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MONDAY, JULY 31, 2017

$4.00 BAHAMAS ‘DROWNING IN UNNECESSARY SPENDING’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Deputy Prime Minister has slammed the Opposition’s leader for raising fears of a “doubledip recession”, arguing that the Bahamas had endured negative growth for the past five years due to the former administration’s “ill-advised policies”. K P Turnquest told Tribune Business that Philip Davis should be the last person to talk of recession until “he can explain and justify to the Bahamian people what they did” between 2012-2017. Mr Turnquest, who is also minister of finance, hit back as he defended the Minnis administration’s decision to seek a 10 per cent across-the-board cut in government spending beyond the 2017-2018 Budget allocations. Emphasising that the Government would “not do anything to harm the economy”, he said the Bahamas was “drowning

DPM slams Davis’s recession claims Govt ‘won’t do anything to hurt economy’

GOVT’S GRAND LUCAYAN PLAN ‘ECONOMIC SUICIDE’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net A FREEPORT-based QC yesterday warned the Government that it will commit “economic suicide” if it takes an ownership stake in the Grand Lucayan’s rescue. Fred Smith QC, the Callenders & Co attorney and partner, told Tribune Business that the Minnis administration would be far better advised to pressure Hutchison Whampoa’s real estate arm to either sell or hire a hotel brand/operator to rapidly re-open the property. He conceded that Freeport’s deepening economic crisis meant the hotel’s reopening was desperately needed, but suggested that

Freeport QC: ‘Kiss of death’ for business

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‘Bahamas needs decade to escape fiscal danger’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

‘Nobody said 10% spend cut easy’ in unnecessary expenditure” via a $2.676 billion recurrent Budget that was “sucking capital” away from the private sector and ordinary citizens. Mr Turnquest said it was essential that the Government bring its runaway spending under control if its fiscal position was to properly benefit from Value-Added Tax (VAT) and other revenue reforms, while simultaneously freeing up the private sector to generate faster GDP growth. And, when it was suggested that a 10 per cent cut See PG B6

$4.18

$4.05

ROBERT MYERS

THE Bahamas will take “at least a decade” to escape its fiscal crisis, a governance reformer warning: “It’s not a one pill cure”. Robert Myers, an Organisation for Responsible Governance (ORG) principal, borrowed a medical analogy from the Prime Minister for his extremely

grim forecast on how long this nation needs to reverse its debt spiral. While praising Dr Hubert Minnis’s national address for “saying all the right things”, Mr Myers reiterated that the new administration’s promises needed to be underpinned by laws that prevented the return of reckless fiscal policies. See PG B5

Reformer: ‘It’s not a one pill cure’ Laws needed; can’t trust politicians Unions ‘can’t sit and throw rocks’

MULTI-MILLION ‘GALAXY’ BRINGS FUN TO NASSAU

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

A MULTI-million dollar family entertainment centre will today complete its first month in business, after filling a market niche many parents and children were “crying out for”. FunGalaxy, effectively a mini-version of Nassau’s annual carnival, spent three-and-a-half years in development and construction before opening its doors on June 30 this year. Antonio Stubbs, FunGalaxy’s vice-president, declined to name the principal developers behind

Family entertainment facility celebrates first month Fills market niche persons ‘crying out for’ ‘Mini Carnival’ three years in making the company, but said its opening had created 14 Bahamian jobs.

See PG B2

FUNGALAXY

Argues administration ‘grasping for straws’ Urges focus on operator, monthly subsidy monthly subsidies - rather than a multi-million dollar upfront outlay - would reduce the potential burden on taxpayers. “This is simply political and economic hara-kiri to buy that hotel,” Mr Smith told Tribune Business. “This is grasping for See PG B4

‘IMPERFECT’ GRAND LUCAYAN RESCUE NEEDS TOP OPERATOR By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net A FREEPORT hotelier believes the Government’s Grand Lucayan ‘rescue plan’ can work provided it does not interfere in management and operations. Magnus Alnebeck, Pelican Bay’s managing director, told Tribune Business that the Minnis administration’s proposal was “not perfect” but could be viable if it confined itself to being a passive real estate investor. Reiterating that Freeport and its tourism product were running out of time, Mr Alnebeck warned that it “will be very difficult to come back” if the Grand Lucayan status quo lasts for

Govt must stay out of operations Tourism ‘nonexistent’ apart from cruise the whole winter 2017-2018 season. Suggesting that the word ‘nationalisation’ ought to be avoided because of the “negative tone” it set, the Pelican Bay chief said of the Government’s plan: “It’s not perfect, but I think that as long as they see themselves as investors in real estate on behalf of the Bahamian people, and stay away from the operations aspect of it, finding a good See PG B7

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GAMING BOARD, WATER CORP LAY-OFFS DENIED By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net GAMING Board and Water & Sewerage Corporation executives have denied reports of lay-offs at both organisations. Incoming Gaming Board chairman Kenyatta Gibson, who is set to assume the post today, told Tribune Business that contrary to social media reports: “We haven’t let anyone go. We have

received no instructions from Cabinet in that regard. Any decision with regard to employment will be made in due course and by virtue of what is in the best interest of the Bahamian people.” Dwayne Woods, the Bahamas Utilities Service and Allied Workers Union (BUSAWU) president, also shot down allegations of lay-offs at the Water & Sewerage Corporation (WSC). “No, that’s not true,”

THE TRIBUNE he replied. “Two contractual workers’ contracts came to an end on Friday. They were sent home and already a proposal for renewal has been submitted on their behalf, but those reports on social media are false.” Kingsley Ferguson, the BPSU’s executive vicepresident, recently told Tribune Business that the union wanted assurances the Minnis administration will honour previous agreements negotiated by the Christie administration, and acknowledged concerns over jobs and benefits cuts amid the government’s pledge to slash spending by 10 per cent.

Fisheries hope for crawfish ‘repeat’ By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net BAHAMIAN fishermen are hoping the imminent 2017-2018 crawfish season is a “repeat” of last year’s, according to the Bahamas Commercial Fishers Alliance’s (BCFA) vice-president. “Everyone is getting ready and hoping that we have a good season like we had last year, and hoping that the Defence Force continue to do what they did last year; keeping the poachers off the banks. They did a tremendous job

last year. The fishermen had a good year last year, and we are hoping for a repeat of that,” Keith Carroll told Tribune Business. The crawfish season begins on August 1, tomorrow, and closes on March 31. “We hope that all the fishermen abide by the laws so that we can have a future in this industry. We also hope that we don’t have any bad storms this year. That is always a concern. The same way the storms impact the land, it does the seabed the same way, and that’s not good for fishermen,” Mr Carroll added.

