The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

THE Prime Minister yesterday said the proposed Sovereign Wealth Fund replacement will place The Bahamas “among the top tier” by helping to mobilise private capital and direct investment towards critical infrastructure projects.

Philip Davis KC, unveiling the National Funds Investments Bill in the House of Assembly for its first reading, said the proposed fund structure will enable The Bahamas to better target monies to key economic development priorities, maximise the value of public assets for the taxpayer and better manage the country’s natural resources.

Besides facilitating public-private partnerships (PPPs) with private capital and investors, he added that the National Investment Fund - and its various underlying sub-funds - will focus on areas such as Family Island infrastructure upgrades; the blue (ocean), green (environmental) and orange (cultural) economies; revenues obtained from carbon credits; the Government’s shareholdings in private companies; and the country’s traditional and biological resources.

“The legislation we are tabling today, the National Investment Funds Bill, will allow The Bahamas to maximise the nation’s assets, investing and deploying our own capital to expand access to additional capital and opportunities,” the Prime Minister said.

“Consider public-private partnerships (PPPs): If we only finance projects with government revenues or borrowing, fiscal constraints will significantly limit how much and how ambitiously we can build. Partnering with the private sector greatly expands the number and scope of infrastructure projects we can take on, allowing us to move forward on more projects on more islands simultaneously.

“Mobilising private capital in partnership with the Government is the most effective way to see significant advancement in expensive projects. Instead of the public having to contribute or borrow every penny for roads, schools, hospitals, airports and homes, we will invite the private sector to partner with us,” Mr Davis continued.

“Instead of the public having to contribute or borrow every penny to expand renewable energy, or improve our defences against hurricanes, we will invite others to partner with us to strengthen our resilience.”

Mr Davis said the National Investments Funds Bill would provide the regulatory framework to govern these activities, establishing how assets ultimately owned by the Bahamian people will be governed and managed.

“This is an essential first step in taking a comprehensive approach to national investment,” he added. “The new framework brings together a number of different strands of government fiscal operations relating to investments, and puts them into properly structured entities that enable partnerships with the private sector. Thus such partnerships can be effectively, efficiently and transparently managed in the national interest.”

Explaining how the National Investment Fund would be structured, Mr Davis said that immediately following the Bill’s passage the Government will proceed with the creation of The Bahamas Resilient Infrastructure Fund to help mobilise capital for the financing of Family Island infrastructure projects.

Underneath this fund will be a series of sub-funds aimed at promoting Family Island growth, food security and renewable energy. “We will also create national funds to leverage and maximise value in underutilised national assets,” Mr Davis said.

“We will co-invest these underutilised assets with private investment and capital in order, for the first time, as a matter of national policy to participate in projects that maximise value, appreciate in value, and utilise the value created to reinvest in national infrastructure priorities.

Pledging that the National Investment Fund will be structured in line with international best practice on governance, transparency and accountability, Mr Davis added: “This will put The Bahamas among the top tier of world class national funds, and demonstrate to Bahamians and to investment partners alike that they can be confident in the integrity of this fund and have confidence in doing business in The Bahamas and with the Government of The Bahamas.”