The Minnis administration
The Christie administration
182 total votes.
By RICARDO WELLS
Tribune Staff Reporter
MEMBERS of the Official Opposition have accused the Minnis administration of triggering Moody's looming review of this country's credit rating with damaging rhetoric, saying the actions and words of the current government prompted the threat of a new downgrade.
In a statement issued Tuesday, PLP Senator Fred Mitchell said the new administration engaged in "reckless" borrowing shortly after assuming office, stating: "You made the broth, so now stew in your own fat."
In a separate statement, the PLP's finance spokesperson and Exuma MP Chester Cooper said the Free National Movement's description of the country's finances since assuming office prompted Moody's latest stance on the matter.
The reaction came after Deputy Prime Minister and Minister of Finance K Peter Turnquest on Monday blamed the Christie administration's efforts to "hide the true extent" of the country's fiscal crisis on Moody's announcement that it has placed the Bahamas' Baa3 credit rating on review for a downgrade.
Mr Mitchell berated Mr Turnquest for his claims.
The former Fox Hill MP said the assertion put forth by Mr Turnquest reflected the thoughts of a person who had not read the Moody's report in full, noting the credit rating agency did not differentiate between the actions of either administration.
"All one has to do is read what Moody's said. They talked about the government and The Bahamas," Mr Mitchell noted.
"In our parliamentary debates, the leader of the opposition, our MPs and senators tried to warn the FNM, stop talking down this economy. We thought it reckless to borrow nearly a billion in their first week in office. We said the only reason for the less than promised fiscal performance was Hurricane Matthew. Moody's affirms that fact."
Mr Mitchell added: "Mismanagement and corruption by the PLP figured nowhere in what Moody's had to say. Those were FNM propaganda lines. Now look what you've done.
"And yet the only thing you can say, having called your own fish stink, is that it's the PLP's fault. As my mum used to say: 'You all ain't shame?'"
The Minnis administration previously announced plans to borrow $323m to cover the deficit for the 2017-2018 fiscal year and an additional $400m to cover the fiscal overhang for 2016-2017.
Moody's last week cited these revelations, together with poorer fiscal consolidation prospects, as the key factors behind its decision to place The Bahamas' sovereign creditworthiness on review for another potential downgrade.
The move comes nearly a month after Moody's indicated that it had been spooked by the incoming government's nine-figure review of budget estimates left by the former administration.
During the budget debate, Mr Cooper attacked Mr Turnquest's budget presentation for sending the wrong message to investors and the rating agencies with talk of $722m in new borrowing.
Despite calling for a bi-partisan approach to fixing the issue, Mr Cooper said yesterday the damage has already been done and urged the Minnis administration to "take a course of corrective action" as it looks to "stave off a likely downgrade".
Mr Cooper's statement read: "The FNM must, no matter how late to the game, develop an economic recovery strategy that will encompass drawing in more foreign direct investment, increasing the ease of doing business, continuing and expanding mortgage relief for troubled homeowners, job creation, reducing the cost of electricity, stemming the tide of crime, and further allowing Bahamian businesses to access global capital to increase employment, and laying out a plan to further develop our capital and Family Island infrastructure.
"To be sure, there is not much point at this juncture in blame-casting; and this latest development is nothing to be celebrated, as despite our divergent views, the failure of the FNM government will mean the failure of The Bahamas."
Mr Cooper said the government and opposition must work together despite their differences in philosophies and approaches toward the success of the country.
The Exuma MP called on the government to engage a bi-partisan solution to the problem and consult the top private sector experts in formulating an economic growth plan and appointment of an economic growth czar.
He added that organic growth from domestic investment and entrepreneurial growth through the streamlining of the business license process and significant investment in entrepreneurship via the Bahamas Entrepreneurial Venture Fund must be key to this new plan of action.
Touching on Baha Mar, Mr Cooper said the government must also "reject any suggestion that fosters uncertainty" regarding the development and its new owner Chow Tai Fook Enterprises Ltd.
Mr Cooper continued: "The Minnis administration's pontification over wild requests by Sarkis Izmirlian that suggests he should somehow reacquire the property at Cable Beach has surely led to uncertainty among those who would wish to book and invest in the property in this most fragile stage of its infancy.
"We note that S&P (Standard & Poor's) cited the stalled opening of Baha Mar as a reason for their downgrade. The former administration was successful in ensuring the opening of Baha Mar. We reiterate in the public's interest that Baha Mar must succeed.
"Mr Izmirlian remains a friend to The Bahamas and a permanent resident of this country. A prudent government would be assisting him in finding another project in the country in which to invest his considerable resources; the property at South Ocean situated next to Albany comes to mind.
"Anything less than full-throated support in word and deed for Baha Mar is potentially harmful to our economy at this time."
Mr Cooper also insisted the government postpone its resolution to borrow $320m to facilitate deficit spending this fiscal year and implement appropriate alternative strategies.
"We suspect this was mere posturing, optics, from the current administration with a plan to revise such a hefty downward outlook at the time of the mid-year exercise to appear the saviour of the economy," Mr Cooper noted.
He added: "But such dangerous games are not suited for serious-minded governments to play. Governance is serious business. This government should focus, like the last, on using the revenue and spending control tools at its disposal to focus on reducing the deficit, not prefacing the year to come with such a burdensome level of debt without looking for cost savings and ways to increase revenue."