Multi-million ‘Galaxy’ brings fun to Nassau From pg B1 “FunGalaxy is the newest indoor family entertainment centre in Nassau,” he told Tribune Business. “It is, simply put, an ‘indoor mini Carnival for children and their parents/guardians in a climate-controlled environment. “FunGalaxy is a well thought-out, meticulously developed, multi-million dollar entertainment centre borne out of inspiration from the children of the principal entrepreneur.” Mr Stubbs said development of FunGalaxy, which is located on Bernard Road at the junction of Adderley Street and the turning for St Augustine’s College (SAC), began in late 2013/ early 2014.

He added that the company’s principal target market was children aged 2-12 years-old, although it did cater to teenagers, too. “We opened on June 30,” Mr Stubbs told Tribune Business. “This facility was needed really, really badly. Other facilities have closed down, and the Carnival comes only once a year. “It’s something people have been dying for. As the company grows, we are seeing more people coming from afar, and it’s expanding really quickly due to social media and word-of-mouth. “We can handle up to 250-300 people at any one time. It’s been awesome. It really, really has. Everyone loves it. It’s one of a

The BCFA has long voiced concerns over poaching by foreign fishermen, primarily Dominicans, and particularly during the closed season. Mr Carroll said that while the Defence Force has done an admirable job in combating poachers, Bahamian fishermen remain concerned over marriages of convenience. “We’re still having some problems with Dominicans coming here and having marriages of convenience. The fishermen are really concerned about that,” said Mr Carroll. kind; unique. You cannot find it anywhere else in the Bahamas.” Mr Stubbs described Fun Galaxy’s prices as “affordable”, and said rides for young children included bumper cars; a pirate ship on a swing that moves back and forth; planes that swing round in the air; a train; carousel of horses; and a ‘tea cup’ ride. The amenities also include a video arcade and games that include basketball; iceball/mini-bowling; and motorbiking/motorcross. FunGalaxy comes equipped with a concessions room serving food and drink products similar to those found at the cinema. Mr Stubbs said the complex also provided ‘party rooms’ for birthdays, and it also catered to schools, summer camps and church groups. A ‘self-serve’ photo booth is also on property.

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Monday, July 31, 2017, PAGE 3

Insurers in corporate governance concern By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

“There is presently no provision in the Insurance Act 2005 that allows for the appointment or office of an independent/nonexecutive chairman of the Insurance Commission of the Bahamas,” Mr Komolafe and the BIA said. “The [relevant] sections of the legislation infer that the Superintendent of Insurance (who is, de facto, the chief executive of the Commission) is prima facie the chairman of the Board of Commissioners. It follows, therefore, that the existing legislation concentrates the leadership of the Board and management in the office of the Superintendent without sufficient checks and balances.”

They added: “This is one of the numerous points that have been raised by the Bahamas Insurance Association (BIA) since 2010 with a view to ensuring that the Insurance Act is amended accordingly. Specifically, this proposed amendment would ensure the separation of powers between the leadership of the Board and the leadership of executive management. “The proposed amendments to align the existing governance framework with international best practices has been shared with the Minister of Finance and Minister of Financial Services. The BIA has written to the Minister of Finance to formally advise him of this anomaly, and it is our

hope that the Government will seek to address this matter as soon as possible. The Insurance Commission of the Bahamas is responsible for the regulation of the insurance industry in The Bahamas.” The Insurance Commission situation is not the only one where the Minnis administration has run into difficulty with its financial regulatory chairmanship appointments. It has named Graham Thompson & Co attorney and partner, Robert Adams, as chairman of the Central Bank’s Board. However, Tribune Business understands that the chair is always held by the governor, in this case, John Rolle.

Govt officials at hospitality summit

principal of TLT Solutions/ Hampton Inn Waldorf. “The NABHOOD awards are given to individuals who have the vision and the ability to make this industry grate,” said NABHOOD president, Andy Ingraham. “We are proud of the progress each one of the awardees have made.”

NABHOOD’s Ownership & Investment Summit, accompanied by a trade show and hospitality student leadership summit, took place under the theme of ‘Creating a New Generation of Diverse Hospitality Leaders’.

THE Bahamas Insurance Association (BIA) yesterday called for the industry’s governing law to be changed because it makes no provision for the independent chairman named by the Minnis administration. The BIA said it backed the appointment of an independent, non-executive chairman - as intended by the Government - on the grounds of improved corporate governance. However, it pointed out that paragraph eight, in the first schedule of the Insurance Act 2005, stipulated that the Insurance Commission’s top executive, the

THE Minister of Tourism and his parliamentary secretary are among those attending the 21st annual International African American Hotel Ownership & Investment Summit & Trade Show. Dionisio D’Aguilar and Travis Robinson, a 2015 alumna of the National Association of Black Hotel Owners, Operators & Developers (NABHOOD) Hospitality Student Leadership Summit, were among the 40 conference speakers. Also present were William Marlin, Prime Minister, St. Maarten, and Paul Pennicook, director, Jamaica Tourism Board. Hotel and Tourism executives from the Bahamas, the Caribbean and the US met at the Miami Marriott Biscayne Bay Resort for the annual summit, which is hosted by (NABHOOD), Black Meetings & Tourism Magazine and Horizons International Group. William Pickard, chief executive of Global Automotive Alliance, reminded

Superintendent of Insurance, “preside as chairman” at its Board meetings. Emmanuel Komolafe, the BIA’s chairman, yesterday said the situation that has arisen following the Government’s Board appointments “reiterates the need to revise the Insurance Act 2005”. “According to the published list of board appointees, a non-executive chairman has been appointed for the Insurance Commission of the Bahamas,” he added. “However, the existing legislative and regulatory framework does not make provisions for such an appointment.” Mr Komolafe, though, backed the creation and appointment of a

attendees that minority pioneers in the hospitality industry dated as far back as the late 1800s. He urged everyone to pick up a copy of Victor Hugo Green’s Greenbook, a 1930s travel guide for African-Americans that shed light on the history of African Americans in the hospitality industry. “When black folks wanted to go on the road,

non-executive Insurance Commission chairman as “an essential component of a robust corporate governance structure”. The BIA chairman, a Fellow of the ICSA Governance Institute and certified corporate governance trainer, said this would better split the roles of management and the Board, and provide greater oversight of the Insurance Commission’s operations. He emphasised that his comments were not intended to be personal, either towards Insurance Commission superintendent, Michele Fields, or the Minnis administration’s elected chairman, former NIB director, Algernon Cargill.

they had nowhere to stay,” said Mr Pickard. “Brother Green said I have to find a way to create [what is now known as] Airbnb in the 1930s, where coloured folks can have a place to stay and a hot meal before they hit the road…out of that came the Green book. I beg of you to tell your children about the green book [because] we have always been in business.”

