speakers who believe that the essence of debate is to be found in making personal attacks.
And for sure, like lots of other Bahamians who seriously believe that there are times in life when the governing party and its parliamentary opposite should work together – united in service and love – for the achievement of the common good.
We make these few comments as prologue and preface to a more nuanced comment on the current debate concerning the Baha Mar project; with such a commentary coming in when the dust has settled, so to speak.
At that juncture, Baha Mar would be consigned to the category: Done Deal. And yet again, we insist that this project is a good one for the Bahamas, for Baha Mar’s investors and for the governing Free National Movement and Her Majesty’s Loyal Opposition, the Progressive Liberal Party.
November 19th, 2010
The Bahama Journal Editorial
That we live in a time and in a place where some who lead can be petty; can be vindictive and where there is more bile spewing than even the law should allow is today self-evident.
And for sure, that we also live in a time when Bahamians should come together in order to pull themselves up from under is also as clear as day. But as clear happens to be the fact that, there are still so very many Bahamians who – for whatever reason – relish in the politics of personal destruction.
As a direct result of this penchant to see politics as some kind of infernal blood-sport, there are those in parliament who routinely hurl invective and slander-tainted innuendoes at others; all in aid of supposedly winning in a debate.
Much of this is rooted in the fact that some of these people are simply ignorant of the fact that this is just not the way it should be in Parliament.
Here we take some little comfort in the fact that, where ignorance is bliss; ‘tis folly to be wise.
Notwithstanding our current chagrin, there is –yet- some comfort to be found in some of what is about to happen in the House of Assembly.
Here, the good news we have today concerns what seems a dawning consensus to the effect that, the Baha Mar Project should proceed.
We suspect that it will proceed precisely because it seemingly has the potential to help the Bahamas in this dread hour; when things are clearly set to pose any number of other challenges.
Evidently, the principals behind this Baha Mar project are to be given their kudos for having the fortitude to persist in a time and in a place where the going –as they say- was rough.
But yet again, in a world where all’s well that ends well, we are happy to report that, the Rt. Hon. Hubert A. Ingraham seems agreed that the Baha Mar project should and indeed, will proceed.
As this nation’s Chief notes: “...As a result of candid discussions with the Chinese Export Import Bank, the China State Construction Company, and following upon discussions between those companies and their partner, Baha Mar, I can advise that consensus has been reached on a number of significant issues related to the proposed Baha Mar Cable Beach Development...”
And as Mr. Ingraham went on to explain, “First, the construction value of works to be subcontracted to Bahamian contractors and subcontractors has been doubled from $200 million to $400 million. Bahamians will also work on elements of the Core Project... Second, China State Construction and Baha Mar have agreed to an extensive and comprehensive training and retraining programme...”
We also note that, “ Baha Mar has also agreed to establish a Training and Service Academy which will provide extensive training prior to the opening of the various hotels and other amenities. The Academy will be permanent, offering ongoing training opportunities for employees and prospective employees...”
This is surely some very good news for the Bahamian people, writ large. But even while all of this is well and good, we wonder why this eminently worthy project attracted so much venom and so much bile from so very many quarters.
Indeed, even as we send out praise-thanks for what has transpired concerning Baha Mar in the aftermath of the prime minister’s Asian foray and in particular, his visit to Beijing, we remain discomfited by some of what now emanates from Parliament as this matter is debated and digested by the nation’s law-makers.
Indeed, like lots of other Bahamians who routinely tune into some of what passes for debate in parliament; we are not impressed. Like others who believe that the people’s business should be handled with the highest degree of decorum and civility; we are just not impressed with speakers who believe that the essence of debate is to be found in making personal attacks.
And for sure, like lots of other Bahamians who seriously believe that there are times in life when the governing party and its parliamentary opposite should work together – united in service and love – for the achievement of the common good.
We make these few comments as prologue and preface to a more nuanced comment on the current debate concerning the Baha Mar project; with such a commentary coming in when the dust has settled, so to speak.
At that juncture, Baha Mar would be consigned to the category: Done Deal. And yet again, we insist that this project is a good one for the Bahamas, for Baha Mar’s investors and for the governing Free National Movement and Her Majesty’s Loyal Opposition, the Progressive Liberal Party.
