By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
Super Value’s owner says he is opposed to joining the WTO and will never change his mind even if studies determine “it’s the greatest thing for The Bahamas”.
Rupert Roberts told Tribune Business he fears that full World Trade Organisation (WTO) membership “doesn’t fit” the Bahamian economy, especially given its minimal physical goods exports, and that it will result in “a free for all” overwhelming both local businesses and consumers.
He warned that the government will face “a big, big push back” from Bahamian voters if it pushed forward with the WTO accession process against their wishes and, while arguing that a referendum is not necessary, suggested it conduct “a comprehensive survey” of public opinion before proceeding.
“I’m not sold on WTO,” Mr Roberts told this newspaper. “I oppose it. I’m afraid that with WTO we’re going to have to reduce duties, and if we reduce duties to 15 percent we will have to raise VAT to 25 percent, and that creates problems for us with consumer dissatisfaction. We would have to face that.
“I feel that no matter what they [the government] say, no matter what they promise, no matter what they negotiate, that we are going to have free movement of labour. All the banks in the world will be coming in, all the supermarkets in the world will want to come in.
“I think it will be a free for all, and not fair to Bahamians and not work for Bahamians. Yes, I oppose it, and I think there’s members of the chamber that oppose it.”
Mr Roberts’ position is significant since he is the first major Bahamian businessman to come out so strongly against the government’s policy decision to push forward and complete an 18-year WTO accession process - the longest ever in the organisation’s history.
The timing of his remarks is also interesting given that a government delegation, headed by Brent Symonette, minister of financial services, trade and industry and immigration, and Zhivargo Laing, the chief WTO negotiator, last week went to Geneva for the fourth Working Party meeting on The Bahamas’ accession bid.
The delegation will this week likely brief the Government, and private sector, on the outcome of those talks and what they may mean for the terms of The Bahamas’ accession, specific industries and the wider economy.
The 15 percent duty rate mentioned by Mr Roberts refers to the fact that The Bahamas must cut its average tariff rate to that level - from the present 32 percent - as part of its accession to full WTO membership.
However, the Government and its negotiating team will likely argue that fears of a 25 percent VAT rate to compensate are unfounded. The VAT rate increase to 12 percent, implemented with the 2018-2019 budget, will likely remain in place long-term to make up for the reduction in tariff rates and associated revenues.
Estimates for how much tariff revenue will be foregone range from $40m to between $100m-$200m. The rationale for the VAT rate hike was to enable the Government to pay off a $360m unfunded arrears backlog, which should be accomplished in time for both the WTO tariff cuts and next general election.
The Government has also frequently argued that WTO membership will not facilitate the free movement of labour, meaning the ability of foreign nationals to enter The Bahamas to live and work. Such a concept was associated with the CARICOM Single Market & Economy (CSME), which The Bahamas has not signed on to, whereas WTO is concerned with free trade in goods and services.
And Mr Symonette and others in the administration have also frequently asserted that WTO membership will not result in an influx of foreign companies and multinationals, pointing out that the Bahamian economy is already greatly liberalised - especially on the service side - and that the Government will still be able to approve who comes in via its “horizontal commitments”.
But, confirming Mr Roberts’ opposition, Super Value’s stores now feature promotional material from the Bahamians Against WTO group, carrying messages such as: “WTO is not wanted in The Bahamas. Bahamian businesses will be no more.”
The Super Value chief said he could not see any Bahamian industry benefiting from WTO membership - not even accountants and attorneys. He added that he would remain opposed to joining even if the Chamber of Commerce-commissioned study by Oxford Economics produced overwhelming evidence in favour of accession.
“If the Oxford group comes along and says this is the greatest thing for The Bahamas to join the WTO, I still don’t want it,” Mr Roberts told Tribune Business. “I don’t think it’s good for us. I’ve seen so many things that we cannot trust, but which this country hopes can happen, especially politically.
“It gets changed, and this group gets screwed. There is not one benefit. We don’t have much to trade. Why do we have to join the WTO when we have little or nothing to trade? My answer is no.”
