The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

An ex-Baha Mar director yesterday slammed as “unforgivable” the failure by its contractor to warn that the planned March 27, 2015, opening would be missed, arguing that an early confession could have avoided the project’s meltdown.

Dionisio D’Aguilar told Tribune Business that China Construction America’s (CCA) decision to seemingly keep Baha Mar’s developer ‘in the dark’ was directly responsible for the subsequent termination of more than 2,000 Bahamian staff, and the multi-million dollar debts that remain owing to local creditors and suppliers.

The businessman, reacting to Tribune Business’s exclusive revelation that CCA knew, two months in advance, that it was unlikely to meet the March 27 opening, said the contractor instead “played crazy” when that deadline was missed.

Rather than accept responsibility, Mr D’Aguilar said the Chinese state-owned company turned around and blamed developer Sarkis Izmirlian, before “going off the deep end” when he refused to pay it.

The Superwash president added that CCA had also managed to “mislead” the Christie administration into “turning against” Mr Izmirlian and Baha Mar, when its own internal memo revealed it had a case to answer.

And Mr D’Aguilar also demanded that Fred Mitchell, minister of foreign affairs, and Shane Gibson, minister of labour and national insurance, publicly apologise for personal attacks against Mr Izmirlian, given the details of Tribune Business’s revelations.

“They tried to make out that the developer was to blame,” Mr D’Aguilar said of CCA, “and that memo shows that, beyond doubt, they knew there was a problem and that they would not meet the deadline, and they did nothing to inform the developer as such.

“That’s unforgivable. Had we known they were not going to make that deadline, and they [CCA] knew they weren’t, we’d have gone to Plan B and not hired so many people.

“We’d have been able to slow the process down so that it did not lead to catastrophe on June 29.”

That was the date when Baha Mar filed for Chapter 11 bankruptcy protection in the Delaware courts, triggering a process that has resulted in 2,000 Bahamians losing their jobs, local contractors unable to collect on a total $74 million owed for work on the project, and other vendors holding a multi-million dollar receivables sum.

Mr D’Aguilar’s comments imply that had Mr Izmirlian and the Baha Mar known the true state of CCA’s construction ‘progress’, they would not have ‘ramped up’ hiring and other pre-opening expenses, potentially saving the development from collapse into its current receivership on behalf of the China Export-Import Bank.

“Had they [CCA] informed us well in advance, and been truthful and honest with all parties concerned that they were not going to meet the deadline, we could have taken alternative action and worked through the crisis,” Mr D’Aguilar reiterated to Tribune Business.

This newspaper revealed yesterday how CCA, in a confidential memo sent to its Beijing parent on January 20, 2015, warned that the Baha Mar project and its stakeholders faced “irreversible and catastrophic loss” unless drastic action was taken.

It requested that China State Construction Engineering Corporation (CSCEC) send it at least another 450 Chinese workers to give it a chance of hitting the March 27 target, and warned: “Currently, the project is at a crucial dash to meet the final deadline.

“However, because the professional sub-contractors failed to provide a sufficient workforce in time, several deadlines for sub-projects were missed and the target completion for several sections got delayed.

“This will directly impact the target of opening on March 27. The situation is now very difficult which, if it cannot be turned around, will soon cause irreversible and catastrophic loss.”

The January 20 memo was written just two weeks after CCA had reassured Prime Minister Perry Christie and Mr Izmirlian that all was well during a series of meetings in China earlier that month.

The January 20 memo, written more than two months before the missed opening date, reveals that the Chinese contractor had grave doubts about whether March 27 could be accomplished.

It was also written three weeks BEFORE the Prime Minister’s Office and Baha Mar issued a joint statement on February 10, 2015, in which they said: “Prime Minister Christie and the chairman of Baha Mar, Sarkis Izmirlian, jointly met with officials from China Construction of America (CCA) and the Export-Import Bank in Beijing in January.

“In that meeting, they received the necessary assurances that the resort will be ready for guests on March 27.”

The memo’s contents raise numerous questions, not least whether CCA and its Beijing parent misled both Mr Christie and Mr Izmirlian during their January meetings in China over the project’s construction status.

“What’s even more unbelievable is, when March 27 came and went, rather than be humble and trying to work out a deal, they played crazy, like the developer had done something wrong,” Mr D’Aguilar told Tribune Business of CCA.

“And all along, they knew. And when March 27 came along, they played crazy when the developer said he was not going to pay them.

“It’s reasonable for the developer to say he’s not going to pay you when you’ve missed the deadline, but they went off the deep end and started blaming 3,000 design changes or something.”

Mr D’Aguilar added that CCA’s request for 450 more Chinese construction workers was ironic, given that Baha Mar had frequently complained about its manpower deficiencies.

“That’s what the Board of Baha Mar had been screaming for for years,” he said, “that they needed more people with technical expertise.

“What is so unbelievable is that they misled the Bahamian Government, who then turned against the developer.”

The subsequent public row between Mr Izmirlian and the Christie administration became both vicious and personal, with several Cabinet ministers mounting attacks on the developer.

Mr Mitchell issued thinly-veiled threats and suggestions that Mr Izmirlian’s permanent residency status should be revoked, while Mr Gibson suggested that all foreign investors be subjected to psychological testing.

Mr D’Aguilar, given the CCA memo’s contents, told the ministerial duo: “I say to Mr Mitchell and Mr Gibson: You didn’t know the facts, you were misled, and you owe Mr Izmirlian an apology.

“That’s what I say personally. Mr Mitchell has gone on record to say that it was the fault of the Board and the developer, and this [the memo] goes straight in his face.

“You were wrong, Mr Mitchell. Sometimes you need to get the facts before you spout off from your mouth.”

Mr D’Aguilar’s comments add to the increasing pressure on Mr Mitchell, who is already grappling with the fallout from his recent comments regarding Cuban detainees released by the Supreme Court.

Meanwhile, Mr D’Aguilar urged the Government and the China Export-Import Bank, as Baha Mar’s financiers, to get Mr Izmirlian back involved with the project, as “only he knows how to get it back up and running in the quickest possible time.

“Just as the Government put pressure on the developer to get the court case back to Nassau, and have the Chapter 11 thrown out, they should now use all the agencies of Government to force the bank to make a deal with Mr Izmirlian,” Mr D’Aguilar added.

“So much harm, egregious harm, has been done to that man.”