Decision to approve Chinese work permits troubling
BY LYNDEN NAIRN
At the risk of prejudicing my views on this matter, let me remind your readers that “a bird in the hand is better than two in the bush”.
The Parliament’s decision to unanimously approve Baha Mar’s request for 8,100 work permits is troubling because it appears that all of the relevant factors were not considered or even known.
At the outset, I want to make it clear that Baha Mar has the right to invest whatever amount it wishes, wherever it wishes and whenever it wishes within the confines of our laws.
I also believe that consistent with the tenets of our capitalistic economy, Baha Mar has the right to make good and bad business decisions. It is not right, for instance, to deny approval of a Bahamian project on the basis that it would create a glut of room inventories in the marketplace, even though one would expect investors and their financiers to have regard for that possibility.
The labor issue is a significant problem not only because it robs Bahamians of maximizing their benefits from the project, and not only because on its face it puts Atlantis at a disadvantage, but because it represents a business deal that apparently could not be financed if the financier were not afforded certain privileges.
During Atlantis’ multiple phases, the government thought that it was in the best interest of the Bahamian people to require Atlantis’ labor component to be at a certain level. Undoubtedly, that imposition caused Atlantis to engage labor at a higher cost than it would if that condition did not exist.
A few years later, in order to ensure that financing is secured for a project, the government has decided to allow Baha Mar to engage almost three times the number of foreign workers as Atlantis. That circumstance means that Baha Mar is able to construct its facility at a lower cost than Atlantis.
That places Atlantis at a significant competitive disadvantage since the cost of construction drives capital requirements, financing costs, room rates and ultimately profitability. Whatever one’s opinion with respect to Atlantis and Baha Mar, one has to at the very least appreciate that this is a legitimate concern for Atlantis.
Indeed, it really ought to concern all of us since this state of affairs creates uncertainty in the minds of current local and international investors as to whether the government might change the playing field and render their business models not feasible.
This is a very dangerous matter and should not be brushed over in our effort to cause Baha Mar to happen. Atlantis’ investment is already in the ground — it is what it is. A decision by the government should not be the event that renders it less competitive — not in a capitalistic environment.
Some persons have criticized the agreement between Atlantis and the government. However, it needs to be remembered that businesspersons must seek to guard against the kind of risk that Atlantis faces today. Perhaps one is saying that such a deal is not in the country’s interest. The fact is though that no reasonable government should be afraid to execute such a deal since no reasonable government would wish to jeopardize a major investment project.
That said, I believe that the government has a moral responsibility to not grant a better deal to Baha Mar. Foreign and local investors must be able to trust that the government will ensure that the playing field is level at the time of their investment and after as well.
No investor, local or foreign, would wish to invest in an environment of uncertainty. This situation could jeopardize future investments in The Bahamas.
Indeed, Sir Sol Kerzner has already said that Atlantis phase four is unlikely. Already, therefore, the cost of granting Baha Mar 8,100 permits to construct a $2.6 billion hotel is $1 billion in future investments. The question is how many other projects will be deterred?
Moreover, if Atlantis’ phase four project were to reflect the Bahamian labor component that was imposed on it several years ago, they are likely to have engaged 3,500 Bahamians, the same number that Baha Mar will hire.
I also found it rather revealing that the labor cost allocated to the 3,500 Bahamians that Baha Mar intends to engage is $200 million over four years. That equates to $275 per week inclusive of national insurance and other benefits.
What is equally striking is that having increased the Bahamian component by $200 million, the Chinese labor component remains unchanged. Assuming that information is complete, and frankly there is no reason to believe that the Prime Minister was complete, then it simply means that Bahamians will be given contracts to procure materials. Assuming such materials are required to be sourced in China, then this amendment constitutes nothing.
What is more, if it is true that as the Prime Minister suggests, the additional $200 million is intended to move Baha Mar’s cost closer to Atlantis’, then what is the incremental cost of the Baha Mar development?
Now let’s say that Baha Mar makes the argument that its total development cost was not lowered as a result of the favorable labor allocation. That is quite possibly true, but does that make the government’s situation any better? Perhaps not.
Here is why: It is indisputable that the Chinese government’s decision to provide the financing is based on the excessive work permits and the sale of materials for that project. Therefore, the inducement takes place broadly at the level of financing, not at the level of project development cost.
That makes Atlantis’ argument even more compelling since in that instance the issue is not merely the competitive disadvantage that is driven by development cost, but the entire project. In other words, if in the absence the incremental incentives the Chinese would refuse to finance the project, the government has unwittingly given Baha Mar a financing advantage. Atlantis can therefore argue that the entire project represents an abandonment of the agreement, not just the additional labor and land cost that they incurred. Even commercial banks can argue that this deal places a competitive bar on them that they cannot reach.
I do not seek to carry water for Atlantis, much less commercial banks. I simply believe that it is essential for us to consider the consequences of the decisions we make.
The fact is that this arrangement has far reaching consequences. I only wish that the Christie administration and the Ingraham administration had not messed up Baha Mar’s original plans so badly. They owe Izmirlian, Atlantis and the Bahamian people an apology and even their resignations.
I now wish to consider a related but slightly different matter. Bahamians will recall that during the various construction phases of Atlantis, many persons argued that it was inappropriate to grant Atlantis all the incentives that were given. Undoubtedly, there were smaller investors, Bahamians and others, who felt that their business models were being threatened by the Atlantis subsidies or perhaps they felt that they should have received similar incentives, for whatever reason.
