Monthly Archives: June 2017

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas' "financial reputation" will be in peril without "emergency borrowing" of $400 million, with the 'junk' downgrade having exposed the Government to a $70 million cash demand.

K P Turnquest, minister of finance, told Tribune Business that Standard & Poor's (S&P) action earlier this year had left the Government on the wrong side of a "hedge" or derivative transaction relating to some of its borrowings.

The loss of 'investment grade' status triggered an immediate demand by the lenders for $150 million in extra collateral, with the Government having to provide "a minimum of $70 million" by the first week of July - the first seven days of its 2017-2018 Budget year.

Mr Turnquest did not provide in-depth details on the 'hedge', other than to reveal that the Bahamas' creditworthiness downgrade by S&P resulted in the Government "immediately" facing demands for extra loan security "in excess of $150 million".

"While this does not represent an expenditure, it does represent a use of cash which has to be funded by revenues," he told the House of Assembly yesterday. "The Ministry of Finance was partially successful in negotiating temporary waivers, but the obligation has not gone away.

"The Government is now required to provide a minimum of $70 million by the first week of July to meet this collateral call."

Mr Turnquest warned that the lenders' demands for extra security would increase should the Government suffer further downgrades, and disclosed that exiting the 'hedge' was "not recommended" as it would require a $120 million-plus payment.

When questioned by Tribune Business about the transaction, he replied: "That relates to a hedge on a loan. If I recall correctly we have to come up with $70 million to collateralise one of these derivatives transactions."

The lenders' demands were revealed to help explain, and justify, why the Minnis administration is seeking Parliamentary authority to borrow $400 million to cover unfunded claims dating from the 2016-2017 fiscal year. Without it, the Bahamas will be in jeopardy of defaulting on some of its loan obligations.

Besides the $70 million 'hedge' fall-out, Mr Turnquest said the $400 million was required to cover the Treasury's $161.284 million payments backlog, representing transactions that required funding.

And, completing its financial exposure, the Government also faces $130.781 million in unfunded commitments - representing promises to pay vendors once the goods or services have been delivered.

"This figure is not exhaustive, as we are aware of further unrecorded commitments," Mr Turnquest said. "While the Government is not insolvent, it is clear that it has a liquidity challenge and, as a result, employees and vendors have had to wait an inordinate time for payment.

"Many civil servants have had to suffer challenges with deductions [for loan payments] not being paid in a timely manner to the bank and other lending agencies.... We faced an immediate cash flow shortage that caused many payables and salary deductions to be delayed as we robbed Peter to pay Paul, so to speak. "

Mr Turnquest's comments illustrate how the Government's financial challenges are negatively impacting individual Bahamians and households, plus the wider economy, with public officials unable to meet their obligations through no fault of their own.

They also highlight, in a very real sense, how downgrades to the Bahamas' sovereign creditworthiness have a direct impact on the Government's fiscal position and end up diverting scarce resources away from essential public services.

"The emergency borrowing authority was the only prudent thing the Government could do to protect the financial reputation of the Bahamas," Mr Turnquest emphasised.

He then blasted the former Christie administration for engaging in what was described as "sheer fiscal insanity" by allowing the recurrent deficit - the gap between revenues and the Government's fixed-cost spending - to balloon to as high as $498 million in the current 2016-2017 fiscal year.

Mr Turnquest likened this to a family having to borrow to pay for its weekly grocery and other bills, a situation that would eventually lead to insolvency. He argued that the Christie administration had "spent like drunken sailors" while giving "lip service" to the need for fiscal consolidation, pointing to how far away it was from its previously forecast $80 million GFS surplus for 2017-2018.

The Minister recalled how he and the former St Anne's MP, Hubert Chipman, upon hearing that projection questioned "what world are these people living in", given that the then-government was continuing to increase spending while also raising taxes on Bahamians.

Acknowledging that Hurricane Matthew's impact had contributed to the expected $500 million deficit for 2017-2018, Mr Turnquest said the figure had been inflated by the former administration "entering into many egregious commitments on the eve of the general election".

