$150m loan for storm repairs

Prime Minister Perry Christie

As of Wednesday, October 19, 2016

By KHRISNA VIRGIL

Deputy Chief Reporter

kvirgil@tribunemedia.net

THE Christie administration yesterday moved a resolution for a loan of up to $150m to defray the costs of this country’s recovery and reconstruction efforts as a result of not only Hurricane Matthew, but for last year’s Hurricane Joaquin.

According to Prime Minister Perry Christie, the damages caused by Matthew are estimated at $600m, while Joaquin imposed costs estimated at around $200m.

The combined total of $800m as a result of both storms, Mr Christie said, equates to 40 per cent of the national budget or 9 per cent of GDP.

Given the hefty price tag attached to the devastation left behind by both hurricanes, State Minister of Finance Michael Halkitis stressed that it was essential that the government accessed the funds as it was not possible to finance the recovery efforts from the existing budget.

“The use of the funds by our preliminary indications is that 60 to 70 per cent of the funds will be used for restoration of public infrastructure which is roads, public buildings, schools, etc,” Mr Halkitis said, “the remainder of the funds will be used for citizen assistance programmes.”

“In light of this damage and devastation the government must respond and we must respond quickly and we must respond adequately.

“It is not possible to finance the recovery efforts from the existing budget. Therefore we are here today to propose this resolution to raise up to $150m to finance the reconstruction and recovery efforts.

“We have had discussions with the Central Bank and with the financial institutions and we are confident that should we need to access the full amount, we will have the commitment for the financial institutions to take up the full amount. We have this commitment to raise all of the money should we require to use the full $150m and I want to make that point because it indicates that we have the capacity to have access to money.

“We will raise this financing at rates below the prime rate which is less than 4.5 and the prime rate is 4.75. My advice is we will raise this money at just over 4 per cent.”

Mr Christie further explained that the Ministry of Finance designed a two-tranche approach to dealing with the funds. He said the funds were exclusively for the reconstruction effort

He said: “The Royal Bank of Canada is the government’s banker. It is with gratitude and pride that I note that all of the banks contacted have readily agreed to participate in the financing that we are about to present by way of resolution to Parliament.

“I also note for the information of members that ordinary citizens and residents of the Bahamas have also expressed an effort in participating in this effort and in this respect the Ministry of Finance has designed a two-tranche approach. A tranche for commercial banks for up to $120m and a tranche for the public in the amount of $30m.”

“The Central Bank has recommended that non residents with a nexus to the Bahamas be allowed to participate in this offer. So these are high net worth individuals who live in the Bahamas who the Central Bank would facilitate their participation in the $30m offering.

“Yesterday (Tuesday) my government accepted the recommendation of the Central Bank. It is for me therefore to indicate that these funds would be exclusively used for the reconstruction effort.”

He added: “The initial focus on the reconstruction effort has been in ensuring restored access to essential services such as electricity and water. The next phase will be the repair and reconstruction of homes and parallel to that phase reconstruction of public infrastructure would be addressed. Mr Speaker the entire government would be involved in all phases of this effort working with local and international partners.”

Resolution

Whereas Article 129 (1) of the Constitution requires the Minister of Finance, before the end of each financial year, to cause to be prepared annual estimates of revenue and expenditure for public services during the succeeding financial year, which shall be laid before the House of Assembly and which estimates have been laid before the House of Assembly;

And whereas Hurricane Joaquin in October 2015 and created significant damage to the infrastructure and personal property of residents of Acklins, Crooked Island, Long Cay, Mayaguana, Inagua, Long Island and San Salvador,

And whereas Hurricane Matthew in October 2016 also created significant damage to the infrastructure and personal property of North and Central Andros, Berry Islands, New Providence and Grand Bahama;

And whereas the government has found it necessary to undertake additional borrowings to finance Hurricane Matthew and Hurricane Joaquin recovery and reconstruction efforts;

And whereas from time to time the House of Assembly has approved borrowing by way of loan agreements with banks to finance approved expenditure;

And whereas by section 18 of the Financial Admission and Audit Act, 2010 (No. 26 of 2010), it is provided that no loans shall be raised by the government and no guarantees involving a financial liability shall be binding upon the government unless entered into with the prior approval, of the House of Assembly, signified by Resolution thereof:

Now therefore be it resolved that this House authorises the Minister of Finance to raise by way of loan or loans a sum not exceeding $150m in aggregate the currency of the Commonwealth of the Bahamas and approves the proceeds of the said loan being used for the purposes of defraying expenditure for recovery and reconstruction efforts as a result of Hurricane Matthew and Hurricane Joaquin.

