Commentary by Elcott Coleby
Unemployment down by 2%
On Friday, the Department of Statistics released its latest bi-annual Labour Force and Household Income Survey which was conducted during the period of April 25 – May 1, 2016. Unemployment fell by 2%, from 14.8% to 12.7%
The results of the survey indicate that since November 2015 the labour force grew by 1.7% and now totals 215,880 persons. The department explained the breakdown as follows:
“Since November 2015, there was an increase (7,540) in the number of employed persons and a decrease (3,855) in the number of unemployed persons resulting in an improvement in the unemployment rate which declined from 14.8% to 12.7%. While New Providence’s unemployment rate decreased, the rates in Grand Bahama and Abaco edged up by 0.5 and 0.4 percentage points, respectively. At the time of the survey the rate in New Providence was 13.2%; in Grand Bahama, 14.7% and Abaco 10.1%.”
There was a noticeable decline in youth unemployment from 30% recorded in November 2015 to 25.8% and discouraged workers in the country declined by 10% over the six month period said the department.
In short, while 27,710 jobs were created in the last four years, the most in any four year period, more than 27,000 persons remain unemployed.
Christie on Moody’s meetings: “very positive”
In the aftermath of the public notification by Moody’s to place the Bahamas’ Baa2 sovereign credit rating under review for two months, both the State Minister and Prime Minister said they were not worried about a possible downgrade. They announced that they will meet with Moody’s and explain to them the bigger economic picture and to persuade Moody’s not to pursue the downgrade.
Well, Moody’s Investor Services held a series of meetings last week with government officials and business representatives and the Government said it was “hopeful” the country’s credit rating will not be downgraded. They characterized the meetings as “constructive.” This week Prime Minister Christie who is also the Finance Minister shared his views on his meetings with Moody’s while as a guest on the Ed. Fields show on Tuesday.
“And we had a god set of meetings with Moody’s, because we think Moody’s were able to see things there that they (meaning Standard and Poors) did not know, and were not aware of. We were able to have detailed presentations to them that would have caused them to – I think – reflect on some positions they have adopted about possible downgrade to junk status, and I think they left here feeling much better than when they arrived, and that’s the best we can do,” said Prime Minister Christie
“What I feel good about is that the private sector was able to contribute to that good feeling.” Mr. Christie described the meetings between Moody’s and the private sector as “very positive” and “dovetailed into what the positions the government took.”
The Prime Minister believed that Moody’s “wait and see” attitude about the economy of the Bahamas is justified.
Central Bank and IMF subdued on economic prospects
In its first quarterly financial report, the Central Bank of The Bahamas reported that a 17.3% hike in government spending during the first three quarters of the 2015/2016 fiscal year ending in March 2016 pushed the national debt to almost $6.8 billion, an increase of $125 million. It is important to note however that in 2012, in excess of $500 million was being added to the national debt annually.
Switching gears to the recent Article IV consultation by the International Monetary Fund (IMF), the fund reported that The Bahamas requires “an urgent shift” towards implementing structural reforms that are “growth friendly” but will take time to deliver and “will take time to bear fruit.”
Turning its attention to the local labour market, the IMF staff projected an increase in unemployment from 14.8% to 15.6 percent by the end of 2016. The Fund predicted a reduction in this figure to 14.9% in 2017; this projected stabilization is based on the expectation that the $3.5bn Baha Mar will open in the near term.
Just how big is the Bahamas’ economy? Is it growing or contracting?
The Central Bank of The Bahamas reported the official size of the Bahamian economy at $7.7 billion (at 2006 prices) at the end of 2015; the regulatory agency claimed that the Bahamas economy had contracted by more than 1%.
The doubling of the amount of Value Added Tax (VAT) collected for the first quarter in 2016 from $74.9 million in March 2015 to $157.1 million has however raised some questions about the accuracy of the reported size of the economy and the level of economic activity which are tied to the level of the country’s employment. The Central Bank said the increase was “reflecting a larger number of registrants.”
