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MONDAY, JUNE 11, 2018

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Dont ‘continually’ hike VAT for fiscal escape By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

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HE government “cannot continually” use VAT hikes to solve its fiscal woes, a top accountant is warning, describing its rising debt servicing and unfunded pension costs as “worrisome”. Raymond Winder, pictured, Deloitte & Touche (Bahamas) managing partner, told Tribune Business that encouraging private sector growth should be as big a priority as increasing revenues when it came to tax reform. Warning the Minnis administration that its predictions of a “soft” economic landing following the 60 percent VAT rate hike had better be correct, he said hitting its fiscal targets

* Private sector fears rises to 17.5%, 20% * $100m unfunded pension bill ‘worrisome’ * 18% interest servicing ratio a ‘red line’

- and delivering benefits the Bahamian people can feel - will be vital to maintaining the government’s credibility. Mr Winder described The Bahamas’ current debt servicing costs, where 18 percent of all government revenues go towards interest payments, as a “red line” that could not be allowed to

increase given the sums it sucks from essential public services. And he warned that the sums allocated to paying civil service pensions, pegged at $100m in the 2018-2019 budget, appeared to be growing at a faster rate than the rest of the budget. “It’s important that the government demonstrate to the Bahamian people that with this increase in taxation you are going to get an improvement in the fiscal position,” Mr Winder told Tribune Business. “We cannot continually raise taxes and allow the fiscal condition to

deteriorate... Obviously the government is hoping there is some reduction in the public sector, some increase in taxation and some limited growth in the economy, and I hope they’re correct that we will have a reasonable landing at the end of the day. “The government needs to constantly reassess the various taxes to ensure we are not only considering raising revenue when we put new taxes on the books, but are considering the creation and encouragement of industries in The Bahamas. That means we must

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‘Sanctions threat’ from web shop taxation hike By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE prime minister has been warned by the Caribbean’s former top financial regulator that The Bahamas faces the “considerable danger” of sanctions from the web shop gaming tax hikes. Calvin Wilson, the immediate past executive director for the Caribbean Financial Action Task Force (CFATF), last night warned Dr Hubert Minnis that The Bahamas could face renewed anti-money laundering sanctions if the industry was driven “underground” by its new tax structure. He indicated that the emergence of concerns over

* Ex-Caribbean financial chief: ‘considerable danger’ * ‘Black market’ warning ill-timed with FATF review * ‘Sensitive time’ for Bahamas reputation an expanded gaming “black market” were especially ill-timed given that The Bahamas is currently being reviewed by the CFATF’s parent, the Paris-based Financial Action Task Force (FATF), to determine whether it has sufficiently addressed the regulatory weaknesses identified in its last evaluation. That evaluation, conducted by a CFATF that Mr Wilson headed for 19 years, noted that The Bahamas’ own Financial Intelligence Unit (FIU) had identified “illegal gambling” as one of

the main offences relating to money laundering. Acknowledging that web shops had been legalised, the CFATF report said implementation and effectiveness of their regulatory regime still had to be assessed. Mr Wilson, in his letter to the prime minister, warned that The Bahamas may have to address the “illegal gambling” issue within a matter of days as part of the FATF process - just as concerns over a tax-driven expansion of this problem were resurfacing. Mr Wilson, a former

banker, barrister and UK Crown prosecutor, called for an “immediate intervention” by the prime minister given the potential implications of the new web shop taxation regime for The Bahamas’ standing in the fight against financial crime. His June 10 letter, a copy of which has been seen by Tribune Business, warned: “A bitter legal action is threatened premised on discrimination, expropriation, breach of legitimate expectation, unreasonableness,

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‘Unfair’ to tax web shops into losses By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE government should not force the web shop industry out of business through the imposition of onerous taxation, a top accountant is arguing. Raymond Winder, Deloitte & Touche (Bahamas) managing partner, told Tribune Business that it was “unfair for any business” whether it was the domestic gaming industry or other sectors - to be driven into a loss-making position by government taxation. Reiterating that the resulting job losses and business closures would be counterproductive for both the government and wider Bahamian society, Mr Winder said: “These taxes should not result in the gaming operators incurring losses. “No business should be incurring losses because of taxation, and the government should put in some kind of floor [ceiling] for the numbers houses as well as those paying business licence fees. Taxes should not go beyond this level because it results in losses for these industries. “It’s unfair for any business if government taxes generate losses,” he continued. “We’re looking to encourage business, and no business will be around for long if it incurs losses. The government has to be sensitive to this, for if they go out of business that will result in higher unemployment and the government will not be able to accomplish some of the things it wants to accomplish.” Mr Winder’s comments are likely to be seized upon by web shop operators as additional ammunition for their intensifying lobbying campaign against the new “sliding scale” tax structure

* TOP ACCOUNTANT: NO INDUSTRY SHOULD BE TREATED LIKE THIS * SAME APPLIES TO SECTORS BURDENED BY BUSINESS LICENCES the government plants to impose on the sector. Neither side has shown any sign of shifting their position in the escalating row, with the domestic gaming sector warning that 2,000 jobs will be lost and 75 percent of web shop locations forced to close if the Minnis administration follows through with its plans. The seven-day deadline for the government to respond to the industry’s concerns expired on Thursday, opening the door to make good on its threat to initiate legal action to block the tax hikes. The government, for its part, is arguing that the web shops must contribute more through taxation to offset the social costs they impose on society through the redistribution of wealth from the many to the few. It believes that the industry’s effect on Family Island communities, in particular, must be redressed given the sums of money it believes are being sucked out to Nassau. And the government believes it has backing from a significant number of Bahamians who feel the web shop industry should never have been legalised in the first place. The Bahamas Gaming Operators Association (BGOA), the sector body, yesterday seized on comments made by Marlon Johnson, acting financial secretary, as evidence that

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Baha Mar contractor: Ginn purchaser plans No rooms for Sarkis initial 120-room hotel By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

BAHA MAR’S main contractor refused to turn over completed rooms to the original developer in early 2015 as it sought leverage to claim an extra $119m in their growing payment dispute. A senior China Construction America (CCA)

* HANDOVER ‘SUSPENDED’ IN PAYMENT ROW * CCA CLAIMED ‘OUT OF POCKET’ BY $119M * SOUGHT MORE MONEY WITHIN THREE MONTHS OF DEAL

official, in a February 16, 2015, e-mail to thenBaha Mar president, Tom Dunlap, revealed that the handing over of finished hotel rooms to Sarkis Izmirlian’s team had been “suspended” until the “big commercial issue” between the two sides was resolved. The document, never previously disclosed, has

