The Tribune

By FAY SIMMONS

and NEIL HARTNELL

Tribune Business Reporters

A gas station operator yesterday said his faith was now “120 percent” restored over the Government’s intention to provide relief for the sector’s plight following Monday’s meeting with the Prime Minister.

Vasco Bastian, the Bahamas Petroleum Retailers Association’s (BPRA) vice-president, told Tribune Business he was “100 percent confident” that the Davis administration will deliver on long-promised assistance for the industry after a meeting he described as “reassuring”.

“It was just the fact that the conversation went in the right direction,” he explained. “I believe in the Prime Minister, I believe the Prime Minister believes in small and medium-sized businesses, and he’s demonstrated that over the years. The conversation was very reassuring. He understands our concerns, he understands our plight, and is much more sympathetic than the previous administration as regards our industry.

“We’re very, very happy. I’m proud to be a small and medium-sized businessman now, and proud to be a Bahamian. My faith never wavered per se. My faith was at 75-80 percent, but now it’s at 120 percent. It’s what we needed. We always go into discussions, and have dialogue, with people that are in charge, that understand you, understand your plight.

“The Prime Minister was very accommodating and that goes well with our confidence level. We’re business persons, we’re Bahamians and we’re trying to keep the wheels of the economy moving. He understands that. We’ll talk in two weeks.” Mr Bastian declined to comment on the specifics of what was discussed, or the potential relief on offer from the Government.

However, while the Prime Minister and other Cabinet ministers reiterated that they will not permit the retailers’ long-sought after margin increase for fear of the impact it will have on families and businesses already struggling with the cost of living crisis, they indicated their willingness to undertake a wide-ranging review of the petroleum sector’s cost and pricing structure.

This would likely not be confined to retailers, but also analyse the wholesale level (Esso, Rubis and Shell) too. And Michael Halkitis, minister of economic affairs, yesterday suggested the Government may also explore the “central purchasing” used by other Caribbean countries.

“We resolved to look at the entire model,” Mr Halkitis said. “Certain Caribbean countries have a system of central purchasing. We want to take a look at that and see if that is suitable in our environment. And we just want to look at the entire chain - from wholesale straight down to the consumer and just examine it.

“So there’s nothing we want to propose right now, but it’s just some other options that we’re looking at. And I could tell you that, you know, if you look right down the chain, everyone is going to say they’re under pressure. The overall concern of the Government is anything that would cause an immediate increase in gas at the pumps for consumers.

“And, as you know, it’s not only consumers but business people, for example, who have vehicles, and so any of those increases would trickle right down”. Mr Halkitis said the Government is sympathetic to the rising costs the dealers are facing, and said: “We understand their plight, and they are under a lot of pressure. They are faced with things, those who are leasing premises, for example, are faced with very high rent and other associated fees.

“And they are faced with rising costs, as everybody in the economy is, and so they are being squeezed. We reiterated to them that we are sympathetic; sympathetic to their plight. As far as we can, we have brought relief in the past, and we will see how we can bring it in the future.”

“There’s no easy solution. We just want to reiterate to the petroleum dealers that we are not unsympathetic. We are sympathetic to their plight, and their issues range from rents to franchise fees to bank charges to being charged to deposit cash, and they’re a cash intensive business,” Mr Halkitis said.

“Credit card fees and any number of things increasing including the private arrangements that they make with their own wholesalers. And so, again, we don’t think that the simple solution is just to increase the margin because you pull one thread and it has it has impacts all straight through.”

The minister said the retailers have submitted proposals for the Government to review, and it is looking at the entire distribution chain when considering a relief strategy. “They presented us with a proposal. We will study it, we will resolve to look at the entire system of how fuel is purchased by retailers, and then resold to consumers.

“So the entire importation, the wholesaling and down to the retailing, and what can be done anywhere along that chain to bring some relief to them. We agreed to in about a week-and-a-half come back together where we can have some concrete proposal. But once again, you know, our overriding position is we don’t want to do anything that leads to a direct increase in prices at the pump at this time”

The Prime Minister reiterated that the Government is sympathetic to the retailers, and said he is confident a solution that is mutually beneficial will be found.

Philip Davis KC said: “The retailers have serious issues concerning their survivability in the context of what’s happening worldwide. A lot of the challenges that they face I’m sympathetic to, and I understand their need to survive. I ask them to give us another two weeks to assess the situation, see how we could help them.

“The challenge we have is how we prevent further burden on the travelling public. And we need to see how we could delicately balance bringing relief to them and, at the same time, not overly burdening the consumers. But I can say that the meeting that we had for several hours yesterday [Monday] was fruitful. I think that we’ll be able to arrive at a solution that serves the common good of all.”