Prime Minister The Rt. Hon. Perry G. Christie Pays Tribute to the late Paul Laurence Adderley

I am deeply saddened by the news of the passing this morning of one of our nation’s finest sons, my very dear friend, confidante and political colleague of many years, the Honourable Paul Laurence Adderley. This is a grave loss for our country, for myself personally, and for the many thousands of Bahamians whose lives were touched by this truly remarkable human being and nationalist over the course of his more than forty years of distinguished service to the Bahamian people. Mr. Adderley was a man of extraordinary intellectual brilliance. His accomplishments were legion. Indeed it is quite impossible to overstate the importance of his many and varied contributions to the development of our nation.

As the longest serving Attorney-General of the 20th century – a period spanning some 17 years – Mr. Adderley engineered the transition of our colonial legal system into a new era of constitutional sovereignty while overseeing the modernization of our laws in so many vital areas of national life. In so doing, he also expanded the judiciary and helped deepen the Rule of Law as the bedrock of our civilization. As Minister of Foreign Affairs, Mr. Adderley was the primary architect of the nation’s foreign policy in the founding years of nationhood; a foreign policy based on mutual co-operation and friendship with our neighbours but always within the context of the principles of self-determination and sovereign independence. Mr. Adderley was absolutely determined that The Bahamas, though small, should preserve its integrity as an independent nation and never allow itself to be subjugated to any foreign power.

As Minister of National Security, Mr. Adderley was a courageous warrior against drug-trafficking. He was chiefly responsible for a wide range of anti-drug trafficking measures, including the OPBAT joint interdiction operations; the negotiation of mutual legal assistance treaties; and the introduction of a raft of new laws aimed at curbing the drug trade and bringing traffickers to the bar of justice. Concurrently, Mr. Adderley was responsible for sweeping changes to both the Royal Bahamas Police Force and the Royal Bahamas Defence Force aimed at better equipping them to discharge their law enforcement mandates in the face of newly emergent crime threats.

As Minister of Education, Mr. Adderly also achieved notable successes. He introduced a raft of initiatives aimed at raising academic standards in the public school system. He restricted social promotion exercises and instituted the BGCSE examination system. He was also instrumental in expanding the Government’s building programme for new schools while instituting the Cadet Programme as a means of better preparing high school students for the transition into responsible life in the wider community. As Minister of Finance, Mr. Adderley steered the country through the extremely difficult recessionary years of the very early 1990’s, insisting on austerity and fiscal discipline as a means of surviving the crisis. That Mr. Adderley was able to rise to this challenge while privately battling both cancer and heart disease makes it even more awe-inspiring. No finer example of patriotic commitment is to be found in the annals of the modern Bahamas. But even beyond his immense achievements as a minister of the government from 1972 to 1992, Paul Adderley will also be remembered as a leader of the Bahamas Bar for nearly 60 years. He was an advocate of incomparable skill admired by all his colleagues for the depth of his learning, the thoroughness of his research and preparation, his powerful intellect, his spellbinding oratory and, most important of all, his adherence to the highest standards of ethical propriety in all his professional dealings. He was, like his father before him, the Hon. A.F. Adderley, a lawyer of truly legendary standing at the bar.

As a parliamentarian from 1962 to 1967 and then from 1972 to 1997, Mr. Adderley was always a fiery and meticulously prepared debater, whether in the House of Assembly or the Senate. Uniquely, he was the fourth consecutive generation of his family to serve in the Bahamian legislature, having been preceded by his father, the Hon A.F. Adderley; and before that, by his grandfather, Wilfred Parliament Adderley; and earlier still by his great grand-uncle, William Campbell Adderley who was a member of the House of Assembly more than 130 years ago. Faithful to this dynastic tradition, Mr. Adderley enlarged upon the accomplishments of his forebears and always gave an excellent account of himself in the halls of Parliament. Following his retirement from frontline politics, Mr. Adderley continued to serve our country in a variety of ways, most notably as the Co-Chairman of the first Constitution Commission. Even with all of the foregoing to the credit of his name, Mr. Adderley regarded his own family as his finest achievement. He was a family man for whom nothing was more delightful than the time spent with his devoted wife and daughters.

Finally, it needs be said that Mr. Adderley was the very embodiment of personal integrity. He was absolutely incorruptible. He was a public servant of the highest order. And yet he shunned all honours. He refused to even consider taking a knighthood when it was offered to him and reacted in the same way whenever any other honour was offered to him over the years. For Paul Adderley, the greatest honour of all – and the only one that really mattered – was the opportunity to serve the Bahamian people to the very best of his ability. And he did precisely that – with great distinction – for all his adult life. On behalf of the Government and people of The Bahamas, the Progressive Liberal Party of which Mr. Adderley was a long and faithful member and a Stalwart Councillor, on behalf of my wife, Bernadette, and on my own behalf, I extend deepest condolences to Mr. Adderley’s widow, Lilith, and their three children, Catherine, Roseanne and Paula. A State Funeral will be held for Mr. Adderley, details of which will be announced shortly by the Cabinet Office.