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A CANADIAN-BASED developer aims to build a new 120-room hotel, add 75 marina slips and upgrade the airport and golf course within 24 months once it closes its acquisition of the former Ginn sur mer. Skyline Investments, a Toronto-based real estate investor/developer, with $500m in assets and a focus on hotel and resort development, broke cover

to unveil its plans for the 2,012-acre property in Grand Bahama’s West End. Tribune Business sources have suggested its purchase is scheduled to close as early as Friday, with a Heads of Agreement signing soon after. The new development will be known as Bahama Bay by Grand Palm Beach Acquisitions Ltd, and was announced at a Town Hall

meeting in West End on Friday. Skyline Investments executives presented their plans to residents, with Tribune Business having exclusively revealed the Toronto-based developer as the buyer in September 2017. Government representatives were also in attendance to listen to

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THE TRIBUNE

Tourism director-general gains top regional award THE Bahamas’ tourism director-general has received the Caribbean Tourism Industry’s Allied Award for her work on the industry’s sustainable development.  Joy Jibrilu was presented with the honour during the Caribbean Tourism Industry Awards Dinner and Fashion Show, part of the annual Caribbean Week’s New York events. She was present at the ceremony at the Wyndham New Yorker in Midtown to accept the award granted by the Caribbean Tourism Organization (CTO) and its allied members. Mrs Jibrilu is the first Bahamian member of the Caribbean Tourism Organisation (CTO) to receive the award. “I am extremely honoured to be receiving the Caribbean Tourism Organisation’s Allied Award this year,” said Mrs Jibrilu. “Promoting our spectacular Caribbean region and its sustainability is a personal passion of mine, and its good stewardship is essential for all of us. I am grateful that my colleagues in the tourism industry, and my neighboirs in the Caribbean, consider my contributions to have been so worthwhile.” Established in 2005, the

TOURISM director-general Joy Jibrilu holding her award with Minister of Tourism and Aviation, Dionisio D’Aguilar. Photo: Azikiwe Aboagye Allied Award is presented to someone who has contributed to the sustainable development of the Caribbean. Eligible organisations include members of government, member airlines and cruise lines, and allied

members, which includes hotels, tour operators, marketing companies, newspapers, magazines and television programming. “It is with both respect and admiration that we recognise these business

and industry icons for their tireless commitment – often beyond the call of duty – to the development of a sustainable Caribbean tourism product,” said Sylma Brown, director of the CTO-USA.

Mrs Jibrilu has worked to encourage sustainable development and tourism growth for The Bahamas, with a focus on respect for the local environment, culture and people. In her role as director general,

she took in May 2014, she has had oversight of the development, marketing and promotion of the tourism industry’s marketing programmes. Prior to this, she served as director of investments in the Bahamas Investment Authority (BIA), starting that role in July 2008. In both positions, Mrs Jibrilu has been involved in negotiating and implementing some of the largest tourism investment and development projects in The Bahamas, including Atlantis and Baha Mar. “I am a firm believer that we are all guardians of these wonderful islands that many of us get to call home, and as a result, we have an incredible responsibility to promote tourism in the most sustainable manner in order to safeguard the Caribbean for future generations,” Mrs Jibrilu said. She was one of nine industry and business professionals, in addition to 12 travel influencers from the media, to be recognised across several award categories during the event. Haitian-American Marlie Hall, an award-winning broadcast journalist and entrepreneur, alongside a former correspondent for CBS News, presided as Master of Ceremonies.

‘Unfair’ to tax web shops into losses FROM PAGE ONE

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the government was involved in a “guessing game” over the new tax structure’s impact. It argued that Mr Johnson failed to produce any data to support his “suspicion” that the gaming industry will remain “vibrant”, despite the industry’s own analysis that taxation rates are increasing from 238 percent to 453 percent under the proposed new tax structure. The Association also accused the acting financial secretary of being “nonchalant and apathetic” towards the possibility of industry job losses when he appeared to suggest that affected employees could apply for jobs as housekeepers and maids at Baha Mar. This provoked an immediate online response from Island Luck chief, Sebas Bastian, who said: “OK, that may go down as the worst statement I’ve ever heard in my life. This man [Mr Johnson] just said that if my staff lose their job they could go be a housekeeper at Baha Mar. “I am embarrassed as a Bahamian to hear you say that, Marlon Johnson. The 3,000 people employed in this industry is listening loud and clear. My people, this is what they think of you. My brother, there is no place in 2018 for that kind of mindset. Shame on you and whoever you are misrepresenting.” Mr Johnson immediately sought to place his comments in context via a social media posting, explaining that he was trying to make the point there was sufficient growth in the economy to absorb job losses in specific industries. “Let me clarify my statement if it was misunderstood,” he wrote. “The point I attempted to make is the economy today is in growth mode, so much so that even entry-level jobs like housekeepers are still being actively recruited by Baha Mar. “That is to say that jobs

at all levels are available in a growing economy such as we are fortunate to have. It was a response to a hypothetical question posed by the interviewer. I apologise if it came across that I was suggesting that persons losing a job in the industry should become housekeepers. That was, and is not, my intent. “It was a point I was attempting to make about the broader economy in summary form during a fluid interview. I understand, though, the inference it could reasonably lead to. Hence I do apologise to those I may have offended due to my own lack of clarity on the matter.” Many observers are likely to question Mr Johnson’s economic growth optimism, especially given the 60 percent VAT rate hike. And, despite his clarification, there is no sign the web shops intend to let him “off the hook”. “This is the first time since announcing the unfair and targeted tax hike that the government has acknowledged the possibility of extreme job losses in the industry,” the Association said yesterday. “If 2,000-plus Bahamians employed by the gaming industry were to lose their jobs due to an unavoidable downsizing, there is no guarantee that they would be employed by Baha Mar as housekeepers or employed at all. They, too, would have to compete with the hundreds of Bahamians already on Baha Mar’s waiting list. “Is this the remedy that the government of The Bahamas is prescribing to address the ramifications of their new taxation law on the lives of everyday Bahamians? Why is the solution sending Bahamians to work for foreign entities instead of securing their jobs with Bahamian employers?” The Association continued: “We respect and applaud the housekeepers and space cleaners who are the backbone of the Bahamian hospitality industry,

but we also respect and applaud the employees that are the backbone of our gaming industry, and we will not stop advocating to save their jobs. “The gaming industry employees a wide range of staff including cashiers, security guards, graphic designers, accountants, marketing executives and compliance officers. We are disheartened that Mr Johnson has given no consideration to the highlytrained corporate staff of the gaming industry. “He also thought nothing of the people the industry employees in our Family of Islands. Do we expect industry employees to leave their home islands to find work in New Providence? These hard-working and capable Bahamians should not be corralled into the hospitality industry because of callous and misinformed government policies.” The present tax structure requires web shop operators to pay 11 percent on taxable revenue or 25 percent of EBITDA (earnings before interest, taxation, depreciation or amortisation), whichever is greater. However, under the proposed new “sliding scale” they will pay: • Up to $20m in revenue, a rate of 20 percent. • Between $20m and $40m, a rate of 25 percent. • Between $40m and $60m, a rate of 30 percent. • Between $60m and $80m, a rate of 35 percent. • Between $80m and $100m, a rate of 40 percent. • Over $100m, a rate of 50 percent. And, in a nasty twist as far as web shop operators are concerned, the government has also imposed new taxation on gamblers themselves rather than the sector. Patrons, from July 1, will have to pay a five percent stamp tax on both their web shop deposits and nononline games/digital sales.