I believe a strong argument can be made by those who were aggrieved. That points to the fact that we need to have clearly defined concessions/incentives in order to create a level playing field and remove uncertainty and arbitrariness from the process. The latter leaves too much room for abuse and under the table dealings. Furthermore, deals should not be made in secret and persons who benefit in any way as lawyers, developers, etc., should not vote in our Parliament on these specific matters.
• Lynden Nairn is a Chartered Accountant, and president of Colina General Insurance.
11/24/2010
thenassauguardian
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.
Showing posts with label Baha Mar foreign workers. Show all posts
Showing posts with label Baha Mar foreign workers. Show all posts
Thursday, November 25, 2010
Friday, October 8, 2010
Prime Minister Hubert Ingraham: It's not in our interest to have a Baha Mar - four years single-phased development
PM: BAHA MAR DEAL MUST CHANGE
By CANDIA DAMES
Guardian News Editor
candia@nasguard.com
The government is unwilling to back down from its position that the plans for the $2.6 billion Baha Mar project at Cable Beach be adjusted in major ways, Prime Minister Hubert Ingraham said yesterday.
His strongest public comments to date on the controversial project came during a sitdown interview at the House of Assembly late yesterday afternoon.
Speaking of the financing being provided by the China Export-Import Bank, Ingraham said,"Attached to their funding are conditions that are onerous, burdensome and unacceptable insofar as the labor content is concerned and the government is therefore asking that some adjustment be made with respect to the labor content of the deal.
"...There are two things that stick in our claw and we want to be able to digest the project and it is difficult to digest it with these things sticking across here."
Apart from the labor issue, Ingraham referred to Baha Mar's plan to build the massive project at Cable Beach in one phase with a planned 2014 completion.
He said those are "major issues, like a big bone". The prime minister added,"It has to be fixed."
"To do the project in a one, single-phased development is not in our interest, and it's in our interest to have the development but not as a single-phased development. Regrettably, that is the position,"he said.
The prime minister was repetitive in many respects as he sought to stress the government's position on this matter.
"What is going to happen to the hundreds of people who are working in those towers that are going to be demolished(at the Wyndham)while it's going to take four years for the project to be completed?" he questioned.
"They are going to be twiddling their thumbs while foreign workers are constructing the place."
Baha Mar has requested 8,150 work permits for the project.
Ingraham said yesterday,"There is more than enough land between the Nassau Beach(Hotel)and the land owned by Baha Mar east of the Nassau Beach for them to construct their 1,000 room hotel, their casino and whatever else they want to construct and open it.
"And nothing prevents them from building the others at the same time. There's no need whatsoever for all to be built and opened at the same time. That is not in our interest. That may well be in the interest of the financiers, the construction company and the owners of the project, but what about our interest? It is not in our interest."
Ingraham said that given persistent criticisms in the media he has faced over the government's handling of the Baha Mar deal he thought it was important for him to "put his anchor down".
"And it is now down," he said.
The prime minister also said there are a number of conditions that Baha Mar must meet, noting that even if the government said yes to the project, it would not necessarily mean it would start tomorrow.
"I have told the Chinese State Construction Company on two occasions, the most recent of which was when we signed the loan for the Airport Gateway(last week), that it is next to impossible for The Bahamas to approve 8,000 or so Chinese workers constructing a resort in The Bahamas with no Bahamian workers on the site at the same time and no transfer of skills to Bahamians at the same time.
"And I've asked them to go back and review their proposition so that the Government of The Bahamas can take a decision, but it is not possible for a resort to be built in The Bahamas with exclusive foreign labor. That's not possible."
He added,"They are in America. They are building lots of things in the United States of America. They're not using all Chinese labor on those projects. I don't expect all Chinese labor to be used on a project in The Bahamas, period.
"This is my country and this is yours."
Ingraham said,"I'm not now putting to them a percentum. We told Kerzner 70 percent of the workers had to be Bahamian. At the airport where the Canadian company is building the new US Departure Terminal, 75 percent or so percent of the workers are Bahamians.
"We understand the nature and complexity of this project. We understand the finances being provided by the Chinese Export-Import Bank. So we accept that the percentum of labor is going to be higher on such a project than it would be on other projects, but we cannot accept a 100 percent foreign labor content on the project, that's not possible."
Regarding the timing of the approval process, he said,"I don't want to be pressured by anybody."
Ingraham then emphasized that he was "sick and tired"of certain stories related to Baha Mar that were "being peddled every day, putting in people's heads things that are not true."
"This was a deal structured by Baha Mar and the Chinese. That's fine. They have come to us. We're not rubber stamps. We have to have our input, our say, before we make a determination. I think the Bahamian people expect no less of me and the Government of The Bahamas,"he said.
"I spoke, I believe very clearly in the House the other day when I said that firstly we would not consider the resolution on the agenda of the House until we get written confirmation that Baha Mar has settled its loan with Scotia[bank], and that two, we would not deal with the matter of the resolution in the House before I go away(to China)on October 22.
"Nothing has transpired to change those two."
He added"I tried to deal with this before. I scheduled my time to deal with it on two occasions. I don't now want to be pressured by anybody as to when I would do so. When I was ready others were not. In due time I will and it will be announced. So there will be no surprise as to when it is going to be dealt with.
