The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A well-known businessman yesterday said he is “happy” to get half the rate of return on investment he once enjoyed, adding: “We’re in a full-blown depression.”

Dionisio D’Aguilar, Superwash’s president, told Tribune Business he had been “shocked” at the substantial revisions to the Bahamas GDP growth numbers that were unveiled by Prime Minister Perry Christie in the 2016-2017 Budget.

Mr Christie said the Government had now adopted Department of Statistics data showing that the Bahamian economy shrunk by 0.5 per cent and 1.7 per cent in 2014 and 2015, respectively, contradicting earlier estimates of positive growth.

Pointing out that economists officially defined a recession as two consecutive quarters of negative growth, Mr D’Aguilar yesterday argued that the Bahamas’ two successive years of contraction qualified as a “depression”.

“I was shocked that the Prime Minister said in the Budget speech that the economy had contracted by 0.5 per cent in 2014, and by 1.5 per cent in 2015. We’re in a depression,” he told Tribune Business.

“We’ve had two straight years of contraction in our economy. I was shocked because the initial reports were that we were growing at 1-1.2 per cent. Then the numbers come out and say the economy contracted, which means we’re in a full-blown depression.”

Mr D’Aguilar said Superwash, whose laundromat services are a necessity, rather than a luxury for many Bahamians, was producing flat year-over-year sales growth.

“We’re in the enviable position of being able to grow and to expand our locations, and upgrade, so we’re continually reinvesting,” he told Tribune Business.

“What I have found is that the more you reinvest, the less the rate of return on your investment. In the past I was happy with a 20 per cent return; now I’m happy with 10 per cent.”

Mr D’Aguilar’s comments reveal just how Bahamian businessmen have had to temper their expectations, and targets, amid an economic climate in which substantial GDP growth remains elusive.

“If you don’t have cash, you’re screwed,” Mr D’Aguilar said, referring to how commercial banks and other lenders were seeking significant equity down payments as a condition for extending loans.

“It’s difficult to get anything off the ground right now without cash. That’s why we’ve got no growth.”

Mr D’Aguilar contrasted the Bahamas’ relatively lame economic performance with the growth, and improved employment numbers, in the US, adding: “That’s a testament to poor governance.

“This government must realise they cannot continue to do things the same old, same old. It’s just a disaster that’s getting worse by the minute. The Government can’t seem to get it right.

“We are in a full-blown depression, and I don’t know how Bradley Roberts and his Merry Men can get up and say they’re doing a good job,” Mr D’Aguilar continued.

“The proof of the pudding is looking at the numbers. There’s nothing they can look at. The economy is tanking with high levels of unemployment. It’s a disaster and it’s growing. The numbers are reflective of how we’ve been performing for quite some time.”

Mr D’Aguilar argued that for GDP growth to improve, the Government needed to change the governance model and structure for the Bahamas, and eliminate all forms of corruption, nepotism and cronyism.

“There’s a growing sense of helplessness that nothing is changing,” he told Tribune Business. “I’m surprised that people are not screaming from the hilltops about the really poor economic numbers that are coming out from this government. It’s dismal, dismal.

“Perry Christie and his Cabinet are running this country into the ground, albeit in a very nice way, but they’re doing it. We’re doing nothing new and innovative to change the way we run this country. Nobody feels good.”