THE TRIBUNE

Monday, June 11, 2018, PAGE 3

‘GATE SHOULD NEVER HAVE BEEN OPEN’ TO WEB SHOPS By NATARIO MCKENZIE Tribune Business Reporter nmckenzie@tribunemedia.net A BAHAMIAN businessman has urged the government to present a “detailed audit” of the web shop gaming sector, and is backing the introduction of a National Lottery. Peter Roker, operator of the Bargain City Plaza on Carmichael Road, told Tribune Business that “the gate should have never been opened” in legalising web shop gaming. He referenced the 2013 gaming referendum/ opinion poll, noting that Bahamians had rejected the regulation and taxation of the industry. “There are certain things that I am concerned about as a Bahamian and a business person,” Mr Roker said. “One is the gambling

issue; how it affects the people, what kind of heritage it is creating for my children and grandchildren, as well as other people’s children and grandchildren. “I am concerned about what kind of impact it will have on the economy and the disposable income of Bahamians. As far as the gambling issue is concerned, when the question of the referendum came up I had the right to vote for it or against it. I voted against gambling. I was very surprised that the Government decided, after the people voted against gambling, to make it legal. It seems as though our vote didn’t count.” Mr Roker added: “If you go to a Family Island like Long Island you can see the absolute disaster gambling is causing the island. As citizens and stakeholders we

have to be mindful and see what gambling in the form we see now is doing to our people.” The present tax structure requires web shop operators to pay 11 percent on taxable revenue or 25 percent of EBITDA (earnings before interest, taxation, depreciation or amortisation), whichever is greater. However, under the proposed new ‘sliding scale’ they will pay: • Up to $20m in revenue, a rate of 20 percent. • Between $20m and $40m, a rate of 25 percent. • Between $40m and $60m, a rate of 30 percent. • Between $60m and $80m, a rate of 35 percent. • Between $80m and $100m, a rate of 40 percent. • Over $100m, a rate of 50 percent. The Bahamas Gaming Operators Association,

in a furious post-budget counter-attack, has threatened legal action over the “expropriatory, discriminatory, excessive and penal” tax rises. Still, Mr Roker argued that even with the steep taxes being assessed, web shop gaming should be a “no, no”. “The government needs to come out and give a detailed audit of this gambling issue. It appears that this gambling issue is a runaway type situation,” he said. “It’s like a tsunami has hit us and we don’t know the end result, but we know that it’s not going to be a good one. “My personal concern is truly the form of gambling. In my opinion, a simple government lottery from which monies could go towards, hospitals, education, sports and the like would suffice. Gambling in

the form we see it now is a no no, even with the taxes.” As for the government’s decision to introduce Value-Added Tax (VAT) at a rate of 12 percent, Mr Roker said: “We now have 12 percent VAT in our face. That’s an enormous amount of money. There are no if’s, and’s or but’s about that.” Mr Roker estimated that roughly 75 percent of Bahamians are what he described as “financially deprived”. He added that increased taxes would likely fall on the backs of those who could least afford them. Still, Mr Roker argued that Bahamians must come to grips with the reality that taxes are necessary. “There is a new day in this country. Bahamians must pay their taxes and utilities or they will not exist as business people,” he said.

MANUFACTURERS SLAM ‘INACCURACY’ ON SECTOR By NATARIO MCKENZIE Tribune Business Reporter nmckenzie@tribunemedia.net MANUFACTURERS have challenged recent statements by The Bahamas’ chief World Trade Organisation’s negotiator, arguing that “worrisome” inaccuracies undermine the sector’s significance. The Bahamas Light Industries Development Council (BLIDC), responding to statements made by Raymond Winder on a radio programme, said: “Mr Winder indicated that the light industries/manufacturing sector is comprised of only 12 to 20 companies. There are currently

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Dont ‘continually’ hike VAT for fiscal escape FROM PAGE ONE continually look at all other forms of taxation,” he continued. “VAT is not an area we can continually look to to meet government’s revenue needs in the future. While VAT is better than Customs duties in terms of social needs, it affects those at the lower end far more than the upper end.” Fears that the government will continually hike the VAT rate have already spooked some in the Bahamian private sector, given that it is relatively easy to do and has now been achieved for the first time. Ben Albury, Bahamas Bus & Truck’s general manager, told Tribune Business: “Where’s this going to end? It’s going to go to 15 percent, 17.5 percent, 20 percent. When they rein in things on their end, show they’re being fiscally responsible and are collecting taxes, people will be a lot more receptive.” The 2018-2019 budget’s VAT hike abandons the low-rate, broad-based structure employed when VAT was first introduced on January 1, 2015. The 4.5 percentage point, or 60 percent, increase brings The Bahamas’ VAT rate closer to the likes of Barbados, at 17.5 percent, and the UK, where it is 20 percent. Mr Albury suggested the 12 percent VAT, and the manner in which the increase was effected, will prove a similar “Achilles heel” for the Minnis administration as it did its PLP predecessor.

Suggesting that the rate should not change so quickly, or by this magnitude, Mr Albury said: “For us it’s a software change, but what about Kelly’s and other places that have thousands of items on their shelves priced at 7.5 percent? “Just as the introduction of 7.5 percent VAT was one of the achilles heels for the PLP, making this 12 percent change the way they have, it’s going to be a death blow for them.” While much attention has focused on the 20182019 budget’s $738.475m civil service salary bill, a closer study shows the public sector workforce’s true cost - when all benefits are factored in - stands at over $900m. The Ministry of Public Service’s budget includes $70m for medical insurance payments, and $100m for civil service pensions. Together, these two “line items” represent 58.6 percent of that ministry’s total budget. And, when these costs are added to the wage bill, civil service personnel costs jump to $908.475m - a sum equivalent to 35 percent or more than

one-third of the government’s $2.589bn fixed-cost spending. Mr Winder expressed particular concern over the $100m civil service pension bill, which represents a $5m increase from the $95m allocated the previous year. Civil servants contribute nothing to their retirement income, with this being funded 100 percent by the taxpayer, and even the government has acknowledged the “ticking timebomb” this represents for its already-precarious finances. “One of the things that is a major challenge for the government in this budget is the amount that is due to pensioners, which seems to be increasing at $5m a year and is now estimated to be $100m,” Mr Winder told Tribune Business. “This is a major concern the government has to consider. That is one of the items that appears to be growing and accelerating. I don’t think any of the other items are growing as fast at around six percent a year. “The number is growing at a pretty hefty pace because every time the government retires

