"New Agenda For Grand Bahama”

INTRODUCTION

* Mrs. Joan Albury – CEO of The Counselors Limited * Distinguished Ladies and Gentlemen

Good morning! It is good to be here today. I congratulate Mrs. Joan Albury and The Counselors Limited for continuing to provide this excellent forum for discussing the business affairs of this, our home island of Grand Bahama. I hope that today’s seminar exceeds all expectations and eclipses past successes.

I will truly not speak long this morning preferring to save some time for questions, if you desire. In my remarks, I will attempt to answer five questions, as I address myself to the broad theme of “A New Agenda for Grand Bahama”. The questions are:

1. What is the state of Grand Bahama’s economy? 2. How will Grand Bahama’s economy fair over the next twelve months? 3. What will happen over the medium term – that is- the next three years? 4. What actions must we take to boost our economic fortunes on this island? 5. How do we get started?


WHAT IS THE STATE OF GRAND BAHAMA’S ECONOMY? In a word, spotty! The reality is that Grand Bahama is the tail of not two cities but several cities. We often call for diversification of the Bahamian economy, meaning we want less reliance on tourism and more contribution from industry and agriculture. In point of fact, Grand Bahama has the most diversified economy of all the islands in our chain. It has a very large privately operated free trade zone called Freeport with a large industrial sector; a significant tourism sector; a financial services sector, dominated by domestic commercial banks; a reasonably sized wholesale and retail sector; a respectable real estate market’ a small but vibrant fisheries sector; and an even smaller agriculture sector. This diversity cannot be found even in New Providence, our most developed island.

It is this diversity that makes me say that Grand Bahama’s economic picture is spotty. While areas of the industrial sector, which rely primarily on clients outside of The Bahamas, are holding their own, despite the significant aftershocks of the recent global economic and financial crisis, the tourism and construction sectors continue to underperform. Tourism, however, has yet another spotty picture, since the cruise business has seen meaningful increases while gains in the stopover business remain marginal, if not flat. Construction, also has spots, since deliberate Government effort has provided meaningful injections into the public area (Government Office Complex, Post Office, etc.) while residential and private commercial construction remain subdued.

The wholesale and retail business remains anemic, though information reaching my desk suggests that the Christmas season was not bad for many and some of the larger companies continue to enjoy some gains. Indeed, the grocery distribution area of the retail sector has seen robust expansion with at least three new players coming on stream within the last twelve months. Many companies, however, continue to struggle.

All in all, it seems that the economy of Grand Bahama fared better in 2010 than it did in 2009 but remains highly tentative. As a result, unemployment remains unacceptably high and overall business performance remains lackluster in too many areas. No cause for celebration here but we are making spotty progress from those dark days of the global fallout.



How will Grand Bahama’s economy fair over the next twelve months?

From our vantage point, Grand Bahama’s economy will get marginally better over the next twelve months but again only in spots. Some areas might actually experience further challenges. I fully expect BORCO and Stat Oil to continue to add additional jobs, sub-contract business, rental revenue and some broad spending to Grand Bahama’s economy. This is especially so given Buckeye’s commitment to continuing the upgrade of the plant following its $1.8 billion acquisition from First Reserve and Vopak only late last year and given Stat Oils continuing commitment to its project. {LET ME NOTE HERE THAT TWO CONSECUTIVE SALES TRANSACTION OF BORCO OVER THE LAST TWO YEARS HAS BEEN A GREAT BLESSING TO THE PUBLIC TREASURY, ACCOUNTING FOR SOME $120 MILLION IN UNEXPECTED REVENUE TO THE GOVERNMENT FROM STAMP TAX). I also expect that the construction of the new Power Plant announced by Emera, the new owners of the Grand Bahama Power Company, will also add to the island’s economic fortunes.

The cruise business will continue to perform well but the stopover business is likely to continue struggling, though some gains may come as the US economy continues to pick up steam. One caveat to this, however, is the possibility of increase oil prices, which seems more likely with the developments in the Middle East. Regrettably, I am not aware of any hotel or resort developments in the offing in the next twelve months.

I do expect, however, that hundreds of Grand Bahamian construction workers will find employment on the Bahamar project over the next twelve months, given the Ministry of Labour’s focused effort to give them opportunities on the project.