September 19, 2012

myplp.org

Caribbean Blog International

Political victimization in The Bahamas... ...as John Marquis concurs with Dennis Dames

Questions For John Marquis


 

EDITOR, The Tribune:




As we near the fortieth anniversary of independence, I too am saddened like John Marquis that some things never change. Mr. Marquis believes that the “PLP’s taste for intimidation and victimization appears to be one of them.” He wrote as much in his op ed, Marquis At Large” that was published in The Tribune on the 15th September 2012.

He went on to opine about the “redeployment” of senior staff at ZNS, playing favourites and loathsome practices within the government and government controlled corporations.

In my opinion, he sought to rewrite history and reflect the PLP government in a negative light while giving the FNM government a wink, a nod and a pass. This position is widely believed to be the official editorial policy of The Tribune.

I have this proposition and a few questions for John Marquis: Within one month of forming the government on 2nd May 2007, the FNM government released six employees from their contracts at the Bahamas Information Services (BIS). For the record, they were Gregory Christie and the late Dudley Byfield from the Grand Bahama office and Luther Smith, Al Dilette, Marlon Nichols and Steve McKinney from the Nassau office. In doing so did the FNM displayed “a taste for intimidation and victimization” as Mr Marquis so eloquently attributes to the PLP government? Was this FNM policy decision “indeed a sad and depressing state of affairs” as Mr. Marquis concurred it was as he echoed the sentiments of Guardian commentator Dennis Dames? Yes, Mr. Marquis, some things never change.

Further, Mr. Marquis had a platform in 2007 to revisit “the history of political victimization” in The Bahamas as he now finds it so convenient to do. In 2007, there was no outrage, no weeping, no wailing, no gnashing of teeth and no righteous indignation expressed over the unceremonious dismissal of our six fellow Bahamian brothers in what many believe to be part of a politically motivated purge of the public service by the strong arm of the FNM government.

Perhaps Mr. Marquis would want to dig deep and find an appropriate adjective to describe the actions of the then FNM government in the interest of fairness and balance. Does he have the journalistic integrity to direct some of the venom and invective (he ostensibly reserves for the PLP) at the policies and practices of the FNM, policies and practices he appears hell bent on excusing, winking at and looking that other way when chastisement was the appropriate response? Again he should do so in the interest of fairness and balance.

In the end I issue the same challenge to the leadership of the FNM as Mr. Marquis issues to Prime Minister Christie. I hope that the next FNM government “can summon the courage to outlaw victimization forever…for the nation’s sake.”

ELCOTT COLEBY

Nassau,

September 17, 2012

Tribune 242

Caribbean Blog International

The Bahamas has the highest inequality in the entire Caribbean... ...The Bahamas is a unique and wonderful country ...but high and rising inequality has been a largely undiscussed side effect of the development path we have taken over the past several decades

The Bahamas Is Becoming Increasingly Unequal




By ALISON LOWE

 

 

Nellie Day – remember her? She wrote an article claiming that the majority of Bahamians live in shacks made of straw and wood, while a wealthy elite can afford mansions made of concrete, strong enough to withstand a hurricane.

 

Her clearly poorly researched and shoddy article appalled The Bahamas at large and soon after it was removed from the US-based travel website where it had been posted, and the author was forced to issue an apology. And rightly so. The Bahamas is a highly developed, developing country. We have made advances in our levels of education, health, and overall economic development that many countries can only dream of. There is absolutely no truth to the claim that an “ample working class inhabits shacks and huts” made of scavenged wood and straw.

 

However, there is an aspect of our development experience which Nellie Day’s “article” touched upon which may in fact hit close to home. Not to give her credit for it, because the extent of her claims indicate she could scarcely have known the underlying facts, but allow me to put it to you that Nellie Day did what something of our politicians might do well to do more of: Talk about inequality. Inequality is an often-cited aspect of development, but not one that is ever talked about in The Bahamas. What actual evidence is there for what inequality looks like in The Bahamas, and should we care either way?