someone, a portion of that person’s salary remains on the books because their pensions are funded by recurrent expenditure. “It’s not going to stop. It’s going to grow faster unless the government finds ways to reduce the number of persons going on to that scheme. If not, that’s going to be a worrisome number for the government to plan and budget for.” The government’s unfunded public sector pension liabilities are projected to hit $3.7bn by 2030 unless corrective action is taken to protect Bahamian taxpayers from this unsustainable fiscal burden. KP Turnquest, deputy prime minister, told Tribune Business last week that pension reform is among the government’s medium-term fiscal goals. This helps explain why the government is so eager to deal with its $360m arrears

within a narrow three-year window, and eliminate the deficit so quickly, as this will enable it to then focus on this pressing matter and NIB reforms. With subsidies to stateowned enterprises (SOEs) consuming $398.294m of taxpayer monies, and $709.413m allocated to debt principal repayments and interest ($381m), these two figures alone - combined with civil service salary and benefit costs show how little room for manoevere the government has with the 2018-2019 budget. These three “items” alone account for $2.016bn, or 77.9 percent, of the government’s total recurrent spending for 2018-2919, with Mr Winder expressing concern that The Bahamas’ cannot “allow this situation to deteriorate” further if it is to continue accessing the international

capital markets. “The other challenge the government has is the percentage of the budget that has to go towards interest payments,” he told Tribune Business. “This is just repayment of debt that does nothing for the economy. It’s money that has already been spent. “That is a worrisome number that the government has to pay attention to. Eighteen cents out of every dollar is a significant portion of government revenue that goes to the retiring of interest and principal on the debt. “The 18 percent of revenue going to interest is clearly a red line, and we cannot afford this percentage going towards the payment of debt. At this rate the government will have less funding available for health, education and other important areas of our economy.”

THE PUBLIC HOSPITALS AUTHORITY

NOTICE

TENDER FOR THE PROVISION OF WASTE COLLECTION SERVICES AT FACILITIES OF THE PUBLIC HOSPITALS AUTHORITY TENDERS ARE INVITED FROM QUALIFIED CONTRACTORS TO PROVIDE WASTE COLLECTION SERVICES FOR FACILITIES OF THE PUBLIC HOSPITALS AUTHORITY, FOR A PERIOD OF ONE (1) YEAR. TENDER DOCUMENTS, WHICH INCLUDE INSTRUCTIONS TO TENDERERS, SPECIFICATIONS AND OTHER RELEVANT INFORMATION, CAN BE COLLECTED 9 AM - 5:00PM MONDAY TO FRIDAY AT THE PUBLIC HOSPITALS AUTHORITY, CORPORATE CENTRE BUILDING “B”, THIRD AND WEST TERRACE, COLLINS AVENUE. A TENDER MUST BE SUBMITTED IN DUPLICATE IN A SEALED ENVELOPE OR PACKAGE IDENTIFIED AS “TENDER FOR THE PROVISION OF WASTE COLLECTION SERVICES AT FACILITIES OF THE PUBLIC HOSPITALS AUTHORITY” AND ADDRESSED TO: THE CHAIRMAN, TENDERS COMMITTEE THE PUBLIC HOSPITALS AUTHORITY CORPORATE CENTRE BUILDING “B” THIRD & WEST TERRACE, COLLINS AVENUE P.O. BOX N–8200 NASSAU, BAHAMAS TENDERS ARE TO ARRIVE AT THE PUBLIC HOSPITALS AUTHORITY NO LATER THAN 12 NOON FRIDAY 6th, July 2018. LATE TENDER(S) WILL NOT BE ACCEPTED. All submissions must be accompanied by (i) a current Business License Certificate which states that your company is in Good Standing for one (1) year from the Business License/Valuation Unit of the Ministry of Finance to provide waste collection services; (ii) three (3) references from current or previous clients; (iii) a copy of Insurance Policy Certificate indicating that your company is insured against loss of life, injury or damages; (iv) a copy of your company Value Added Tax (VAT) Registration Certificate; (v) an up-to-date (not less than one (1) month old) V.A.T Compliance Certificate and (vi) a letter from the National Insurance Board (NIB) stating that your company is up to date and in good standing in the payment of its NIB contributions on behalf of those persons employed in your company. The Public Hospitals Authority reserves the right to accept or reject any or all Tender(s).


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THE TRIBUNE

Baha Mar contractor: no rooms for Sarkis FROM PAGE ONE been filed with the New York State Supreme Court as part of Mr Izmirlian’s $2.25bn damages claim against CCA and its affiliates. It shows that, just three months after the original developer agreed to release $54m in advances on disputed claims, the Chinese state-owned contractor remained dissatisfied with its compensation. The e-mail, from CCA director Dawei Wang, was in response to a missive from Mr Dunlap three days’ previously, in which Baha Mar’s president asked whether he was aware of more work stoppages related to building inspections. Mr Wang told Mr Dunlap that all ceiling, life safety and TCO (temporary occupancy certifcates) were proceeding according to schedule. Yet he then added: “The only [thing] suspended is rooms handing over, which we could not proceed [with] because there is still a big commercial issue for pending resolution. “And the reality is, once we hand over the rooms, Baha Mar’s team will change the locks and [make it] hard for CCA to revisit.” Mr Wang’s letter then cited $119m in extra costs that CCA had incurred to “accelerate the project and meet the target date” following the November 2014 meetings that had sought to resolve the growing financial and completion-related differences between contractor and developer. The CCA executive alleged that the contractor had added 600 management and line staff; handed more work to Bahamian contractors; paid “extra premium” for carpet installation and exterior works; and incurred overtime and bonus payments to boost “productivity and working time”. He alleged that this resulted in $36m of “out-ofpocket spending not paid by Baha Mar”, and accused Mr Izmirlian and his team

