Local manufacturers cannot continue to rely heavily on import taxes, if The Bahamas is to gain accession to the World Trade Organization (WTO), a top accountant has stated.
Raymond Winder, managing partner at Deloitte and Touche and chief negotiator for The Bahamas' WTO accession, stressed to Guardian Business the need for the country to strike a balance as the current tariff rates remain too high in certain areas.
"The question is can we carve out a portion of the products which we currently manufacture in The Bahamas and be able to retain high enough rates on those products," he said.
"However, we will have to reduce the tariffs on other areas so the overall tariff rate is low even though you may have portions of those products that have high taxes, but others will now have to be much lower and bring the average down.
"Clearly, a number of our local manufacturers rely heavily on import taxes on finished products that are similar to the ones that they manufacture and they rely on that."
Chairman of the Bahamas Trade Commission Philip Galanis recently expressed concern about the impact the liberalization of trade will have on the manufacturing and agriculture industries, where stakeholders believe it will leave them "extremely vulnerable" to the importation of goods that compete with those they produce. He also admitted that it might be quite some time before The Bahamas receives WTO accession.
"It really creates a dichotomous situation. While we understand the needs and concerns of the producers, the government also has to take into account the needs of citizens who want products at a cheaper price," he said.
"Egg producers are very concerned because there is an excess of eggs in the Bahamian market presently. Part of the reason is because the food stores are saying that they can buy eggs cheaper. So they (egg producers) feel threatened or vulnerable to what's happening. They are hoping that the government will help them in a way, either by increasing tariffs on imports, or limiting the importation."
Their comments to Guardian Business come as Minister of Financial Services Ryan Pinder confirmed that The Bahamas and WTO have "mutually agreed" to postpone a working group meeting. With The Bahamas still in the process of completing its factual summary on its trade regime, and with the WTO Bali Ministerial Conference underway, the two sides agreed to postpone that meeting until February.
To date, the WTO has received this nation's offers as it relates to goods and services, indicating to what extent The Bahamas is willing to liberalize its trading regime in those areas.
Among the primary requirements of accession are a reduction in the average import tariff level, a fact that feeds into the discussion on the need for alternative forms of revenue such as value-added tax (VAT), upon WTO accession.

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