More like this story

BahamaPundit 8 years ago

Wonder what's on the list for how 100 million of the 150 million dollars borrowed for hurricane relief will be laundered into the pockets of PLP cronies. All repairs should be conducted by the Ministry of Works within our current budget. Not a cent should be borrowed!!!! Shame on the lending banks for not requiring a non partisan committee to oversee the distribution of funds. Shame on the lenders, because the borrower is clearly without shame.

Well_mudda_take_sic 8 years ago

EmphasisWe are doomed if we permit Crooked Christie to get away with adding $150 million to our already unsustainable national debt. Rumors abound that Crooked Christie has told his cabinet members and other PLP MPs that they must take advantage of the Hurricane Matthew crisis and "strike now while the iron is hot." Crooked Christie is of the view that, no matter what the risk of financial collapse, the cupboard must be left totally bear in the event his corrupt government does not win the next general election. He is of the view that a non-PLP government will only last one term at most if it is unable to obtain any credit facilities from the cartel of local clearing banks, i.e. Fidelity, Commonwealth, BoB, BNS, CIBC-FCIB & RBC/FINCO.

Halkitis said: "The use of the funds by our preliminary indications is that 60 to 70 per cent of the funds will be used for restoration of public infrastructure which is roads, public buildings, schools, etc......the remainder of the funds will be used for citizen assistance programs".

For Crooked Christie's corrupt PLP government, use of the term "citizen assistance programs" is code for "buying votes" in the run up to the next general election and you can bet well over half of the funds borrowed will end up in the pockets of Crooked Christie's elitist political friends and business cronies, including their families, mistresses, same-sex companions, etc.

And Crooked Christie said: "...the funds were exclusively for the reconstruction effort." But don't we all remember when he said: "...the funds from VAT were to be used exclusively for paying down our national debt."

Now we all know why Crooked Christie as Minister of Finance continues to allow the cartel of local clearing banks to royally rip off the Bahamian public with exorbitant bank charges and other outrageous bank fees. Get ready poor Bahamians for another round of huge fee hikes by the local clearing banks, and you can bet Bradley Roberts will be asked by Crooked Christie to complain bitterly on behalf of the public, but once again it will be nothing but a show of political lip service by Big Bad (and Ugly) Brad!

Well_mudda_take_sic 8 years ago

Of course "bear" was meant to be "bare" in reference to the cupboard mentioned in the first paragraph of my comments above.

Socrates 8 years ago

Sorry for our kids.. the future looks bleak..

TalRussell 8 years ago

Comrades! Ever sugar coating why the PLP Cabinet will borrow another $150 million, all of it in the name of the citizens, residents and business operators who done got it bad trying pay their bills and government taxes and fees out their already hurting paychecks and business revenues.
This Law Partner and his former law Partner's regimes doesn't even know what it means to perform the responsibility of maintenance to government's roads, buildings, docks, BahamaAir, airports, prison, schools, utilities corporations equipment and at our hospitals. Why would you trust the same government who won't even weed the damn graveyards with another $150 million?
Their idea of remodeling government buildings is to pretty up an old building with fresh paint. To fix an broken street light months after constant complaints from area residents or business operators. The people all over the Bahamaland been begging their governments for years to stop patching things up and in the name Jesus to please remodel or rebuild them properly.
But now this former remaining in power Law Partner is about to borrow another $150 million, as big and bold as when his former Law Partner borrowed hundreds millions build new roads.....hundreds millions dollars of new .roads that no government workers even bothers to perform the required maintenance on.
Go ahead PM Christie, spend another $150 million to hand over to "Shane Gibson to supervise" on newly constructed taxpayers things of which your government has no plans to ever do maintenance on.
It's the entire system of government that is broken and needs fixing, first.....stupid!

Honestman 8 years ago

It is so desperately sad that much of this borrowed money will never reach those that really need it. Bahamian politics stinks to high heaven.

SP 8 years ago

.... The More PM Christie talks, The Bigger His Pinocchio Nose Gets ....