of cutting the $54m that was supposed to be released by almost 40 percent. The $54m was part of a November 17-18, 2014, agreement which committed CCA to “substantially complete” Baha Mar on March 27, plus improve work productivity and project management. For its part, Baha Mar was to request the payment of the disputed $54.622m to CCA from the project’s financier, China Export-Import Bank. This was to be broken down into $15.103m (50 percent of the disputed sum) paid immediately. Some 70 percent of the $45.815m being reviewed by all parties was also to be paid immediately, with a further $15m eventually due as a final settlement. Mr Wang’s letter said Baha Mar’s “reviewing” had further cut these payments, and added: “CCA has the sincerity to reach agreement with Baha Mar to resolve the commercial issues, and did make significant compromising during the Beijing meeting to accept the $54m as the settlement of previous commercial issues and move the project forward, but we could not accept the further deduction of the post-review and the opinion that this $54m is the final total additional payment to cover CCA until the project finishes.” The Wang e-mail shows that CCA’s compensation remained uppermost in the contractor’s thoughts amid the final, doomed rush to Baha Mar’s missed March 27, 2015, completion that ultimately led to the Chapter 11 bankruptcy protection filing and some 18 months of legal wrangling before the property finally enjoyed a first-phase opening two years later. Just three months after the November 2014 agreement, CCA was already seeking more money, including some $36m to cover additional construction changes (CCDs). Mr Wang alleged that 95 percent of these changes were

made without a price being approved, or payment, from Baha Mar, and forecast that a further $11.7m in CCDs would be incurred before completion. The executive also claimed that the contractor’s monthly payments were “much less than what CCA has to spend to maintain the momentum if the project progress to approach the completion”, and said Baha Mar’s withholding of $63m in retainage was also causing a “big cash flow impact”. “Counting all these impacts together, the deficit in terms of cash flow to CCA is around $36m (CCA not expecting to be fully paid by owner for this additional cost, just for your reference about how much money was spent by CCA to accelerate the project and meet the target date) plus $36m and 70 percent of $58m equal $119m,” Mr Wang said. “This is not including the impact from monthly progress payment cutting. Tom, we are so close to success and we believe we will succeed. I hope you can understand the difficulty being faced by CCA now and help us to resolve it in a reasonable way. “My suggestion is to include the releasing of retainages and partial approval of outstanding CCDs, assuming 70 percent release, in the payment of February... Please let me know your suggestions for resolving this issue; we need your leadership to come over the last hurdle, make the last push and march to the final destination.” February 2015 was an especially controversial month for CCA and its payments. Baha Mar and Mr Izmirlian previously alleged that China Export-Import Bank’s own project monitor, Ryder, Levitt & Bucknall, “assessed down” CCA’s invoices for February-May 2015 from $343.8m to $76.1m - less than one-quarter of what it claimed to be owed.

Ginn purchaser plans initial 120-room hotel FROM PAGE ONE

residents and gather feedback on the ten-year development plan. K Peter Turnquest, Deputy Prime Minister, responded to questions along with minister of state for Grand Bahama, Senator Kwasi Thomson, and local MP, Pakesia Parker-Edgecombe. Also present were Philip Weech, director of the Bahamas Environment Science and Technology Commission (BEST), and director of investments at the Bahamas Investment Authority (BIA), Candia Ferguson. Skyline Investments said it was planning a “Smart City” that will act as a headquarters for high technology startups, personal businesses and consultancies. It is aiming to develop a fully integrated green community through its use of use of sustainable energy sources, recycling, efficient and low environmental impact construction methods. With over $2bn to be invested, Derek Gape, director of operations for the West End project, said initial goals for the first 24 months of the project include creating a new 120-room hotel with commercial retail spaces and amenities; redeveloping and reopening the West End airport; adding an additional 75 slips to the existing marina at the current Old Bahama Bay site; and bringing the golf course into full operation. Gil Blutrich, Skyline’s chairman, said: “We are proud to have the opportunity to develop Bahama Bay and be part of the West End community. We believe that that this development will have a significant impact on Grand

GOVERNMENT representatives were on hand with Skyline International executives to gather feedback and respond to questions from local residents of West End about the planned Bahama Bay project.  Photo: Keen i Media Ltd Bahama. We know that both xreal estate component of the West End community and the Ginn project, and hired Skyline will grow together Replay Resorts to master and become a major player in plan the property. Lubert the hospitality industry in The Adler and Credit Suisse have Bahamas”. worked together in the belief Tribune Business sources this is the best way to maxpreviously suggested that imise their exit price - and negotiations have involved potential recovery - by selling the added complication of the former Ginn sur mer as dealing with two vendors. one. What would have been the Skyline Investments, which core project was owned by is listed on the Tel Aviv Stock Lubert-Adler, the Philadel- Exchange, describes itself on phia-based investment bank its website as having $500m that was Ginn’s financing in assets. It specialises in real partner. estate investment and develIt held 280 acres that were opment related to the hotel/ earmarked as the site for the resort industry. hotels and casino, and its It describes itself as landholdings also include key “sourcing new acquisition amenities such as the airport, opportunities to grow and marina and utilities. diversify its cash flow in Lubert-Adler also con- North America”, with an trolled the Old Bahama emphasis on geographical Bay Resort, the golf course, diversification. the existing marina, comCurrent properties include mercial facilities such as the Hyatt Regency at The the restaurants and retail, Arcade in Cleveland; the and associated operational Renaissance Cleveland Hotel; facilities. Bear Valley Ski Resort in But a Credit Suisse-led California, plus a variety of lending syndicate took pos- mixed-use resort developsession of the remaining 1,476 ments throughout Canada. acres at the former Ginn sur Skyline’s plans for the Ginn mer project after Ginn Devel- sur mer property are unclear, opment Company defaulted although its development will on its $276m loan. likely be less high-rise than It effectively inherited the the original developer’s.


THE TRIBUNE

Monday, June 11, 2018, PAGE 5

‘Sanctions threat’ from web shop taxation hike FROM PAGE ONE unfairness, lack of empirical analysis and the absence of consultation with stakeholders. “There is also some opinion that one of the unintended consequences of the government’s approach may be the expansion of the existing “black market” gambling houses, which may expose The Bahamas to possible international sanctions. “And it is on this point that there is considerable danger of a possible resumption of international sanctions. With the benefit of valuable information which was available to me whilst at the CFATF, and with The Bahamas’ national interests uppermost in mind, I would like to urge your immediate intervention, honourable prime minister, for an expeditious resolution of this matter given events that may transpire at the FATF in a few days.” Alfred Sears QC, attorney for the Bahamas Gaming Operators Association, warned in a May 31, 2018, letter that the proposed budget tax hikes on the web shop industry threatened to drive the “numbers” business underground where it would be harder to regulate - a development that would attract the attention of sanctioning international regulators. The Association’s own study, by ten-year gaming industry veteran and accountant, Gavin Hamilton, suggested that the increases, and their impact on the seven licensed web shop chains, would drive 30 percent of the industry’s existing customer base to an “underground black market” which already accounts for 15 percent of domestic gaming business. Members of the former Christie administration have also warned that the government’s plans will

take the sector back to where it was pre-legalisation in 2014, an outcome they say will be counterproductive to the intent behind that move. Mr Wilson, meanwhile, said the revival of such concerns was poorly timed given that The Bahamas is in the midst of addressing the deficiencies in its antimoney laundering/counter terror financing regime identified in last year’s CFATF. While it was unclear whether The Bahamas had given such a report at the recent CFATF plenary, Mr Wilson said the country had also “met the criteria to be reviewed” by the FATF’s International Cooperation Review Group (ICRG) - a process that was previously confirmed to Tribune Business by Carl Bethel QC, the attorney general. This review is due to complete this month, and the ex-CFATF executive director said the process gives countries a year to rectify deficiencies or “face further and detailed scrutiny in the coming months” and be subjected to FATF public statements and inclusion on its IRCG Compliance Document. Warning that this could bring “international reputational risks”, Mr Wilson recalled how The Bahamas spent $35m to escape its original “blacklisting” in 2000, paying “a significant price” for doing so. He added: “Given the current heated national debate on the proposed tax increase to be imposed on the gaming sector, apparently without objective expert analysis and stakeholder consultation, the potential flight of gaming operations to the ‘black market’ arena and the flagging of illegal gaming as one of the top predicate offences by the FIU, The Bahamas could be called upon to address this issue with its regional