The Oxford Economics study, due to be completed and released imminently, is intended to analyse WTO’s likely impact on the overall economy as well as key, specific industries. The Chamber has said its findings will determine whether it supports or opposes the accession bid.
“From what I know about it I’m against joining the WTO. I don’t see how it could be good for us. We can’t compete with the world, and can’t let the world in,” Mr Roberts added. “When I say compete with the world, Bahamian can go outside and become world beaters and world leaders, but overall I don’t feel it would be good for us.
“I’ve heard a speech by Rand Paul [US senator] calling for the US to withdraw. It looks like the WTO has served its purpose and the world should be rethinking it, and countries rethinking it, and coming up with something better than one size fits all. The size doesn’t fit The Bahamas.”
Last year’s G-20 summit communique, issued under pressure from the US, called for reform of the WTO, which serves as the overseer for the world’s rules-based trading regimes. This has produced several calls locally for The Bahamas to hold off from joining until the outcome of such potential changes becomes clearer.
“I don’t think we need a referendum,” Mr Roberts said of WTO’s political implications. “All government has to do is a comprehensive survey of how Bahamians feel, and they shouldn’t go against the wishes or desires of Bahamians. If the electorate feel we should not, they should not.”
Agreeing that the Government seemed to be moving the WTO accession forward regardless, he warned against ignoring the Bahamian people’s will. “I think they’ll have a big, big push back from the voters if they were to do that,” he told Tribune Business.
“We elected them to make the decisions for us, but this is too big a decision, and a decision the voters are against. That will be a problem for them politically.... I think they’re going headlong into it. That’s what it seems like. I hope they can get a vote through Parliament because I think the businessmen in parliament are against it, and if enough are against it they may as well quit now.”
Arguing that the Government had not come close to making the case for full WTO membership, the Super Value chief told Tribune Business: “The people that are for it should help show us where it’s good for us. Even the Government should do that; show is it’s good for us, convince us it’s good for us.”
Comments
ohdrap4 5 years ago
Better to speak out late than ever.
The chamber of commerce just wants to walk around in suits and get free business lunches.
One 5 years ago
Rupert Roberts is pushing his own agenda under the guise of protecting the Bahamian way of life. Speculating a VAT increase; which will distract most people onto his side. Wealthy Bahamians had an opportunity to help their country and look at the state we're in. The community country is dead and now everyone is for themselves. In this environment we need a free market so that wealth and success isn't hoarded by the same folks.
ThisIsOurs 5 years ago
Free market? WTO will do nothing for regular Bahamians.
The only difference it could make is to replace Rupert Roberts with his foreign corollary. WTO will not produce a cheaper cost of living, any price reductions in tbe cost of goods and services will be replaced by higher taxes. I'm even skeptical on the lower prices because if they implement a corporate tax what will happen to insurance premiums and our BPL bill. These guys couldn't swallow a 7.5% VAT. WTO will mean that less Bahamians own some of the pie. But thst only matters if you had a piece in the first place.
What would make a difference is training, education and real support for entrepreneurs, NONE of which require the WTO. It requires vision.
realitycheck242 5 years ago
Mr Roberts can see that his Super Value chain will go the way of City Markets as soon as the Bahamas joins the WTO. Market forces will prevail with the likes of US giants Publix and Kroger waithing in the wings
Dawes 5 years ago
Whilst i think publix etc would easily beat Super Value if they wanted to, why haven't they come already. I thought City market was owned by a foreign company before Tiger. Wouldn't that mean foreign companies can enter over here? Or was that a one off?
DDK 5 years ago
WTO = VERY BAD IDEA. Bahamas like a little minnow waiting to be gobbled up by the ruthless sharks of the world. Mr. Roberts may be pushing his own agenda but he is right on this one.
Economist 5 years ago
It is sad when people, like Mr. Roberts, who should know better are so arrogant with their ignorance.
