By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Sarkis Izmirlian’s letter to his former 2,026 Baha Mar staff shows there is no “imminent” breakthrough likely in the impasse over the $3.5 billion project, a senior private sector executive believes.

Gowon Bowe, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) chairman, told Tribune Business that the letter’s content and tone indicated “there’s no silver lining yet”.

With no commercial resolution to the dispute between Mr Izmirlian and his Chinese partners likely before they head back to the Supreme Court for the hearing of the Government’s Baha Mar winding-up petition on November 2, Mr Bowe also expressed concern over the economy’s ability to absorb the displaced workers.

He acknowledged, though, that it was “always the question” of how long the $21.5 million that the Government owed the developer for the West Bay Street re-routing would last, given that this sum had been financing Baha Mar employee salaries since July.

And Mr Bowe said Mr Izmirlian’s message to his former employees signalled that a resolution to the Baha Mar dispute “doesn’t seem to be imminent”.

“Just in terms of that letter issued by the developer to the staff that followed behind [the 2,026 lay-offs announcement], it indicates it is obviously not one that is in the works,” the Chamber chair added.

“I believe the court hearing is less than two weeks away. We haven’t heard anything at the Chamber specifically in terms of where those talks are. But it looks like there’s no silver lining yet, put it that way.”

Mr Izmirlian, in his letter to former staff, hinted strongly that little to no progress towards a resolution had been made in talks between himself and Baha Mar’s Chinese partners.

“Whilst there are still ongoing conversations with all parties aimed at finding a solution to be able to finish and open Baha Mar, it is very difficult to predict where these will lead,” he wrote. “As such, I am not able to tell you what the future holds for us.”

Mr Izmirlian continued: “I am writing to you with a heavy heart. Despite all our efforts and hard work, the day we have hoped would never arrive is here, and the liquidation process has forced very significant workforce reductions at Baha Mar.

“The unfortunate truth is that with Baha Mar still not completed, no concrete resolution in place, no confirmed funding source, and without the benefit of binding the parties into a proven reorganisation process, there is simply no way for Baha Mar to sustain the thousands of jobs that are being cut today.”

Tribune Business sources have provided mixed updates on the progress of those talks, which are being mediated by Baha Mar’s joint provisional liquidators as part of their Supreme Court-ordered mandate.

Some sources close to developments have suggested that “some progress” has been made, but any potential agreement between Mr Izmirlian, the China Export-Import Bank and China Construction (America) remains some way off.

Others, though, have struck a markedly more downbeat tone that is similar to Mr Izmirlian’s letter. They have predicted that no resolution will be reached before the November 2 winding-up hearing, and that Baha Mar will not be completed and open until December 2016 at earliest.

Tribune Business contacts have also suggested that relations between the joint provisional liquidation team of Bahamian accountant, Ed Rahming, and UK duo, Alastair Beveridge and Nick Cropper, and the China Export-Import Bank are less than warrm.

While sources close to the trio have denied this, Tribune Business understands that Baha Mar’s main debt financier was unhappy about the failure to downsize the project’s workforce.

This newspaper was told that the China Export-Import Bank felt that maintaining Baha Mar’s 2,400 staff, and paying them for doing nothing without any incoming revenues to support a monthly $7.5 million wage bill, was not in keeping with the joint provisional liquidators’ mandate to preserve and maintain the asset.

Mr Bowe, meanwhile, said the private sector wanted to examine the impact that the Baha Mar lay-offs will have on the Bahamas’ unemployment figures.

He suggested that much of the improvement in the May 2015 unemployment figures had been caused by an increase in temporary, not permanent hires.

And many of the laid-off Baha Mar workers would have been hired within the last year to 18 months, only to now be returning to the jobless count.

“We want to see what this does to the unemployment numbers and, in reality, what is the ability of the economy to absorb them?” Mr Bowe told Tribune Business.

“In terms of long-term, stable jobs there’s not been a significant uptick, and this [Baha Mar] was one of the developments that was going to do so.

“To have these persons employed in the in the last 12-18 months come back on line is going to have a very significant impact on these numbers.”

Still, Mr Bowe said there could be a “rather swift” re-hiring of the dismissed Baha Mar employees if a resolution to the dispute between Mr Izmirlian and the Chinese was forthcoming soon.

“Until we have a resolution in some form or fashion that gets construction activated, re-engaged and up and running, it’s really an unknown quantity,” the BCCEC chairman added of Baha Mar.

While the laid-off workers are “known entities” in terms of their training, their terminations could not come at a worse time personally, with Christmas over the horizon.

The Bahamian economy will also, at least temporarily, lose their spending power at a time when it needs every bit of juice it can get.