By NEIL HARTNELL
Tribune Business Editor
The Bahamas’ 121st spot in the World Bank’s ‘ease of doing business’ rankings is “not a good marketing tool” to attract foreign investment, the Opposition’s deputy leader yesterday fearing it will “confirm negative perceptions” of this nation.
K P Turnquest told Tribune Business: “I think that as a country that depends, to some extent, on foreign direct investment, this is clearly not a good marketing tool for us.
“It gives the impression, and perhaps confirms the view held by some, that this country is not progressive, and the ease of doing business is not what one would expect in a modern society.
“That is also complicated by persons and other considerations that are not typical in a modern business environment.”
Mr Turnquest did not describe what he meant by “persons and other considerations”, although he was likely referring to the lack of transparency and accountability within the Government and public sector, plus corporate governance woes.
The FNM’s deputy leader added that when the Bahamas’ ‘ease of doing business’ ranking was combined with questions over the Government’s handling of major developments, such as Baha Mar, “it doesn’t give a tremendous amount of confidence to the external investors looking at the Bahamas, looking at the cuttings and news reports.
“We will never know what the opportunity cost will be as a result of this negative news,” he added. “It’s unfortunate that it will confirm, for some people, an already negative perception of the Government and the Bahamas.”
The Bahamas now stands perilously close to dropping into the bottom third of the world when it comes to the World Bank’s rankings, and Mr Turnquest said this showed the Christie administration had been “an abysmal failure” when it came to facilitating private sector activity.
“They’ve not improved the ease of doing business, and it’s another symptom of the overall neglect by this Government of the business environment,” he told Tribune Business.
“You pick a subject, and the reality is: We’re challenged. Whether it’s Immigration, finance, utilities, regulation, we’re challenged all over. It’s not getting better; it’s getting more complicated.”
Mr Turnquest said the slew of international regulatory initiatives impacting the Bahamian financial services were merely exacerbating this country’s own internal ‘business ease’ issues.
Asked what the Opposition would do to reform the way business and commerce are conducted in the Bahamas, Mr Turnquest added: “We have to rely upon technology in the first instance to decrease the amount of running around and transactions necessary to facilitate business.
“We need to streamline systems, where we have overlapping agencies and requests for the same information. We have to look at the number of fees and processes; transaction processes. We have to see if we can streamline some of those and cut them where possible.”
The Bahamas is now ranked below ‘economic powerhouses’ such as Papua New Guinea (119th); Swaziland (111th); the Solomon Islands (104th); and Lesotho (100th).
And it has also slipped behind many of its Caribbean competitors, including Jamaica (67th); St Lucia (86th); Antigua & Barbuda (113th); and Barbados (117th). Until the past two-three years, the Bahamas was placed ahead of the latter two.
The Bahamas’ ‘ease of doing business’ decline has not resulted from anything it has necessarily done but, rather, the fact it has effectively ‘stood still’ while its competitors have enacted reforms enabling them to overtake this nation.
The Bahamas’ one-spot fall in the latest rankings was largely due to its 73-place drop on the ‘ease of paying taxes’, from 22nd in the world to 95th. This stemmed from its implementation of Value-Added Tax (VAT), and the extra burden it has imposed on the private sector.
Elsewhere, the Bahamas fell six spots - from 112th to 118th - when it came to protecting minority investors, and from 134th position to 139th on the ease of obtaining credit.
While the Bahamas maintained its 118th spot on the ease of ‘starting a business’, it fell from 108th to 110th on construction permits, and from 115th to 116th on getting electricity.
The only ‘bright spot’ was the 18-place improvement on the ‘ease of registering property’, but even here the Bahamas only moved from 184th in the world - near rock bottom - to 106th.