He added that new spending commitments were emerging every day, and said: "Commitments and contracts were signed between May 8-9, millions of dollars in commitments.

"It is evident that the blatant fiscal recklessness of the other side in the run-up to the general election was a major contributing factor. When they look back at the 8-9, they will have to explain to the Bahamian people why they entered into these contracts for services, employment and extension of contracts for people on contracts that should have ended."

Mr Turnquest cited 41 persons in Acklins who were hired on May 9, a day before the election. While his claims were challenged by Opposition MP, Glenys Hanna-Martin, the Minister said they were "calling, trying to find out how they will get paid and when.

"What is egregious is the previous administration gave these people the impression they would be long-term employees, when the contract for those people is three months," he added. "They have these people on three month contracts, and when that is up this government will have to make a decision."

Highlighting the growing gap between the Government's spending and income, Mr Turnquest said recurrent revenues had increased as a percentage of GDP by 5.4 percentage points - from 17.6 per cent in 2011-2012 to a projected 23 per cent in 2017-2018.

Yet over the same period, recurrent spending had risen by 8.6 percentage points to a forecast 28.6 per cent in 2017-2018. This, Mr Turnquest said, had resulted in the Government's recurrent fiscal deficit growing from 2.4 per cent of GDP in 2011-2012 to 5.6 per cent for the upcoming fiscal year.

Unless this was corrected, the Minister warned that the Government will "have to borrow ever more to cover everyday expenses", creating "an ever-growing vicious cycle that could begin to feed on itself continually if not corrected".

"It points out why we have to break this borrowing cycle," Mr Turnquest said.

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Bahamas 'Reputation' In Danger Without $400 Million Borrowing - Bahamas Tribune

By RENALDO DORSETT

Tribune Sports Reporter

rdorsett@tribunemedia.net

THE basketball prospect showcase culture in the country continues to develop and International Basketball Academy Bahamas looks to become one of the leaders in the field as its event grows in stature.

IBA Bahamas and Get Me Recruited (GMR) will host the 2017 "Super 60 Showdown/Hot 100 Bahamas Showcase" at the Kendal Isaacs Gymnasium June 16-18.

Friday's opening session will be hosted 4-8pm followed by 9am to 5pm sessions on Saturday and Sunday.

The Super 60 segment is geared towards the top seniors in the country and the Hot 100 is for the top juniors among both boys and girls.

The two groups collaborated last June when they hosted the inaugural edition of the showcase and scores of players came out to seize advantage of the opportunity. The showcase featured some of the most highly touted Bahamian high school players based both locally and abroad.

IBA Bahamas has impacted the local basketball scene in its brief history led by its director Denycko Bowles, who also serves as the head coach of the Doris Johnson Mystic Marlins. It is the first international branch of the IBA programme.

The showcase featured players from junior high schoolers to post grad unattached. In addition to the summer programmes, IBA has participated in the Summer of Thunder and travelled to AAU tournaments in the US.

Lamont Taylor, the CEO of GetMeRecruited.com said the partnership is aimed at bringing greater exposure to talented players from the Bahamas.

Get Me Recruited is a Raleigh, North Carolina-based company whose goal is to connect high school players and college coaches through the mission statement: "To be personally involved in the collegiate basketball recruiting process one recruit at a time."

"We're looking to build a bridge between America and the Bahamas because there is so much talent here. The athleticism here is a step above what we've normally seen. The athleticism in these videos and in these games is well above what we're used to. If no one sees them they don't have a chance to offer them scholarships and get them to the states. We want to provide a platform where these kids can showcase their skills, get coaches looking at them and provide opportunities," he said following the 2016 showcase.

Training at the showcase also featured Tim Fields, a skill instructor at John Lucas Enterprises.

A busy summer for IBA Bahamas will also include its 4th Annual Elite Skills Summer Camp. The camp, to be hosted June 26 to July 14 at the Bahamas Academy Gymnasium, Wulff Road, is open to both boys and girls ages 5 to 18.

The camp will feature a concentration on offensive and defensive critiquing and performance, advanced ball handling and footwork.