 

Data is scarce (The Bahamas and the Caribbean as a whole is what has come to be termed a “data poor region”, which severely impedes progress in policy making, but that could be the subject of an entire article in itself), but I did find something to answer my question – and the findings are troubling. For one, The Bahamas has the highest inequality in the entire Caribbean, according to a recent study compiled for a project on development trajectories in the Caribbean by the United Nations Economic Commission for Latin America and the Caribbean, with a Gini coefficient of 0.57 (the Gini coefficient measures inequality, on a scale of 0 to 1, with 1 representing total inequality). Secondly, inequality is only increasing.

 

In The Bahamas’ Department of Statistics’ most recent Labour Force Survey, a graph showing trends in income distribution from 1973 to 2011 shows a laudable closing of the income inequality gap from one of quite severe income inequality in the Bahamas in 1973 to a vastly improved position by 1989. However, the next point at which data is available – 1999 – shows that the 1990s were a turning point for income inequality trends. From 1999 onwards, income inequality has been increasing in The Bahamas. That is to say the rich hold a higher proportion of overall income in comparison to the less well off. To be clear, the increase is not massive, but it is a negative trend.

 

Meanwhile, data also shows that the share of the overall wealth of The Bahamas held by the “bottom” 20 per cent of the population has not changed at all in percentage terms in at least 38 years. While total household income has increased (meaning that by holding the same percentage of that total amount, their absolute income has increased) in terms of a proportion of the whole, the bottom 20 per cent’s share has remained in the vicinity of 4 to 5 per cent of The Bahamas’ total household income.

 

My intention in writing this article is simply to bring these facts to the fore, and suggest that inequality is something we should be talking about as a society. Firstly, I believe it would be beneficial to consider what took place in the 1990s that may have contributed to this negative trend emerging. At first glance, the growing gap seems counterintuitive, considering that the ’90s saw the Atlantis resort come on stream, in what has been talked about by many as a moment which contributed to the emergence of a substantial middle class in the Bahamas. Secondly, what does high and growing inequality say about the health of our nation and its future development? There are many well-respected academics and policy makers who tell us that a society with high levels of inequality is more likely to suffer from lower growth, higher crime and poor health and to generally be less happy.

 

Thirdly, how can we stop, slow or reverse this trend? And should we? As we consider these questions, it is worth noting that the economic crisis is likely to have only significantly worsened this inequality.

 

Indeed, the evidence is already being seen. In a shocking report in January 2012 that received far less attention than the seriousness of its contents warranted, Tribune business editor Neil Hartnell pointed out that Department of Statistics figures show that the number of Bahamian households surviving on less than $5,000 per year has increased by an “alarming” 83 per cent in the past four years.

 

Additionally, between the years 2007 to 2011 there has been a 33 per cent or one third increase in the number of households (to be clear, by “household” we are talking about an entire group of people who live within a particular residence and their combined earnings) earning $20,000 or less, with the number of such households increasing from 24,780 to 33,015. It is possible that the wealthy have also lost out, but with a greater safety net and more secure jobs, their fall will not have been so great. This has been the trend worldwide – it is the less well-off, those who are already more vulnerable, who have fallen the furthest due to the economic downturn.

 

But why should we care? There are several very good reasons which are commonly advanced. While I will not attempt to definitively link these issues to inequality, I think it is certainly worth considering them, given that academic and public policy reports worldwide have found that there are strong reasons to believe that the interconnections are very real.

 

The first is crime. In one of the most comprehensive reports to ever have been produced on crime in the Caribbean, a joint report of the UN and the World Bank on “Crime, Violence and Development: Trends, Costs and Policy Options in the Caribbean” (2007) the authors describe the disastrously high levels of crime in the region and find evidence to suggest that countries with higher levels of inequality have higher rates of both murder and robbery, no matter what their overall level of wealth. This is not to say that other factors do not come into play – indeed, it is likely through some of the same channels that contribute to inequality (perhaps structural unemployment, poor education outcomes) that crime grows, but it is also possible that the mere fact of inequality becomes an independent source of crime.

 

The second reason to care is a suggested link between inequality and long term economic prospects. Some argue that efforts to make a society more egalitarian will come at the expense of economic efficiency and growth; that it is through being able to reap large rewards that the wealthy will go on to spur further growth through investment and innovation and, if not, the economy will be stifled.

 

Others suggest this is a fallacy. In his own article trumping the need to redress America’s income imbalances, Professor, Nobel Laureate economist and former chief economist for the World Bank, Joseph Stiglitz, points to countries such as Sweden which are both economically healthy and the most “equal” of all modern economies. In one of his own recent articles on the topic of inequality, Stiglitz states that overall it is “well documented that countries that are more unequal don’t do as well, don’t grow as well and are less stable.” For one possible reason why this might be, we only have to link this back to the UNODC report’s connection of inequality with crime, factoring in the impact of crime on private business activity, on human capital, and crime’s ability to encourage brain drain – the urge for those with the intellectual and material capital to leave the country going and perhaps never come back – to see how inequality could cut growth. Add in the impact on health and education of a large group of people getting stuck at the bottom of the ladder and how this would affect their ability to contribute to economic activity and there is further intuitive evidence of why inequality may hurt growth and stability.

