The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

The opposition’s deputy leader yesterday urged the government to borrow up to $2bn to prevent the Bahamian economy’s collapse amid the COVID-19 pandemic.

Chester Cooper, pictured, the Progressive Liberal Party’s (PLP) shadow minister for finance, told the House of the Assembly that the Minnis administration should “identify borrowing facilities in the area of $1bn to $2bn in this low interest environment in order to shore up the economy”

“This can be a combination of direct borrowing, and through public private partnerships (PPPs) for projects that will create much-needed jobs and stimulate the domestic economy,” he added.

Noting that the US government has just approved a $2tn stimulus package, Mr Cooper argued that the government “should not scoff” at suggestions The Bahamas needs its own $2bn stimulus package to combat the economic fall-out from COVID19.

Should the crisis be “shorter or flatter” than anticipated, Mr Cooper argued that any borrowed funds “may be used to pay down existing high interest debt, reducing future debt servicing pressure”, while “$1bn of this money can be used for temporary employment programmes”.

K Peter Turnquest, deputy prime minister, had earlier unveiled several additional initiatives to help bolster the economy in the short-term.

The government is allocating some $60m in foregone revenue over the next three months to a “tax credit and deferral” initiative targeted at medium to large businesses. Of that sum, half will effectively be provided by the government to pay the salaries of workers at qualifying businesses for three months.

Mr Cooper, meanwhile, said at least $150m of his proposed $2bn in borrowed funds “should be used to build a state-of-the-art digital infrastructure. E-government must cease to be a buzz word, and we should target making 90 percent of government services fully available online, taking advantage of the Central Bank’s digital currency and the private sector providers of mobile wallets”.

He added: “The government should take $250m and invest immediately in real food security. BAMSI (Bahamas Agricultural and Marine Science Institute) is a good model, but Andros is primed for growth in this area and others. The government should take $200m and make it available in grants and loans to small and medium-sized enterprises. The current allocation is simply not enough.”

“The government should also provide an additional $50m in food and rental assistance throughout the next six months. The government should expand the unemployment assistance plan to $50m for at least 13 weeks, and consider funding it for another 13 weeks after that if economic conditions warrant.”