Dionisio D'Aguilar: Government contracts problematic due to economy's 'smallness'

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July 04, 2014

A leading businessman has argued that the "smallness" of the Bahamian community causes any government contract award process to be "fraught" with problems.
Meanwhile, Dionisio D'Aguilar said he is not inclined to believe the United States is best suited to pass judgment on The Bahamas with respect to issues of transparency and corruption.
"The U.S. can stand up and say The Bahamas is corrupt but there are tons of cities in the U.S. where there is corruption; that's not an excuse, but in the greatest democracy they have their problems too," he added.
Commenting in the wake of concerns over "undue government interference" in government procurement processes in The Bahamas, raised by the U.S. Department of State in its Investment Climate 2014 report, Dionisio D'Aguilar said it is "very, very difficult" to make contract awards truly objective in the Bahamian context.
D'Aguilar, a former director on the board of the Bahamas Electricity Corporation, the president of Superwash and the chairman of AML Foods, told Guardian Business: "I am not giving (the government) a pass, we all agree there's a lack of transparency in our system, but even if you go through the intricacies of the bid process and you follow the protocol in place, given the fact there are so many relationships here in this very small community it's very, very, difficult to get true independence or be in the position where you can disqualify people who are not independent," said the businessman.
He noted that when he was a director at BEC a bid had come before the board for a contract from a company in which he was also on the board, adding that this is a regular occurrence in the Bahamian business environment.
In its 2014 Investment Climate report, designed to advise U.S. companies doing business abroad, the U.S. reserved some of its more critical comments for a section on the transparency of the regulatory system in The Bahamas, calling Bahamian procurement systems "particularly problematic".
It adds: "Over the last year, the embassy has received several complaints from U.S. companies alleging a lack of transparency and undue government interference with bidding and procurement
The report also notes, in a section on corruption, that "anecdotal evidence suggests there is widespread patronage with contracts routinely directed to party supporters and benefactors", while "there has not been a sustained effort to ensure that opportunities for abuse of the system are minimized."
D'Aguilar said that in his opinion, awarding government contracts "is not as easy as it seems", pointing to challenges finding companies that can effectively perform the jobs they are assigned.
"I always say this when I'm in private business and evaluating whether to award a contract to someone: It's not always about price, it's about my perception of their ability to execute. If my perception is I can't get a lower price and then they leave me with a whole heap of problems, it's very difficult."
He said that while he would prefer to see a procurement system implemented that helps to mitigate the corruption that does exist, he finds it difficult to see what this would look like.
"How we would do it, I don't have the foggiest," he said, adding that he would not look for examples in the U.S., but in countries such as Denmark or Sweden.
His comments have a somewhat different tone to those emanating from individuals such as Chairman of the Bahamas Chamber of Commerce and Employers Confederation Rob Myers, who has stated emphatically both prior to and since the issuance of the U.S. report that the government must move to increase the transparency of its procurement process, claiming that The Bahamas is "at threat" if it continues down the same path.
In a statement issued yesterday in response to comments from Minister of Labour and National Insurance Shane Gibson, who claimed that the report was political as it was authored by Hank Ferguson, an economic and commercial specialist at the U.S. Embassy in Nassau, who also happens to be the son of former Free National Movement (FNM) Senator Johnlee Ferguson, the U.S. Embassy denied that Ferguson is responsible for the report.
"The 2014 Investment Climate Statement on The Bahamas was prepared by Washington-based diplomats assigned to the embassy in Nassau. The document was then reviewed in Washington, D.C. before being released to the public as the official view of the United States government.
"...Non-American staff have a limited, if any, role in the preparation of these statements and are not the authors of the statements," the report said.

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News date : 07/04/2014    Category : Business, Nassau Guardian Stories

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