By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
A prominent businessman yesterday urged the Bahamian private sector not to create a “self-fulfilling prophecy of doom and gloom”, and said: “2014 will be what we make it.”
Franklyn Wilson told Tribune Business the business community was in danger of talking itself into a recession by the continuous negative “drumbeat” on the likely consequences that Value-Added Tax’s (VAT) implementation will have.
Suggesting that the private sector had “made its point” over VAT, the Arawak Homes and Sunshine Holdings chairman said persisting with the issue was equivalent to “flogging a dead horse” and “not constructive” to reviving the Bahamian economy.
Noting that just one or two major investment projects would turn around an economy of the Bahamas’ size, Mr Wilson said there were enough positive signs from this nation’s core tourism and investor markets to encourage local companies to scout for - and seize - opportunities.
He pointed to the Bahamas’ network of Tax Information Exchange Agreements (TIEAs) as one such opportunity, telling Tribune Business this nation was viewed as “a jewel” by Canadians in comparison to the rest of the Caribbean.
“I believe the business community can create very much a self-fulfilling prophecy,” Mr Wilson told this newspaper. “If everyone creates a steady drumbeat of negative news, that’s what we’ll get.
“While I understand the business community’s strong resentment of VAT, that point’s already been made. If you keep hammering on that drumbeat, it becomes a self-fulfilling prophecy.
“The business community should be very careful about this drumbeat, because otherwise what they say will happen, will happen. The private sector has made its point, so at some point it must stop flogging a dead horse.”
Mr Wilson said there were positive signs for the Bahamian economy amid the gloom, given Atlantis’s optimism for 2014 and the various investment projects - Baha Mar, Albany and the re-opening of the Grand Lucayan’s Reef Village - on the horizon.
“I don’t care how tough things are; in every business there’s an opportunity to do something better,” Mr Wilson added. “If sufficient of us do that, we’ll be on to something better.
“I’m presuming the Government will recognise that while fiscal reform is necessary, doing it in a way that is destructive is in no one’s interests, so I’m confident sensible heads will prevail on fiscal reform.
“All I’m saying is that everyone can point to all the things that are wrong. I believe that 2014 is up to us. We can all, in the private sector, if we wish, look at all the usual suspects that are wrong and do ourselves harm, or look at the increasing range of opportunities out there for all of us and decide to take advantage of them.”
With the Dow Jones Industrials Average (DJIA) at record levels, Mr Wilson said that “has to mean something for the Bahamas”, given that its traditional second home buyer market were usually major stock market investors.
And with Congress seemingly working out a viable solution to the long-standing US federal budget woes, Mr Wilson said the increased confidence this will foster - combined with the ‘wealth effects’ from the stock and housing markets - would play to the Bahamas’ advantage.
Continuing to emphasise the positive, the Sunshine Holdings chairman said he had yesterday spoken to the chairman of a major international hotel company who was looking to “do something in the Bahamas”, while a realtor he knew informed him that a major Chinese investor was currently in Nassau.
“The beauty of the Bahamas is that it does not take a lot to turn the economic reality of this country around pretty quickly,” Mr Wilson told Tribune Business.
“Our business community needs to see what the opportunities are.”
Pointing to the Bahamas’ TIEA network with other countries, he added: “I myself was in Canada recently, and was shocked. I did not know the Bahamas today has a competitive advantage over Barbados as to where Canadian companies should start operations.
“Who’s saying: Let’s pursue that, and look for business in Canada? That has the potential to be huge business.
“I met with one of the large banks in Canada, and they are increasingly aware of this. People in Canada don’t care about the weaknesses of our relationship with the rest of the Caribbean; we’re a jewel.”
And, by exploiting such potential opportunities, Mr Wilson said the Bahamas would be able to grow, rather than tax, its way out of its economic problems.
This, he added, would be “less painful and better for everybody”.
“All this drumbeat is not constructive for the country,” Mr Wilson added. “Even if accurate and well-intended, if you’re hearing all this drumbeat, business leaders saying all this, how’s that constructive?
“Let’s not play God. The future is ours to try and shape with God’s help. It’s up to each of us to determine if we’re starting from a platform of doom and gloom, or one of making something happen.”
Comments
jackflash 10 years, 10 months ago
Of Course!
He is VAT Exempt under the PLP.
No VAT, no NIB, no BEC, on License fees..
No Moral compass!
