‘Untenable’: Bahamas 106th on business ease

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas’ latest slump in the World Bank’s Ease of Doing Business rankings was yesterday branded “untenable”, as the country slipped out of the world’s top 100 nations.

Edison Sumner, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) chief executive, called for “a concerted effort” by both the Government and private sector to reverse a damaging trend that has resulted in this nation falling another nine spots in the global rankings to 106th.

The World Bank’s 2016 rankings, published yesterday, indicate that the Bahamas continues to ‘stand still’ while rivals make improvements and leapfrog ahead of it on regulatory efficiencies and systems.

And they again suggest that repeated promises by Prime Minister Perry Christie, and several of his Cabinet Ministers, to improve the ‘ease of doing business’ in the Bahamas, continue to ring hollow.

While the Bahamas saw its rankings for the ‘ease of paying taxes’ and ‘enforcing contracts’ improve, it remained flat or regressed in most other categories - such as ‘Starting a Business’, where it fell to 118th in the world.

The Wold Bank rated the Bahamas 133rd on the ‘ease of getting credit’ and 94th for construction permits, while also giving this nation low marks for ‘getting electricity’, ‘registering property’ and ‘protecting minority investors’.

No members of the Christie administration were available for comment last night, but they are likely to suggest that the World Bank has failed to account for various improvements that have either been implemented or are in the works.

For example, the Government can point to the creation of the Central Revenue Agency (CRA) and consolidation of revenue-collecting departments; the ability to incorporate and register companies on-line; and the impending BEC management takeover by PowerSecure.

Yet, notwithstanding these arguments, the latest slippage again suggests the Bahamas’ economic competitiveness is being eroded - which in turn sends the wrong signals to potential foreign direct investors.

Mr Sumner told Tribune Business that the Bahamas first needed to “understand clearly” the methodology being used by the World Bank, and how it was being evaluated.

“We do have challenges, and have acknowledged that,” he said. “The Chamber has expressed, for quite a while, that we need to put mechanisms in place to stop the slippage.

“We are currently sitting in 106th, nine points down, and we should make a concerted effort, Government and the private sector, when this report is next produced, to move ourselves up the list.

“It’s not a tenable place to be, and I’d like to see ourselves in a better position.”

Calling for a private-public partnership (PPP) to improve the delivery of business services and the way commerce is conducted, Mr Sumner added: “In speaking to any investor or business person, whether Bahamian or foreign, I’ve heard complaints across the board that it’s very frustrating and difficult to do business in the Bahamas.

“The level of bureaucracy that one has to go through is something that is more of a deterrent to doing business than anything else..... The systems can be streamlined to ensure the flow of business improves.”

Other private sector executives said the ‘ease of doing business’ drop would merely exacerbate an already “depressed” economic environment, which was already grappling with low growth and high unemployment prior to last week’s 2,000-plus Baha Mar lay-offs.

Rick Lowe, an executive with the Nassau Institute think-tank, said: “It seems like everything is snowballing. How do we get back on the road?

“It’s unfortunate. We don’t know where to begin, and so few of us have any confidence now. It’s quite distressing really.”

He added: “It’s the bureaucracy. It doesn’t encourage entrepreneurship and investment. You see it in a depressed economy because people are even more hesitant.

“It’s a bureaucratic maze, and it seems to get worse.”

The World Bank’s 2016 report acknowledged that had the Bahamas been evaluated last year on this year’s methodology, it would actually have improved its position in the rankings.

Yet this improvement would only have amounted to two places - from 108th to 106th - and suggests that the Bahamas would have fallen even further in 2014 than the 13 places it actually lost.

Mr Sumner described that part of the report as “no consolation”. And he called for improved monitoring, measurement and evaluation of the business services delivered by the public sector, and its interaction with the private sector.

Giving the Government credit for consolidating its revenue collection agencies via the CRA, Mr Sumner said: “We need to take away the red tape, all the onerous processes, and make approvals quicker.

“It’s taking too long to get Business Licences and other important documents completed. We can reduce the time taken to get businesses registered. We need to move the entire system of getting Business Licences, and renewals, to where it becomes even more streamlined.”

When it came to starting a business, the World Bank rankings placed the Bahamas behind the likes of Jamaica, St Lucia, Barbados and Antigua & Barbuda, not to mention the likes of the UK and US.

The accompanying report said: “The Bahamas made starting a business more difficult by adding a requirement for Value-Added Tax (VAT) registration.

“According to data collected by Doing Business, starting a business there requires eight procedures, takes 28.5 days, and costs 10.9 per cent of per capita income.”

“It comes down to the human element that often-times slows things down,” Mr Sumner said, calling for “improved attitudes” from those in the public sector responsible for processing business applications.

While agreeing that the private sector should not be given “a free pass”, Mr Sumner said that approval processes were sometimes not clear, with entrepreneurs unsure of the required documents and frequently ‘turned around’ and sent to multiple government agencies.

“I had to go through this myself for business registration and VAT registration,” the Chamber chief executive said. “The come back and ask for something else that’s not on the original list of requirements.

