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Gb Chamber Chief: Make Enterprises Bill More 'Flexible'

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

THE Commercial Enterprises Bill should be made more "flexible" by including "attributes" other than direct capital outlay in the $250,000 investment calculation, a businessman urged yesterday.

Mick Holding, the Grand Bahama Chamber of Commerce's president, told Tribune Business that the minimum investment threshold should be "less arbitrary", with investors given 'credits' towards that benchmark for other aspects such as job creation and bringing new technologies/skills to the Bahamas.Arguing that direct capital outlay should not be the only criteria used to determine whether qualifying start-ups have met the Bill's criteria, Mr Holding welcomed the legislation as a further potential boost for Grand Bahama's economy. "I'd like it to not solely be direct capital investment," he suggested of the $250,000 threshold, "but also take into account job creation. Every job created would be worth 'x' towards that $250,000, and there's also credit given to other things.

"If the investment fits into a particular business we are seeking to attract that gets entered as another credit. If we're trying to attract a certain industry, and a business invests $100,000 but creates 12 jobs and brings new technology to the island, they should get a credit for that.

"It doesn't have to be new technology that they bring, but a new skill or trade that doesn't exist here and be of benefit to the Bahamas."

Essentially, Mr Holding's argument is that the Government should take a more holistic approach in assessing a company's overall economic impact, rather than just its capital investment spend, when determining whether it has met the Bill's minimum $250,000 threshold.

Given that the Commercial Enterprises Bill has now been passed by both parliamentary chambers, and is now making its way to the Governor-General for assent and passage into law, it is unlikely that Mr Holding's suggestions will be incorporated.

Still, he reiterated that "rather than leave it totally arbitrary" the Bill should be more flexible on its $250,000 'investment' definition, adding: "It should recognise other attributes besides capital investment."

Mr Holding told Tribune Business that the Commercial Enterprises Bill would "go hand in hand" with the Government's plans to make Grand Bahama an offshore 'technology hub' and the recent associated Summit, plus its impending repeal of the Grand Bahama (Port Area) Investment Incentives Act.

Suggesting that the 'technology hub' plans had probably helped drive the Commercial Enterprises Bill's creation, the GB Chamber chief said the latter would tackle a long-standing problem he had identified.

"I've argued for some time that the $500,000 capital requirement for foreign investors is somewhat arbitrary," he told this newspaper. "It's been reduced in this case to $250,000, but I always thought the absolute requirement for a $500,000 investment was inflexible and didn't take into account other important factors.

"You can have a new technology business that requires just a half dozen chairs and desks, and half-a-dozen computers. That doesn't stack up to a $500,000 investment."

A similar point was made by Brent Symonette, minister of financial services, trade and industry and Immigration, who explained that the lower $250,000 investment threshold was selected because some of the targeted industries - call centres, maritime brokerage and technology start-ups - did not require significant upfront capital.

Mr Holding, meanwhile, also supported the certainty that would be created by the Commercial Enterprises Bill's 'fast track' work permit process, which mandates that the Immigration Department approve permits for senior executives of targeted industries within 14 days.

"I've seen too many cases in the past where businesses have come to the Bahamas, but they find it very difficult to start up operations because they can't get work permits for senior executives," he told Tribune Business. "The timeline is important so that when people come to invest they can say: 'I'm good to go'. Fourteen days is reasonable because Immigration can still say 'no'."

The Bill provides for work permits to be issued for up to three years, and renewed for a similar term, with the Government arguing that six years should be sufficient for companies to train up Bahamian understudies to replace the expatriates.

Mr Holding agreed that the process "can't be carte blanche", with companies obtaining as many work permits as they liked, and backed 'knowledge transfer' and training for Bahamians.

Yet, describing the Bill as "a boost", he added: "I think it will dovetail in quite nicely. Having launched the Grand Bahama Technology Summit, and invited companies to come here and start businesses here, to make some steps to say we've made it easier with this Commercial Enterprises Bill sends a strong message to them I would have thought."

Mr Holding added that the Commercial Enterprises Bill would also complement the Government's Grand Bahama (Port Area) Extension of Tax Exemptions Bill, which will provide a 'blanket' 20-year renewal of expired tax exemptions for Freeport's licensees and homeowners, not just the Port Authority and Hutchison Whampoa.

"We at the Chamber of Commerce had lobbied for that for most of 2017, so we were very happy to see that happen," he told Tribune Business of the new legislation. "It gives 20 years of certainty to any business looking to invest in Freeport with these tax concessions.

"Prior to that, where you were left to apply and there was uncertainty as to the length of concessions, that meant businesses wanting to invest didn't know what their costs and liabilities were going to be.

"It's all about creating an environment of certainty. The work permits work into that as well. If licensees know they have the tax concessions, they can plan on 20 years, and plan on having the work permits for three years. It creates certainty."

Comments

banker 1 week, 2 days ago

This gentleman has it right. There should be no arbitrary amount if the business can come in and operate successfully. The economic offset will be huge. And let's take the politics and training bullsh*t out of the equation. The goal of any business is not to train Bahamians -- it is to make money. If a business needs to import ALL of their workers, they should be able to.

Business is very Darwinian -- survival of the fittest and most efficient. The political donkeys do not realise how much it costs to transplant a foreign worker. It is a huge drain on capital. If it makes sense to use Bahamians, they will. Simply because it is good economics. If the path to profitability is without Bahamians, so be it. A viable successful business is worth its weight in gold if it operates in the local economy. These businesses aren't buying Bahamian patrimony, like the hilltops and beaches that we sold to the hospitality industry. They are not getting Crown land. They just want a frigging office, a bank account and the freedom to make money.

The trouble is, in spite of others think, you cannot simply train Bahamians or others for that matter in a year or two. Nothing replaces several years of experience in a job -- especially a job in the knowledge industry.

Either we open our doors and let the business sunshine enter or we build walls, live in our own declining cesspit and throw shiite at each other. The trouble is, we have gotten good at the latter, and we don't mind the smell anymore.

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mandela 1 week, 2 days ago

A question, if Baha-Mar $4.4 billion investment hires would be around 5 to 6000 jobs.A $250,000 investment x 18 investors equaling $4.5 billion with approximately 20 hires each (which i doubt) will only be 360 jobs, i don't see how this will stimulate the economy on a whole.

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gbgal 1 week, 2 days ago

Banker makes a valid point regarding Bahamians and jobs. Business is for making profits; the owners take the risks and direct the actions. Leave 'em be to get on with the business. Qualified Bahamians are employed all around the world and they choose when and if to return home. Who knows? If new and challenging opportunities opened here, these persons may be tempted to return. Also, jobs in the technical fields and other entrepreneurial startups here might stimulate our young people to strive for excellence in school and prepare themselves for keen competition in the job market. Possible...

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