The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A prominent QC yesterday urged the government to seize the “now or never” opportunity provided by COVID-19 to transform Freeport into “the economic juggernaut for the future of The Bahamas”.

Fred Smith QC, the Callenders & Co attorney and partner, told Tribune Business that The Bahamas will “never have another post-pandemic moment like this” to cut through the red tape and restrictions that have prevented a city built for 300,000 persons from realising its 65-year potential.

He spoke out after Elsworth Johnson, minister of financial services, trade and Immigration, alluded to the role Freeport could play in a restructured, diversified Bahamian economy as a logistics, transhipment and distribution hub that adds value to international trade.

Addressing the House of Assembly during the 2020-2021 Budget debate, Mr Johnson said Freeport has “arguably the best” trade infrastructure in the Western Hemisphere due to a combination of the Hawksbill Creek Agreement’s investment incentives, its deep water harbour, the Freeport Container Port and other major industrial investments.

“Freeport presently contains the necessary international trade logistics infrastructure for the creation of value-added trade centres,” Mr Johnson said. “The trade logistics infrastructure is arguably the best in the hemisphere.

“Freeport has the largest deep-water harbour in the hemisphere and operates a Container Port and transshipment terminal with the existing capacity to receive the anticipated Panamex-size ships expected with the expansion of the Panama Canal. There is also the Shipyard repair facilities located in Freeport.”

Jumping on Mr Johnson’s remarks, and giving them his “100 percent” backing, Mr Smith told Tribune Business: “Freeport is potentially the economic juggernaut for the future of The Bahamas, and I am very happy that the minister recognises that. We in Freeport are very keen to work with the minister, and would welcome any collaboration between the Government, licensees and Grand Bahama Port Authority.”

Calling on the Prime Minister to match the demands he made of the Government’s Economic Recovery Committee for “bold” thinking post-COVID-19, the outspoken QC argued that the pandemic’s economic fall-out had created what might be The Bahamas’ final chance to maximise the economic impact envisaged by Freeport’s founders.

“Given that we already have this infrastructure for about 300,000 people in Freeport, this is the quintessential anchor project that has been here since 1955,” Mr Smith argued. “It is about time all our politicians, FNM and PLP, and the bureaucrats in Nassau, recognised this gift horse staring them in the mouth.

“It’s now or never. Prime Minister, take a bold step. Make Freeport the future of The Bahamas. It was always supposed to be an experimental economic hub under the Hawksbill Creek Agreement. Do it now. It will take some years; it will not happen overnight, but once you demonstrate good faith to investors again they will come back in droves.

“Frankly, we’re never going to have another post-pandemic moment like this. The Government should say we are not going to reinvent the wheel in other parts of The Bahamas, and create all these Heads of Agreements for the rest of The Bahamas, like they did with the I-Group in Mayaguana, and recognise as a national policy the spectacular infrastructure and ready-made jurisdictional construct in Freeport.”

Suggesting that The Bahamas is “under-populated”, Mr Smith argued that Freeport has the necessary infrastructure to support the necessary population expansion for creating sufficient critical mass to support a self-sustaining internal market.

He also called on the Government to attract investors who saw themselves making Freeport and, by extension, The Bahamas as their permanent home. This, Mr Smith said, would ensure they and their families had a stake in building successful businesses and communities, and he urged: “We want investors, not transient invaders.”

This, he argued, was what had helped Freeport to thrive in its early years. “Foreign investors didn’t come as transient investors,” the well-known QC told this newspaper. “They came with their families and savings, and invested their dollars and became permanent members of the community.

“There was a permanent community of foreign investors, and that’s what we need. We don’t transient investment by some big multinational corporation that is here today and gone tomorrow. We want investors, not invaders, and people who are going to meaningfully invest themselves, their family and money in building the community, be it in Nassau, Freeport or elsewhere.”

Some observers may view some of Freeport’s early investments, such as casino gambling, as less than attractive, while concerns over the Grand Bahama Port Authority’s (GBPA) direction, ownership and management will also likely have to be addressed for the city to be resurrected.

However, Mr Smith argued that the Government can give an immediate boost to investor confidence by publicly stating as policy that it will extend Freeport’s real property tax, Business Licence, income and capita gains tax exemptions until the Hawksbill Creek Agreement expires in 2054.

Also calling on the Government to lose its “Immigration insecurities”, and permit the entrepreneurs and skilled workers required for Freeport to flourish to enter the country, he added: “It’s all well and good for us to talk about building a technology hub, attracting a medical school or having a university.

“None of those ideas will work unless we have an investment and Immigration policy which says we want investors to come here with their families and money to help create a better future and successful community.”

Mr Smith said achieving this would help create thousands of Bahamian jobs, while also allowing locals to partner in joint ventures with foreigners by removing restrictions such as exchange controls.

“Talking and talking about change, and doing the same thing every administration has done for the last 30 years, will not get us anywhere,” he told Tribune Business. “The simplicity of this is they don’t have to make any drastic changes.

“All they have to do is extend the Hawksbill Creek Agreement, allow the Port Authority to be the one-stop shop and stop interfering with economic activity in Freeport. Add the licensees in Freeport, and businesses generally in Grand Bahama, as one of the exempted entities to benefit under the Commercial Enterprises Act, which will drastically simplify the process for work permits.”