This year’s NABHOOD chairman’s award went to the mayor of the City of Baltimore, Catherine E. Pugh. The NABHOOD Trail Blazer Award went to Thomas Penny III, president of Donohoe Hospitality Services. The Asian-American Hotel Owners Association Outstanding Hotelier Award went to Tracy Prigmore,

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Govt’s Grand Lucayan plan ‘economic suicide’ From pg B1 straws and an unimaginative collapse in government thinking. I do not think that direct government ownership in private enterprise is good for the economy in any circumstances. “This creates a bag of mischief. It positions government as a competitor to private hoteliers, restaurants, bars and entertainment etc. There should be laws preventing the Government from getting into business.” Mr Smith is the first prominent Freeport resident to speak out against the Government’s proposed ‘last resort’ rescue plan, as detailed by Prime Minister Dr Hubert Minnis in his national address last week.

While no details have yet been provided, Dr Minnis indicated the Government was in talks to partner with other, unnamed investors and take an equity stake in a group that would ensure the Grand Lucayan’s reopening in time for the winter 2018 season. Dr Minnis said the Government viewed this action as similar to the auto and banking industry bail-outs undertaken by the Obama administration and UK government during the 2008-2009 recession. He added that his administration’s strategy was similar, too: Re-open the Grand Lucayan, turn it around, and then the Government would sell its equity stake to its partner investors or someone else.

Legal Notice

NOTICE INTERNATIONAL BUSINESS COMPANIES ACT (No. 45 of 2000)

Blue Key Limited In Voluntary liquidation

Notice is hereby given that in accordance with Section 138 (4) of the International Business Companies Act (No. 45 of 2000), Blue Key Limited, has been dissolved and struck off the Register according to the Certificate of Dissolution issued by the Registrar General on the 11th day of May, 2017.

Diane Nobile, Esq, 201 S. Biscayne Blvd, Suite 2650, Miami, Florida 33131 Liquidator

THE TRIBUNE The Government’s strategy was backed by Carey Leonard, the former Grand Bahama Port Authority (GBPA) in-house counsel, who took an opposite view to Mr Smith - now his colleague at Callenders & Co. “If that’s the only alternative the Government has, I support it,” Mr Leonard told Tribune Business. “But they ought to try and have an exit strategy as soon as possible. “We’ve got no alternative; we’ve got to get that hotel open. Quite frankly, that’s what’s needed.” However, Mr Smith said the Government’s ‘track record’ in business since the Bahamas became independent suggested that its involvement in the Grand Lucayan’s ownership was not a good idea. The Government is already providing $429 million in collective subsidies to 25 state-owned enterprises (SOEs) this fiscal year, and the wellknown QC warned that the Grand Lucayan, too, could become a continual drain on the Bahamian taxpayer. “Government’s involvement in business in the

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Bahamas,” Mr Smith said, “from the days of Hatchet Bay in Eleuthera in the 1970s through to the supreme example, the involvement of the Hotel Corporation in the Lucayan Strip going back to the 1970s and, more recently, Bahamasair and BEC, continues to highlight how tragically incompatible government involvement in the private sector is. “First of all, it is a wonderful opportunity for corruption. It becomes almost inevitable. Then, of course, government monies are funnelled to subsidise and prop up what are usually failed enterprises. “Third, you have the financial, economic and political purse and might ranged against smaller hotels, bars, restaurants and entertainers in every conceivable way,” he continued. “It is the kiss of death to free enterprise for the Government to have any ownership in a private sector company.” Mr Smith has been contradicted by other observers, including Mick Holding, the Grand Bahama Chamber of Commerce president, and departing Port Lucaya Marketplace tenants, all of whom have argued that Freeport’s economic situation is so dire that the

NOTICE

NOTICE is hereby given that RENAND FLEURIDOR of Treasure Cay, Abaco, The Bahamas, is applying to the Minister responsible for Nationality and Citizenship, for registration/naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/ naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 24th Day of July, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, N.P., The Bahamas.

Government must do whatever it takes - including partial nationalisation - to get the Grand Lucayan open, and jobs and business activity flowing. Yet the QC argued in response: “I completely understand the need to generate business and help to revive the economy in Freeport. I do not consider that the Government buying the Grand Lucayan is the answer. “I encourage the Government to vigorously pursue Hutchison to find a buyer and, until then, a management company to help to run the Grand Lucayan under Hutchison’s ownership and stabilise the operation.” Mr Smith conceded that taxpayer subsidies could be needed to underwrite such an arrangement, which was in place until January this year, when Memories withdrew from Grand Bahama due to a dispute with its Grand Lucayan landlord over Hurricane Matthew repairs. Yet he reiterated: “Government subsidy is preferable to government ownership, and taking on a huge financial and lossmaking burden. The history of Freeport is replete with examples of government buying private enterprise,

and all of them always fail at the taxpayer’s expense. “It would be far cheaper to spend $1 million a month than to spend $100-$200 million a month on capital, and then have the recurring burden of ongoing expenditure maintaining that large hotel strip.” The Grand Lucayan has been losing $10-$11 million annually, and an equity stake will leave the Government on the hook to subsidise its share of those annual losses. Any move to acquire an equity stake would also involve the Government in a hotel business that is extremely volatile, and which it elected to exit in 1992. Mr Smith added that it would likely take six-nine months to close a Grand Lucayan deal involving government equity participation. He argued that if the Government wanted to “jumpstart” Grand Bahama’s tourism economy, the Ministry of Tourism and island’s Promotion Board should instead focus on ways to bring more shortstay visitors to the island from south Florida and other areas.