"...We have been more than willing to facilitate and accommodate Baha Mar. It is not our fault that it took all this time for them to come to terms about the loan. It is not our fault. We had two separate meetings of the House of Assembly scheduled for that purpose. They were not in a position to do so."
Asked whether he thought the decision by the Chinese partners to invest in Baha Mar was a vote of confidence in The Bahamas, Ingraham said,"If the Chinese didn't have confidence in The Bahamas they wouldn't even talk to Baha Mar. I wouldn't talk about invest, so the investment's in The Bahamas.
"And we are deeply appreciative for the Chinese willingness to invest that kind of money in The Bahamas. We are deeply appreciative and would wish for the project to go ahead.
"We know what the Chinese interest is in terms of what benefits they get out of the deal...There must be some interest on the part of The Bahamas and The Bahamas'interest is to maximize the benefits which may be derived for The Bahamas from this investment and to ensure that when the project is complete, that the project advances us, enhances our tourism and does not drag us down."
10/6/2010
thenassauguardian
By CANDIA DAMES
Guardian News Editor
candia@nasguard.com
The government is unwilling to back down from its position that the plans for the $2.6 billion Baha Mar project at Cable Beach be adjusted in major ways, Prime Minister Hubert Ingraham said yesterday.
His strongest public comments to date on the controversial project came during a sitdown interview at the House of Assembly late yesterday afternoon.
Speaking of the financing being provided by the China Export-Import Bank, Ingraham said,"Attached to their funding are conditions that are onerous, burdensome and unacceptable insofar as the labor content is concerned and the government is therefore asking that some adjustment be made with respect to the labor content of the deal.
"...There are two things that stick in our claw and we want to be able to digest the project and it is difficult to digest it with these things sticking across here."
Apart from the labor issue, Ingraham referred to Baha Mar's plan to build the massive project at Cable Beach in one phase with a planned 2014 completion.
He said those are "major issues, like a big bone". The prime minister added,"It has to be fixed."
"To do the project in a one, single-phased development is not in our interest, and it's in our interest to have the development but not as a single-phased development. Regrettably, that is the position,"he said.
The prime minister was repetitive in many respects as he sought to stress the government's position on this matter.
"What is going to happen to the hundreds of people who are working in those towers that are going to be demolished(at the Wyndham)while it's going to take four years for the project to be completed?" he questioned.
"They are going to be twiddling their thumbs while foreign workers are constructing the place."
Baha Mar has requested 8,150 work permits for the project.
Ingraham said yesterday,"There is more than enough land between the Nassau Beach(Hotel)and the land owned by Baha Mar east of the Nassau Beach for them to construct their 1,000 room hotel, their casino and whatever else they want to construct and open it.
"And nothing prevents them from building the others at the same time. There's no need whatsoever for all to be built and opened at the same time. That is not in our interest. That may well be in the interest of the financiers, the construction company and the owners of the project, but what about our interest? It is not in our interest."
Ingraham said that given persistent criticisms in the media he has faced over the government's handling of the Baha Mar deal he thought it was important for him to "put his anchor down".
"And it is now down," he said.
The prime minister also said there are a number of conditions that Baha Mar must meet, noting that even if the government said yes to the project, it would not necessarily mean it would start tomorrow.
"I have told the Chinese State Construction Company on two occasions, the most recent of which was when we signed the loan for the Airport Gateway(last week), that it is next to impossible for The Bahamas to approve 8,000 or so Chinese workers constructing a resort in The Bahamas with no Bahamian workers on the site at the same time and no transfer of skills to Bahamians at the same time.
"And I've asked them to go back and review their proposition so that the Government of The Bahamas can take a decision, but it is not possible for a resort to be built in The Bahamas with exclusive foreign labor. That's not possible."
He added,"They are in America. They are building lots of things in the United States of America. They're not using all Chinese labor on those projects. I don't expect all Chinese labor to be used on a project in The Bahamas, period.
"This is my country and this is yours."
Ingraham said,"I'm not now putting to them a percentum. We told Kerzner 70 percent of the workers had to be Bahamian. At the airport where the Canadian company is building the new US Departure Terminal, 75 percent or so percent of the workers are Bahamians.
"We understand the nature and complexity of this project. We understand the finances being provided by the Chinese Export-Import Bank. So we accept that the percentum of labor is going to be higher on such a project than it would be on other projects, but we cannot accept a 100 percent foreign labor content on the project, that's not possible."
Regarding the timing of the approval process, he said,"I don't want to be pressured by anybody."
Ingraham then emphasized that he was "sick and tired"of certain stories related to Baha Mar that were "being peddled every day, putting in people's heads things that are not true."
"This was a deal structured by Baha Mar and the Chinese. That's fine. They have come to us. We're not rubber stamps. We have to have our input, our say, before we make a determination. I think the Bahamian people expect no less of me and the Government of The Bahamas,"he said.
"I spoke, I believe very clearly in the House the other day when I said that firstly we would not consider the resolution on the agenda of the House until we get written confirmation that Baha Mar has settled its loan with Scotia[bank], and that two, we would not deal with the matter of the resolution in the House before I go away(to China)on October 22.
"Nothing has transpired to change those two."
He added"I tried to deal with this before. I scheduled my time to deal with it on two occasions. I don't now want to be pressured by anybody as to when I would do so. When I was ready others were not. In due time I will and it will be announced. So there will be no surprise as to when it is going to be dealt with.
