The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Chamber of Commerce’s chairman yesterday said he was “extremely concerned” over the economy and Public Treasury’s ability to withstand another Category Three-plus hurricane.

Speaking as Hurricane Irma grow into a Category Five ‘super storm’, Michael Maura told Tribune Business that a Matthew-type hit could “be devastating” to the Bahamas’ prospects of avoiding a further sovereign credit downgrade.

With Moody’s having imposed a ‘negative’ outlook on the Bahamas, and made clear it wants to see this nation execute on its fiscal consolidation and economic growth plans within the next 12-18 months, Irma is already threatening to throw the Minnis administration off course just 11 days later.

While Nassau and the Bahamas’ other major economic centres will seemingly be spared the worst, based on Irma’s projected path at press time, just a slight change in course could see it emulate Matthew by passing through the entire island chain.

“I’m extremely concerned,” Mr Maura told Tribune Business. “I do not believe that as businesses, as well as the Public Treasury, that we can handle another significant impact like a major hurricane - a hurricane of Category Three or above.”

Matthew, which was a Category Three storm when it passed New Providence, inflicted an estimated $600 million worth of damages on the Bahamas in early October 2016.

Irma, with its 185 mile per hour winds, is an even more powerful storm that is expected to maintain Category Four/Five intensity when it enters the southern Bahamas.

Should it deviate from its projected track and take a similar course to Matthew, many doubt whether the Bahamas’ weak economy and strained fiscal position will be able to handle a recovery effort that would cost hundreds of millions of dollars.

Acknowledging the potential implications for the Bahamas’ sovereign credit rating, Mr Maura said: “If we got another hit, which puts us to where we have several hundred million dollars in hurricane rebuilding damages, and funding is required to get us back on our feet, that will be devastating.”

The south-eastern Bahamas, chiefly Inagua, Mayaguana, Acklins, Crooked Island and Ragged Island, is expected to bear the brunt of Irma’s wrath. While the area’s small populations and limited economies would minimise the financial damage, Mr Maura said other islands - including New Providence - would feel the hurricane’s impact.

Mr Maura, who is also the Nassau Container Port’s (NCP) chief executive, said local and international meteorologists monitoring Irma had informed the shipping facility that tropical storm force winds could ultimately extend 250-300 miles from the hurricane’s eye when it passes between Andros and Cuba.

Hurricane force winds could extend 150-200 miles from Irma’s eye, and Mr Maura said numerous islands would feel the hurricane’s eastern side, which is traditionally where the worst weather in a storm is located.

Warning that Nassau could still experience “hurricane strength gusts” from Friday into Saturday, the Chamber chairman emphasised: “The Bahamas is going to be impacted by Hurricane Irma.

“The southern Bahamas is going to be severely impacted, and there’s potential for parts of south Andros to be severely impacted. The current track means Nassau could be spared serious damage, but it does not mean that people shouldn’t take it seriously.”

Mr Maura recalled the flooding along New Providence’s southern coast in Matthew’s wake, and said Irma’s threat again highlighted the need for proper insurance coverage among both the private sector and the Government.

Urging the Government to ensure catastrophic coverage was accessible to all who need it, Mr Maura said: “There’s very little that can be done in a couple of days but, looking ahead, what are we going to do from an insurance perspective to ensure we have adequate insurance.

“We have to help those businesses throughout the Family Islands, and those businesses in New Providence and Grand Bahama, that struggle to get insurance. We need to at least get catastrophic insurance made available to them.”

Uninsured, or under-insured, businesses often struggle to re-open in the aftermath of natural disasters. A key factor explaining why so many Family Island businesses have found it difficult to revive from Hurricane Joaquin in 2015 is the lack of insurance.

“We’re not even half-way through the hurricane season,” Mr Maura told Tribune Business. “There’s more to follow, so the Government is encouraged to look very carefully at the insurance opportunities to cover our country, because we need the help.”

The Minnis administration has already reversed one of its predecessor’s policies by renewing the Bahamas’ policy with the Caribbean Catastrophe Risk Insurance Facility (CCRIF), giving it access to a maximum $35 million payout for damage to infrastructure and other public assets.

“That’s our challenge, legacy,” Mr Maura added. “We are in the hurricane alley, and we need to take steps, both as a government and individuals, to ensure that we can protect ourselves when these storms to arise, and they will.

“This government has been taking its fiscal management very seriously, and have no doubt as to what needs to be done. It’s unfortunate so soon into their term that there is a major hurricane on our doorstep, but we’re counting on government to do what they need to do to mitigate this major storm.”