NOTICE

NOTICE is hereby given that JEFFREY SAINTILUS of Spanish Wells, Eleuthera, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/ naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 31st day of July, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.

NOTICE

JADARA LIMITED

BLUE ORCHID MANAGEMENT LTD.

STENISHA DINAMIC INCORPORATED

N O T I C E IS HEREBY GIVEN as follows:

(a) JADARA LIMITED is in voluntary dissolution under the provisions of Section 138 (4) of the International Business Companies Act 2000.

(a) BLUE ORCHID MANAGEMENT LTD. is in voluntary dissolution under the provisions of Section 138 (4) of the International Business Companies Act 2000.

(a) STENISHA DINAMIC INCORPORATED is in voluntary dissolution under the provisions of Section 138 (4) of the International Business Companies Act 2000.

(b) The dissolution of the said company commenced on the 27th July, 2017 when the Articles of Dissolution were submitted to and registered by the Registrar General.

(c) The Liquidator of the said company is Leeward Nominees Limited, Akara Building, 24 de Castro Street, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.

(c) The Liquidator of the said company is Bukit Merah Limited, The Bahamas Financial Centre, Shirley & Charlotte Streets, P.O. Box N-3023, Nassau, Bahamas

Dated this 31st day of July, A. D. 2017

_________________________________ Leeward Nominees Limited Liquidator

_________________________________ Bukit Merah Limited Liquidator

EXXONMOBIL EXPLORATION AND PRODUCTION NAMIBIA (OFFSHORE) LIMITED

N O T I C E

NOTICE

NOTICE Pursuant to the provisions of Section 138 (8) of the International Business Companies Act 2000, notice is hereby given that the above-named Company has been dissolved and struck off the Register pursuant to a Certificate of Dissolution issued by The Registrar General on the 6th day of July A.D., 2017. Dated the 31st day of July, A.D., 2017 R.W. Rice Liquidator of EXXONMOBIL EXPLORATION AND PRODUCTION NAMIBIA (OFFSHORE) LIMITED

EXXONMOBIL EXPLORATION AND PRODUCTION NW AFRICA (OFFSHORE) LIMITED ________________________________________________ N O T I C E IS HEREBY GIVEN as follows: (a) EXXONMOBIL EXPLORATION AND PRODUCTION NW AFRICA (OFFSHORE) LIMITED is in dissolution under the provisions of the International Business Companies Act 2000. (b) The dissolution of the said Company commenced on the 26th day of July, 2017 when its Articles of Dissolution were submitted to and registered by the Registrar General. (c) The Liquidator of the said Company is T.A. Parmentor, of 22777 Springwoods Village Parkway, Spring, Texas 77389, U.S.A. Dated the 31st day of July, 2017 HARRY B. SANDS, LOBOSKY MANAGEMENT CO. LTD. Registered Agent for the above-named Company

EXXONMOBIL EXPLORATION AND PRODUCTION NW AFRICA (OFFSHORE) LIMITED ____________________________________________ Creditors having debts or claims against the above-named Company are required to send particulars thereof to the undersigned c/o P.O. Box N-624, Nassau, Bahamas on or before 25th day of August, A.D., 2017. In default thereof they will be excluded from the benefit of any distribution made by the Liquidator. Dated the 31st day of July, A.D., 2017.

T.A. Parmenter Liquidator 22777 Springwoods Village Parkway Spring, Texas 77389 U.S.A.

NOTICE

LALITTY INVEST LTD.

KANETOAD LTD.

NOTICE is hereby given as follows: (a) Lalitty Invest Ltd. is in Voluntary Dissolution under the provisions of Section 138(4) of the International Business Companies Act 2000. (b) The Dissolution of the said Company commenced when the Articles of Dissolution were submitted to and registered by the Registrar General of the Commonwealth of The Bahamas. (c) The Liquidator of the said Company is Beatus Limited, P.O. Box N7776-348, N.P., Bahamas.

NOTICE is hereby given as follows: (a) Kanetoad Ltd. is in Voluntary Dissolution under the provisions of Section 138(4) of the International Business Companies Act 2000. (b) The Dissolution of the said Company commenced when the Articles of Dissolution were submitted to and registered by the Registrar General of the Commonwealth of The Bahamas. (c) The Liquidator of the said Company is Beatus Limited, P.O. Box N7776-348, N.P., Bahamas.

Dated this 27th day of July, A.D., 2017

Beatus Limited Liquidator

THE TRIBUNE

Monday, July 31, 2017, PAGE 5

‘Bahamas needs decade to escape fiscal danger’ From pg B1 Emphasising that Bahamians can no longer trust politicians “to do the right thing”, the ORG principal urged the Government to prioritise energy reform as “a massive fix” for the Bahamian economy’s woes. He also called on trade unions to become “part of the solution” to improved worker productivity, arguing that they “cannot just sit and throw rocks at people” as has happened in the past. “I think he’s saying all the right things,” Mr Myers told Tribune Business of Dr Minnis’s address. “It’s very encouraging, but the fact remains that if we want to put this country on a path and course to greater sustainability over the longterm, we’ve got to start putting this stuff in legislation as opposed to leaving it to the will of the politicians. “That, in my view, is imperative because we’ve seen the considerable degradation that has occurred because of not having fiscal laws, or laws that guide the Government. “We’ve seen the degradation that has happened because of the lack of laws that guide the Government, and it’s going to take us at least a decade - if we have the rights laws and safeguards put in place - it’s going to take us at least a decade to get out of the imminent danger we’re in.” Mr Myers’ comments illustrate the scale of the task the Bahamas faces to reverse its current fiscal trajectory, which involves