 

You might also consider how higher levels of inequality can signify less “equality of opportunity”, such that children born of poor parents are less able to live up to their potential, or as Stiglitz puts it, how “lack of opportunity means that a country’s most valuable asset – its people – are not being fully used.” He was referring to the situation in the United States of America, where inequality is the highest in the developed world, and, according to Stiglitz, is now at such an “intolerable” level that the country will “pay the price”. In a country with as few people as The Bahamas it is arguably even more important that we ensure each one can live up to their potential to contribute to our society. Reinforcing Stiglitz’s assertions with regard to why high inequality in the US is indeed a problem, the Organisation for Economic Development and Cooperation (OECD) warned the US in June that it must fix its inequality level, noting impacts on health, education, innovation, and economic wellbeing. Meanwhile, the extent of inequality in the U.S. is one of the main messages of the “Occupy” movement, which has managed to play a major part in bringing the issue into the mainstream agenda and political debates.

 

“Occupy” complains, and Stiglitz also contends, that inequality distorts political outcomes as those at the top gain a disproportionate voice in the political process. When this occurs, democracy is often weakened, as is economic growth, as “rent-seeking” behaviour causes those who already have wealth to bend political outcomes to their own benefit rather than that of the economy as a whole. Some link this effect of inequality to the devastating financial crisis in the United States which led to the economic doldrums the globe has experienced ever since.

 

As for what the data may tell us so far, it is hard to decipher exactly what role, if any, inequality may have played in stymying economic activity in The Bahamas. Between 1980 and 1990, GDP growth averaged 3.5 per cent in The Bahamas, while between 1990 and 2000, as inequality stopped narrowing and began to grow, it averaged 1.85 per cent. From 2000 to 2010, as already high levels of inequality trended higher, there was an average of only 0.84 per cent growth, but this period also saw both the effect of the slowdown in tourism following the September 11th attacks of 2001 and the global downturn post-2008 financial crisis. Overall, from 1980 to 2011, growth averaged a low 2.11 per cent. Given that the increase in inequality beginning in the 1990s is only a minor one, but a negative trend, I would suggest that it would have been unlikely to have had any major effect on economic growth over and above these other global factors to date, but this is not to say that in the long run, and with a continued worsening of inequality levels, it could not have an impact.

 

Potential social and psychological implications of inequality should also factor into the debate. What does it mean to live in a society where you have multi-billionaires living within several miles of people who are struggling to keep $100 in their bank account? There is a question of how high inequality leads to a deterioration of social cohesion within a society, which, as eminent social scientists such as Professor Robert Skidlesky of Warwick University have stated, is the foundation upon which “democracy – or, indeed, any type of peaceful, contented society – ultimately rests.”

 

As for why inequality in the Bahamas may be on the rise, there are several potential causes which spring to mind. Firstly, our economic model as a whole. We have traditionally sought to attract high net worth individuals to The Bahamas to set up shop and residence, and as “usual residents”, some of them and their particularly large household incomes will have factored into the Department of Statistics report of November 2011 on which the latest trends in inequality are perceptible.

 

Another issue, however, is long-term structural unemployment. James Smith, then former minister of state for finance and today a consultant to the Ministry of Finance, told me earlier this year by email that this type of unemployment is likely to be a contributing factor given that statistics show that between 1995 and 2011 the average unemployment rate in The Bahamas, notwithstanding the rise of Atlantis and the relative boom period of the mid-2000s, remained at a stubborn 10 per cent. Structural unemployment is joblessness that comes about due to a lack of fit between the skills individuals have and the jobs being created. Hence although in economically good times, jobs were being created, there remains a core group of individuals who are not suited to benefit from them. In this regard, if we care about inequality, this is yet another reason to focus on education and to what extent our inadequate education system is growing this proportion of the population, as business leaders commonly complain, and therefore contributing to further inequality.

 

Taxation surely must bear some of the blame, too. Just this week we have seen the announcement of a forum to discuss future taxation options for the Bahamas, with one of the recognized reasons why this is needed being the question of “equity”. As it stands, the Bahamian taxation system which relies most heavily on tariffs on imports for revenue creation, is regressive. The poor pay relatively more of their salaries in tax than the rich. When you take more money out of the pockets of the less-well-off, you not only limit their disposable income, but you reduce their pool of resources which they can save towards options like college for their children, or invest in property and other income-generating assets, for example. In other words, you are curtailing their options and their children’s, to take a step-up on the social ladder. By allowing the wealthy to pocket a greater share of their incomes, you leave them with yet more options for investment in activities that will increase their incomes yet further.