November 19th, 2010
The Bahama Journal Editorial
Sir Sol Kerzner says: The proposed deal between the Government of The Bahamas and Baha Mar violates previous agreements between the government and Kerzner International
Sol Kerzner hits out on Baha Mar
By BRENT DEAN
The Nassau Guardian
Deputy News Editor
brentldean@nasguard.com
Says Baha Mar deal violates agreements made with his company
The proposed deal between the Government of The Bahamas and Baha Mar violates previous agreements between the government and Kerzner International, charged Sir Sol Kerzner yesterday.
“Baha Mar proposes employing thousands of foreign Chinese workers, which would represent far more than 30 percent of the total labor force.
Approval of this arrangement by government would be a clear breach of an investment agreement with a developer that has become its largest private employer, and an investor who took a risk on The Bahamas when its economy was struggling far more than it is today,” said Sir Sol Kerzner, chairman and chief executive officer of Kerzner International in a statement.
The House of Assembly is scheduled to conclude debate on the Baha Mar resolution today. The company is seeking 8,150 work permits for Chinese workers to help construct the $2.6 billion resort. The government is seeking the blessing of the House as it grants the work permits. The opposition has said it supports the deal.
In previous heads of agreements between Kerzner and the government, it pledged to grant Kerzner most favored nation status, meaning no investor would be granted concessions greater than Kerzner.
However, in a rare public statement, Kerzner, who is the largest private sector employer in the country, said Baha Mar is being granted much more than his company received.
“When we made our largest single investment of approximately $1 billion for Phase III, we did so based on a heads of agreement signed with the PLP government in 2003. Among the many requirements that government imposed on Kerzner under this and prior agreements was a strict rule that at least 70 percent of the total construction labor force would be Bahamian,” said Kerzner.
“As was the case with the two previous agreements with government, our 2003 agreement included a most favored nation provision that assured Kerzner that our investments would be protected from subsequent investors receiving more favorable terms. These agreements represented a solemn promise by The Bahamas to us that any subsequent investor would only compete against us on a level playing field.”
Prime Minister Hubert Ingraham said on Sunday that the Baha Mar deal would be approved by the end of the month. It is unclear if Kerzner’s intervention will have any effect on that pronouncement.
Yesterday Baha Mar was not pleased with Kerzner’s public intervention.
“We are not going to comment on Mr. Kerzner’s public relations statement. The Baha Mar project has been well vetted with the public, the government and its investors. We are happy the Baha Mar resolution is being debated in Parliament today,” said the company in response to Kerzner.
Kerzner International said it intends to discuss with the government how to address its concerns. As a result of the deal, Baha Mar is to receive on the labor and land components of the proposed deal, Kerzner can argue it is entitled to the same.
The government is transfering 265 acres of public land at Cable Beach to Baha Mar as a part of the deal.
Kerzner International emphasized that the heads of agreement for each of the three phases of development on Paradise Island required that at least 70 percent of the total construction labor force had to be Bahamian.
Bahamian labor is more expensive than labor from countries such as China and Mexico.
The company and its chairman argued that the deal Baha Mar is to receive “would represent a material breach” of its agreement with the government.
“When Kerzner first invested in The Bahamas by acquiring what is now the Coral and Beach Towers out of bankruptcy in May 1994, we made our investment on the basis of agreements with the government that gave us contractual assurances regarding our investment. Although we were confident in our abilities to re-establish the Bahamian tourism industry at that time, we did so in the face of truly dire economic conditions,” said Kerzner in his remarks.
“Accordingly, we insisted upon most favored nation treatment, which would ensure that no subsequent investor would be given advantages that we never enjoyed. Since our first investment, we have always found government – irrespective of the party in office – to be a faithful partner who has justified our initial and subsequent confidence in The Bahamas as an investor. We have invested more than $2.3 billion over the course of our build-out of the three phases of Atlantis, increasing our room count from approximately 1,100 in 1994 to over 4,000 today.
“We have grown the Bahamian workforce from approximately 1,200 employees when we commenced operations in 1994 to nearly 8,000 full-time employees today, not to mention the indirect employment that our investment has generated in the community. Furthermore, we have spent millions on training programs to develop and improve the skills and professionalism of our work force, which has allowed Atlantis to be rated among the top resorts in the world.”