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$300 million-plus annual deficits and a $7.052 billion national debt that was projected to breach the 80 per cent debt-to-GDP ratio at end-June. A former Chamber of Commerce chairman, and head of its Coalition for Responsible Taxation, he led much of the private sector’s negotiations with the Christie administration over VAT and its revenueside reforms. Fiscal responsibility is one of ORG’s priority issues, and Mr Myers argued that current and future Bahamian governments needed to be bound by law to achieve this given the failures of their predecessors. “We’ve got to create a culture of open, accountable government and eliminate the corruption; he’s [Dr Minnis] 100 per cent right on all these things,” he told Tribune Business. “But let’s put in place laws that bind them to do that. We’ve left it to the will of the political elite, and arrived at this place because of it. I no longer want to trust personalities; I want to trust the law.” ORG has been among the numerous groups campaigning for a Fiscal Responsibility Act, viewing it as a key tool in restraining government spending and forcing it to be more accountable and transparent over how it uses taxpayer monies. Other observers have argued that the Bahamas needs to go further by implementing so-called ‘Fiscal Rules’, which would

set limits for key ratios, such as debt-to-GDP, that the Government cannot breach or exceed. K P Turnquest, minister of finance, previously told Tribune Business that Fiscal Responsibility-type legislation is near the top of the Government’s legislative agenda for when it returns to Parliament in September, lying second only to anti-corruption laws. He added that a Fiscal Responsibility Bill had been drafted, having given an idea of what it may contain in his Budget address. Mr Turnquest said then that such a Bill would target an annual GFS ‘balanced Budget’, meaning that the goal is to add no new debt to the existing $7-billion plus national debt. The Government’s other objective would be to maintain “a desirable and sustainable” debt-to-GDP ratio. To underpin this, the proposed law will require the Government to set out the assumptions underpinning its annual Budget, along with its longer-term fiscal targets. Targets could also be set for some components of the Government’s fixed-cost spending, such as the civil service wage bill, while plans and timelines for eliminating any deficits will also have to be laid out. However, if the Minnis administration’s 2017-2018 Budget forecasts hold, the Government’s debtto-GDP ratio will remain around the 80 per cent benchmark for the next three fiscal years through to June 2020. And the national debt will have risen, albeit at a slower rate, to $7.7 billion over that same period,

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with the ratio to GDP kept in check by improved economic growth. “If our GDP was booming through the roof, we’d not have a lot of these problems, but we have poor GDP growth and little fiscal responsibility,” Mr Myers told Tribune Business. “The other drivers of this are open and accountable governance, and fixing the education system. We’ve got to have a more productive workforce to have higher GDP numbers. “It’s not a one-pill cure, to use Dr Minnis’s analysis. He’s right, but there’s no one pill solution to this.” Mr Myers suggested that the Bahamas adopt “a relatively open” Immigration policy to attract the businesses, investors and managers with the capital and skills to grow its economy. Apart from improving the ‘ease of doing business’ and maintaining foreign direct investment (FDI) at “a relatively high level”, Mr Myers’ economic recovery prescription also involves ‘buy in’ from the trade union movement. “The unions have to take an active role understand they’re part of the solution, and recognise that regionally we’re uncompetitive,” he told Tribune Business. “They’ve got to start working on, and drive, productivity if we’re going to remain a relevant tourism destination. They’ve got to take a vested interest. They can’t sit and throw rocks at people, and not care about the outcome.” Mr Myers also urged the Minnis administration to

focus on energy reform as a priority, adding: “Energy costs have to come down. “Energy is a massive fix, and helps the bottom line of the Government, private citizens and the private sector. I can’t imagine that Desmond Bannister [minister of works] should be doing anything else other than trying to fix this power situation in the next couple of months. That should be his utmost and single priority. What can be more important than that?”

Mr Myers added that while the Government had delivered the correct ‘statement of intent’, it now needed to follow through and deliver on what it is promising. “He’s absolutely on the right track. The question is: Can he walk the walk and actually make it happen?” he asked of Dr Minnis. “It’s a massive task, and I understand the enormity of it. That’s why I’m really worried about it. It’s a lot to do.”

NOTICE TO:

ARNOLD BROWN & LINDA BROWN Please contact MITRE COURT LAW FIRM Suite 227, Island Lane Building, Olde Towne, Sandyport Nassau, The Bahamas 242-327-4150 Contact: Atty C. Hepburn

PAGE 6, Monday, July 31, 2017

THE TRIBUNE

Bahamas ‘drowning in unnecessary spending’ From pg B1 would be hard to achieve, due to 80 per cent of the Budget representing fixed costs that were ‘baked in’, the Minister replied: “No one said it was going to be easy.” While any extra savings are unlikely to make a significant dent in the Government’s $722 million approved borrowing, Mr Turnquest said there would be a considerable reduction in the projected $323 million deficit for 2017-2018 if the target is hit. Mr Davis and the Progressive Liberal Party (PLP), though, argued that the potential $267.6 million spending reduction - should the Government achieve its goal - threatened to cause too much economic disruption.

They argued that such austerity measures could tip the Bahamian economy into recession, and accused the Minnis administration of having no growth plan. However, Mr Turnquest blasted back: “He [Mr Davis] needs to look at the last five years if he wants to talk about recession, and that’s backed up by the numbers. “We’ve been in recession for the last five years, and been in recession because of the ill-advised policies of the previous administration.” Tribune Business revealed back in April how International Monetary Fund (IMF) data showed the Bahamas had endured zero or negative growth for four consecutive years between 2013-2016, a

period that covered most of the former Christie administration’s term in office. Apart from 0 per cent growth in 2013 and 2016, the Bahamian economy contracted by 0.5 per cent and 1.7 per cent, respectively, in 2014 and 2015 despite ever-increasing spending by the previous government. “You can’t spend money to save money. It doesn’t work like that,” said Mr Turnquest, adding of Mr Davis: “When he can explain and justify to the Bahamian people what they did, then he can talk. “We’re focused on our programme, and won’t be deterred by the noise in the marketplace.” Should the Government slash its 2017-2018 fiscal year spending by $267.6 million, that would eliminate almost 83 per cent of its projected $323 million deficit, cutting it to $55.4 million.

Achieving that goal would require other estimates to hold, including revenue collections, but the Minnis administration is showing clear signs of its intentions to achieve something no other government has done. “We don’t want to suggest to anybody that the savings we intend are easy,” Mr Turnquest told Tribune Business. “We are committed, and committed to putting in the work, and making the sacrifices as necessary in order to achieve. “We are making sensible, rationale decisions. We are not about to do anything that is going to harm the economy. We have a prosperous country; however, we’re drowning in unnecessary expenditure and have to get that under control. “You’re actually sucking capital out from the private sector and putting it in the public sector, where we know it’s a one-way

street, so you don’t get the benefits of that capital to increase wealth and increase capacity in the general economy.” The Deputy Prime Minister said success with its planned spending cuts was unlikely to significantly reduce the Government’s $722 million borrowing requirement, given that much of this - at least $400 million - was required to pay bills and commitments from the previous fiscal year. “We’ll see how this pans out,” he added, “but we hope to recover the savings we need, which will reduce the need for new borrowing and set us up for 2018-2019. That’s the hope.” When asked whether the Government had committed to a 10 per cent spending cut in return for Moody’s holding-off on downgrading the Bahamas’ creditworthiness to ‘junk’, Mr Turnquest replied: “Not at 10 per cent.