"...We have been more than willing to facilitate and accommodate Baha Mar. It is not our fault that it took all this time for them to come to terms about the loan. It is not our fault. We had two separate meetings of the House of Assembly scheduled for that purpose. They were not in a position to do so."
Asked whether he thought the decision by the Chinese partners to invest in Baha Mar was a vote of confidence in The Bahamas, Ingraham said,"If the Chinese didn't have confidence in The Bahamas they wouldn't even talk to Baha Mar. I wouldn't talk about invest, so the investment's in The Bahamas.
"And we are deeply appreciative for the Chinese willingness to invest that kind of money in The Bahamas. We are deeply appreciative and would wish for the project to go ahead.
"We know what the Chinese interest is in terms of what benefits they get out of the deal...There must be some interest on the part of The Bahamas and The Bahamas'interest is to maximize the benefits which may be derived for The Bahamas from this investment and to ensure that when the project is complete, that the project advances us, enhances our tourism and does not drag us down."
10/6/2010
thenassauguardian
Wednesday, September 29, 2010
Foreign Workers on Bahamian Construction Sites
Foreigners on Bahamian construction sites
tribune242 editorial
THE DEBATE on the number of Chinese to be employed on the construction of the Baha Mar Cable Beach project -- six hotels, about a 100,000-square foot casino, a 200,000 square-foot convention centre, 20-acre beach and pool, 18-hole golf course and a 60,000-square foot retail village with additional residential products -- is going to be interesting, if and when it takes place on the floor of the House.
The number of foreign workers required by the Chinese as part of the deal is unusually large. But it is well known that the Chinese do not approve foreign loans unless their workforce is employed as a major part of the loan project. In the case of Baha Mar -- valued at about $2.5 billion - $1.918,965,693 billion has been negotiated with the China Construction Company as primary contractors. With that financial outlay it is amazing that government was able to negotiate any Bahamian presence. As Mr Ingraham said in presenting his resolution for this project to the House "the foreign labour component intended during the construction for the resort exceeds levels ever experienced in the Bahamas and is beyond anything ever contemplated by my government."
Under the UBP, construction up to a certain value was reserved for Bahamian contractors. Over that value it was agreed that Bahamians did not yet have the expertise or equipment to handle very large jobs and so those were left to foreign contractors, such as McAlpine, Balfour Beatty and others. In the 1950s, said Mr Ingraham, the government permitted 25 per cent of the labour force in construction and/or the operation of tourism development to be foreign.
During the Pindling era, however, the foreign labour component increased and newspaper articles recorded protests, either by foreign workers complaining of working conditions, or Bahamians questioning their presence in the Bahamas. For example, in 1988, 600 angry Indians went on hunger strike on the construction site of the Crystal Palace Hotel, Cable Beach. They accused the foreign contractor, Balfour Beatty, of treating them as slaves. Earlier - in 1981 - the Construction and Civil Engineering Union picketed the construction site of government's $66.5 million Cable Beach Hotel. "They import Filipinos to shovel sand. You tell me no Bahamans can do that?" complained a Bahamian worker. There were 40 Filipinos on that job site.
But the 1990 demonstration to protest the employment of common labourers -- truck drivers for example -- from Brazil on government's $55 million Nassau International Airport expansion was particularly interesting. The ratio of foreigners to Bahamians was 70 per cent on that construction site with government having to pay a large penalty if the number of Bahamians went over the agreed 139 or 30 per cent of the total work force. This prompted the carrying of placards that read: "It's Better in the Bahamas for Brazilians!"
At one point during the contract there were more than 340 Brazilians at the construction site, bringing the Brazilian count to 71 per cent compared to the 139 Bahamians that the company had agreed to use during this period.
The Pindling government had agreed that for every five Bahamians hired by the Brazilian company over the agreed 139 Bahamian workers, the government would have to pay $88,000 or $17,000 for each worker.
In the House on April 30, 1990, then Opposition Leader Hubert Ingraham revealed that the Pindling government had also agreed to pay all of the Brazilian company's Customs and stamp duties, work permit fees for their workers, and building fees on mechanical and electrical permits. In addition government was to pay all public utility fees -- connections and the like -- except for the actual electrical consumption.
The FNM found it preposterous that government would be penalised if more than 139 Bahamians were hired at the airport. "It is incredible that the Government has agreed to pay extra monies for Bahamians to work in their own country," said the FNM.
When the Ingraham government came to power its policy on foreign labour was established on the resort properties of Kerzner International -- the ratio of Bahamians to non-Bahamians on that site was not to exceed 30 per cent foreign to 70 per cent Bahamian.
And now here were the Chinese financially backing the transformation of Cable Beach into a mega tourist resort and asking for 8,150 of their countrymen to be engaged on the "core project". The projection is that some 1,200 Bahamians will be engaged in construction of the non-core projects.
Because of the unusual request for foreign labour -- 71 per cent foreign to 29 per cent Bahamian -- Prime Minister Ingraham has brought the matter to the House to give the Opposition an opportunity to express the opinions of their constituents on the matter. Both sides have to determine - in the words of Mr Ingraham - "whether this invaluable benefit of skills transfer and improved exposure to new technologies can or will occur in a project where contact between Bahamians and foreign experts is likely to be limited." Bahamians also have to decide whether in these lean years this project, with its foreign labour, is what they believe will jump start their economy.