The biggest food wholesaler in The Bahamas is already foreign owned and has been for years. Foreign companies are not and will not be knocking down our doors to come here. We have a very small insignificant market.
Publix was in The Bahamas and pulled out.
We have a unique market so it is unlikely anyone of the big companies will be here soon.
Also look at Shell and ask yourself why they decided that this market was not worth the trouble to them?
Going into the WTO will open the rest of the world to young entrepreneurial Bahamians.
Yes Mr. Roberts, those young upperty citizens that that you would like to remind to remember their place.
ThisIsOurs 5 years ago
Open the rest of the world to who? Its a fallacy Its a fallacy. What stops a young Bahamian entrepreneur from flying to Florida today to find a copacker? Nothing.
Has WTO done anything to help our Caribbean neighbours develop a profitable world market? No. It's like saying the CEB bill will create hundreds of Bahamian tech startups. No it's a welcome mat, not for "every" foreign firm, frankly the large ones won't be interested in us, its for the small ones who see a market with little competition that they can dominate. Roberts could be wiped out by Wal-Mart 5th cousin.
Economist 5 years ago
The point is, why should he have to fly to Florida? At the moment The Bahamas is our only market. And we can't even sell our products here for lack of internationally recognized certification.
We have all these tourists. Try getting a Bahamian grown or made food products into the hotels.
The successful Haitians are not coming to The Bahamas. Only the poor, who our Bahamas Defence Force openly allow to come in by the thousands.
The population growth in Haiti far exceeds the ability of any country to expand economic growth to absorb their ever growing population.
BahamaPundit 5 years ago
Re Economist What goods are you trying to sell but aren't allowed to? Switcha? Nope. Or are you just making things up?
ThisIsOurs 5 years ago
Youre right about Publix, we are too small. The CEB bill has already shown you who will show up. The jokers. But even the jokers have more money than the average Bahamian and in a market with no competition they can dominate.
BahamaPundit 5 years ago
Re Economist Are you dreaming? If WTO is so great, why are all the Haitian and Jamaican "young entrepreneurs" (from WTO member states) beating down the door to get into The Bahamas? People chase money not WTO pipe dreams. Zuckerberg didn't need WTO to start Facebook, he used something vastly Superior to WTO, his brain!
BahamaPundit 5 years ago
Mr. Roberts is right about his point on duty. How will the removed duty be replaced? Either VAT will rise to 25% or income tax (more likely) will be implemented. The WTO offers absolutely nothing positive for Bahamians. The only ones that will enjoy it are government and their cronies and those who like to attend conferences and banquets. Get real Bahamas! Do nothing Minnis is using WTO as a smoke screen, because he has nothing to offer The Bahamas other than the status quo.
TalRussell 5 years ago
Yes,, yes one thing is straightforward - comrade Rupert, speaks likes a true protectionist link keep all doors locked stiffer competition, yes, no..... And. say Colony of Out Islands is a importer and is dubious argument say - WTO gon' be bad - cause we're not an exporter, yes, no?
DonAnthony 5 years ago
It is time to move on from having a few wealthy families dominate retail in this country. It amounts to a subsidy where the profits are restricted to the very few. Meanwhile the masses pay a higher price than they would otherwise. Let these large foreign conglomerates enter the market and because of economies of scale prices will fall. Perhaps institute a regulation where at least 50% of the shares in these companies are offered to the Bahamian public. As it is now these private firms are very tightly held and it leads to the widening income inequality we are facing today.
Case in point is Mr. Roberts who is the largest shareholder in commonwealth bank which IPO ed in 2000 and has thousands of Bahamian shareholders benefiting from its success. It allows a very wide base of Bahamians to benefit from the economic pie. Supervalue on the other hand does not. To encourage firms to be listed on BISX those that meet a certain threshold ( say at least 25% public ownership and at least 1000 Bahamian shareholders) should pay a far lower business license fee than those firms that hoard profits in the hands of the few.