“What we committed to is looking at all expenditure and rationalising the programmes we have to ensure the expenditure we have is in line with the Government’s priorities, or is a programme that is going to bring benefits.” Mr Turnquest acknowledged that change would be “an uncomfortable position” for some persons, but said the Government would “certainly try to honour every commitment” it has made - including with the public sector trade unions. “We don’t believe in padding the civil service to pick up the slack,” he told Tribune Business, “so as we find excess capacity we will deal with it. “Those double dipping or outside the scale of the civil service, we’ll have to renegotiate those or take whatever action we have to do to ensure we bring the wage bill back in line.”

Treasury chief: UK may need 3-year transition after Brexit By JILL LAWLESS Associated Press

LONDON (AP) — Britain will abide by some European Union rules for up to three years after it officially leaves the bloc in March 2019, the country’s Treasury chief said Friday. Treasury chief Philip Hammond said a transition period is needed “to get from the status quo today to the new normal.” He said the transition should end before Britain’s next election, which is scheduled for 2022. Many British businesses accuse the government of sending mixed signals about Brexit. Officials say Britain will leave the bloc’s single market and customs union, and end free movement from EU countries.

But officials also say the changes, which have huge economic implications, won’t happen overnight. Hammond told Sky News that a transition period will let businesses “go on operating normally” while Britain works out its post-Brexit relationship with the EU. His comments come amid conflicts within the government between those, including Hammond, who want a compromise “soft Brexit” to ease the economic shock of leaving the EU, and those who want a clean, sharp break. More than a year after Britons voted to leave the bloc, many aspects of the U.K.’s future relations with the EU remain unclear.

NOTICE TO:

MARKET REPORT FRIDAY, 28 JULY 2017

t. 242.323.2330 | f. 242.323.2320 | www.bisxbahamas.com

BISX ALL SHARE INDEX: CLOSE 1,870.26 | CHG 0.01 | %CHG 0.00 | YTD -67.95 | YTD% -3.51 BISX LISTED & TRADED SECURITIES 52WK HI 4.38 19.17 9.09 3.60 2.41 0.13 6.50 8.60 6.00 10.60 14.49 2.52 1.60 6.00 10.00 11.00 10.00 7.25 12.51 11.00

52WK LOW 4.01 17.43 8.19 3.50 1.47 0.12 3.80 8.40 5.83 10.05 10.00 2.18 1.50 5.80 8.75 7.29 8.00 6.60 11.93 10.00

1000.00 1000.00 1000.00 1000.00

900.00 1000.00 1000.00 1000.00

PREFERENCE SHARES

1.00 106.00 100.00 106.00 105.00 105.00 100.00 10.00 1.01

1.00 100.00 100.00 100.00 105.00 100.00 100.00 10.00 1.01

SECURITY AML Foods Limited APD Limited Bahamas Property Fund Bahamas Waste Bank of Bahamas Benchmark Cable Bahamas CIBC FirstCaribbean Bank Colina Holdings Commonwealth Bank Commonwealth Brewery Consolidated Water BDRs Doctor's Hospital Famguard Fidelity Bank Finco Focol ICD Utilities J. S. Johnson Premier Real Estate Cable Bahamas Series 6 Cable Bahamas Series 8 Cable Bahamas Series 9 Cable Bahamas Series 10 Colina Holdings Class A Commonwealth Bank Class E Commonwealth Bank Class J Commonwealth Bank Class K Commonwealth Bank Class L Commonwealth Bank Class M Commonwealth Bank Class N Fidelity Bank Class A Focol Class B

CORPORATE DEBT - (percentage pricing) 52WK HI 100.00 100.00 100.00

52WK LOW 100.00 100.00 100.00

SYMBOL AML APD BPF BWL BOB BBL CAB CIB CHL CBL CBB CWCB DHS FAM FBB FIN FCL ICD JSJ PRE CAB6 CAB8 CAB9 CAB10 CHLA CBLE CBLJ CBLK CBLL CBLM CBLN FBBA FCLB

SECURITY Fidelity Bank Note 17 (Series A) + Fidelity Bank Note 18 (Series E) + Fidelity Bank Note 22 (Series B) +

SYMBOL FBB17 FBB18 FBB22

Bahamas Note 6.95 (2029) BGS: 2014-12-3Y BGS: 2015-1-3Y BGS: 2014-12-5Y BGS: 2015-1-5Y BGS: 2014-12-7Y BGS: 2015-1-7Y BGS: 2014-12-30Y BGS: 2015-1-30Y BGS: 2015-6-3Y BGS: 2015-6-5Y BGS: 2015-6-7Y BGS: 2015-6-30Y BGS: 2015-10-3Y BGS: 2015-10-5Y BGS: 2015-10-7Y

BAH29 BG0103 BG0203 BG0105 BG0205 BG0107 BG0207 BG0130 BG0230 BG0303 BG0305 BG0307 BG0330 BG0403 BG0405 BG0407

BAHAMAS GOVERNMENT STOCK - (percentage pricing) 115.92 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

104.79 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

MUTUAL FUNDS 52WK HI 2.07 3.95 1.96 170.77 146.34 1.50 1.67 1.58 1.10 6.99 8.54 6.15 10.52 11.46 10.46

52WK LOW 1.67 3.04 1.68 164.74 116.70 1.44 1.63 1.55 1.04 6.41 7.62 5.66 8.65 10.54 9.57

LAST CLOSE 4.27 17.43 9.09 3.60 1.47 0.12 4.00 8.60 6.00 10.45 10.01 2.54 1.55 6.00 9.75 7.29 10.00 7.01 12.50 10.00 1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.01 LAST SALE 100.00 100.00 100.00 108.55 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