September 28, 2010
tribune242 editorial
tribune242 editorial
THE DEBATE on the number of Chinese to be employed on the construction of the Baha Mar Cable Beach project -- six hotels, about a 100,000-square foot casino, a 200,000 square-foot convention centre, 20-acre beach and pool, 18-hole golf course and a 60,000-square foot retail village with additional residential products -- is going to be interesting, if and when it takes place on the floor of the House.
The number of foreign workers required by the Chinese as part of the deal is unusually large. But it is well known that the Chinese do not approve foreign loans unless their workforce is employed as a major part of the loan project. In the case of Baha Mar -- valued at about $2.5 billion - $1.918,965,693 billion has been negotiated with the China Construction Company as primary contractors. With that financial outlay it is amazing that government was able to negotiate any Bahamian presence. As Mr Ingraham said in presenting his resolution for this project to the House "the foreign labour component intended during the construction for the resort exceeds levels ever experienced in the Bahamas and is beyond anything ever contemplated by my government."
Under the UBP, construction up to a certain value was reserved for Bahamian contractors. Over that value it was agreed that Bahamians did not yet have the expertise or equipment to handle very large jobs and so those were left to foreign contractors, such as McAlpine, Balfour Beatty and others. In the 1950s, said Mr Ingraham, the government permitted 25 per cent of the labour force in construction and/or the operation of tourism development to be foreign.
During the Pindling era, however, the foreign labour component increased and newspaper articles recorded protests, either by foreign workers complaining of working conditions, or Bahamians questioning their presence in the Bahamas. For example, in 1988, 600 angry Indians went on hunger strike on the construction site of the Crystal Palace Hotel, Cable Beach. They accused the foreign contractor, Balfour Beatty, of treating them as slaves. Earlier - in 1981 - the Construction and Civil Engineering Union picketed the construction site of government's $66.5 million Cable Beach Hotel. "They import Filipinos to shovel sand. You tell me no Bahamans can do that?" complained a Bahamian worker. There were 40 Filipinos on that job site.
But the 1990 demonstration to protest the employment of common labourers -- truck drivers for example -- from Brazil on government's $55 million Nassau International Airport expansion was particularly interesting. The ratio of foreigners to Bahamians was 70 per cent on that construction site with government having to pay a large penalty if the number of Bahamians went over the agreed 139 or 30 per cent of the total work force. This prompted the carrying of placards that read: "It's Better in the Bahamas for Brazilians!"
At one point during the contract there were more than 340 Brazilians at the construction site, bringing the Brazilian count to 71 per cent compared to the 139 Bahamians that the company had agreed to use during this period.
The Pindling government had agreed that for every five Bahamians hired by the Brazilian company over the agreed 139 Bahamian workers, the government would have to pay $88,000 or $17,000 for each worker.
In the House on April 30, 1990, then Opposition Leader Hubert Ingraham revealed that the Pindling government had also agreed to pay all of the Brazilian company's Customs and stamp duties, work permit fees for their workers, and building fees on mechanical and electrical permits. In addition government was to pay all public utility fees -- connections and the like -- except for the actual electrical consumption.
The FNM found it preposterous that government would be penalised if more than 139 Bahamians were hired at the airport. "It is incredible that the Government has agreed to pay extra monies for Bahamians to work in their own country," said the FNM.
When the Ingraham government came to power its policy on foreign labour was established on the resort properties of Kerzner International -- the ratio of Bahamians to non-Bahamians on that site was not to exceed 30 per cent foreign to 70 per cent Bahamian.
And now here were the Chinese financially backing the transformation of Cable Beach into a mega tourist resort and asking for 8,150 of their countrymen to be engaged on the "core project". The projection is that some 1,200 Bahamians will be engaged in construction of the non-core projects.
Because of the unusual request for foreign labour -- 71 per cent foreign to 29 per cent Bahamian -- Prime Minister Ingraham has brought the matter to the House to give the Opposition an opportunity to express the opinions of their constituents on the matter. Both sides have to determine - in the words of Mr Ingraham - "whether this invaluable benefit of skills transfer and improved exposure to new technologies can or will occur in a project where contact between Bahamians and foreign experts is likely to be limited." Bahamians also have to decide whether in these lean years this project, with its foreign labour, is what they believe will jump start their economy.
September 28, 2010
tribune242 editorial
Saturday, September 11, 2010
Baha Mar resolution before Parliament calls for more than 8,000 work permits for foreign workers
BAHA MAR WANTS WORK PERMITS FOR 8,150 NON-BAHAMIANS
By KRYSTEL ROLLE
Guardian Staff Reporter
krystel@nasguard.com:
Prime Minister Hubert Ingraham yesterday tabled a resolution in Parliament for the multi-billion dollar Baha Mar project, laying out some of the details of the proposed deal which would require the government to transfer more than 260 acres of land to the developers before any work even begins, and grant more than 8,000 work permits to foreigners.
"The resolution results from the fact that the foreign labor component intended during the construction of the resort exceeds levels ever experienced in The Bahamas and is beyond anything ever contemplated by my government,"Ingraham said.
Ingraham indicated that debate of the resolution would not begin until Baha Mar resolves the outstanding loan matter that it has with Scotiabank.
Baha Mar CEO Sarkis Izmirlian will travel to Toronto, Canada, next week to meet with bank officials on the issue.
The progress on the Baha Mar deal is being held up by the payment of an outstanding loan the company has with Scotiabank, reportedly worth around $160 million. The Cable Beach properties are being held as security.