Central Bank governor John A. Rolle said a possible explanation could be a better coverage of business activities and more accurate information on growth measures.
“There is a better coverage of businesses that, in exercises up to this point, estimated economic activity.
“A re-measure of the level of economic activity is not equivalent however to changes in growth trends and estimates. Growth measures can change though, if we get better information on sectors that were not previously covered and if these show up as more dynamic sectors,” said Governor Rolle.
But how likely are these “better” pieces of information and “dynamic” sectors to reflect a doubling in VAT intake? In 2015 the VAT collection stood at $600 million. If current collection trends hold, the government is likely to collect over one billion dollars in VAT in calendar 2016. It is reasonable to assume that the economy is significantly larger than previously reported and that the level of economic activity is higher than reported. This would mean that the rate of unemployment could be significantly lower than reported. What about the debt-to-GDP ratio? A doubling of the VAT collection is highly unlikely if unemployment is increasing and the economy is contracting as was officially reported. These issues are worth deeper examination.
Dr. Nottage discusses “MARCO ALERT”
“Time is important” said National Security Minister the Hon. Bernard Nottage as he discussed protocols for the rescue and protection of children on Thursday. National Security officials including the police met at police headquarters to discuss regulations to the Child Protection Act including specific guidelines for an immediate and formal alert system once a child is reported missing.
Dr. Nottage said that there was a suggestion that the police did not respond to a missing person report for 24 to 48 hours of the disappearance, but this will change with immediate all points bulletins posting throughout the network of police stations where officers are immediately engaged and on the ground in communities in an intensive rescue operation.
“The difference now is that, they (the police), are going to respond immediately. They will report - when they get the (missing persons) report, they will disseminate it to the various police stations and to the mobile police officers and to those who are walking because they have radios - right away. The Commissioner will be informed and he will begin the formal alert” said Minister Nottage.
Dr. Nottage also reminded police officers that they are the first responders and as such they have the greatest opportunity “to effect a positive outcome.”
Turning his attention to the media, Minister Nottage said that the number of public alerts via radio can be easily increased and inserted into the normal radio programming.
These new protocols, or MARCO ALERTS, are driven by the abduction and brutal murder of 11 year old Marco Archer almost five years ago. Young Archer left home to go to the store but was never seen alive again. His badly decomposed body was discovered behind a building in the western district of Nassau.
Government launches revamped Mortgage Relief Plan
“We went back to the drawing board because it was a commitment that we wanted to be faithful to and over these past years we have been refining and having discussions and exchanging proposals with the lenders and other stakeholders and now we have a plan that we think can work because the main difference is this time we are taking a holistic approach to the entire (debt) situation. We are looking at not only mortgage debt but as well consumer debt. How do you enable people to be able to fulfill their commitments and manage the debt that they have and restrict the amount of debt that people take on in the future?”
That was State Minister for Finance the Hon. Michael Halkitis explaining the government’s new approach to mortgage relief to thousands of distressed homeowners. The initial plan launched in 2012 benefitted less than ten people.
The qualifying criteria for enrolment in the upgraded mortgage relief program is a owner occupied residential property valued at $500,000 or less that is ninety days or more in arrears. All participating banks are required to supply the government with monthly progress and performance reports. The plan is designed to hold program participants accountable to ensure that they remain current with their restructured mortgage payments.
The initial reports received by the government from the banks are that several hundred distressed homeowners will qualify for the upgraded mortgage relief plan.
The multimillion dollar mortgage relief program is scheduled to last for three years.
Dr. Johnson bows out for 2017; endorses Senator Bell
Members of Parliament customarily meet with their constituents to inform them of weighty decisions as retiring from frontline politics; they normally do so after meeting with the party’s leadership, but before notifying the general public via the media. And so on Tuesday at the monthly meeting of the Carmichael constituency, Dr. Johnson, MP for Carmichael and Youth, Sports and Culture Minister, told his supporters that because of personal reasons, he would not be seeking the PLP’s nomination for Carmichael in the 2017 general elections. Dr. Johnson served for one term.
