The Tribune

By NEIL HARTNELL

Business Editor

nhartnell@tribunemedia.net

BAHAMIANS are too scared of foreign competition, a local businessman warned yesterday, adding: "We have to forget about being protectionist."

Bruce Raine, International Private Banking Systems (IPBS) principal, told Tribune Business that an increasingly globalised world economy meant Bahamians cannot rely upon the Government and its agencies to act as a barrier to foreign competition.

Pointing out that he has competed against overseas rivals "all my career", the specialist financial services software developer said computer and Internet technology was continuing to break down boundaries and distances between countries.

As a result, he warned that Bahamians had "to learn to compete" and be smarter than their rivals, adding that the Government's ability to keep competition at bay via the National Investment Policy and National Economic Council (companies), and Immigration Department (work permits), was eroding on a daily basis while undermining economic growth.

Mr Raine was speaking out amid fears that the Commercial Enterprises Bill, with its minimum $250,000 investment threshold for targeted industries and 'fast track' work permit approval, would result in foreign companies squeezing out Bahamian entrepreneurs and highly-skilled professionals.

The IPBS chief, though, credited the Minnis administration for seeking to boost economic activity and productivity via innovative legislation that was similar to measures introduced by international financial centre (IFC) rivals. "Look around and we see Cayman," Mr Raine told Tribune Business. "I've seen Cayman with that Enterprise City..... I could go in there and would get work permits automatically, one, two or three, if you subscribed for a given level of investment. I think that's what they're trying to do here.

"I don't know I have a problem with that," he added of the Bill's provisions. "All of my career in this business I'm in I've had to compete in a global market. If you want to sell software in Trinidad, Cayman, Bermuda or Turks & Caicos, I've always had to compete with foreigners."

Asked whether he thought Bahamian workers and companies are frightened of foreign competition, Mr Raine agreed. "I think we are and that's not good," he told Tribune Business.

"It makes us lazy. We are in a global world now. There are no boundaries, no walls any more; the computer and Internet make it so. We have to learn to compete and be as smart, or smarter, than the competition.

"If they set up here we have certain advantages over that guy. That's what we bring to the fore, and cannot rely on the Government to keep the competition out. We've got to fight in our own world."

Advocates of the Commercial Enterprises Bill will likely argue that the 'protectionist' measures fostered by the work permit and foreign investment regime have created a culture of 'entitlement' where Bahamians believe their nationality guarantees a job.

Such notions are viewed as undermining productivity and work ethic, but proponents of 'Bahamianisation' will counter that it has safeguarded the development of the Bahamian entrepreneurial and middle classes through reserving certain industries and jobs for locals only.

The Commercial Enterprises Bill, though, is likely a reflection of the Government's view that the Bahamas' current economic model has taken the country as far as it can, and that a new one is desperately needed to modernise the economy and break a decade-long low-to-no growth/high unemployment cycle.

"They're thinking in the right direction," Mr Raine told Tribune Business of the Government. "What they want to do is increase the level of business activity and productivity; that's a good thing.

"We've got work to do, no question about it, but we have to forget about being protectionist. We have to live in the world we're in. This is the problem we have; we've got too much protection."

The Commercial Enterprises Bill is designed to liberalise the granting of work permits by allowing senior executives and specialist personnel in targeted industries to enter the Bahamas without first obtaining such approvals.

They must apply for the necessary work permits within 30 days of arriving, and the Bill mandates that if the Immigration Department fails to approve them within 14 days of application receipt they will be deemed as automatically approved.

The legislation is also targeted at specific industries - chiefly foreign exchange earners, and those which have been cited by the Minnis administration as part of its economic growth and diversification strategy.

Financial services leads the way with reinsurance; captive insurance; investment fund administration; arbitration; wealth management; international trade and international arbitrage included in the 'fast track' work permit sectors.

Also listed in the Bill are technology-related industries such as computer programming; software design and writing; bioninformatics and analytics; nano technology; and biomedical health facilities.

The Government has targeted Grand Bahama as a technology hub, and the inclusion of 'boutique health facilities' on the 'fast track' list adds to the focus on health. Data storage and warehousing are also present, as is aviation registration and 'approved' aviation maintenance operations - again sectors that have been identified by the Minnis administration as potential growth drivers.

The list is concluded by 'call centres' and manufacturing and assembly/logistics businesses.