While debate on the resolution is not expected to begin until near the end of September, the prime minister yesterday laid out some of the aspects of the deal to ensure that the Bahamian people are fully informed on the requirements, consequences and benefits that are projected to result for The Bahamas if the development proceeds as currently proposed.
The total value of the project is estimated at $2.6 billion. Ingraham revealed yesterday that a contract for the amount of $1,918,965,693 has been negotiated with the China State Construction Company as primary contractors for the project.
Ingraham said the terms of the funding obtained by the developers of the resort"include a requirement that the overwhelming majority, if not virtually all of the workers to be engaged on the core project, over the life of the project, be foreign workers--some 8,150 persons."
Baha Mar officials have stated that at no time will more than 5,000 foreigners be working on the site.
"It is projected that some 1,200 Bahamians will be engaged in the construction of the non-core project that is, the new West Bay Street, the new Commercial Village and the initial site preparation for the core project,"Ingraham added.
Using the construction phase of the Atlantis Resort as a comparison, Ingraham noted that before that was constructed his government established that the ratio of Bahamians to non-Bahamians on the site would not exceed 30 percent foreign to 70 percent Bahamian.
Ingraham said that was done despite the need at that time for large numbers of expatriate experts and labor for the efficient completion of the project.
He added that the established ratio was obtained during two phases of construction of the Kerzner International resorts under FNM administrations and was continued during the PLP government during the third phase expansion of the project.
Ingraham said based on Baha Mar's numbers, it is proposed that 71 percent of the workforce be foreign and 29 percent Bahamian.
"This represents a complete reversal of conditions imposed upon Kerzner, for example,"he said.
"What must be determined is whether this invaluable benefit of skills transfer and improved exposure to new technologies can or will occur in a project where contact between Bahamians and foreign experts is likely to be limited."
As previously reported, the Baha Mar project is to comprise six hotels with approximately 3,500 rooms and condominiums, an approximately 100,000 square foot casino, 200,000 square feet of convention facilities, a 20-acre beach and pool experience, an 18-hole golf course and a 60,000 square-foot retail village and additional residential products.
To achieve this, Ingraham explained that a large amount of government and crown land must be transferred to the developers.
The Radisson, now the Sheraton, was transferred to Baha Mar in 2005. The Wyndham Crystal Palace and the Nassau Beach Hotel are currently on leased crown land, the prime minister noted.
But Ingraham said the approval for the Baha Mar project requires the transfer of the land occupied by both hotel properties, the Hobby Horse Hall parcel, Fidelity Bank, Cecil Wallace-Whitfield Centre(which houses the Ministry of Finance and the Office of the Prime Minister), the Cable Beach Police Station and the old West Bay Street, new corridor number seven, 50 acres of Gladstone Road, the Prospect Ridge parcel, Water and Sewerage Corporation parcel, BEC Parcel, BECâ substation, plus an additional parcel of .783 acre for a total of 264.965 acres.
Ingraham said because of the conditions set by Baha Mar's financiers China Import Export Bank and the China State Construction Company these lands are required to be transferred in advance of the start of construction of the project.
"It is the position of my government that these lands will only be transferred for the expressed purpose of facilitating the development and that should the development not proceed the land must return to the government,"he said.
Baha Mar has said 8,00 permanent jobs are also projected once the resort is completed.
If the project receives Bahamas government approval, Baha Mar's first course of action would be to award nearly$60 million of construction contracts to six Bahamian contractors, representing early infrastructure works needed to prepare the site.
It is expected that all outstanding matters relating to the Scotiabank loan will be resolved within the next two-week period.
Debate is expected to start on September 23 or 24.
9/9/2010
thenassauguardian
By KRYSTEL ROLLE
Guardian Staff Reporter
krystel@nasguard.com:
Prime Minister Hubert Ingraham yesterday tabled a resolution in Parliament for the multi-billion dollar Baha Mar project, laying out some of the details of the proposed deal which would require the government to transfer more than 260 acres of land to the developers before any work even begins, and grant more than 8,000 work permits to foreigners.
"The resolution results from the fact that the foreign labor component intended during the construction of the resort exceeds levels ever experienced in The Bahamas and is beyond anything ever contemplated by my government,"Ingraham said.
Ingraham indicated that debate of the resolution would not begin until Baha Mar resolves the outstanding loan matter that it has with Scotiabank.
Baha Mar CEO Sarkis Izmirlian will travel to Toronto, Canada, next week to meet with bank officials on the issue.
The progress on the Baha Mar deal is being held up by the payment of an outstanding loan the company has with Scotiabank, reportedly worth around $160 million. The Cable Beach properties are being held as security.
While debate on the resolution is not expected to begin until near the end of September, the prime minister yesterday laid out some of the aspects of the deal to ensure that the Bahamian people are fully informed on the requirements, consequences and benefits that are projected to result for The Bahamas if the development proceeds as currently proposed.
The total value of the project is estimated at $2.6 billion. Ingraham revealed yesterday that a contract for the amount of $1,918,965,693 has been negotiated with the China State Construction Company as primary contractors for the project.
Ingraham said the terms of the funding obtained by the developers of the resort"include a requirement that the overwhelming majority, if not virtually all of the workers to be engaged on the core project, over the life of the project, be foreign workers--some 8,150 persons."
Baha Mar officials have stated that at no time will more than 5,000 foreigners be working on the site.
"It is projected that some 1,200 Bahamians will be engaged in the construction of the non-core project that is, the new West Bay Street, the new Commercial Village and the initial site preparation for the core project,"Ingraham added.