 

Additionally, by continuing the use of a taxation system that in general sees this nation collect a lower-than-average amount of revenue as a proportion of GDP than other countries, as the tariff-based system does, you limit the ability of the government to potentially engage in meaningful public investment that will benefit the most vulnerable. All of this has a knock-on effect on social mobility and inequality in the long run. Similarly, the lack of an inheritance tax allows the wealthy to pass on money and property to their heirs without paying any tax on these assets, as would be the case in many jurisdictions worldwide, including the United States and the United Kingdom. This too, may perpetuate and even have a “snowball” effect on inequality in The Bahamas, as children of the wealthy can receive property and money that they in most cases played no part in producing/obtaining, increasing their options and life chances with no input of their own, without making any contribution to the state which might wish to take redistributive steps to assist those whose initial life chances are not so rosy.

 

The Bahamas is a unique and wonderful country, but high and rising inequality has been a largely undiscussed side effect of the development path we have taken over the past several decades. If unaddressed, some experts would say it may well contribute to derailing our progress and turning back the clock on advancements that have been made. Or it may be that inequality has little to do with our most serious problems. But as the country with the highest inequality in the Caribbean that continues to rise, isn’t it time we talk about it?

 

 

September 11, 2012

 

Tribune 242

 

Caribbean Blog International

 

 

 

Our children deserve better...

Some Sad Facts of Life


The Bahama Journal Editorial



Some of this nation’s youth – through no fault of their own – are fated to be failed by any number of this nation’s social institutions inclusive of both Church and State.

Most of us seem to have forgotten that there was once a time when our people [fathers, mothers and other extended family] did care about the well-being of their off-spring.

Alas! This was not to last.

To this very day, there yet remains a hardy few of oldsters among us who can remember the arrival of that time when Bahamians fell in love with a brand new kind of ethos – one that trained its eye on ego-run amok: – of all my mother’s children, I love ME the most and thus the fervent idolatry of ME and MINE.

As a direct consequence of this new worship, we now have on our collective hands some of the results that inevitably follow when greed, selfishness and rampant consumerism are allowed free rein. As some among us gloat about their good fortune; some others pig out.

Sadly, thousands upon thousands of others are obliged to beg for a crust of bread, a taste of sugar and a vulgar bed wherever the day leaves them.

Some of this nation’s children are schooled and educated in comfort while others are left to fend for themselves in places where gun-fire can blast out its bloody report in a moment and in a twinkling of an eye.

Our children deserve better. Sadly, they may be in for worse piled upon even more of the same. Information reaching us speaks a story of horror, neglect and indecisiveness as regards the current state of affairs in any number of public schools which are bulging to the point of bursting their banks with students.

Today we have schools where classrooms are chock-full of students – many of them at the primary level – where only so many can ever really benefit; and so the beat continues for hundreds upon untold hundreds of this nation’s youth.

This is no basis upon which we can ever even hope to build a thriving Bahamian Nation; and clearly, the times are hard and they may get even harder.

Scarier than this is this sad fact of life: – This nation’s children deserve far better than they are presently getting from their parents, their pastors and their parents’ representatives in parliament. Indeed, one of the signs of the times in today’s Bahamas has to do with the extent to which any number of undocumented women – especially Haitians – now make it their business to produce as many children as they possibly can.

Evidently, they do what they do because they have come to the conclusion that things are truly better in the Bahamas for them – and that – these things are going to be quite fine for their brood.

Interestingly, there is today every indication that some of the Haitian women who are – as the saying goes – ‘dropping-baby’ – are utterly dependent on their male counterparts. As interesting is the fact that some of these men have left family members behind in a Haiti where things are still verging on bad tending towards worse; this notwithstanding reconstruction work taking place in Port-au-Prince and its immediate environs.

In direct counterpoint to this Haitian story of baby-making gone rampant, we have a situation on our collective hands where far too many of this nation’s men routinely abuse drugs that can and do destroy mind, body and soul.

As the Minister of National Security recently commented, “…There is a segment of our society where the widespread use and abuse of mind altering illicit drugs, alcohol and other substances… is prevalent. We often see the consequential bloodshed and death as gang members destroy themselves and others in seeking to maintain and/or establish turf in a war between and among our people…”

Nottage goes on to note the obvious when he indicates, “…The focal point to building a safer Bahamas must be a commitment to national renovation and renewal and that the security of the country is a vital pillar on which to build a thriving nation…”

These resounding words must yet be translated into action on the ground. As night follows day, so does it follows that today’s brutalized thug was once some cooing mother’s bundle of joy.