MANUFACTURERS SLAM ‘INACCURACY’ ON SECTOR FROM PAGE THREE no less than 50 companies engaged in production in The Bahamas, and this number is not exhaustive.” The BLIDC added: “The chief negotiator also advanced that the prospect of employment growth for the sector was unlikely. This is also misleading. According to the Department of Statistics May 2017 Labour Force Report, manufacturing employs 4,365 persons, while agriculture, hunting, forestry and fishing employ a further 935, bringing the total to 5,300 individuals. In fact, some of our members single handedly employ in

excess of 200 persons. “While Mr. Winder did acknowledge the government would seek to protect these businesses, it is worrisome when statements are made which, in their inaccuracy, undermine the significance of the sector.” The BLIDC said it was encouraging all policymakers, as well as interested persons, to visit the BLIDC’s website, www.blidc.org which lists all of its members, as well the products made in The Bahamas. The growing list includes plastic cups, bottled water, bread, resort wear, mattresses bleach, windows, beer and cigars. 

and international counterparts in a few days. “Therefore, any significant change to the taxing architecture of domestic gaming should be supported by expert analysis and stakeholder consultation to ensure there will be no increase in existing ‘black market’ illegal gambling and other money laundering vulnerabilities in The Bahamas.” Web shop operators have warned that the reduction in locations and winnings payouts, as a result of the tax hike, will further push patrons into the arms of “underground” gaming. They have argued that the Government is comparing “apples and oranges” by basing the sector’s new tax structure on what exists in markets such as Florida and Macau, which they allege are not comparable to the Bahamian industry’s structure. Mr Wilson said that, in the circumstances, it was “in The Bahamas’ best interests if the current impasse” between the government and gaming industry was “settled as expeditiously as possible” via dialogue. “If it is indeed correct that The Bahamas will seek to exit the FATF ICRG this month, then there must be no impediment or detracting information that could preclude the Bahamas from doing so,” he wrote. Warning that The Bahamas was at “a critical juncture”, Mr Wilson added: “All national efforts must be directed to towards urgently moving past this impasse through creating the climate for dialogue so that an appropriate level of tax could be determined for the gaming sector and, importantly, removing any possibility of a return to black market illegal gambling operations given the potential negative implications for The Bahamas’ international reputation at this very sensitive time.”

To advertise in The Tribune, contact 502-2394


PAGE 6, Monday, June 11, 2018

THE TRIBUNE

80-story 3 World Trade Center to open after years of delays NEW YORK Associated Press AN 80-STORY office building set to open this week at the World Trade Center will be the third completed skyscraper at the site where the twin towers stood. Today’s ribbon-cutting for the 1,079-foot (329metre) three World Trade Center marks a major step in the rebuilding of the site, stalled for years by disputes among government agencies, trade centre developer Larry Silverstein, insurers and 9/11 victims’ family members who wanted the entire site to be preserved for eternity as a memorial. The new $2.7bn building, designed by Pritzker Prizewinning architect Richard Rogers, has been the fifthtallest building in New York City since construction topped out in 2016. That designation seemed elusive in 2009 when the Port Authority of New York and New Jersey, which owns the trade centre site and was battling with Silverstein over costs associated with rebuilding, sought to reduce three World Trade to a four-story “stump”. After arbitration in the dispute between the developer and the property owner, construction started in 2010 but was halted at seven stories due to a lack of financing. The financial situation improved in 2012, Silverstein said. “It was like somebody came to us and said, ‘The curtain has gone up, you can now access this pool of financing.’” The Port Authority’s current executive director, Rick Cotton, joined the agency in 2017 and missed out on the fights with Silverstein. Cotton said the opening of three World Trade is “really a major transformative step in the ongoing evolution of the World Trade Center from a construction site to an active, living, breathing campus of office buildings and a memorial”. Three World Trade’s 62-foot (19-metre) lobby faces the National Sept 11 Museum. Wedged between the Santiago Calatravadesigned transportation hub and four World Trade

year. The artwork inspired the streaming service Spotify to sign a lease for the top floors of the building including the “graffiti in the sky” floor. Silverstein said 40 percent of three World Trade’s office space is leased. GroupM will start moving in July 16, Valverde said. Management consulting firm McKinsey & Co has leased space and will move in next year. Myers Mermel, the chief executive of TenantWise, a real estate advisory firm, said the McKinsey deal will spur other prestigious financial services firms to consider moving to the area. “McKinsey marks a turning point in front office acceptance of the new World Trade Center,” he said. Silverstein, now 87, thought he had gotten “the brass ring” when he signed a 99-year lease on the trade center in July 2001. Two planes piloted by terrorists destroyed the trade center complex six weeks later. Silverstein recalled a conversation with his wife, Klara, about whether he should try to rebuild or not.

THREE World Trade Center, second from right, joins its neighbours One World Trade Center, left, and four World Trade Center, right, next to the September 11 Memorial and Museum in New York. The centre’s latest skyscraper opens today.  Photo: Mark Lennihan/AP Center, also built by Silverstein, the new building consists of an 80-story tower straddling a 17-story “podium”. Zigzagging beams down the east and west faces of the tower look like an embellishment but are actually structural components that will allow for column-free spaces inside. “It’s a load-bearing system,” said Carlos Valverde, a Silverstein Properties vice president who has supervised construction

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outdoor deck that will be shared by all the building’s tenants. A mural of a dancer in a red dress adorns a wall on the otherwise bare 68th floor, which will eventually be covered with street artists’ work. The new building is the second Silverstein skyscraper to feature graffiti artists’ work. Street artists were invited to wield their spray cans on the 69th floor of the new building’s neighbor, four World Trade, last

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“We can either walk away from this place as many people are advising me to do and as the insurers want me to do or we can stay and rebuild,” Silverstein recalled saying. “But I said, ‘It’s going to be a tough ten years,’ because I thought we could do it all in ten years.” Seventeen years later, Silverstein has completed four World Trade and three World Trade. One World Trade, the tallest building on the site, was developed by the Port Authority. The still unfinished two World Trade Center, immediately north of the transportation hub, is awaiting an anchor tenant and financing before it can be built beyond a stump. “We’ve just got to find the occupant of that last tower. Get that done,” Silverstein said. Also starting construction after years of delays is the nearby Ronald O Perelman Performing Arts Center at the World Trade Center, named for the billionaire investor after he made a $75m donation. Its scheduled completion date is 2020.