Registration for both the showcase and the camp can be found at http://www.ibabahamas242.com and more information can be found via email - info.ibabahamas@gmail.com, or coach Bowles at 466-0049.

Continued here:

'Super 60 Showdown/Hot 100 Bahamas Showcase' Starts June 16 - Bahamas Tribune

Palm Beach Post (blog)

Silver Airways offers $69 fares and Bahamas getaways Palm Beach Post (blog) The South Florida-based airline said it is also teaming up with Bahamian resorts to offer special escapes under the Biggest Bahamas Vacation Giveaway Ever program. Silver says that during June the airline will award six two-night vacations for four ...

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Silver Airways offers $69 fares and Bahamas getaways - Palm Beach Post (blog)

In the great tradition of members surrounding the Kardashian-Jenner clan (considerKylie Jenner's over-the-top 19th birthday in the Bahamaswith an all-star squad),Kim Kardashian just went all out for Kanye West's island destination40th birthday party.

Kim flew a whole squad of friends and family naturally to the Bahamas to celebrate Kanye's big 4-0... which is technically today: June 8.

A post shared by Kim Kardashian West (@kimkardashian) on Jun 6, 2017 at 4:30pm PDT

According to a source close to the couple, they "had a great time on vacation in Baker's Bay [on the island of Great Guana Cay in the Bahamas]," ET reports. Specifically,E! News reports the family spent four full days atBaker's Bay Golf and Ocean Club, where they reportedlyrented a villa home on the grounds.

Also according to the source in ET, "They spent six days at a private home and were able to go totally off the map."

And going off the map from time to time is among Kim's publicly stated new priorities, following the Paris robbery.

The source told ET the trip involved "no work or social media" for the parents of two just family time, pool time, and relaxation. In the spirit of both true relaxation, and personal protection of both physical and emotional varieties, the family asked for a social media blackout. (Recall that Kanye, too, had a tumultuous last year including psychiatric hospitalization.)

But Kim did share a couple of isolated snaps on social media, including a shot with her kids on a private plane.

But more on their lodgings: The couple took over the home of Mike Meldman, according to the ET report. He's the third owner of Casamigos Tequila, along with Rande Gerber and new-twin-dad George Clooney and that certainly explains why sparse details available from the trip always seemed to include tequila... and by that particular brand name.

cheers!

A post shared by Kim Kardashian West (@kimkardashian) on Jun 7, 2017 at 11:58am PDT

Kim and sister Kourtney have both stayed at the home before.

Jet Set is Bravo's launch pad for the most extravagant, luxurious, and unforgettable travel experiences. Ready for takeoff? Then Like us on Facebook to stay connected to our daily updates.

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Go Inside Kim Kardashian's Big Bahamas Bash for Kanye West's 40th Birthday (Despite the Social Media Blackout) - Bravo (blog)

The Bahamas in action during the Beach Soccer World Cup.

By RENALDO DORSETT

Tribune Sports Reporter

rdorsett@tribunemedia.net

WITH their performance at the 2017 FIFA Beach Soccer World Cup, the Bahamas moved up nine spots in the latest edition of the world rankings.

The Bahamas is ranked at No.38 with a total of 435 points, in the latest edition of the poll released yesterday.

Prior to the tournament, the Bahamas stood in the No. 47 spot in the 2016 world rankings with 287 points. Under the leadership of head coach Alexander Soares, the team finished with a 1-2 win-loss record.

In game one, they suffered a hard-fought 3-2 loss to familiar foe Switzerland, followed by a lopsided 10-1 loss to Senegal.

The Bahamas made history when they became the first Caribbean team to win a match at the FIFA Beach Soccer World Cup with their 4-1 victory over Ecuador to close out play in Group A.

In addition, the tournament featured another first as FIFA fielded a select All-Star side to host the Bahamas in an exhibition match. The FIFA All-Stars won that match 6-3.

The Bahamas is also ranked No.5 in CONCACAF behind Mexico, El Salvador, Panama and the USA.

Following the tournament, Team Bahamas captain Gavin Christie told FIFA.com that he hoped the performance left a lasting legacy and great source of pride for the future of beach soccer in the country.