BahamaPundit 5 years ago
Good points but WTO has very little to do with what you are saying. Bahamians will not be offered shares in any WTO companies that come here.
DonAnthony 5 years ago
I must say I know very little about the structure or terms of our entry into WTO. It shows that the government has done a terrible job explaining it to the Bahamian people. I am certainly in the camp that is sceptical that the pros will outweigh the cons. But I am confident that we have the discretion to mandate a certain level of Bahamian ownership in these companies if there is the political will to do it. The United States is in the WTO and prohibits more than 25% foreign ownership in any domestic airline carrier. I would imagine there are many other examples of this.
I am sure too that as broad a base of Bahamian ownership in these companies is the way to go. It simply empowers the average Bahamian to have an opportunity to share in the wealth creation in this country. It makes no sense to restrict a local market so a few individuals can reap the profits of artificially high protectionist restrictions that raise the cost of living throughout the country and they refuse to allow others who pay the cost of these subsidies to benefit as well. Government needs to do more to incentivize firms to offer shares to the public.
ThisIsOurs 5 years ago
I was given an interesting perspective on share offerings to the Bahamian public. The point made was it's more of a marketing ploy. In general Bahamians don't have the resources to hold on to long term investments. Over time they sell the shares and the sharks have arrangements with the clearing house to buy shares above the market price. At the end of the day the offer of shares still ends up with the people with the money, not spread into the community.
The only solution is to give people something they can keep and that can help them to pull themselves up and that's education. I see alot of lip service let's give away a few tablets programs but no real vision or targets for a successful training program. I mean they make a grand announcement about free tuition at UB then UB reply with we have to hike fees. This is the consistent example of non thinking political games being played with our future. Just say anything to get a vote.
DonAnthony 5 years ago
It is an interesting story you were told and there may be some truth to it but I suspect very little. The facts are that commonwealth bank has more than 4000 different individual Bahamian shareholders, the Arawak Port over 10000. Those are not inconsequential numbers in a population as small as ours and could be much larger if the government cared more about stock ownership and wealth equality.
For those wise and lucky Bahamians who hold on to their shares long term, share ownership can be financially liberating and life changing. It has certainly changed my life. I bought into Bahamian companies with the earnings from my first paychecks, very small amounts, but consistently month after month, year after year. As Albert Einstein said the most powerful force in the universe is compound interest. I was able to retire after only working 13 years. What I did any Bahamian with a modest income, frugal lifestyle and discipline along with investing savvy and some luck can achieve, but it would have been impossible without the opportunity to invest in Bahamian companies and by extension BISX.
ThisIsOurs 5 years ago
The individual gave the scenario in reference to the cruise port company offering loans to buy shares. I'm going to bet that those 20,000 shareholders are doing ok and aren't wondering how they're going to buy goods and pay the electricity bill. I agree with you that it's a path to great wealth but I think it's also true that you have to have something to play with. The sales pitch that the poor people in the inner city will benefit is a dream. They can't keep their lights on, they need a step up first.
realitycheck242 5 years ago
This would be a great move. Commonwealth Bank initiated their IPO in 2000 because pop wife sold a portion of her large share holding in the bank. With the thinking of the likes of Mr Roberts. It may take one of his kids to finally decide to go the IPO route for super value because his mind set is colonial and he does not beleave in spreading the wealth to the masses. Joining the WTO may just be the thing that forces his hand.
DonAnthony 5 years ago
It also makes great business sense for companies to have as many shareholders as possible as this creates loyal customers. I patronize those businesses that I own stock in and offers shares to Bahamians. I therefore buy my gas from Shell, never from Rubis. Why should I help a foreign company that does not give a damn about me when I could help a Bahamian one I am a shareholder of? I know that with every purchase I am benefiting in the sale. I rather shop at Solomon’s than at supervalue. If Mr. Roberts had an IPO for supervalue he would have a built in base of very loyal shareholders who are also customers.
ohdrap4 5 years ago
actually, if I am not mistaken, in the early 1990s Supervalue offered sahres to its employees, but they promptly sold them back not understanding long term investment, perhaps the reporter can inquire.