Both the governing Free National Movement and opposition Progressive Liberal Party support the Baha Mar deal.
11/18/2010
thenassauguardian
By BRENT DEAN
The Nassau Guardian
Deputy News Editor
brentldean@nasguard.com
Says Baha Mar deal violates agreements made with his company
The proposed deal between the Government of The Bahamas and Baha Mar violates previous agreements between the government and Kerzner International, charged Sir Sol Kerzner yesterday.
“Baha Mar proposes employing thousands of foreign Chinese workers, which would represent far more than 30 percent of the total labor force.
Approval of this arrangement by government would be a clear breach of an investment agreement with a developer that has become its largest private employer, and an investor who took a risk on The Bahamas when its economy was struggling far more than it is today,” said Sir Sol Kerzner, chairman and chief executive officer of Kerzner International in a statement.
The House of Assembly is scheduled to conclude debate on the Baha Mar resolution today. The company is seeking 8,150 work permits for Chinese workers to help construct the $2.6 billion resort. The government is seeking the blessing of the House as it grants the work permits. The opposition has said it supports the deal.
In previous heads of agreements between Kerzner and the government, it pledged to grant Kerzner most favored nation status, meaning no investor would be granted concessions greater than Kerzner.
However, in a rare public statement, Kerzner, who is the largest private sector employer in the country, said Baha Mar is being granted much more than his company received.
“When we made our largest single investment of approximately $1 billion for Phase III, we did so based on a heads of agreement signed with the PLP government in 2003. Among the many requirements that government imposed on Kerzner under this and prior agreements was a strict rule that at least 70 percent of the total construction labor force would be Bahamian,” said Kerzner.
“As was the case with the two previous agreements with government, our 2003 agreement included a most favored nation provision that assured Kerzner that our investments would be protected from subsequent investors receiving more favorable terms. These agreements represented a solemn promise by The Bahamas to us that any subsequent investor would only compete against us on a level playing field.”
Prime Minister Hubert Ingraham said on Sunday that the Baha Mar deal would be approved by the end of the month. It is unclear if Kerzner’s intervention will have any effect on that pronouncement.
Yesterday Baha Mar was not pleased with Kerzner’s public intervention.
“We are not going to comment on Mr. Kerzner’s public relations statement. The Baha Mar project has been well vetted with the public, the government and its investors. We are happy the Baha Mar resolution is being debated in Parliament today,” said the company in response to Kerzner.
Kerzner International said it intends to discuss with the government how to address its concerns. As a result of the deal, Baha Mar is to receive on the labor and land components of the proposed deal, Kerzner can argue it is entitled to the same.
The government is transfering 265 acres of public land at Cable Beach to Baha Mar as a part of the deal.
Kerzner International emphasized that the heads of agreement for each of the three phases of development on Paradise Island required that at least 70 percent of the total construction labor force had to be Bahamian.
Bahamian labor is more expensive than labor from countries such as China and Mexico.
The company and its chairman argued that the deal Baha Mar is to receive “would represent a material breach” of its agreement with the government.
“When Kerzner first invested in The Bahamas by acquiring what is now the Coral and Beach Towers out of bankruptcy in May 1994, we made our investment on the basis of agreements with the government that gave us contractual assurances regarding our investment. Although we were confident in our abilities to re-establish the Bahamian tourism industry at that time, we did so in the face of truly dire economic conditions,” said Kerzner in his remarks.
“Accordingly, we insisted upon most favored nation treatment, which would ensure that no subsequent investor would be given advantages that we never enjoyed. Since our first investment, we have always found government – irrespective of the party in office – to be a faithful partner who has justified our initial and subsequent confidence in The Bahamas as an investor. We have invested more than $2.3 billion over the course of our build-out of the three phases of Atlantis, increasing our room count from approximately 1,100 in 1994 to over 4,000 today.
“We have grown the Bahamian workforce from approximately 1,200 employees when we commenced operations in 1994 to nearly 8,000 full-time employees today, not to mention the indirect employment that our investment has generated in the community. Furthermore, we have spent millions on training programs to develop and improve the skills and professionalism of our work force, which has allowed Atlantis to be rated among the top resorts in the world.”
Both the governing Free National Movement and opposition Progressive Liberal Party support the Baha Mar deal.
11/18/2010
thenassauguardian
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