"It's a dream come true for a small nation like the Bahamas to host an event of this magnitude on our shores," he said.

"It's just the beginning for the Bahamas. It's a building block and a very good start. It's creating a new culture for beach soccer in the country. The fans love it and they want more. They're already asking when the next tournament is and they see that it's a sport that the Bahamas can perform in at the highest level. This can be huge for the Bahamas."

The tournament also produced a shakeup among the top teams in the world ranking.

Brazil returns to the top overall team in the rankings after they claimed their fifth Beach Soccer World Cup title, their first since 2009.

Former champions, Portugal, fell one spot behind to No.2, followed by this year's surprise story Iran at No.3 after they finished third at the BSWC.

Russia is ranked No.4 followed by 2017 runners-up Tahiti who returned to the top five. Switzerland remained in seventh, eighth-place Paraguay swapped places with Japan, who now sit ninth, while UAE end May in the top 10, having narrowly missed out on a place in the FIFA Beach Soccer World Cup quarter-final.

More here:

Bahamas Climbs To No.38 In Latest Beach Soccer World Rankings Poll - Bahamas Tribune

The Bahamas was well represented at the Cruise Lines International Association's (CLIA) Cruise360 Conference and Trade Show, which recently took place at the Greater Fort Lauderdale Convention Centre in Florida.

The Bahamas used the show to forge links with key travel agents, cruise line executives and industry representatives through a series of networking events, educational workshops and trade show exhibitions.

Glenda Johnson, the Bahamas' Florida-based director for cruise and maritime development, said: "It's crucial to educate agents so that they can better sell to their clients."

CLIA is the world's largest cruise industry trade association.

The cruise industry surpassed 2016 passenger projections, reaching 24.7 globally, up from a projection of 24.2 million.

Passenger numbers are again forecast to grow this year to 25.8 million.

According to the cruise industry, 72 per cent of cruise sales are generated by travel agents.

In the luxury cruise segment, 93 per cent of worldwide cruise sales are generated by travel agents.

The demand for cruising has grown 62 per cent over the past two years, and eight of 10 agents in the US expect sales to increase in 2017.

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Bahamas Well Representedat Key Cruise Industry Show - Bahamas Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A prominent governance reform campaigner warned yesterday that the Bahamas has "no time for mistakes" on fiscal reform, with Moody's having expressed alarm at the deterioration unveiled in the 2017-2018 Budget.

Robert Myers, a principal with the Organisation for Responsible Governance (ORG), told Tribune Business that this nation was "absolutely on the radar" of both credit rating agencies - Moody's and Standard & Poor's - reiterating that he, too, was shocked by the vast gulf in the fiscal forecasts between the Minnis administration and its predecessor.

"When one administration says that it is going to narrow the deficit and it doesn't happen, it just makes us all look stupid," he said. "That's not good from a number of standpoints; there are no ifs, ands or buts about it.

"The reality is that we have to do better with managing our fiscal affairs.

"We have to take this stuff very seriously or we are going to face some very hard socio-economic times."

Moody's recently warned that the Minnis administration's much-revised fiscal forecasts, and its planned $722 million borrowing, show this nation's fiscal strength was "much weaker" than it had bargained for.

The ratings agency wrote-off its previous projection that the Bahamas' direct government debt-to-GDP ratio would stabilise below 70 per cent, instead estimating that this will continue to climb through the 2019-2020 fiscal year - in contrast with the Government's forecast that it will peak near 73 per cent in 2017-2018.

Mr Myers said that while the Minnis administration appears to be saying the right things, how effective it can be remains to be seen. "The new administration is saying the right things for the most part," he agreed.

"The question remains how effective they can be in terms of making it happen, and does it have enough people who understand the changes that need to be made in order to make that happen.

"We really don't have time for mistakes.

"We need people in there that are going to do what they say and act responsibly.

"There needs to be a big shift in the culture of governance in this country."

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Moody's Shows Bahamas Has 'No Room For Mistakes' - Bahamas Tribune