Overall, employment prospects in some areas of construction will likely expand over the next twelve months while new employment in other areas of the economy will remain subdued.

What will happen over the medium term – that is- the next three years?

It depends. Much good can happen! The possibilities are surreal. It is in answering this question that I want to address this issue of a “New Agenda for Grand Bahama”. Ladies and Gentlemen, enough is enough! Grand Bahama cannot continue to linger in this valley of economic despair as it has for more than eight years now. It cannot continue to be described as the prom date that cannot be picked up to go to the prom. It is time for us to begin a new effort to achieve prosperity for our island. Believe me when I say, there is no hero that is going to fly in and make this happen for us. We must get this done in partnership with those who want to make it happen and believe that it can happen.

There is every reason to believe that this island has a bright future. It has the capacity for significant growth and that no feud between the owners of the Port or anything else stands in the way of that other than focused, deliberate and sustained right effort on the part of those who should take up the charge. Grand Bahama:

* Needs and can have a larger more prosperous population, driven by a sensible permanent residency policy geared toward attracting high net worth and ultra-high net worth individuals, namely from Europe and Latin America; * Can be an offshore finance centre satellite for one of the emerging super-economies like China; * Can be an offshore medical and education district within the Americas; * Can be a second home market and recreational spot for the wealthy of Latin America, namely Brazil and Mexico; * Can be host to an LNG Plant, providing new energy options for The Bahamas; * Can be a hub for regional power supply between Grand Bahama and Abaco, increasing scale and lower energy cost for both islands; * Can have a meaningful yacht and aircraft registry; * Can be a High-end Retail Centre for offshore shopping; and * Can be a major entertainment centre in all the Americas.

This by no means is an exhaustive list, but I tell you my research and experience confirms that these and more are possible. In their realization are hundreds of business opportunities for Bahamians; thousands of jobs for our people; and new and sustained prosperity for our beloved Grand Bahama. Their realization can put Grand Bahama at the centre of the economic growth and development of our nation for decades to come.

Actions Needed

Intention and Desire

We must abandon the negativity that saps our energy and muddies our will. We must state emphatically and with faith, our intention and desire to move forward and to achieve these potentialities. When we do so with conviction, we will find the means to fulfill these desires.

“Inherent in every intention and desire is the mechanics for its fulfillment…intention and desire in the field of pure potentiality has infinite organizing power. And when we introduce an intention in the fertile ground of pure potentiality, we put this infinite organizing power to work for us.”

In other words, people, believe and you find the power to achieve.

Steady Action

We will need sustained action to achieve these outcomes. That will take time but if we believe the results, then we will do the work necessary to get them…

Togetherness

If we try to achieve these results through solo action, we will fail. It will not happen but by togetherness. This does not mean we need everybody on board because everybody will never be on board. It does mean, however, that we need the right and enough persons on board to the get the work and that they must be willing to work together to do so…Politics, religion, class, status, etc. set aside for the common mission of bringing the Magic back to our city and the Grand back to our island…

How Do We Get Started?

The presence of Buckeye, Stat Oil, Emera and Ross University of late before now First Reserve supports the fact that Grand Bahama can be an attractive prospect for big business. The problem, in part, is that Grand Bahama is not receiving the kind and level of sustained investment promotion it needs. I honestly believe that with efforts to actually make outreaches to the investment community abroad, Grand Bahama might find some fish to bight.

Given this, I wish to announce today the Government’s decision to establish a Grand Bahamas Business Development Board which would be a partnership between the Government, Grand Bahama Port Authority and the Grand Bahama Chamber of Commerce the function of which would be: (i) Promoting investment in Grand Bahama; (ii) Examining business procedures in Grand Bahama and making recommendations for improvement; and (iii) Developing strategies for the broad growth and development of Grand Bahama. The Government is prepared to fund this Board to the tune of $500,000 in the first instance, with matching funds from both the Port Authority and the Chamber of Commerce. $250,000 will immediately be available for investment promotion through the Budget of the Office of the Prime Minister and the balance funded in the 2011/2012 Budget exercise in July.

We are ready to start, are you.