To advertise in The Tribune, contact 502-2394

VACANCY A well established, customer focused organization is seeking to fill the vacancy of Chief Financial Officer. The successful candidate will be expected to direct all finance related activities of the Company, including but not limited to cash management, financial reporting, budgeting and forecasting. Additionally, the individual will be responsible for the management and development of employees reporting to them directly and indirectly. The individual should be strategic, with proven leadership and analytical skills. Only applicants with the designation Certified Public Accountant or equivalent with 15 or more years of Accounting experience will be considered.

Interested and qualified persons should apply to: 242jobopp@gmail.com on or before June 17, 2018.


THE TRIBUNE

Monday, June 11, 2018, PAGE 7

COMMONWEALTH OF THE BAHAMAS IN THE SUPREME COURT

2017 CLE/qui/01302

Common Law and Equity Division BETWEEN IN THE MATTER OF THE QUIETING TITLES ACT, 1959 AND IN THE MATTER of ALL THAT piece parcel or lot of land containing 14,407 square feet situate on the Western side of Williams Street in the Eastern District of the Island of New Providence and approximately 100 square feet North of Shirley Street bounded on the NORTH and WEST by land the property of Theatrical Enterprise SOUTH partly by land said to be the property of one Davis and land said to be the property of the Estate of Jane C. Archer on the EAST William Street more particularly described and delineated on Plan No. 5700 NP filed in the Department of Lands and Surveys. AND ALSO IN THE MATTER of ALL THAT piece parcel or lot of land containing 4,939 square feet also known as Lot No. 14 Block 135 situate 166 feet East of Williams Street in the Eastern District of the Island of New Providence and bounded on the NORTH by Lot No. 16 being the property of Gold Circle Company Limited EAST by Lot No. 18 now or formerly the property of Lavese Munnings SOUTH by Lot No. 13 now or formerly the property of David Thompson and WEST by an access Road and more particularly described and delineated on Plan No. 5076 NP filed in the Department of Lands and Surveys. AND ALSO IN THE MATTER of ALL THAT piece parcel and lot of land containing 6,779 square feet situate 115.92 square feet East of Williams Street in the Eastern District of the Island of New Providence bounded NORTHWARDLY by vacant land EASTWARDLY by land said to be the remainder of the Estate of the late Sydney Farrington SOUTHWARDLY by property said to be now or formerly the Estate of the late Anthony Baker WESTWARDLY partly by land said to be now of formerly the property of John Brown and Telle’s Auto and more particularly described and delineated on Plan No. 4039 NP filed in the Department of Lands and Surveys. AND

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IN THE MATTER OF the petition of LYNDEN BETHEL ___________________________________ NOTICE ____________________________

THE PETITION OF LYNDEN BETHEL in respect of:ALL THAT piece parcel or lot of land containing 14,407 square feet situate on the Western side of Williams Street in the Eastern District of the Island of New Providence and approximately 100 square feet North of Shirley Street bounded on the NORTH and WEST by land the property of Theatrical Enterprise SOUTH partly by land said to be the property of one Davis and land said to be the property of the Estate of Jane C. Archer on the EAST William Street more particularly described and delineated on Plan No. 5700 NP filed in the Department of Lands and Surveys and thereon edged in Pink. AND ALSO ALL THAT piece parcel or lot of land containing 4,939 square feet also known as Lot No. 14 Block 135 situate 166 feet East of Williams Street in the Eastern District of the Island of New Providence and bounded on the NORTH by Lot No. 16 being the property of Gold Circle Company Limited EAST by Lot No. 18 now or formerly the property of Lavese Munnings SOUTH by Lot No. 13 now or formerly the property of David Thompson and WEST by an access Road and more particularly described and delineated on Plan No. 5076 NP filed in the Department of Lands and Surveys and thereon edged in Pink. AND ALSO ALL THAT piece parcel and lot of land containing 6,779 square feet situate 115.92 square feet East of Williams Street in the Eastern District of the Island of New Providence bounded NORTHWARDLY by vacant land EASTWARDLY by land said to be the remainder of the Estate of the late Sydney Farrington SOUTHWARDLY by property said to be now or formerly the Estate of the late Anthony Baker WESTWARDLY partly by land said to be now of formerly the property of John Brown and Telle’s Auto and more particularly described and delineated on Plan No. 4039 NP filed in the Department of Lands and Surveys and thereon edged in Pink. THE PETITIONER claims to be the owner of the fee simple estate in possession of the parcels of land hereinbefore described free from encumbrances and has made application to the Supreme Court of the Commonwealth of The Bahamas under Section Three (3) of the Quieting Titles Act, 1959, in the above action, to have his title to the said land investigated and the nature and extent thereof determined and declared in a Certificate of Title to be granted by the Court in accordance with the provisions of the said Act. NOTICE is hereby given that any person having a dower or a right to dower or an Adverse Claim or a claim not recognized in the Petition shall on or before the expiration of Thirty (30) days after the final publication of these presents, file in the said Registry of Supreme Court and serve on the Petitioner or the undersigned a Statement of his claim in the prescribed form verified by an Affidavit to be filed therewith. Failure of any such person to file and serve a Statement of his Claim on or before the expiration of Thirty (30) days after the final publication of these presents will operate as bar to such claim. Copies of the Petition and Plan of the said land may be inspected during normal office hours in the following places:- the Registry of the Supreme Court, 1st Floor, British American Building, George Street, Nassau, The Bahamas, and the Chambers of the Petitioner’s Attorneys, Suite # 6, Gomez Building Dowdeswell Street east of Christie Street in the City of Nassau, The Bahamas. NORWOOD A. ROLLE & CO. Chambers Suite #6 Gomez Building Dowdeswell Street east of Christie Street Nassau, N.P. The Bahamas Attorneys for the Petitioner

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PAGE 8, Monday, June 11, 2018

