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Business Easier In Gaza Than Bahamas

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Deputy Prime Minister Peter Turnquest.

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The deputy prime minister yesterday pledged "drastic improvement" after the World Bank concluded it was easier to do business in the war-torn West Bank and Gaza Strip than The Bahamas.

KP Turnquest, pictured, told Tribune Business that planned reforms to the Government's processes and interaction with the private sector, driven by the increasing use of technology, would warrant "a significant upgrade" to The Bahamas' 118th spot in the World Bank's "ease of doing business" index.

While that represented an improvement of just one spot from last year's 119th position, the World Bank still put The Bahamas two places behind the 116th-ranked West Bank and Gaza Strip - the Palestinian territories regularly subjected to bombardments, economic blockades and lengthy power outages as a result of conflict with Israel.

Mr Turnquest, though, said The Bahamas was frequently "short changed" by assessments from the World Bank and other international agencies, which often failed to account for improvements and reforms enacted by this nation.

He added that the Government will initiate legal reforms to give effect to recommendations from its own "Ease of Doing Business" committee, chaired by Lynn Holowesko, when the mid-year budget is unveiled in the House of Assembly in early 2019.

The Minnis administration's critics, though, are likely to seize on the World Bank's latest findings to argue that its much-touted "ease of doing business" focus has yet to bear fruit, with The Bahamas effectively "treading water" and going nowhere fast in terms of improving its competitiveness and attraction for foreign direct investment (FDI).

In truth, both the Government and its political opponents can use the latest World Bank index - with its rankings for 2019 - to make their rival cases. The latest rankings do represent an improvement, albeit the smallest possible upgrade, and provide further evidence that The Bahamas' has "bottomed out" by arresting multiple years of slippage in the index.

The Bahamas' lowest-ever ranking came in 2016, when it fell to 121st spot, prompting alarm among the private sector and swift pledges of fundamental reform by the then-Christie administration to turn the situation around.

Its successor can point to initiatives such as the Commercial Enterprises Act, which streamlined the Immigration regime for approved companies in targeted industries, and introduction of the "single portal" Internet window for start-ups' Business Licence applications as moves that could have merited a much higher upgrade from the World Bank.

The reality, though, is this nation has only improved by three places over two years, and remains a long way short of its former "ease of doing business" slot in the 60s and 70s spots - a position that once placed it in the world's top-third.

The Bahamas' ranking below West Bank and the Gaza Strip is likely to be both alarming and embarrassing, although some aspects of the Palestinian territories' ratings appear questionable - especially their 54th spot for "ease of trading across borders", given that the latter area is currently blockaded by both Israel and Egypt.

Mr Turnquest, while arguing that the World Bank and other agencies often fail to give due reward for implementing reforms, yesterday conceded that The Bahamas has to go further in protecting its economic and investment reputation.

"It's typical that they don't give you the credit but, by the same token, we still recognise we have some work to do," the Deputy Prime Minister told Tribune Business. "Hopefully in the next update we will see some further improvement.

"There are some legal changes, and the implementation of technology solutions, that we think will bring about drastic improvements that warrant a significant upgrade."

Mr Turnquest identified these as "the single [Internet] portal for doing business with the Government from a business point of view, as well as technology upgrades we are looking at for government services as a whole".

He declined to identify those specific "upgrades" and "services", as they did not fall under his Ministry, but promised they would lead to "modernisation throughout the system and the way the citizen interacts with the Government and maintains its records".

The Government is already exploring the use of blockchain technology for maintaining Bahamians' education records, and Mr Turnquest said the Minnis administration was "going to do our best" to eliminate the "red tape" and bureaucracy frequently encountered by Bahamians.

"All this goes to our reputation and our attractiveness as an investment destination," he acknowledged of The Bahamas' "stand still" in the "ease of business" index. "Obviously we are keenly interested in ensuring The Bahamas is best positioned, particularly among our regional peers, as the preferred and easy destination in which to do business."

While The Bahamas ranked above Barbados, St Vincent and the Grenadines, Guyana, St Kitts and Nevis and Grenada in the latest World Bank rankings, it was behind Jamaica, Trinidad & Tobago, the Dominican Republic, Dominica, and Antigua and Barbuda. Jamaica led the Caribbean in 75th spot, an area once inhabited by The Bahamas.

Mr Turnquest, meanwhile, confirmed the Government's "ease of doing business" committee, headed by Mrs Holowesko and attorney Bryan Glinton, had submitted their final report.

"We are in the process of evaluating all the recommendations that have been made, and are providing and drafting legislative amendments that are necessary to give effect to some of what has been made," he told Tribune Business.

Mr Turnquest said these changes will be unveiled with the mid-year Budget, and emphasised that the Government planned to press on with reform regardless of how The Bahamas is ranked by the World Bank and others.

"Generally speaking, all of these ratings people have short-changed us with respect to the tremendous effort made, and improvements made, to various systems," he said. "We continue to press on, recognising no one is going to give us anything, and that we're going to have to go out and demonstrate and prove it.

"There's definitely keen interest in this area. It is the focus of the Government, and I'm confident we'll achieve the necessary results. The fact we have not dropped in the rankings is a significant achievement. The fact we are making changes is a net positive."

The World Bank's latest index did give The Bahamas credit for reforms that made it easier to pay taxes and obtain credit. The former referred to the online system for filing and paying Value-Added Tax (VAT), while the latter was boosted by the passage of legislation that governs the proposed Credit Bureau.

And The Bahamas' achieved a modest improvement in its scores in six of the 10 categories in which itself and 189 countries were rates. The improved scores were obtained in the categories of paying taxes; starting a business; dealing with construction permits; getting electricity; registering property; and resolving insolvency.

