Business dilemma - how long can we survive?


Robert Myers

By Neil Hartnell

Tribune Business Editor

The Government was yesterday urged to strike "a happy medium" in its battle against COVID-19 amid fears that an extended lockdown could "completely destroy the Bahamian economy".

Robert Myers, the Organisation for Responsible Governance's (ORG) principal, told Tribune Business there had "to be some balance" between fighting the virus and restarting certain industries given that few businesses have the financial reserves to withstand the lockdown extension being considered by the Minnis administration.

Speaking ahead of Monday's House of Assembly session, during which MPs will be asked to determine if the current lockdown should be extended by up to 30 days, Mr Myers said the Government had made the right call by enacting emergency powers until month's end.

Backing present measures as critical to preventing a projected surge in the COVID-19 infection rate, the ORG chief said his key concern was that maintaining the lockdown status quo fo


Nassau in shutdown

r another month could put "everybody out of business" and prevent the Bahamian economy from restarting.

"I believe the Government has made the right decision in the short-term," Mr Myers told this newspaper. "If the infection rate was climbing to such a point that gave them considerable concern, they have absolutely made the right decision and shown great leadership.

"But there's going to have to be a balance because otherwise everybody will be out of business, including the country.... There's got to be some balance with some people getting back to work. We've got no tourism economy because nobody is travelling from anywhere to come here.

"The Government needs to be thinking about what industries it can get up and operating so at least there's some income some sectors of the economy are earning. So when we start back up, at least there's some money flowing. Right now, everyone is using up their reserves. Companies are using their reserves and employees are using their reserves," he continued.

"I think a lot of people are living pay cheque to pay cheque, and we can only support our people for so long. We're talking three weeks. There's got to be some balance that they can strike between controlling our infection rate and putting some of the workforce back online. There's got to be some way we can manage that risk."

Mr Myers said this was the task Singapore and other countries are presently engaged in, where they were slowly - and cautiously - opening specific economic sectors back up as the COVID-19 infection rate declined or seemingly came under control.

Pointing out that such actions could always be reversed if the virus appeared to reboot, the ORG principal added: "There's got to be some happy medium where we don't completely destroy the economy. At a certain point, if you destroy the economy you put the country at a significant risk of fiscal failure. You put businesses, people and the country at risk of failure.

"There's got to be a happy medium there, and a way in which to manage the number of infections, and balancing that against work and trying to achieve some revenue generation for people and businesses in certain sectors.

"We understand the hotel sector is going to be decimated because nobody is travelling from the US and Europe right now. There's nothing we can do about that, but it doesn't mean there's businesses in sectors like manufacturing, construction and retail that couldn't be opened if the rates of infection became lower and lower," Mr Myers continued.

"There's got to be some balance between the risk of infection and rebooting the economy. This could go on for months. I don't think the Government, nor businesses, nor people, have the kind of reserves that can withstand that kind of closure of the economy. They've got to come up with something."

Mr Myers' concerns were echoed by Rick Lowe, Nassau Motor Company's (NMC) director/operations manager, who yesterday said "the show must go on to some extent" to prevent the collapse of individual companies and the wider economy.

He argued that the Government should strive for the shortest lockdown period possible, and adjust its strategy according to COVID-19 testing results. "Is it understandable? Yes," Mr Lowe said of the present lockdown, and the Government's consideration of an extension. "But the show must go on to some extent.

"I don't think at the end of another 30 days it's going to be very positive. It's going to be a long, hard crawl from the depths of economic despair. I think we should strive for the shortest time period possible [on the extension], and make adjustments from there, but I'm not the person with the power.

"The last thing our healthcare system needs is to be more overwhelmed than it is already. But there's the other side that people need to earn a living to buy groceries and pay electricity bills etc."

Mr Lowe described the COVID-19 testing results, which have detected five cases in the Bahamas to-date, as the "critical link" that should determine the length of any lockdown extension.

He added: "I know one thing. Going for a month to month-and-a-half without revenue is going to put a huge strain on companies. It could be devastating. We went in today and did the payroll, wrote some cheques for import taxes, and you have these other bills to pay.