CLOSE 4.27 17.43 9.09 3.60 1.47 0.12 4.00 8.60 6.00 10.45 10.01 2.55 1.55 6.00 9.75 7.29 10.00 7.01 12.50 10.00

CHANGE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.01

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

CLOSE 100.00 100.00 100.00

CHANGE 0.00 0.00 0.00

108.54 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

-0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

FUND CFAL Bond Fund CFAL Balanced Fund CFAL Money Market Fund CFAL Global Bond Fund CFAL Global Equity Fund FG Financial Preferred Income Fund FG Financial Growth Fund FG Financial Diversified Fund FG Financial Global USD Bond Fund Royal Fidelity Bahamas Opportunities Fund - Secured Balanced Fund Royal Fidelity Bahamas Opportunities Fund - Targeted Equity Fund Royal Fidelity Bahamas Opportunities Fund - Prime Income Fund Royal Fidelity Int'l Fund - Equities Sub Fund Royal Fidelity Int'l Fund - High Yield Fund Royal Fidelity Int'l Fund - Alternative Strategies Fund

VOLUME

150

6,300 450

VOLUME

NAV 2.07 3.95 1.96 174.30 146.25 1.50 1.63 1.58 1.08 6.92 8.03 6.15 10.52 11.46 10.01

EPS$ 0.444 0.932 -0.510 0.383 -0.340 0.000 -0.760 0.587 0.190 0.540 0.570 0.102 0.455 0.753 0.763 0.330 0.830 0.600 0.697 0.000

DIV$ 0.080 1.000 0.000 0.210 0.000 0.000 0.000 0.300 0.220 0.360 0.570 0.060 0.060 0.290 0.450 0.000 0.340 0.140 0.620 0.000

P/E 9.6 18.7 N/M 9.4 N/M N/M -5.3 14.7 31.6 19.4 17.6 25.0 3.4 8.0 12.8 22.1 12.0 11.7 17.9 0.0

YIELD 1.87% 5.74% 0.00% 5.83% 0.00% 0.00% 0.00% 3.49% 3.67% 3.44% 5.69% 2.35% 3.87% 4.83% 4.62% 0.00% 3.40% 2.00% 4.96% 0.00%

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

0.00% 0.00% 0.00% 0.00% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 7.00% 6.50%

INTEREST 7.00% 6.00% Prime + 1.75%

MATURITY 19-Oct-2017 31-May-2018 19-Oct-2022

6.95% 4.00% 4.00% 4.25% 4.25% 4.50% 4.50% 6.25% 6.25% 4.00% 4.25% 4.50% 6.25% 3.50% 3.88% 4.25%

20-Nov-2029 15-Dec-2017 30-Jul-2018 16-Dec-2019 30-Jul-2020 15-Dec-2021 30-Jul-2022 15-Dec-2044 30-Jul-2045 26-Jun-2018 26-Jun-2020 26-Jun-2022 26-Jun-2045 15-Oct-2018 15-Oct-2020 15-Oct-2022

YTD% 12 MTH% 2.34% 4.55% 0.90% 1.64% 1.21% 2.55% 3.48% 4.01% 3.17% 7.00% 2.15% 4.22% -1.93% -1.89% 0.81% 2.21% 2.28% 1.30% -1.08% 1.77% -5.96% -3.05% 1.90% 4.59% 7.24% 11.96% 2.77% 3.88% 3.94% 4.69%

NAV Date 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 31-May-2017 30-May-2017 30-May-2017 30-May-2017 30-May-2017 30-May-2017

MARKET TERMS BISX ALL SHARE INDEX - 19 Dec 02 = 1,000.00 52wk-Hi - Highest closing price in last 52 weeks 52wk-Low - Lowest closing price in last 52 weeks Previous Close - Previous day's weighted price for daily volume Today's Close - Current day's weighted price for daily volume Change - Change in closing price from day to day Daily Vol. - Number of total shares traded today DIV $ - Dividends per share paid in the last 12 months P/E - Closing price divided by the last 12 month earnings

YIELD - last 12 month dividends divided by closing price Bid $ - Buying price of Colina and Fidelity Ask $ - Selling price of Colina and fidelity Last Price - Last traded over-the-counter price Weekly Vol. - Trading volume of the prior week EPS $ - A company's reported earnings per share for the last 12 mths NAV - Net Asset Value N/M - Not Meaningful

TO TRADE CALL: CFAL 242-502-7010 | ROYALFIDELITY 242-356-7764 | FG CAPITAL MARKETS 242-396-4000 | COLONIAL 242-502-7525 | LENO 242-396-3225

ELRICH ARLINGTON WALKER Jr. Please contact MITRE COURT LAW FIRM Suite 227, Island Lane Building, Olde Towne, Sandyport Nassau, The Bahamas 242-327-4150 Contact: Atty C. Hepburn

THE TRIBUNE

Monday, July 31, 2017, PAGE 7 Sarkis Izmirlian, the thenRadisson Cable Beach resort (now the Melia) had generated a small net profit for the Government under its Bahamian operator, the Myers Group, based on accounts seen at the time by Tribune Business. Mr Alnebeck also likened the Government’s ‘last resort’ bid to reopen and/or sell the Grand Lucayan to the Bahamian taxi industry’s structure, pointing out that most vehicles were driven by persons who did not own the plates. “There are many taxis in the Bahamas owned by people not driving them. The driver is doing a good job and the person who owns it is irrelevant,” the Pelican Bay chief said. He added that numerous successful hotels worldwide were owned by real estate

developers, pension funds and other financial investors, who were not involved in the daily operations having outsourced this to brand operators and management companies. While no details have yet been provided, Prime Minister Dr Minnis indicated the Government was in talks to partner with other, unnamed investors and take an equity stake in a group that would ensure the Grand Lucayan’s re-opening in time for the winter 2018 season. Dr Minnis said the Government viewed this action as similar to the auto and banking industry bail-outs undertaken by the Obama administration and UK government during the 2008-2009 recession. He added that his administration’s strategy was

similar, too: Re-open the Grand Lucayan, turn it around, and then the Government would sell its equity stake to its partner investors or someone else. Mr Alnebeck, meanwhile, said that while Pelican Bay was “doing very well” because of its corporate customer base, the remainder of Freeport’s tourism market was almost entirely reliant on the Bahamas Celebration cruise vessel to generate business. “We need it open,” he told Tribune Business of the Grand Lucayan. “If it doesn’t re-open for at least part of the upcoming winter season, it is going to be very difficult to come back. “If somebody comes in and that leads to the opening of at least 50 per cent of it, at least we’re stopping

Stocks sag following disappointing profit reports

says the economy reminds him of what golfers call a “son-in-law” shot, one that’s not bad but not great. “We’re not throwing new money into the stock market at this point,” Weiss said. Instead of U.S. stocks, he prefers foreign markets where he says economies have more potential for improvement. Many other investors have shifted their money using a similar philosophy, and the falling value of the dollar against other currencies has helped boost foreign stocks’ returns.

