The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A trade union leader last night backed the Prime Minister's decision to place New Providence on total lockdown as he warned that COVID-19's economic impact may wipe out the Bahamian middle class.

Obie Ferguson, the Trades Union Congress (TUC) president, told Tribune Business that Dr Hubert Minnis had little choice but to impose even harsher restrictions because too many Bahamians "are not following the rules" implemented to prevent COVID-19's spread.

Acknowledging the "serious effect" this near-total lockdown will have for Bahamian businesses, Mr Ferguson voiced optimism that "the economy can come back but not in the present form". He called for those with capital, including union-connected pension funds, to pool their resources in creating new and restructured ventures designed for the evolving digital age.

With post-COVID-19 recovery depending on "the co-existence of capital and labour", the TUC president also warned that "productivity must be the order of the day" and said many in the labour/union movement had already bought into the concept provided they were treated as "participants" in the decision-making process.

For the short-term, though, Mr Ferguson conceded that The Bahamas was "in big trouble" due to COVID-19's economic fall-out, and predicted that it may take as much as two years "to jump start" the economy again depending on how quickly the tourism industry rebounds.

"Eventually, with the way things are going, by the end of this exercise [COVID-19] there may not be a middle class in The Bahamas because there is no income," Mr Ferguson told Tribune Business. "In the absence of income it is difficult to even begin the basic stuff. This is having a very serious effect on the working community.

"I've been inundated with phone calls. People aren't able to find food; their housing arrangements, those renting are being threatened that they will be thrown out. You have people with mortgages not paying their mortgages. You can imagine that if this continues through to 2021, and this puts them six to seven months behind on their mortgage, they risk their entire life savings.

"For most people their main asset, the wealth they have, is their house. This is having a serious emotional, psychological and financial impact on the workforce. I've been inundated with phone calls."

COVID-19's economic impact has been especially harsh for lower income and middle class Bahamians who have either lost their jobs or seen incomes cut as a result of the pandemic. With more than one in four Bahamians now receiving food assistance, and an unemployment rate thought to be hovering around 50 percent, the latest lockdown will further increase the pressure on these indicators.

Mr Ferguson said those hitting the unemployment lines were also losing their group health insurance, conceding that employers were finding it increasingly difficult to maintain such coverage in the absence of earnings themselves.

"As one employer told me: I hear you, Mr Ferguson, I'm with you, but how long can I keep paying for group insurance when I have no income'," the union president added. "While people may have a difficulty with it, from a business standpoint the employer is making a case that's reasonable; no income, no payment, no union dues, no nothing."

Mr Ferguson, while supporting Dr Minnis' decision to impose a near-total seven-day lockdown on New Providence in a bid to halt a surge in COVID-19 cases that currently total 731, said persons should have been given at least 48 hours to prepare by obtaining adequate food and water supplies.

"It makes sense for a total lockdown," he said. "Obviously it appears as if some of our people are not taking it seriously. They're still not complying with the protocols that the Prime Minister announced. I drive through the city to get to my house and people are not following the rules of staying six feet apart, wearing a mask or protective gear, and staying away from large crowds.

"We don't know who is a carrier of COVID-19. There's no obvious indicator. We have to treat each person as a potential carrier. If we do that, and comply with the rules, I believe the spike we are now experiencing will level off and become manageable."

Mr Ferguson acknowledged that The Bahamas was "back to square one" on the post-COVID-19 economic re-opening, with employment having "virtually come to a complete halt" and almost no economic activity to speak of.

"We're in big trouble," he told Tribune Business. "The economy needs revenue. You cannot run an economy without revenue. If there's no revenue, nothing is happening. It's going to take several months to jump start the economy again, for the planes to be flying and the cruise ships to come. We're talking a minimum of twelve months and up to two years."

Still, despite the gloom, the union president struck a modestly optimistic tone in saying: "I think, quite frankly, there is a strong possibility that the economy can come back but not in the present form."

As an example, Mr Ferguson suggested that existing business models, such as that for the cruise industry, needed to be reengineered and retooled so that Bahamians gained a greater share of the economic benefits through less reliance on the lines' private islands.

"We just have to become more creative and more embracing," he added. "We have to embrace all of the domestic experts in our country. Capital and labour must co-exist, no question about that. Productivity must be the order of the day.

"I'm on record as supporting productivity, the labour movement is on record as supporting productivity. We must produce, we must be efficient, but for that to happen we must be participants in the process. Let us all collaborate through reciprocity."