“It adds to the frustration that business people are feeling, as they waste a lot of time going round these places, which equates to money and bottom line losses. Businesses are going round these places to do something that should be done in days, but takes weeks.”

Mr Sumner reiterated that the Chamber wanted to work with the Government to identify and eliminate “areas of weakness in the system”, given that its members were “on the front line” and “most impacted” by the situation.

And he repeated the Chamber’s offer to take over management of the Business Licence registry, arguing that this would bring “more ease and efficiency to the conduct of business in the Bahamas.

“We believe that by doing this we can reduce significantly the cost of doing business in the country, and show business in the local environment and internationally we have been improving our situation,” he added.

Comments

Islandgirl says...

Thank you once again, perry christie. Question: is there NOTHING that can be done, outside of the next general elections, to legally remove this man from power? I mean, he has singlehandedly destroyed this nation and recovery isn't looking too promising right now. Good God! It has to at least be treason!

Posted 28 October 2015, 2:50 p.m. Suggest removal

Economist says...

If you wrote a book setting all this out no one would believe it.
They would say that no government could be that incompetent.
But here it is........incredible.

Posted 28 October 2015, 3:06 p.m. Suggest removal

TruePeople says...

I tell ppl abroad some tings, and they turn on me one time and say ise lyin'

Posted 28 October 2015, 4 p.m. Suggest removal

asiseeit says...

The saddest part is that PCG and his kleptocrates along with their daft supporters actually think they are doing an excellent job. Meanwhile right thinking Bahamians know that the only excellent job they are doing is enriching themselves and their minions, that is what they call good governance, PLP style.

Posted 28 October 2015, 3:37 p.m. Suggest removal

TruePeople says...

"And they again suggest that repeated promises by Prime Minister Perry Christie, and several of his Cabinet Ministers, to improve the ‘ease of doing business’ in the Bahamas, continue to ring hollow."

Like everything else they say

Posted 28 October 2015, 4:01 p.m. Suggest removal

SP says...

**....................... Help and hope is on the way - Believe in Bahamians ...........................**

We thought Hubert Ingraham was an idiot, but Perry Christie and crew are the biggest bunch of dumb idiots to ever hold office.

Firstly, Perry Christie proved beyond all doubt that he couldn't even get out of his own way to start with, by trying to play politics with the gambling referendum, when he had already secretly committed to S&P to tax gambling to assist with national debt.

He TOTALLY screwed that up then wasted three years figuring out how to swing S&P and the electorate......**FAILED**!

Perry Christie has absolutely no intention of easing the business climate for Bahamian / FDI participation any more than Syrian president Bashar al-Assad intends to stop slaughtering Syrians.

Power obviously makes one stupid!

This big red idiot was **literally inundated with $BILLIONS in proposals** immediately after 2012 elections for any number of investment projects from Bahamians with bona fide FDI partners that all fell hook line and sinker for the PLP "Bahamians first" rhetoric.

This dancing jackass ignored and **frustrated every dam one of them** until investors got fed up and went elsewhere.

Confirmed useless jackass, Perry Christie cannot point to EVEN ONE BAHAMIAN FOREIGN PARTNERSHIP his group of pirates approved for any business since 2012!

Master Jackass, Hubert Ingraham was equally as bad with his "Bahamians need not apply policy".

**What kind of psychopath "supposed leaders" purposefully retard their own countries, peoples and development?**

http://tribune242.com/users/photos/2015…

Posted 28 October 2015, 5:01 p.m. Suggest removal

MonkeeDoo says...

World Bank might have called IZZY ? Or they might have seen the e-mail from Baltron to China ExIm Bank on how to steal a foreigners investment in the Bahamas. Either way, ain't no one investing here in any great hurry now. Pinocchio talking about Stocking Island but lets see how long the nose grows before the project starts.

Posted 28 October 2015, 5:09 p.m. Suggest removal

MonkeeDoo says...

That report is very telling as one looks at a number of rankings since 2012. Read that as May 2012.

Posted 28 October 2015, 5:11 p.m. Suggest removal

sealice says...

is this a "teachable moment" or part of his legacy?

Posted 29 October 2015, noon Suggest removal

Honestman says...

Shane Gibson was right: any overseas investor who wants to invest a sizeable amount in The Bahamas should be psychologically evaluated (for his own sake) I mean he would have to be "a few cents short of a dollar" to be wanting to deal with this administration!

Posted 29 October 2015, 1:09 p.m. Suggest removal

SP says...

**While the country dies, PLP busy hogging up everything for friends, family and lovers **

Jamaica thriving as never before, as Christie's policies choke Bahamas economy back into deep recession.

http://www.jamaicaobserver.com/news/Wor…

Sir Lynden Pindling fired both incompetents and must have known of dumb and dumber's resolve not to allow Bahamians to partner with FDI.

http://www.jamaicaobserver.com/news/Jam…

"Right now in Jamaica, we are going through possibly, the most active period of investment in the tourism sector than we have ever had,” McNeill pointed out.

http://tribune242.com/users/photos/2015…

Posted 29 October 2015, 2:49 p.m. Suggest removal

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