“It is with mixed feelings however that I advise you the great people of Carmichael after meeting with the candidate’s committee and its chair the party’s leader and Prime Minister that because of personal reasons, I will not seek the PLP’s nomination for the Carmichael constituency for the 2017 general elections. It was a long and thoughtful process that brought me to this decision. I will return to private practice but I will continue to be an activist for youth empowerment and sports development in this country.”
Dr. Johnson took the opportunity to endorse Senator Keith Bell, State Minister of National Security who was present at the meeting.
“My cabinet colleague and friend Senator Keith Bell who is a good friend of Carmichael has expressed an interest in working with you and representing your interest at the highest level. I am sure others may emerge but I trust and support Senator Bell’s candidacy and I am confident that if afforded the same privilege as you have afforded me, Senator Bell will not let you down. I will do all that I can to ensure that Senator Bell is elected the next member of Parliament for the Carmichael constituency” said Dr. Johnson.
Dr. Johnson has served the people of Carmichael for one term.
Commonwealth Parliamentarians meet in Nassau
The 41st Regional Conference of the Commonwealth Parliamentary Association (CPA) The Caribbean, The Americas and The Atlantic Region and the 9th Regional Conference of Commonwealth Women Parliamentarians (CWP) The Caribbean, The Americas and The Atlantic Region, will meet in conference here in Nassau over the next several days.
CWP events commence on Saturday 23 July with a conference at Atlantis and will conclude with a presentation and luncheon on Sunday, where 2014 CARICOM Triennial Award recipient and esteemed jurist, Marion Bethel, will address regional Parliamentarians.
Addressing Parliamentarians at the Saturday conference will be the past Regional Chair and current Chair of the Bahamas branch of the CWP, the Hon. Glenys Hanna-Martin. Also addressing delegates will be the current Regional CWP Chair, The Hon. Shirley Osbourne, Speaker of the Legislative Assembly of Montserrat who will preside over the conference.
It is anticipated that women parliamentarians from Antigua & Barbuda, Barbados, Bermuda, British Virgin Islands, Cayman Islands, Guyana, Montserrat, Nevis Island, St. Lucia, Trinidad & Tobago, Turks & Caicos Islands will be in attendance.
Amid all public infighting in the lead up to the FNM national convention and calls for him to step down, Prime Minister the Rt. Hon. Perry G. Christie took to the airwaves this week to make it clear that he intends to continue leading the PLP, including into the next general election, because young members of his Government urged him to do so. He also suggested that instability would arise in the party if he were no longer leader, similar to what is occurring in the Opposition.
The Ministry of Foreign Affairs and Immigration released a statement on Thursday assuring Bahamian passport applicants that steps are being taken to address the huge backlog in The Bahamas and abroad and the extended waiting periods for collection. “A Special Team of Staff Members has been put in place to deal with issues relating to Grand Bahama and to assist with the backlog of issued passports in Grand Bahama. We hope to offer some relief within the coming week. Arrangements are also being finalized to assist with the demand in the Overseas Offices and the Family Islands Section. With the provisions that have been put in place, the Ministry expects the backlog to be reduced as quickly as possible” said the statement.
FNM Chairman Sidney Collie called a press conference on Wednesday to update the public on the upcoming FNM convention. He said that the party will reflect on its past; outline its vision for the future of the country and review the four years of governance of the PLP. He further noted that the party agreed to a funding mechanism where the candidates for leadership were required to pay $100,000 each with the finance committee securing the balance of the $350,000 required to stage the convention. He confirmed that to date Dr. Minnis had paid his required $100,000 and Butler-Turner had paid $50,000. Butler-Turner said earlier in the week that she was withholding the balance of the funds until she was provided with an accounting of how the money would be spent.
