August 02, 2022
The Opposition's leader yesterday voiced optimism that the Prime Minister's "intervention" will prevent "a substantial blow" to Grand Bahama's economy with up to 130 jobs threatened by the Gold Rock group's closure.
Michael Pintard told Tribune Business that, after reaching out to Philip Davis QC over the holiday weekend, both the Government and Free National Movement (FNM) are “quite anxious” to resolve the all-out conflict that has erupted between Gold Rock’s owners, the Florida-based Del Zotto family, and the Grand Bahama Port Authority (GBPA) and its affiliates.
Besides Gold Rock, the supplier of pre-cast, block and ready mix concrete, the Del Zottos’ Friday announcement that they also plan to shutter the Home Design Center and Do It Center, their hardware and furniture/home stores, has sparked alarm for the Marco City MP because of the wider potential fall-out for Freeport’s Dorian and COVID-ravaged economy.
Mr Pintard warned that the Gold Rock group’s exit threatens “to send entirely the wrong signal” to both Bahamian and international investors right when there are fledgling signs that Grand Bahama’s economy may be poised for revival, with the $200m Carnival cruise port set to begin dredging within the next 60 to 90 days.
While much still hangs on closing the Grand Lucayan’s sale, and rebuilding Grand Bahama International Airport, the FNM leader said both Freeport and the wider Bahamas could suffer “reputational damage” if any conflict between a private sector entity and quasi-governmental authority such as the GBPA goes unresolved.
Pointing to the negative construction industry impact from the loss of local pre-cast concrete supply for major development and infrastructure projects, Mr Pintard said that based on his conversations with the Prime Minister it appeared Mr Davis was keen “to get involved in this matter” and would address with his Cabinet at today’s full meeting.
“I’ve had a chance to have discussions with the Prime Minister, and made an undertaking to be as helpful as possible,” the Opposition leader told Tribune Business. “We’ve had quite fruitful discussions in the last two days. I reached out to the Prime Minister, and he was very anxious to get involved in this matter.
“He is having discussions this coming week, as early as tomorrow, with his [Cabinet] colleagues to see what emergency steps he can take to intervene in this matter.... We are encouraging all parties to work towards finding common ground so we have a continued presence of those businesses, which will be of benefit to the island’s recovery and the growth and development of the island.
“I’ve had a chance to have discussions with the GBPA as well as with the principals of Gold Rock and the Prime Minister. I think this week we should see some movement, and hopefully it will be favourable. We’re quite anxious, both the Government and the Opposition, to see this matter resolved.”
Tribune Business sought to obtain the Prime Minister’s and the Government’s official position on the Gold Rock situation but was unable to do so before press time last night. Clint Watson, Mr Davis’ press secretary, said in response to this newspaper’s inquiries that he would seek to find out but no reply was received.
A successful intervention by the Government could also be extremely difficult to achieve given that relations between Gold Rock and the GBPA, plus its Grand Bahama Development Company (DevCO) affiliate, appeared to have completely broken down with little prospect of reconciliation given the hostility exhibited to each other in their respective statements.
The spark that triggered the conflict appears to have been Gold Rock’s negotiations with DevCO over access to aggregate/fill in the latter’s Devonshire subdivision that was critical for its ready mix, block and pre-cast concrete products. DevCO, though, has argued that Gold Rock’s continued monopoly over this source cannot be justified because it had under-performed the previous contract by not taking the stipulated tonnage.
Unable to make headway over the terms they want, Gold Rock and the Del Zottos branded the GBPA as “the leaders of the most grossly underperforming island in The Bahamas” as they unveiled the shuttering of not just their concrete-making business but also their Grand Bahama-based hardware store and furniture and home centre.
The GBPA, though, said DevCO wanted to “right size” the deal such that Gold Rock would still have access to the same level of aggregate it previously mined, and be able to sustain its operations, but give up its exclusivity to let other Bahamian contractors have access to the same fill and thus create a “more equitable” arrangement for all industry players.
Arguing that the Home Design Center and Do It Center closures are “unnecessary”, because they are not impacted by the aggregate talks, the GBPA said: “This move, seemingly motivated by nothing but spite, will cost yet more hardworking families their livelihoods and further shrink the options available to consumers in a struggling economy.”
Mr Pintard yesterday told Tribune Business that the dispute has wider ramifications beyond just the Gold Rock group and its employees. Affirming that he is “extremely concerned”, he said: “That company has approximately 130 employees. That would be a substantial blow to more than 100 families on the island. That is a tremendous concern.
“Apart from the direct impact on those families, it’s going to have a tremendous impact outside with businesses that those families support through their income. Second, and very important, it sends entirely the wrong signal to the local and international community to have a group of companies under one umbrella close.
“It’s the wrong signal about the viability of businesses in this market. If there are conflicts that cannot be resolved in this market, whether with municipal or national government, it increases the possibility of reputational damage as well. In a variety of ways this is bad news.”
Mr Pintard also voiced fears that the loss of Gold Rock’s locally-based concrete manufacturing business will worsen already-strained supply chains for Bahamian contractors, reducing efficiency and increasing costs by delaying the arrival of critical components for infrastructure projects such as pre-cast culverts and drainage tunnels.
“The services and products they provide are very diverse,” he added of Gold Rock. “They operate in some very distinct sectors of the island-wide economy. They would have a direct impact on the supply chain for a number of critical products, which are crucial given the fact there are already global supply chain issues that have slowed the progress of any number of projects.
“Now you add to that this company, a supplier of blocks, which impacts local construction. This is a group that would do a lot of work with projects expected to come on stream, which has a potential impact on things like the Carnival cruise port and the medical facility that is being constructed. They provide concrete structures for a variety of businesses, including septic tanks. The impact on supply chain issues and ongoing infrastructure projects is quite significant.”
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