"We'll have to be in tomorrow for a little while. Things still go on. Phone bills are still being paid, electricity bills are still being received, courier bills still have to be paid. There's goods to be picked up at the port, will clients want to go ahead, will staffing be at the same level, how quickly can you ramp back up? There's so many things to take into consideration."

The dilemma outlined by Messrs Myers and Lowe is the same as that confronting the US and other economies in their response to COVID-19. Donald Trump, the US president, recently said he wanted to reboot the economy by Easter, which falls in mid-April, and suggested that "the cure cannot be worse than the problem".

This alludes to concerns that the massive economic and social disruption could be far worse, and negatively affect millions more persons, than COVID-19, although Mr Trump's critics will likely accuse him of endangering lives if such an approach is adopted.

Meanwhile, the Bahamian government last night further expanded the list of industries and businesses to be treated as "essential services", and exempted from the lockdown, provided they comply with the mandatory social distancing policies outlined in the latest Emergency Powers Order.

Commercial fishermen will be allowed to sell their product until April 1, 2020, but only through a processing plant and wholesale distributor. No contact with the end-customer is permitted with fish markets at locations such as Montague and Potter's Cay closed.

Rental car companies will also be allowed to open between 8am to 1pm, but only to receive returned vehicles and extend expiring contracts. Property management and maintenance services companies can operate provided there is no customer interaction, while attorneys will be able to take instructions from clients in criminal matters only if this cannot be done through audio visual means.

Freeport's industrial economy, which includes the likes of Polymers International, Pharmachem, Buckeye Bahamas, Freeport Container Port and the Grand Bahama Shipyard, will be open but only to essential workers for the maintenance of key equipment.

And Nassau-based Commonwealth Brewery, too, will be allowed to operate only for the purpose of its security team securing sites and responding to emergencies. Suppliers of cleaning products to companies; cleaning services providers; pool maintenance and supplies businesses; and funeral homes and cemeteries are also being allowed to operate, albeit the first four are confined to set hours.

Farms are permitted to open between the hours of 6am and 1pm, but not to the general public, while electronic communications, technology and IT providers can also provide support to business clients between 10am and 5pm.

Tribune Business had previously seen a list of 46 different industries and businesses that were requesting they be added to the list of "essential services" exempted from the present lockdown, but fewer than half appear to have made it.

Carl Bethel QC, the Attorney General, previously said a 14-day extension of the existing lockdown was an option being considered, but added that the Government's medical advisers were pushing for a 30-day extension that would take it to the end of April.

Mr Myers yesterday suggested that the Government could mandate that elderly workers, or those with underlying health issues such as heart disease and diabetes, be mandated to stay home as evidence from other countries suggested they were most at risk of suffering complications if they caught COVID-19

"Speaking as a businessman and civil society leader, I'm very concerned as to what the long-term effects of a long-term shutdown will look like," he added. "We have the potential for fiscal instability and civil instability.

"I understand we have this horrible health instability, but there are other dangers on the horizon. I'm assuming the Government has given consideration to all those risks - health, civil and financial."

Mr Myers said the COVID-19 lockdown had required him to close all his multiple business interests and send staff members home. These include Capstone, a construction company; Caribbean Landscaping; ACIH, a technology and brokerage firm; Western Hardware & Lumber; a garden centre; and retail flower store.

"This is the first week and reality sets in quickly," he told Tribune Business. "When you're sitting at home and have sent everyone else home, the reality of that is significant and weighs heavily on people like myself. We're producers.

"I haven't done this in 35 years. I've never shut my doors like this. During a hurricane we've closed for a day, but have never closed all the companies. For producers like myself this is hell. It's nerve-wracking. I get it. We all get it. We support the decision, but in our mind there's going to have to be some balance.

"We're completely shut down. We've pulled people in from Andros, pulled people in from Abaco, shut down and shuttered all of our job sites and are waiting for the word to get going again. We ain't doing any business, we ain't making any money. It's really bad news."

K Peter Turnquest, deputy prime minister, earlier this week said the Government has yet to employ all the fiscal stimulus tools at its disposal. He acknowledged that a massive intervention will be required to jump-start the Bahamian economy once the COVID-19 crisis has passed.