B_I_D___ 10 years, 10 months ago
They want the noise to stop so they can just merrily go about and roll out VAT without serious or harsh criticism and publicity...or transparency. They know VAT is BAD news and once the harsh reality hits the end consumer there will be hell to pay, but if they get it going past the point of no return they can just keep trying to plug holes and make it look like they are fixing it. The sooner the final end user/consumer realizes that his personal living expenses will shoot up, the better, so no, the private sector and others need to make as much noise and plublicize the true effects of VAT that the government does not want you to know. Force them to come clean and be open to the average minimum wage employee about how he or she may not be able to put food on the table, how they may not be able to afford rent anymore, etc, etc. But hey...the government will skim from some of the money created with VAT to give back to those who were adversely effected by VAT...pure genius!!
hj 10 years, 10 months ago
The private sector won't bring the economy into recession. That's the government's job and they are doing a fantastic job.
banker 10 years, 10 months ago
He's lying about the competitive tax advantage with Barbados. You can get a business licence, bank account, work permits and corporation quicker and cheaper in Barbados without going through the wringer of the Bahamian civil service. They have one stop shopping for all of that. On top it all, there is a definite tax advantage. Once the corporate tax of about 4% is paid, profits can be repatriated to Canada tax free. AND, they have a much cleaner more efficient banking system that clears international cheques in a matter of hours (24-48), not days and weeks. And energy costs are lower and not prone to the island wide blackouts that the amateurs at BEC pull off.
Everyone else is eating our lunch. And on top of that, we are exporting tech jobs to Jamaica. The government sees incoming businesses as a source of revenue, and not as a job creator and economy builder. Hence, they cut steaks off the race horse, so to speak. Not one damn cabinet minister knows about businesses, except for the Bahamian kind where you have friends and colleagues to grease the wheels.
Quite simply the Bahamas cannot compete, and with the new economic zone, the Cayman Islands is attracting world-wide businesses that are clean, and knowledge-based which generates a lot of money and uplifts the population.
ThisIsOurs 10 years, 10 months ago
Hmmm...reminds me of a conversation I had with someone before the election. They were adamant that there was no recession, that it was all made up by the opposition. Their reasoning? The people in the straw market were making money.
We've had 40 yrs of ignoring reality and hoping God will save us from our own recklessness.
B_I_D___ 10 years, 10 months ago
The reason the straw vendors were making money was they were not paying their national insurance, business licenses or rent!! Heck, I'd be rolling in dough and able to retire if I didn't have to pay my bills!!
sheeprunner12 10 years, 10 months ago
Can we trust anything that a Pingdomite turn Christie crony says?????????????
PLP insiders and generals dont give a damn about taxes or VAT!!!!!!
As far as they are concerned, thats for the Bay Street Boys and Eastern White Knights to pay.............
Go figger............
Reality_Check 10 years, 10 months ago
This guy Wilson aka Snake never ceases looking for foreigners to prey on......Canadians watch out!!!
Honestman 10 years, 10 months ago
What a stupid statement from Wilson. Everyone with an ounce of understanding of economics knows that the imposition of a 15% VAT will cause a severe recession in the Bahamian economy. We don't need to talk ourselves into it Frankie, all we have to do is look at what has happened in other Caribbean jurisdictions. VAT is NOT the fiscal reform solution for the Bahamas. It has not worked in other Caribbean islands and it will most certainly not work here. Government has a small window left in which to implement alternative tax reforms but it seems hell bent on pushing ahead with VAT. This will be the final nail in the PLP's coffin.
watcher 10 years, 10 months ago
I recently had a discussion about VAT with a lady who works in her company's IT department. Not only did she not know how VAT works, other than being aware that "some things will be more expensive", she was also adamant that nobody in her company had mentioned that their software needed to be updated sometime this year, once details of the tax have been finalised.
I am by no means saying that this lady is ignorant, or not good at her job, but Mr Wilson, I AM saying that the general public (not, I hasten to add, the readers of the Tribune online) seem to not have had the whole new tax system adequately explained to them. So we will continue to talk, shout, harangue and generally carry on bad until everyone in our Bahamas is aware of just how disastrous this evil tax will be for us.
ohdrap4 10 years, 10 months ago
yep, the other day i spoke to a clerk at the business licence office, and said vat will make things more expensive.
she asked: are we going to pay it once a year like in the US? (obviously thinking about income tax)
i said, no. you will pay everytime you buy something.
so, not even government employees who may need to require vat certificates or other proofs from the public have been instructed.
The_Oracle 10 years, 10 months ago
No Customs officer I've spoken to has had any training or information either. Seems they do not know what to tell them until they finalize it all. July will probably bring border paralysis, via total confusion. Our Governmental problem ever present is no logistical capability. Edicts from on high are always mis-directed / unsupported through the rank and file in Government.
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