Fresh off his Espy award as the best college athlete for 2015 and the NBA summer basketball league, Buddy Hield is in town this week. His itinerary included courtesy calls on the Sports Minister, Dr. Johnson and Prime Minister the Rt. Hon. Perry G. Christie at the Office of the Prime Minister; a courtesy call on the Governor General Her Excellency Dame Marguerite Pindling; accepting a sports legend award and hosting an exhibition basketball game. WNBA player Jonquel Jones is also in town to accept her legends awards as they both joined 37 other sports legends such as Eddie Ford, Dr. Timothy Barrett, Leon ‘Apache’ Knowles, Fred Papa Smith, Cynthia ‘Mother’ Pratt and Vince Ferguson to be memorialized on the Thomas A. Robinson National Stadium’s Walk of Fame. The legends presentation is part of the country’s 43rd Independence celebration.
Olympic champion and local businessman Sir Durward Knowles celebrated the 40th anniversary of the Rotary Club of Southeast Nassau; he was a founding member and former president of that club. The 98 year old mariner drew laughs when he told fellow Rotarians that despite his advanced age, he still “remembers everything.”
The 28 member strong Bahamas Olympic team was named this week. Most notable was sprint sensation Shaune Miller who met the Olympic qualifying times in the 100m, 200m, 400m and of course the 400m relay. What an extraordinary talent.
The Disney Corporation revealed this week that the results of an environmental impact assessment (eia) and geotechnical studies of the island, it would not move ahead with plans to construct a cruise port on Egg Island, just off the shores of Spanish Wells and Royal Island.
Sarkis Izmirlian’s Granite Ventures Ltd, an unsecured creditor in the provisional liquidation of Baha Mar, filed a summons in the Supreme Court on Wednesday seeking to transition Baha Mar from provisional liquidation into full liquidation, arguing that the provisional liquidation process is only looking out for the financial interests of the China EXIM Bank and CCA, the general contractor. They also expressed concerns that Baha Mar receivers were under such pressure that they might “undervalue” the project in any sale, and “abandon” potential assets.
Secretary General of the Hotel and Allied Workers Union Darren Woods refuted claims this week that the union is financially strapped as staff at its Tonique Williams Highway headquarters have not been paid in six weeks. He did however confirm that some checks from hotels were received late by the union. He also refuted claims of the imminent closure of the union’s daycare center and laundry mat operations.
Royal Caribbean Cruises Ltd. in partnership with the Pan American Development Foundation (PADF) donated $10,000 worth of medical equipment to the National Emergency Management Agency (NEMA) on Thursday of this week. The equipment will be used in the government clinic in Colonel Hill, Crooked Island, which is currently under repair from damages sustained during the passage of Hurricane Joaquin in October 2015. A Memorandum of Understanding, MOU, was signed between Captain Stephen Russell, Director of NEMA and Roberto Obando, Project Director, PADF during the short ceremony. The Colonel Hill clinic is scheduled to open in August of the year.
Parole Commission member Bishop Drexel Gomez said that as part of the country’s overall parole system, suitable housing is an important part of the rehabilitative process and the system’s success. He told the media that from his church ministry, the housing conditions that ex-offenders return to upon their release are “conducive to sending them right back” to prison. The Parole Commission is currently in consultation with multiple stakeholders on how to best revamp the country’s parole system.
The former headquarters for Shell Bahamas Limited and current headquarters of the Water and Sewerage Corporation was officially renamed the E. George Moss Building on Friday, 18th July. Appointed in 1976, Mr. Moss was the first Bahamian General Manager of the Water and Sewerage Corporation. Prime Minister Christie delivered the keynote address and unveiled the new plaque and name. Also in attendance was Deputy Prime Minister the Hon. Philip Davis, State Minister for Works the Hon. Arnold Forbes, Chairman of the Corporation the Hon. Leslie Miller and former Prime Minister the Rt. Hon. Hubert A. Ingraham.
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