The Tribune

By KHRISNA VIRGIL

Deputy Chief Reporter

kvirgil@tribunemedia.net

GOWON Bowe, president of the Bahamas Institute of Chartered Accountants (BICA), has questioned the basis of Sarkis Izmirlian’s call for a moratorium on Baha Mar’s sale to Chow Tai Fook Enterprises Ltd (CTFE), insisting concessions should not be the determining factor of whether the deal reached completion.

As concessions have been a matter of heated discussion, Mr Bowe called on the government to execute a more stringent approach to how these are accounted for, which outlines the economic benefit to the country to allay fears that “something is being given away”.

He further criticised the former Christie administration, saying it gave too much of an impression of great responsibility and influence in the matter when this is not the role of the government.

The state, he said, has the responsibility of ensuring the appropriateness of the investor and who may own land in the country, but not the terms of transactions to take place.

Suggesting Mr Izmirlian’s remarks were “emotional,” Mr Bowe said it is important for all parties to revert to understanding the sale of the resort is a transaction between private entities.

Mr Izmirlian is Baha Mar’s original developer.

Last week, his company BMD Holdings Ltd called for the sale process to be halted, saying this was motivated by a review of the recently released heads of terms between the Export Import Bank of China (CEXIM), China Construction America and the government.

The statement reiterated the former developer’s pledge he is fully prepared to purchase the beleaguered resort, complete construction and operate it with a full Bahamian workforce and organisation.

It also noted that BMD is now considering legal options against the parties involved in the heads of terms.

“From the perspective of a former developer calling on the government to call a moratorium, the question should be upon what basis?” Mr Bowe said in an interview with The Tribune yesterday.

“The government is not a party to the transaction. The government has issued concessions, which will no doubt have conditions upon which the parties must adhere or else they don’t get the concessions.

“But receiving concessions or not receiving concessions is not then to determine whether the transaction goes through between two private enterprises. From that perspective, we really should be focused on saying the government should not involve itself in something that it has no business in. If it only has its interest based on the concessions that have been granted, then it should hold the parties that it has given the concession to accountable, but that shouldn’t interfere or give the impression that the government has an equity interest or an actual stake in this project.

“The government has a stake in the country and in it being successful. So as long as they are satisfied that they are not bringing investors that are going to do more harm than good to the country, they have done their due diligence in their responsibility.”

He added: “There has been a tremendous amount of technical persons that have been involved in this process and they should be able to sit down in a dispassionate manner and explain the process. Not underlying details, but the process and be very clear as to what the government’s role is legally as a participant in the overall activities and the negotiation that’s taking place and what the government has done.

“So that it is a very clear indication that the government has not interfered in private business because we are not a social state we are a state that is government by private enterprises having rights under the law and the government does not own all assets.”

Where there are difficulties understanding concessions, Mr Bowe said the government must direct efforts to ensuring there is an even trade off.

“The new administration needs to step back and look and say that we have a proper economic planning unit that focuses to make sure that we have a true cost benefit analysis to ensure that for every dollar and concession we give, it has a net benefit to the country of at least a dollar or more.

“We should not be giving away anything. We should say that if I allow you not to pay certain taxes the benefit will be that the employment and the taxes that the employed individuals pay will net more money than the actual taxes I have conceded in the arrangement.

“I think that is the real discussion that we should be having saying really on what basis have governments, not just the previous administration, been granting concessions. Are they able to justify the return from the concessions? We have never had a true accounting of concessions granted. I know the current deputy prime minister and minister of finance has indicated an intent to table all concessions or contracts that had concessions. But that tabling is only a part of the story. What they should do is an actual accounting that says I gave ‘x’ number of concessions to Atlantis and this is the net economic benefit to the country,” Mr Bowe said.