By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Ministry of Finance’s top official yesterday said a proposed $183m contract with a Bahamas Striping group affiliate to overhaul west Grand Bahama’s roads was “never signed; it was cancelled”.

Simon Wilson, the financial secretary, speaking at a Rotary Club of West Nassau meeting, also denied that the Government provided a guarantee for the $100m loan that Bahamas Striping received from the Africa Export-Import Bank this week. A portion of this loan is to complete roadworks in Exuma and Eleuthera, and Mr Wilson was challenged on whether the group is “a financier for the Government now”.

A debate has already erupted over whether the financing for these roadworks, which has been arranged through Bahamas Striping, is a private-public partnership (PPP) in the true meaning of the term or, alternatively, an off-the-books loan designed to keep debt off the Governments books and balance sheet.

PPPs are projects that provide a public service and infrastructure, and which are executed and financed by private sector partners. The latter gain their return on investment, profits and repay any debt lender via revenue streams generated by the project. However, there are no known revenue streams generated by the Bahamas Striping roadworks.

As for the $183m west Grand Bahama roadworks, which were supposed to be performed by Abaco Caribbean Holdings, a Bahamas Striping affiliate, Mr Wilson said: “That contract was never signed; it was cancelled. I don’t know about it. Once it was signed and it’s with the funds, then I get involved. Right now I’m not involved.”

The Prime Minister’s Office, in a statement issued on April 8, asserted the contract’s inclusion in a list of government procurement deals awarded in December 2024 was an “administrative error” because it had neither been awarded nor approved. Instead, the award to Abaco Caribbean Holdings, a Bahamas Striping group subsidiary, had already been “paused by the Prime Minister” prior to the list’s publication.

In a somewhat opaque explanation of events, which included no names, the Prime Minister’s Office said there remains “an urgent need for public works in Grand Bahama” which the roadworks contract was seemingly designed to help address. However, the procurement list identified it as a “direct award”, meaning it never went out to tender or was subject to competitive bidding where multiple firms submitted offers.

“An international financial organisation (IDB Invest) had settled a pre-qualification amount with a particular vendor (Bahamas Striping/Abaco Caribbean Holdings), and the matter proceeded from there toward a conclusion,” the Prime Minister’s Office said.

“Upon this being brought to the Prime Minister’s attention, he instructed that the matter be set aside for further review. Unfortunately, that instruction was not reflected in the list that was subsequently published, which has led to regrettable confusion.

“The model of the vendor in question is that of a project manager. As such, the allocated funding would not have gone to a single contractor but rather to several contractors operating in Grand Bahama.” A website closely associated with Fred Mitchell, minister of foreign affairs, suggested that as many as 33 contractors would have enjoyed a share of the $183m contract.

However, several sources speaking on condition of anonymity said a procurement contract of such size would have had to be approved at ministerial level before a Cabinet paper can be drawn up and it is placed on the Cabinet agenda. They suggested the Abaco Caribbean Holdings award made it to Cabinet, where questions and concerns were raised over the size of the award and other issues.

And questions were also raised as to why IDB Invest, the multilateral lender’s private sector finance arm, would progress the potential $22m revolving credit facility for Abaco Caribbean Holdings so far - completing both an environmental and social review as well as placing it on the Board’s agenda for April 29, 2025, - if had not received government assurances that the project was approved.

Observers challenged whether the ‘direct award’ of such a large $183m contract can be justified based on the law set by the Public Procurement Act. The last version of this Act, passed by Parliament under the Davis administration, sets out the grounds under which this procurement method can be used.

These include that the contract value is less than $100,000; that no suitable bids were received in a competitive tendering process; “reasons of extreme urgency”, such as a natural disaster; and other factors that do not necessarily appear to apply to such a project.

IDB Invest, in documents released publicly in February 2025, said: “IDB Invest is looking to finance approximately $22m through a working capital facility to support Abaco Caribbean Holdings, a Bahamian company, and its shareholders, the Bahamas Striping Group of Companies.

“This financing will be directed towards the West Grand Bahama Road Improvement project, which seeks to enhance connectivity, safety and the overall travel experience across Grand Bahama. The project involves the rehabilitation of asphalt paving of 51 miles of highway and 47 miles of settlement roads, with an estimated cost of $185m.”

Other IDB documents, seen by this newspaper and giving more detail on the project, state: “These improved roadways will unlock economic opportunities, facilitate smoother transportation of goods and services, and bolster the tourism sector, which is vital for the island’s economy....

“Abaco Caribbean Holdings, founded in 2016 as a turnkey service provider, has gained experience through the planning, designing and construction of parks and community centres, and implementing smart technology systems. Most recently, with the support of other companies of Bahamas Striping, it has expanded its services into road paving and construction, land clearing and site development.

“The project consists of the reconstruction and rehabilitation of a stretch of approximately 51 miles of the Queen’s Highway, a main asphalt paved arterial road on the West End of Grand Bahama, about 47 miles of minor roads - collectors and settlement roads - various other capital and infrastructure works, and other road and infrastructure safety enhancements.”

The latter is set to include “the installation of guard rails where required; the placing of traffic signs and road striping; the adoption of traffic calming measures; the placement of reflective road studs; and the construction of sidewalks in selected areas.

“To achieve the required production of asphalt for the road pavement, the company will install a new asphalt plant, which will be located approximately at the midpoint between Eight Mile Rock and the West End, within a rural environment, without any neighbours living nearby, and its main access is by the Queen’s Highway,” the IDB Invest report added.