The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas must "pool resources like never before" if it is to successfully jump-start the economy once COVID-19 has passed, a banker urge yesterday, adding: "We need that asue mentality."

Gowon Bowe, pictured, Fidelity Bank (Bahamas) chief financial officer, told Tribune Business that institutions and individuals with liquid resources to invest must "lose selfishness" and deploy such capital into businesses and industries likely to produce the quickest post-pandemic bounce back.

Warning that The Bahamas' economic structure means it is simply not equipped to undertake a multi-billion dollar stimulus package, he argued that this nation required a "community jump-start" where it went "back to the days of knowing our neighbour and having some faith and trust in one another".

And Mr Bowe said one "silver lining" of the national lockdown imposed to fight COVID-19 is that it gives the Government and private sector time to plot an economic recovery strategy and identify where scarce funding will have its greatest impact in reviving commerce, jobs and incomes.

"In a lockdown there is nowhere for capital to go," the ex-Chamber of Commerce chairman explained. "We're going to benefit from the silver lining of the lockdown because it gives that opportunity to understand where the capital must flow.

"If we know the areas where we are going to relaunch, hopefully that's where people with savings and resources are able to direct cash flow, get employment moving, get salaries moving... People that want to take advantage of opportunities and have excess liquidity, if they invest in these opportunities that will allow economic activity to pick back up.

"It's taking advantage of the pause. It's going to be disruptive to most persons, including those that save for a rainy day. We have to pool our resources together like never before, and direct capital into those organisations that need it even though it may require some ownership changes," Mr Bowe continued.

"We need that asue mentality when we come out of this so that banks and others can deploy capital in the most efficient manner. We're going to lose selfishness to jump start the economy. For the benefits will come back to me even if I'm not first out of the gate."

Mr Bowe explained that even if an investor's existing business interests were not involved in the revival plan's first wave, they would ultimately benefit from a rising tide lifting all boats as jobs and economic activity returned, thereby stimulating aggregate demand and the creation of new businesses.

"While we may see the US printing money, The Bahamas does not have that luxury," Mr Bowe added. "It's going to be more of a community jump-start by those that have, and those that have not, working together.

"Very few countries can do the things the US has done, and as we don't have the demand for our currency, we're going to have to be more community-minded, more selfless and more collaborative in our approach. We have to go back to the days of knowing our neighbours and having some faith and trust in one another."

Mr Bowe added that commercial banks will have to carefully monitor capital and liquidity levels given that many institutions, businesses and even individuals will seek to draw down on their existing deposits to provide cash flow during the nationwide COVID-19 lockdown.

"The banking industry has three parties: Depositors, shareholders and borrowers," he told Tribune Business. "We're going to have to devise a mechanism to ensure all protected because we don't want one party to lose out."