The same principle applies to the girl-child who – at the age between twelve and fifteen – is laden with child; and thus a rape-victim.

She too was once some one’s precious princess of a child. This is all so very sad.

We can and should do better.

September 17, 2012

Jones Bahamas

Caribbean Blog International

The government of The Bahamas must commit to investment in renewable energy technologies ...Diversifying the energy portfolio of The Bahamas is an act that does not require a referendum

Choosing a scapegoat for oil exploration

thenassauguardian editorial

Drilling for oil in The Bahamas is a contentious issue, yet it is one that can only be resolved by moving the process forward.  Under the previous administration, the process was delayed when a moratorium was placed on oil exploration in the wake of the Deepwater Horizon spill.  And now, the government has feigned decisiveness by confirming compliance with license requirements subject to a public referendum on oil exploration and drilling.

While public involvement is the foundation of a democracy, public officials are elected because they encompass the qualities and intellect to lead and implement policies that positively impact future generations.  When needed, government officials seek expert advice and consultation to steer technical policy decisions.

Oil drilling carries a heavy burden because the economic benefits are vast yet clouded by the potential for an environmental disaster and corruption.  This confluence of socio-economic and environmental factors compounded by cutting-edge technology requires a team of experts to model, analyze and report various scenarios to the layman.

Will the people be adequately informed and educated on oil drilling specific to The Bahamas?  For a country with a dearth of technical professions, it seems very unlikely that voters will be fully prepared to make this very important decision.

Unfortunately, whether members of the public approve or reject oil drilling in The Bahamas, they will be the scapegoat for the lack of political will by either governing party, the Free National Movement (FNM) or Progressive Liberal Party (PLP), to make a decision.

A referendum should not be used as a political ploy to deflect responsibility.

Even if the last exploratory well was drilled in 1986, why has the government decided that it now requires a public referendum?  Credible attempts to add The Bahamas to the list of oil producing countries have been on-going for the past 60 years.

A frenzy of activity occurred between 1945 and 1971 followed by a subsequent gap until 1982 when amended petroleum legislation stimulated a brief renewal in interest.  Licenses were held at one time by Chevron, Texaco, Mobile and other principle operators still largely recognizable today.

Unlike previous attempts, the combination of technological advancements, the rise in crude oil prices and the continued expenditure of resources by BPC, this may well be the first time in Bahamian history that oil extraction becomes possible as a viable industry.

With the Deepwater Horizon spill still featuring prominently in discourse, the government may fear a public relations disaster by endorsing oil exploration.  But the physical conditions south of Andros differ vastly from the Deepwater Horizon in the Gulf of Mexico.

The Bahamas is in a perilous economic state with the International Monetary Fund (IMF) noting the GDP-to-debt ratio approaching 60 percent in part because of “contingent liabilities among public corporations such as the Bahamas Electricity Corporation (BEC)”.  In an ironic twist of fate, the very industry under scrutiny holds the country hostage for energy production because oil prices continue to rise.

But statements from the IMF touting the potential revenues based on the size of oil deposits should be carefully regarded.  Lessening The Bahamas’ reliance on petroleum products for energy production would be a significant economic stimulus, and oil revenues, if approved and if extracted, would be an added bonus.  The Bahamas cannot wait and count on prospective oil resources to become self-sufficient.

The government of The Bahamas must commit to investment in renewable energy technologies.  Diversifying the energy portfolio of The Bahamas is an act that does not require a referendum.

Sep 11, 2012

thenassauguardian editorial

Caribbean Blog International

Bankers have expressed fears that the re-named Homeowners Protection Bill would result in The Bahamas’ own ‘credit crunch’ ...if passed into law as is...

Homeowners Bill Still ‘Shoots Risk Through The Roof’




By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

 

 

Bankers yesterday expressed fears that the re-named Homeowners Protection Bill would result in the Bahamas’ own ‘credit crunch’ if passed into law as is, with Tribune Business told there were no “material changes” from the first draft.

 

While no commercial bankers were prepared to speak openly yesterday, under condition of anonymity senior executives said the proposed legislation “fundamentally changes” the risk/reward calculation associated with lending.

 

This, Tribune Business was told, was largely due to the Bill giving the Supreme Court the power to intervene when commercial banks were attempting to realise exercise their power of sale on delinquent properties.

 

Further exercising commercial bank concerns is that the Bill plans to give the courts the ability to delay this process for an unspecified time period, creating huge uncertainty about the industry’s ability to realise mortgage security/collateral.