OTOH, I recall City Markets shareholders inside the harbour bay store having a heated discussion after it had been sold, an saying something like they patronized there because they had shares, and rowing over the state of affairs. What happened to them? THEY WERE ROBBED BY THE CORPORATE RAIDERS WHO BOUGHT CITY MARKETS, JUST LIKE THE EMPLOYEES WERE.
Now, let us have tally of bahamian investors who were robbed in these share offerings? I can think of a few. A former employer of mine offered an IPO once, I just did not buy any of what they offered and I was looked upon as a pariah. I left the company after that. A few years later, the company folded and the employees never recovered their investment, neither did the members of the public who invested.
realitycheck242 5 years ago
Some of the failed IPO s that come to my mind in the Bahamas recent history include RND cinemas, Benchmark Bahamas LTD,, Freeport Concrete was also a major failure and Bank of the Bahamas. You are right in saying city market was a failure, there is hope still for BOB if the political interference is removed from that institution. . Cable Bahamas can also be considered failure with the absence of divididend payment over the last few years
realitycheck242 5 years ago
Meanwhile with the amount of Chinese stores popping up in the retail sector and Chinese businesses in other areas, one can easily conclude that the WTO assention has already arrived
Well_mudda_take_sic 5 years ago
When politicians, academics, think tank nerds and international agencies all get together to try sell us on something like joining the WTO, we should all know by now that's a definite signal we should be running the other way as fast as we can. Joining the WTO would be the equivalent of giving up our economic sovereignty to foreign corporate interests and others who could not care less about the Bahamian people. The WTO was created by the largest developed countries to allow their constituent interests to rape, pillage and plunder smaller less developed countries around the world, like the Bahamas. They will tell us we can't have tariffs and protectionist policies that serve our economic needs, all the while they go about putting in place their own tariffs and protectionist policies that serve their own economic needs. The WTO is not for us and anyone who tells us otherwise should be viewed with great suspicion. End of story.
TalRussell 5 years ago
Yes, yes comrade Rupert worked for Sir Stafford Sands. operating under the City Market and out Jacksonville Florida's Winn-Dixie banners, yes, no?
rcap 5 years ago
BONEFISH 5 years ago
The Bahamas should have been part of the WTO from the beginning.We have wasted so much time for this accession process.This country is badly in need in need of modernization in trade and how business is conducted in this country.
BahamaPundit 5 years ago
The truth of the matter is New Providence is vastly overpopulated. With Baha Mar, Atlantis, Albany etc. jobs should not be an issue here. But, with its swelling Haitian population, there will never be enough jobs in New Providence with or without WTO. Go check our public schools and you will see thousands of Haitian students being educated for work in New Providence. The sad fact is this tiny island state will never have enough jobs to gainfully employ even half of the Haitian immigrant population, let alone its own people. We have too many people on this 21 by 7 rock period!
truetruebahamian 5 years ago
I have been railing against WTO for years, yet nobody hears. Those who are drawn in by the circus and the disney lights become convinced like Zhivago Laing. He adopts a very aestheticly united states approach to the concept, but forgets that most of us are not 'Merkins and have a better understanding of the tides that affect our shores. We are not them. We do not wish to be them, and we will fight tooth and nail to be away and not subjugated by them. I am Bahamian and want for us nothing to do with the WTO.
TheMadHatter 5 years ago
"The Oxford Economics study, due to be completed and released imminently, ..."
I just double-checked my calendar and could not find the month of Imminently. Maybe somebody tore some of my pages out.
Mr Roberts is correct. The sad thing is the majority of Bahamians know the words to Redemption Song by Bob Marley, but dont see the new merchant ships on the horizon. The govt is getting ready to sell us by June of next year. I wonder if the former Head Boy of Hawksbill High currently leading the charge, had back in the 70s thought that one day he would offer up the heads of his countrymen to foreign masters. Is that what it means to be Head Boy?
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