Showing posts with label Bahamian workforce. Show all posts
Showing posts with label Bahamian workforce. Show all posts

Friday, February 11, 2011

What's the exact amount (net) that represents the proceeds of the sale of Bahamas Telecommunications Company (BTC)?

What are we getting and what were we paid for BTC?
thenassauguardian editorial



The deal is done. It is finished. The Bahamas Telecommunications Company or at least the majority of BTC, 51 percent, has been sold to Cable & Wireless Communications and The Bahamas will soon be a part of the LIME telecommunications network.

On the surface, it would appear that for dispensing with 51 percent of BTC, Bahamians could expect to receive, over time, the following features which presumably the existing Bahamian management and staff of BTC are unwilling or unable to deliver:

• expanded services for smart phones (Blackberry, iPhones) at “reasonable” prices and faster mobile services to deliver music and television to handsets;

• increase in the number of places Bahamians can go to receive phone services;

• purchase pre-connected phones at retail outlets;

• standard prices for daily cellular services and no more long distance charges for calls made locally;

• better roaming and faster broadband services;

• more connectivity for the Family Islands and more efficient services for small- and medium-sized businesses;

• easier to understand billing services and up to 36 percent reduction in costs per minute over the next three years; and

• spending on community projects including support for Junkanoo; a “center for excellence”; opportunities for Bahamians to work in the rest of the Caribbean (movement of labor has arrived); and increased services to our major economic sectors, tourism and banking.

In addition to the improved services on our existing network, CWC will reportedly pay to the government $210 million plus another $7 million in stamp duties for 51 percent of BTC.

Should we deduct from that figure the unknown amount of net cash value in excess of $15 million at the date of sale that CWC is allowed to take out of BTC?

Should we also deduct the $39 million that the government (Bahamian taxpayer) has agreed to place in the “Feeder Trust” which would presumably cover the shortfall in BTC’s existing pension plan?

It would be useful and enormously transparent if someone would let the public know the exact amount (net) that represents the proceeds of the sale of BTC.

And while you are at it, let us know how the Treasury will fare in future without the $96 million in dividends paid to it by BTC in 2009, if we are to accept a recent report published in the local press.

We would be among the first to agree that there is a need to improve the services performance of BTC but we find it difficult to accept that the above list of services cannot be provided by the Bahamian workforce.

We find it equally difficult to accept that the best way to improve services would be to sell the majority of shares to a regional carrier which, in addition to collecting two percent of total revenue for its intellectual property (despite being the majority owner) would most likely make all major decisions involving the local company in its far-away regional headquarters in the Caribbean. A regional carrier would most likely remit much-needed foreign exchange out of the country in the form of dividends and profits.

And above all, we most certainly hope that our Caribbean friends, who may hold equity (shares) in LIME are not indirectly holding shares in BTC before Bahamian residents are allowed to do so.

2/10/2011

thenassauguardian editorial

Friday, November 19, 2010

Sir Sol Kerzner says: The proposed deal between the Government of The Bahamas and Baha Mar violates previous agreements between the government and Kerzner International

Sol Kerzner hits out on Baha Mar
By BRENT DEAN
The Nassau Guardian
Deputy News Editor
brentldean@nasguard.com


Says Baha Mar deal violates agreements made with his company


The proposed deal between the Government of The Bahamas and Baha Mar violates previous agreements between the government and Kerzner International, charged Sir Sol Kerzner yesterday.

“Baha Mar proposes employing thousands of foreign Chinese workers, which would represent far more than 30 percent of the total labor force.

Approval of this arrangement by government would be a clear breach of an investment agreement with a developer that has become its largest private employer, and an investor who took a risk on The Bahamas when its economy was struggling far more than it is today,” said Sir Sol Kerzner, chairman and chief executive officer of Kerzner International in a statement.

The House of Assembly is scheduled to conclude debate on the Baha Mar resolution today. The company is seeking 8,150 work permits for Chinese workers to help construct the $2.6 billion resort. The government is seeking the blessing of the House as it grants the work permits. The opposition has said it supports the deal.

In previous heads of agreements between Kerzner and the government, it pledged to grant Kerzner most favored nation status, meaning no investor would be granted concessions greater than Kerzner.

However, in a rare public statement, Kerzner, who is the largest private sector employer in the country, said Baha Mar is being granted much more than his company received.

“When we made our largest single investment of approximately $1 billion for Phase III, we did so based on a heads of agreement signed with the PLP government in 2003. Among the many requirements that government imposed on Kerzner under this and prior agreements was a strict rule that at least 70 percent of the total construction labor force would be Bahamian,” said Kerzner.

“As was the case with the two previous agreements with government, our 2003 agreement included a most favored nation provision that assured Kerzner that our investments would be protected from subsequent investors receiving more favorable terms. These agreements represented a solemn promise by The Bahamas to us that any subsequent investor would only compete against us on a level playing field.”

Prime Minister Hubert Ingraham said on Sunday that the Baha Mar deal would be approved by the end of the month. It is unclear if Kerzner’s intervention will have any effect on that pronouncement.

Yesterday Baha Mar was not pleased with Kerzner’s public intervention.

“We are not going to comment on Mr. Kerzner’s public relations statement. The Baha Mar project has been well vetted with the public, the government and its investors. We are happy the Baha Mar resolution is being debated in Parliament today,” said the company in response to Kerzner.

Kerzner International said it intends to discuss with the government how to address its concerns. As a result of the deal, Baha Mar is to receive on the labor and land components of the proposed deal, Kerzner can argue it is entitled to the same.

The government is transfering 265 acres of public land at Cable Beach to Baha Mar as a part of the deal.

Kerzner International emphasized that the heads of agreement for each of the three phases of development on Paradise Island required that at least 70 percent of the total construction labor force had to be Bahamian.

Bahamian labor is more expensive than labor from countries such as China and Mexico.

The company and its chairman argued that the deal Baha Mar is to receive “would represent a material breach” of its agreement with the government.

“When Kerzner first invested in The Bahamas by acquiring what is now the Coral and Beach Towers out of bankruptcy in May 1994, we made our investment on the basis of agreements with the government that gave us contractual assurances regarding our investment. Although we were confident in our abilities to re-establish the Bahamian tourism industry at that time, we did so in the face of truly dire economic conditions,” said Kerzner in his remarks.

“Accordingly, we insisted upon most favored nation treatment, which would ensure that no subsequent investor would be given advantages that we never enjoyed. Since our first investment, we have always found government – irrespective of the party in office – to be a faithful partner who has justified our initial and subsequent confidence in The Bahamas as an investor. We have invested more than $2.3 billion over the course of our build-out of the three phases of Atlantis, increasing our room count from approximately 1,100 in 1994 to over 4,000 today.

“We have grown the Bahamian workforce from approximately 1,200 employees when we commenced operations in 1994 to nearly 8,000 full-time employees today, not to mention the indirect employment that our investment has generated in the community. Furthermore, we have spent millions on training programs to develop and improve the skills and professionalism of our work force, which has allowed Atlantis to be rated among the top resorts in the world.”

Both the governing Free National Movement and opposition Progressive Liberal Party support the Baha Mar deal.

11/18/2010

thenassauguardian