Using the construction phase of the Atlantis Resort as a comparison, Ingraham noted that before that was constructed his government established that the ratio of Bahamians to non-Bahamians on the site would not exceed 30 percent foreign to 70 percent Bahamian.
Ingraham said that was done despite the need at that time for large numbers of expatriate experts and labor for the efficient completion of the project.
He added that the established ratio was obtained during two phases of construction of the Kerzner International resorts under FNM administrations and was continued during the PLP government during the third phase expansion of the project.
Ingraham said based on Baha Mar's numbers, it is proposed that 71 percent of the workforce be foreign and 29 percent Bahamian.
"This represents a complete reversal of conditions imposed upon Kerzner, for example,"he said.
"What must be determined is whether this invaluable benefit of skills transfer and improved exposure to new technologies can or will occur in a project where contact between Bahamians and foreign experts is likely to be limited."
As previously reported, the Baha Mar project is to comprise six hotels with approximately 3,500 rooms and condominiums, an approximately 100,000 square foot casino, 200,000 square feet of convention facilities, a 20-acre beach and pool experience, an 18-hole golf course and a 60,000 square-foot retail village and additional residential products.
To achieve this, Ingraham explained that a large amount of government and crown land must be transferred to the developers.
The Radisson, now the Sheraton, was transferred to Baha Mar in 2005. The Wyndham Crystal Palace and the Nassau Beach Hotel are currently on leased crown land, the prime minister noted.
But Ingraham said the approval for the Baha Mar project requires the transfer of the land occupied by both hotel properties, the Hobby Horse Hall parcel, Fidelity Bank, Cecil Wallace-Whitfield Centre(which houses the Ministry of Finance and the Office of the Prime Minister), the Cable Beach Police Station and the old West Bay Street, new corridor number seven, 50 acres of Gladstone Road, the Prospect Ridge parcel, Water and Sewerage Corporation parcel, BEC Parcel, BECâ substation, plus an additional parcel of .783 acre for a total of 264.965 acres.
Ingraham said because of the conditions set by Baha Mar's financiers China Import Export Bank and the China State Construction Company these lands are required to be transferred in advance of the start of construction of the project.
"It is the position of my government that these lands will only be transferred for the expressed purpose of facilitating the development and that should the development not proceed the land must return to the government,"he said.
Baha Mar has said 8,00 permanent jobs are also projected once the resort is completed.
If the project receives Bahamas government approval, Baha Mar's first course of action would be to award nearly$60 million of construction contracts to six Bahamian contractors, representing early infrastructure works needed to prepare the site.
It is expected that all outstanding matters relating to the Scotiabank loan will be resolved within the next two-week period.
Debate is expected to start on September 23 or 24.
9/9/2010
thenassauguardian
Friday, September 3, 2010
The National Congress of Trade Unions of The Bahamas (NCTUB) endorses the multi-billion dollar Baha Mar project
UNIONS ENDORSE BAHA MAR
By KRYSTEL ROLLE
Guardian Staff Reporter
krystel@nasguard.com:
Reversing its stance on the controversial Chinese labor issue surrounding the multi-billion dollar Baha Mar project, the National Congress of Trade Unions of The Bahamas(NCTUB)yesterday endorsed the project, saying the benefits outweigh any difficulties the union had.
Initially NCTUB threatened to hold massive demonstrations if the government approved Baha Mar's bid to bring in approximately 5,000 Chinese workers the mega resort says it needs during the project's construction phase.
However, during a news conference yesterday, NCTUB President John Pinder acknowledged that The Bahamas does not have the capacity nor the skill set to construct the project without the help of foreign aid.
"After further consultations with Baha Mar officials we got all of the concerns we had addressed and we're satisfied that this project is in the best interest of this country,"he said during the news conference which was held at the Bahamas Public Service Union headquarters on Wulff Road."We are further satisfied that we do not have the skill set to do this project all on our own."
Pinder said the issue with work permits can be a serious revenue generator for the government.
"It's proposed that Baha mar may ask for as much as 5,000 work permits, but at no time will there be 5,000 Chinese workers,"Pinder said."We are told that they will maximize the use of Bahamian workers qualified to work on this project and the semi-skilled persons. We have asked that these positions be made known to us so persons could apply for various positions."
"Work permits will cost Baha Mar an average of$5,000 per work permit... we believe this is a golden opportunity for the government to raise some revenue to be able to ensure that unions are able to get some sort of increase for our membership,"he continued.
The union also hopes that the government would consider using a percentage of the $5 million it stands to bring in from work permit fees to expand and redevelop the Bahamas Technical and Vocational Institute(BTVI).
Pinder said the key to the union's endorsement was the assurance by Baha Mar officials that Bahamian workers will receive first preference during and after the construction, and that Baha Mar will train Bahamians in some of the more modern techniques that are currently not widely used in the country.
NCTUB Assistant General Secretary Jennifer Isaacs-Dotson said the union in conjunction with the Ministry of Education, BTVI and The College of The Bahamas would ensure that workers receive on-the-job-training.
She said the union would be working closely with Baha Mar personnel to hack out the details of the training exercise.
"Our main job is to ensure that workers receive cross training. This is a good opportunity to train our workers,"Dotson said."Every time a large project comes, we say we don't have the skilled workers. I think it's now time to put our money where our mouth is."