Reality_Check 8 years ago

Re-post: Christie no doubt has told the local clearing banks that the $150 million loan facility will be repaid using the proceeds of a "special tax" that will be introduced by the next government after the up coming general election no matter whether the next administration is led by Christie, Minnis or McCartney. Both Minnis and McCartney had to agree that this would indeed be the case no matter which party or coalition of parties wins the next general election and forms the next government. The cartel of clearing banks insisted on this requirement being met as a pre-condition to providing the $150 million credit facility that is.....you guessed it....guaranteed by none other than the honest hardworking already financially crippled taxpayers of the Bahamas. As Christie put it to the cartel of the local clearing banks, and to Minnis and McCartney, the proposed "special tax" balloon that he floated shows that it would be political suicide for the current PLP led administration to significantly increase taxes in the run up to the next general election. Therefore, doing so would have to be the responsibility of the next government early on in its first term.

Millennial242 8 years ago

Minnis & McCartney have no power nor legal privilege when it comes to the Government making a current loan agreement with the banks...I was following your "re-post" until that line....so called "cartel of clearing banks" would be foolish to take on their promises (if such a thing even occurred)

Well_mudda_take_sic 8 years ago

I wondered about this same point too. But what prevents Minnis and McCartney from creating a binding obligation, undertaking or commitment on behalf of their respective political parties that is dependent or contingent on the outcome of a future event like a general election? Like you, I wouldn't trust a politician's promise to do anything!

BahamaPundit 8 years ago

This man is probably the closest we've ever come to a true banana republic type dictatorship. The lack of transparency and accountability for his dealings is beyond belief for a modern democracy.

TalRussell 8 years ago

Comrade Crown Minister V. Alfred, just recently went all bananas over proclaiming an abundance almost all Bananas production figures at BAMSI. This means that no person anywhere in Bahamaland, needs go hungry after hurricane Matthew resulted in their foods stuff shortages. No need current to fridge them. No need rush to go visit grocery Rupert Roberts.
The PM wants borrow $150 million for Hurricane "Czar” Shane to oversee its spending, but why not just borrow say $50 million, when V. Alfred does swear that BAMSI has done produced something like $100 million in bananas? This is about the level of bananas accountability we got from BAMSI's millions, that we can expect to get from the PM's anointed hurricane Matthew "Czar."
Nope, I don't just makes this bad-ass bananas stuff up.

http://tribune242.com/users/photos/2016…

sheeprunner12 8 years ago

Another $150 million to go towards PLP re-election ........... are the FNMs that blind?????? ...... Why don't the Opposition MPs say they will not vote for this $150M until Perry account for the $100 million that cannot justifiably be seen on the ground in Acklins, Crooked Island, Long Cay, Long Island, Rumm cay and San Salvador (Joaquin victims) .......... $100 million was spent on less than 10,000 Family Islanders?????? ........... Say What???????????? A BIG lie

SP 8 years ago

... Nobody Thought To Question Governments Related Cost Of ShantyTown Dwellers ...

Word is, Illegal Haitian shantytowns were all decimated by hurricane Matthew (praise JAH). Where are these people now, and what is the estimated cost to tax payers to assist these illegals?

At this juncture, what is the official policy regarding rebuilding of these illegal shantytowns?

Yes, they are occupied by human beings, and yes we are to be our brothers keepers, however, our own distraught "brothers" MUST be given priority over these illegal parasites.

"Bahamians first" & "we believe in Bahamians" may have just been a political ploy bad joke for the PLP, but Bahamians are not amused!

Sickened 8 years ago

You must remember that ALL of these illegal immigrants are allowed to vote for the PLP; they just aren't allowed to vote FNM. You may not see them standing in the same lines we are in on election day, but they are voting!

MonkeeDoo 8 years ago

They need to create a special purpose vehicle to borrow this money under. And Cabinet Members should jointly and severally guarantee it. Brave will be dispersing it through MOW. Them stubby grubby nubby fingers will be busy. And Bulgie gern get he finger in the pie too.Jesus help us sinners. !

ThisIsOurs 8 years ago

For "Hurricane Joaquin"????? What happened to the 100 million they already got? I suspect this money will go largely to doing what wasn't done in the islands then they will come back and say, well it wasn't sufficient, we need more.

Opposition parties PLEASE ask for some clarity on exactly which portion of this money is meant for Joaquin repairs and which repairs are those. They must have a very DETAILED answer, at this point, they've had an entire year to prepare a proper strategy for Joaquin restoration. They must know down to the price of the last nail where work is left to be done.

Sign in to comment

OpenID

The Tribune