A SIGN for Wall Street carved into a building located near the New York Stock Exchange. U.S. stocks followed other markets lower on Friday, July 28, 2017 after Amazon and several other big companies reported quarterly results that underwhelmed investors. (AP Photo/Mark Lennihan, File)

‘Imperfect’ Grand Lucayan rescue needs top operator From pg B1 brand and operator to run it, then it could be solid. “The problem is when you get involved in the operations side that you’re not experienced in. As long as they see themselves as investors in real estate, find a solid operator and use this as a short-term measure, it’s not perfect but it’s better than nothing.” Mr Alnebeck added: “If there is no other way, it’s a brave step for them [the Government] but something that needs to be done. “The problem arises if Government is in there trying to run a private business. As long as they are not getting involved in the

By STAN CHOE Associated Press NEW YORK (AP) — Stock markets around the world sagged on Friday after Amazon and other big companies reported quarterly results that underwhelmed investors. The Standard & Poor’s 500 index lost 3.32 points, or 0.1 percent, to 2,472.10 and closed a week packed with corporate earnings reports almost exactly where it started. It set a record during the middle of it. The Dow Jones industrial average gained 33.76 points, or 0.2 percent, to 21,830.31 and set another all-time high. The Nasdaq composite fell 7.51, or 0.1 percent, to 6,374.68. A little more than half the companies in the S&P 500 have now shown how much profit they made during the spring, and the results have been mostly encouraging. Earnings for the index are on pace to be about 9 percent higher than

hiring, pay and marketing I think it can work provided they have a solid operator. Hopefully that increases the value of the property, and at some point the Government can exit and make a profit on behalf of the Bahamian people.” Mr Alnebeck said there was precedent for the Government’s Grand Lucayan model elsewhere in the world, with Sandals managing resort properties in Jamaica that were owned by that island’s government. The model of government ownership, private operator has also met with modest success before in the Bahamas. Prior to its sale to former Baha Mar developer,

a year earlier, according to FactSet. But expectations were high coming into the reporting season, and the few companies that have fallen short of forecasts have seen their stock prices punished. Amazon dropped $25.96, or 2.5 percent, to $1,020.04 after its profit missed expectations. Its forecast for operating income this fiscal year was also below many analysts’ forecasts, though revenue for the latest quarter beat expectations. Earnings reports were the main focus for markets during a busy week, where the Federal Reserve also decided on Wednesday to hold interest rates steady and the government on Friday gave an update on the economy’s health. The economy grew at an annual rate of 2.6 percent in the second quarter, revved up by a rise in consumer spending, the Commerce Department reported. Last quarter’s growth rate was more than double that of the year’s first quarter, which was revised down

to 1.2 percent. The faster growth, though, was still a shade below the 2.7 percent that economists expected. “Overall, the economy continues to move along, but it’s hard to see where the fuel is going to come from for further acceleration,” said Rich Weiss, chief investment officer of multiasset strategies at American Century Investments. He

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the downward spiral. But if you’re looking at an end of summer [2018] opening it’s going to be very difficult to come back.” Mr Alnebeck continued: “The tourism industry is almost non-existent apart from the Bahamas Celebration. We have some boaters coming, but nothing that’s equivalent to the Sunwing Vacation programme of the last two years. “Things turned around when Sunwing came in, opened Memories, and then sales were going up again. We had a long way to go to get back to 2005-2006 numbers, but we were going in the right direction. “But then the storm came, Hutchison shut the property and that took the bottom out of the whole thing.”

PAGE 8, Monday, July 31, 2017

THE TRIBUNE

Obama’s health care law still needs some patchwork By TOM MURPHY Associated Press THE health care law of the land has survived for now, but it needs help — and it needs it soon. Soaring prices and fewer choices may greet customers when they return to the Affordable Care Act’s insurance marketplaces this fall, in part because insurers are facing deep uncertainty about whether the Trump administration will continue to make key subsidy payments and enforce other parts of the existing law that help control prices. Assurances don’t look to be coming anytime soon. “As I said from the beginning, let ObamaCare implode, then deal. Watch!” President Donald Trump tweeted Friday, soon after the Senate narrowly rejected the latest push to dismantle the Obama-era health care law.

anteed them through this month. If they stop, insurers will have to raise prices for coverage, known as premiums, because by law they must still offer the same reduced deductibles for their lowincome customers. Trump appeared to threaten those payments Saturday, tweeting: “If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!” Starting in 2014, members and their staffs had to use federal or state health care exchanges instead of the coverage that is available to most government workers. Most members who use the coverage buy it off the health care exchange created by the District of Columbia. They also collect subsidies from the government if they use the dis-

“As I said from the beginning, let ObamaCare implode, then deal. Watch!” Health and Human Services Secretary Tom Price said in a statement after the Senate vote that the administration would pursue its health care goals through regulation. That kind of uncertainty rattles insurers, many of whom have already stopped selling policies through public insurance markets established by the health law because they were losing money. Their main concern now is that the administration will stop paying crucial subsides called for in the law that help reduce costs like deductibles for people with low incomes. The subsidies, estimated at $7 billion a year, have been challenged by Republicans in court, and Trump has only guar-

trict’s exchange. Members aren’t required to use the coverage. Some get health insurance through a spouse, for example. Leerink analyst Ana Gupte surveyed several states and has said that insurers are asking for price hikes of around 36 percent when they assume the subsidies go away, compared with about 18 percent if they stay. People with low incomes might be shielded from these hikes in part because the law provides tax credits that cover much of the premium. But those who make too much to qualify for that help — and tend to vote Republican — could get hit hard, noted health care consultant Robert Laszewski, a former insurance executive.