Together, this contributed to a modest rise in The Bahamas' overall score, but was not enough to alter its "inertia" in the World Bank rankings. And many Bahamian consumers and businesses are likely to regard it as ironic that the category in which this nation is ranked highest, at 50th in the world, is "paying taxes". This represented an improvement on the prior year's 55th spot.

The Bahamas also saw modest year-over-year improvement on "starting a business", where it rose from 108th to 105th, while it moved upwards on the "ease of getting electricity" - from 117th to 87th.

But, in the other categories, the only way appeared to be down. The Bahamas fell from 86th to 91st for "dealing with construction permits"; from 142nd to 114th on the "ease of getting credit"; from 167th to 169th on the "ease of registering property"; from 157th to 161st in "trading across borders"; from 129th to 132nd on minority investor protection; and from 74th to 84th on enforcing contracts.

The World Bank's annual 'ease of doing business' index is used as a key indicator by international investors to guide them in their decision-making, as it enables them to gauge how easy it is to conduct commerce in a particular nation.

Smooth regulatory processes are especially important to a Bahamian economy positioned as an international financial and business centre (IFC), but investors will be especially wary of allocating capital to projects in low-ranked nations, or those that have suffered consecutive falls such as the Bahamas, as this gives them the impression that their investments will be unsafe, and caught up in too much bureaucracy and red tape.

Comments

The_Oracle 11 months, 3 weeks ago

The truth sucks. No amount of Technology and reform of processes can overcome the simple and arbitrary civil servant obstacle/refusal to stamp/sign/facilitate without favor/bribe/sweet talk. The existing processes served the British empire for centuries, based on civil servants "serving" Fix the damn people! stop appointing those who would "set up shop" within government departments.

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TheMadHatter 11 months, 3 weeks ago

"Mr Turnquest, though, said The Bahamas was frequently "short changed" by assessments from the World Bank and other international agencies, which often failed to account for improvements and reforms enacted by this nation."

Yeah. LOL. The Bahamas doesn't suck, it's just that others fail to account for our wonderfulness. I don't know what the word is to describe that psychosis, but i'm sure it's hard to pronounce.

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bcitizen 11 months, 3 weeks ago

I have to take blood pressure pills and Ativan before l enter any government office. They work harder at not working than if they just did their job.

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TheMadHatter 11 months, 3 weeks ago

"Mr Turnquest, though, said The Bahamas was frequently "short changed" by assessments from the World Bank and other international agencies, which often failed to account for improvements and reforms enacted by this nation."

LOL. Yeah sure. The Bahamas doesn't actually SUCK - it's just that others "fail to account" for our wonderfulness.

That's the silliest one so far this year. These fellows need to move to Hollywood and do stand-up.

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OldFort2012 11 months, 3 weeks ago

I have an idea how to climb that ladder 50 places in one fell swoop: fire everyone in the civil service, replace with no one. Just leave empty chairs.

Problem solved.

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ohdrap4 11 months, 3 weeks ago

oh i though you were planning to bribe the inspectors.

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bogart 11 months, 3 weeks ago

The DPM has to be given credit for using the term "short changed"....given that as a businessman affiliated wid an airljne....competing with Bahamasair a heavily sibsidized airline......an he being tne Finamce Minister has to hand over tne taxpayers money to Bahamas.air....takes a lot of kajones to do that....

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BMW 11 months, 3 weeks ago

Two words come to mind actually threecome to mind when i think of the civil servants:lazy,slack and pompeus!

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ted4bz 11 months, 3 weeks ago

It’s hard for foreigners to do business in this country because it’s designed by the white Bahamian oligarchs to prevent the negros from getting ahead without party permission. Now that they embrassed and forced to reform their antiquated schemes intended against Bahamian negros they will do this nonetheless in ways that red tapes remain in place for the negros while red carpet are rolled out for the foreigners. After all look whose chairing the reform -the Holoweskos, the UBP group, FNM and PLParty masters!!!!!!

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DDK 11 months, 3 weeks ago

You could not be more erroneous in your assessment. It is hard for ALL BAHAMIANS and foreigners to conduct business in the Bahamas because it is run by BAHAMIAN civil servants.

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sucteeth 11 months, 3 weeks ago

If it wasn't for the white Bahamians nothing would get done in this country. All others always have their hand out looking for donations or whatever else they can swing you out of..

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Chucky 11 months, 3 weeks ago

If truth be told this the single biggest problem foreigners complain about. Bahamian tactic of continually moving the goal posts. You can never get to the finish line.

Sadly, it's my belief that my fellow useless Bahamians deliberately cause this, but there are so many reasons, and it's very complicated.

Unfortunately this problem is not going to be legislated away. It's like everything else. It will take at least a generation of change to begin showing improvement. And that's from when we start. And the start will have to cover many things like education, crackdown on corruption and nepotisim, a change of attitude across the board, ridding society of the dregs who designed this system to their benefit.
Clearly this won't happen. Those who reap the rewards don't want to open the shop to competition.
Our country, as far as the little people are concerned is doomed.

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DWW 11 months, 3 weeks ago

Good laughs. Seriously though until this country is able to allow quick and efficient land transfers without 12 to 24 months of lawyers fees. Ain nuttin goan change. Until we have a proper zoning and planning document ain nuttin goan change. Until someone can explain to me why the country is the way it is I will never believe that anything will change. Banks wont lend against property that can't be cleared title. Tell me how does a condominium have title problems when the one next door doesn't? Why because the legal profession is making too much money fleecing the bahamian economy. And the registry is stuck in 1786

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