Dotson added that the union's initial concerns also had to do with the lack of consultation both the previous Christie administration and the current Ingraham administration had with the union on the project.
"We need to be involved more at the ground level,"she said, adding that the union will be present on the day the government brings the issue to Parliament.
Leader of Government Business in the House of Assembly Tommy Turnquest confirmed that the Ingraham administration intends to bring the labor resolution to Parliament on September 8. Turnquest said the MPs would be allowed to express their views on the labor issue before the government makes a final determination.
If a majority of MPs take issue with that component, he said the government would have to take that into consideration prior to making its decision.
Pinder said the union is hoping that the government and the official opposition will give the necessary approval for the project.
Turnquest said publicly that at the height of construction Baha Mar could have up to 8,000 foreign workers on the project.
Dotson said it would also be the union's job to protect the rights of the Chinese workers. Yesterday the union pledged to make every effort to do that if the work permits are granted.
Baha Mar has said that out of the 10,000 proposed construction jobs the project will create, at least 3,300 will be set aside for Bahamians. Eight thousand permanent jobs are also projected once the resort is completed.
The proposed Cable Beach development would be financed by the Export-Import Bank of China and constructed by the China State Construction Engineering Corporation.
If the project receives Bahamas government approval, Baha Mar's first course of action would be to award nearly$60 million of construction contracts to six Bahamian contractors, representing early infrastructure works needed to prepare the site, Baha Mar's Chairman and Chief Executive Officer Sarkis Izmirlian said in a press statement last month.
9/2/2010
thenassauguardian
By KRYSTEL ROLLE
Guardian Staff Reporter
krystel@nasguard.com:
Reversing its stance on the controversial Chinese labor issue surrounding the multi-billion dollar Baha Mar project, the National Congress of Trade Unions of The Bahamas(NCTUB)yesterday endorsed the project, saying the benefits outweigh any difficulties the union had.
Initially NCTUB threatened to hold massive demonstrations if the government approved Baha Mar's bid to bring in approximately 5,000 Chinese workers the mega resort says it needs during the project's construction phase.
However, during a news conference yesterday, NCTUB President John Pinder acknowledged that The Bahamas does not have the capacity nor the skill set to construct the project without the help of foreign aid.
"After further consultations with Baha Mar officials we got all of the concerns we had addressed and we're satisfied that this project is in the best interest of this country,"he said during the news conference which was held at the Bahamas Public Service Union headquarters on Wulff Road."We are further satisfied that we do not have the skill set to do this project all on our own."
Pinder said the issue with work permits can be a serious revenue generator for the government.
"It's proposed that Baha mar may ask for as much as 5,000 work permits, but at no time will there be 5,000 Chinese workers,"Pinder said."We are told that they will maximize the use of Bahamian workers qualified to work on this project and the semi-skilled persons. We have asked that these positions be made known to us so persons could apply for various positions."
"Work permits will cost Baha Mar an average of$5,000 per work permit... we believe this is a golden opportunity for the government to raise some revenue to be able to ensure that unions are able to get some sort of increase for our membership,"he continued.
The union also hopes that the government would consider using a percentage of the $5 million it stands to bring in from work permit fees to expand and redevelop the Bahamas Technical and Vocational Institute(BTVI).
Pinder said the key to the union's endorsement was the assurance by Baha Mar officials that Bahamian workers will receive first preference during and after the construction, and that Baha Mar will train Bahamians in some of the more modern techniques that are currently not widely used in the country.
NCTUB Assistant General Secretary Jennifer Isaacs-Dotson said the union in conjunction with the Ministry of Education, BTVI and The College of The Bahamas would ensure that workers receive on-the-job-training.
She said the union would be working closely with Baha Mar personnel to hack out the details of the training exercise.
"Our main job is to ensure that workers receive cross training. This is a good opportunity to train our workers,"Dotson said."Every time a large project comes, we say we don't have the skilled workers. I think it's now time to put our money where our mouth is."
Dotson added that the union's initial concerns also had to do with the lack of consultation both the previous Christie administration and the current Ingraham administration had with the union on the project.
"We need to be involved more at the ground level,"she said, adding that the union will be present on the day the government brings the issue to Parliament.
Leader of Government Business in the House of Assembly Tommy Turnquest confirmed that the Ingraham administration intends to bring the labor resolution to Parliament on September 8. Turnquest said the MPs would be allowed to express their views on the labor issue before the government makes a final determination.
If a majority of MPs take issue with that component, he said the government would have to take that into consideration prior to making its decision.
Pinder said the union is hoping that the government and the official opposition will give the necessary approval for the project.
Turnquest said publicly that at the height of construction Baha Mar could have up to 8,000 foreign workers on the project.
Dotson said it would also be the union's job to protect the rights of the Chinese workers. Yesterday the union pledged to make every effort to do that if the work permits are granted.
Baha Mar has said that out of the 10,000 proposed construction jobs the project will create, at least 3,300 will be set aside for Bahamians. Eight thousand permanent jobs are also projected once the resort is completed.
The proposed Cable Beach development would be financed by the Export-Import Bank of China and constructed by the China State Construction Engineering Corporation.
If the project receives Bahamas government approval, Baha Mar's first course of action would be to award nearly$60 million of construction contracts to six Bahamian contractors, representing early infrastructure works needed to prepare the site, Baha Mar's Chairman and Chief Executive Officer Sarkis Izmirlian said in a press statement last month.
9/2/2010
thenassauguardian
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