 

As a result, senior bankers explained, the risk associated with mortgage lending in the Bahamas would dramatically increase, with potentially huge implications for the wider economy - especially the real estate and construction industry.

 

Tribune Business understands that a meeting to discuss the proposed legislation, involving government representatives, the Central Bank of the Bahamas, the Clearing Banks Association (CBA) and members’ attorneys, and other lenders has been scheduled for today.

 

However, a copy of the Homeowners Protection Bill, which has been obtained by Tribune Business, is little changed from the first version - also seen by this newspaper.

 

That document was panned by many, including former minister of state for finance and Central Bank governor, James Smith, who is now a key Ministry of Finance adviser. The banking industry, which had expected the legislation to be radically revised, is also likely to have been disappointed.

 

“I don’t think there’s a material change in it,” one banker told Tribune Business. “What they are doing is allowing the courts to intervene in a transaction where the lender has assessed the risk and levied an appropriate rate of return.

 

“When there’s a borrower default, that’s already been priced into the rate, and you have some expectation as to what happens when there’s a default.

 

“But the Bill will allow the courts to determine what happens, which means the underlying risk fundamentally changes. Why would any lender enter into an open-ended contractual arrangement where the court can intervene and fundamentally change the risk in the middle of the contract?

 

“All these open-ended arrangements shoot the risk through the roof.”

 

The banking/lending industry’s concerns are focused on sections four-seven of the proposed Bill. Clause four allows the court to give a borrower relief “from consequences of the breach of a covenant or the non-payment of the principal or interest of the loan”, while number five gives borrowers time to “remedy” their delinquency when the lender is seeking to take possession of the property.

 

In particular, clause five allows the courts to prevent a lender taking possession of a delinquent property “for such period or periods as the court thinks reasonable”.

 

They can do this if they believe the borrower can pay sums due, or remedy, their default “within a reasonable period”. Both terms are short on specific, leaving everything to the court’s and judge’s discretion, and creating a nightmare of uncertainty for the banks.

 

Suggesting that the Bill’s drafters were likely unaware of the potential ‘unintended consequences’, one banker said: “What this is going to do is simply increase the risk of the lender.

 

“You are stuck with risk that you cannot manage, because in the event of default the courts can intervene, and you can’t charge a rate commensurate with the underlying risk.

 

“It’s all about risk and return. If you’re risk can’t be controlled and defined fully upfront, with all this uncertainty you will act appropriately.”

 

Essentially, with the risks associated with mortgage lending increased, and returns reduced, Bahamian bankers said there would be major ramifications for home lending in this nation.

 

Potential consequences, they added, included fewer persons qualifying for mortgage loans; higher downpayments and interest rates; and potential withdrawal from the mortgage market.

 

All were conditions for a ‘credit crunch, and the bankers said this would impact home ownership, the real estate market and overall prices, and the construction industry.

 

“Anything that increases a lender’s risk is going to be reflected in some other action, whether it’s an increased interest rate, smaller advances or withdrawal from the lending market,” one banker warned.

 

“Any combination of those things could apply, and it will not be good for the economy.”

 

The same banker also questioned whether the overstretched court system would be able to cope with potentially 4,000 delinquent mortgage borrowers.

 

Another banker added of the Bill: “There’s still a lot of gaps in it. It would not have the desired impact.” They suggested it would impact interest income, and solvency and capital ratios, creating problems in complying with international accounting standards.

 

Meanwhile, section six of the Bill proposes to allow courts to consider advance payments made by delinquent borrowers, while section seven permits them to give borrowers a period “of no less than 12 months” to make good their arrears under certain circumstances.

 

Other clauses exempt banks/lenders from paying Stamp Duty if they sell a foreclosed property within five years of granting the loan; give borrowers the right to choose their attorneys, appraisers and property insurers; allow borrowers to remortgage with another institution at no cost; and aim to prevent “excessive salary deductions”.

 

September 14, 2012

 

Tribune242

 

Caribbean Blog International

 

Constitutional reform, pt. 4: ... ...I now offer some recommendations for consideration in the reform of Chapter 2 of the Bahamian Constitution

Constitutional reform, pt. 4

By Alfred Sears

In part 3, I described the instances of unequal and discriminatory treatment of Bahamian women citizens who are married to non-Bahamian spouses and their children born outside of The Bahamas; and the condition of statelessness which results when children born in The Bahamas, neither of whose parents are citizens of The Bahamas, are not regularized in a timely fashion.  I now offer some recommendations for consideration in the reform of Chapter 2 of the Bahamian Constitution.

 

Recommendations

The citizenship provisions of the Constitution should balance the principles of (1) careful control of national membership in the Bahamian nation; (2) a recognition of the human rights claim of those who have a genuine link to The Bahamas; and (3) the competition within the global marketplace amongst countries to attract and maintain the human resources of the world.  The most critical resource in The Bahamas, I contend, is the people.  The talent, creative imagination and intellectual production of the Bahamian people and residents are the critical factors that will determine whether The Bahamas realizes its full potential.

Therefore, we should be inclusive in our citizenship policies, giving all persons who have a genuine link to The Bahamas the security of a legal status to inspire in them a sense of loyalty to The Bahamas and a desire to make their best contribution to the development of The Bahamas.  In this context, I therefore recommend that the citizenship provisions of our Constitution be amended in the following respects:

1. That all gender discrimination be removed from the citizenship provisions, especially with respect to the non-national spouses of Bahamian women and their children born outside of The Bahamas.  Bahamian men and women should be treated equally in all respectS under the citizenship provisions of the constitution.  The norm of nondiscrimination should be the guiding principle as we reconstruct the constitution.

2. The protection of the status of children and the avoidance of statelessness amongst children in The Bahamas should inform the citizenship provisions of the constitution dealing with children.  Therefore, children born in The Bahamas should be deemed citizens at birth where at least one parent is a citizen of The Bahamas, a permanent resident, an immigrant on work permit or is registered under the Immigration Act 1967.  Further, a child under five years found in The Bahamas, whose parents are not known, should be presumed to be a citizen of The Bahamas by birth.  Like the 14th Amendment of the United States Constitution and Article 5 of the Constitution of Jamaica, which grant citizenship to all persons born in the United States and Jamaica, we should retain and strengthen Article 7 of the Bahamian Constitution so that children born in The Bahamas, neither of whose parents are citizens, are given citizenship at birth.  We should not punish children for the illegal conduct of their parents.

3. Also children born overseas to a citizen of The Bahamas serving in a diplomatic or consular capacity should be recognized as citizens by birth.

4. The constitution should be revised to recognize dual and multiple citizenship.  Increasingly more Bahamian nationals are residing outside of The Bahamas, particularly in the United States.  These Bahamians have benefited from obtaining the citizenship of other countries.  Some may argue that dual and multiple nationalities may affect the security of The Bahamas, such as facilitating the fraudulent use of passports, the commission of major crimes, the provision of safe harbor for fugitives and the smuggling of would-be immigrants.  While these concerns must be carefully considered, I believe that the Bahamians across the diaspora have always shown an unswerving patriotism towards The Bahamas.

Bahamians have always sought self-improvement and increased opportunities in other countries without losing their loyalty to The Bahamas and their sense of national pride.  This was reflected in the “Project” during the 1940s and 1950s when thousands of Bahamian men and women worked as migrant workers in the United States.  Today thousands of Bahamians reside outside The Bahamas in pursuit of higher education and professional opportunities.  In fact, the Bahamian diaspora should be perceived and used as a critical source of influence, investment and remittances in the international community to advance the Bahamian strategic development, security and global brand.

Dual and multiple nationalities would not, in my opinion, undermine the loyalty Bahamians have to The Bahamas.  Further, several Commonwealth Caribbean countries as well as the United States provide for multiple and dual citizenship.  Moreover, The Bahamas tacitly recognizes dual citizenship of its citizens, as is evidenced by Article 8 where a person born outside of The Bahamas to a Bahamian father becomes a Bahamian citizen at birth and in the note contained in the Bahamian passport, which states that: “Citizens of The Bahamas who are also nationals of another country cannot avail themselves of the protection of the representatives of The Bahamas against the authorities of that country, and are not exempt, by reason of possessing Bahamian citizenship, from any obligation (such as military service) to which they may be liable under the law of that country.”

5. Section 16 of the Bahamas Nationality Act says the minister “shall not be required to assign any reason for the grant or refusal of any application or the making of any order under this act the decision upon which is at his discretion; and the decision of the minister on any such application or order shall not be subject to appeal or review in any court”.  This ouster clause does not mean that the minister should not act in accordance with the rules of natural justice.  Given the fundamental importance of decisions relating to nationality, the discretion of the minister responsible for nationality and citizenship relating the determination of applications for registration or naturalization should be subject to judicial review and no person should be deprived of her/his citizenship without due process of law.

5. Finally, Chapter 2 of the constitution dealing with citizenship should be expressed in more readily understandable form and the language and structure should be simplified.

 

• Alfred Sears is an attorney, a former member of Parliament and a former attorney general of The Bahamas.

Sep 13, 2012

thenassauguardian