THE TRIBUNE

White House takes up fight against ‘back-stabbing’ Trudeau QUEBEC CITY Associated Press BASHING the leader of one of America’s venerable allies, the White House escalated its trade tirade and leveled more withering and unprecedented criticism on yesterday against Canada’s prime minister, branding Justin Trudeau a back-stabber unworthy of President Donald Trump’s time. “There’s a special place in hell for any foreign leader that engages in bad faith diplomacy with President Donald J Trump and then tries to stab him in the back on the way out the door,” Trump trade adviser Peter Navarro said in an interview nationally broadcast in the United States. Canada’s foreign minister, Chrystia Freeland, said her country “does not conduct its diplomacy through ad hominem attacks”. The verbal volleys by Navarro and Trump’s top economic adviser, Larry Kudlow, picked up where Trump left off Saturday evening with a series of tweets from Air Force One en route to Singapore for his nuclear summit tomorrow with North Korea’s Kim Jong Un. Kudlow suggested Trump saw Trudeau as trying to weaken his hand before that meeting, saying the president won’t “let a Canadian prime minister push him around. ... Kim must not see American weakness”. Just as the Trudeau-hosted Group of Seven meeting of the world’s leading industrialised nations had seemed to weather Trump’s threats of a trade war, the president backed out of the group’s joint statement that Trudeau said all the leaders had come together to sign. Trump called Trudeau “dishonest & weak” after Trudeau said at a news conference that Canada would retaliate for new US tariffs. Trudeau didn’t respond to questions about Trump when the prime minister arrived at a Quebec City hotel yesterday for meetings with other world leaders, though Freeland later told reporters that “we don’t

PRIME Minister Justin Trudeau, right, meets with the Prime Minister of Vietnam, Nguyen Xuan Phuc, during a bilateral meeting as part of the G7 yesterday in Quebec City.  Photo: Jacques Boissinot/AP think that’s a useful or productive way to do business.” A Trudeau spokesman, Cameron Ahmad, said Saturday night that Trudeau “said nothing he hasn’t said before — both in public and in private conversations” with Trump. And Roland Paris, a former foreign policy adviser to Trudeau, jabbed on Trump on Twitter: “Big tough guy once he’s back on his airplane. Can’t do it in person. ... He’s a pathetic little man-child.” Trudeau said he had reiterated to Trump, who left the G-7 meeting before it ended, that tariffs would harm industries and workers on both sides of the US-Canada border. Trudeau told reporters that imposing retaliatory measures “is not something I relish doing” but that he wouldn’t hesitate to do so because “I will always protect Canadian workers and Canadian interests”.

Navarro, the Trump trade adviser, said his harsh assessment of what “bad faith” Trudeau did with “that stunt press conference” on Saturday “comes right from Air Force One”. He said Trump “did the courtesy to Justin Trudeau to travel up to Quebec for that summit. He had other things, bigger things, on his plate in Singapore. ... He did him a favour and he was even willing to sign that socialist communique. And what did Trudeau do as soon as the plane took off from Canadian airspace? Trudeau stuck our president in the back. That will not stand”. Kudlow, in a separate TV appearance, said Trudeau was “polarising” and “really kind of stabbed us in the back.” The Canadian leader pulled a “sophomoric political stunt for domestic consumption,” Kudlow said, that amounted to “a betrayal”.

“Don’t blame Trump. It was Trudeau who started blasting Trump after he left, after the deals had been made.” Kudlow said Trump won’t let people “take pot shots at him” and that Trudeau “should’ve known better”. But the criticism left a former Canadian prime minister, Stephen Harper, stumped. “I don’t understand the obsession with trade relations with Canada,” he said, given that Canada is the biggest single buyer of American goods and services in the world. From promoting democracy and to fighting terrorism, “we’re on the same page. We’re the closest partners in the world and you don’t want to see a dispute over one particular issue poison everything.” Trudeau had said Canadians “are polite, we’re reasonable, but also we will not be pushed around.”

He described all seven leaders coming together to sign the joint declaration despite having “some strong, firm conversations on trade, and specifically on American tariffs”. In the air by then, Trump tweeted: “Based on Justin’s false statements at his news conference, and the fact that Canada is charging massive Tariffs to our US farmers, workers and companies, I have instructed our US Reps not to endorse the Communique as we look at Tariffs on automobiles flooding the US Market!” He followed up by tweeting: “PM Justin Trudeau of Canada acted so meek and mild during our @G7 meetings only to give a news conference after I left saying that, “US Tariffs were kind of insulting” and he “will not be pushed around”. Very dishonest & weak. Our Tariffs are in response to his of 270% on dairy!” Before leaving for Singapore, Trump had delivered a stark warning to America’s trading partners not to counter his decision to impose tariffs on steel and aluminum

imports. The G-7 also includes Britain, Italy, France, Germany and Japan. “If they retaliate, they’re making a mistake,” Trump said. Trump insisted relationships with allies were a “ten” just before he left the summit. At a rare solo news conference before heading to Asia, Trump said he pressed for the G-7 countries to eliminate all tariffs, trade barriers and subsidies in their trading practices. He reiterated his longstanding view that the US has been taken advantage of in global trade, adding, “We’re like the piggy bank that everybody’s robbing, and that ends”. Navarro appeared on “Fox News Sunday”, and Kudlow was on CNN’s “State of the Union” and CBS’ “Face the Nation” and Harper spoke on Fox’s “Sunday Morning Futures”.


THE TRIBUNE

Monday, June 11, 2018, PAGE 9

Unorthodox Trump faces toughest test yet in North Korea summit SINGAPORE Associated Press EMBARKING on a self-described “mission of peace”, President Donald Trump puts his seat-ofthe-pants foreign policy to its toughest test yet as he attempts this week to personally broker an end to North Korea’s nuclear program in talks with Kim Jong Un. The impulsive American president, who just this weekend sowed chaos within the Western alliance, is set to face his match on the global stage as he prepares to meet Kim in Singapore tomorrow. In the historic first meeting between the leaders of the technically-still-warring nations, Trump is prioritising instinct over planning. Unlike traditional summits between heads of state, where most of the work is completed in advance, US officials say the only thing certain ahead of these talks will be their unpredictability. Ever since Trump shocked allies, White House officials and, by some accounts, the North Koreans themselves when he accepted Kim’s March invitation for a meeting, the two leaders have lurched toward an uncertain encounter that could affect millions. “It’s unknown territory in the truest sense, but I really feel confident,” Trump told reporters Saturday. “I feel that Kim Jong Un wants to do something great for his people and he has that opportunity and he won’t have that opportunity again.” Trump landed in Singapore on yesterday evening, about four hours after Kim arrived in the island citystate. The two are scheduled to meet for the first time tomorrow morning. Trump’s engagement with Kim fulfills the North Korean ruling family’s

long-unrequited yearning for international legitimacy, itself a substantial concession after more than a generation of US efforts to isolate the country on the global stage. “It’s never been done before,” Trump said. “And obviously, what has been done before hasn’t worked.” A triumvirate of forces is bringing the meeting to fruition, said Scott Snyder, senior fellow for Korea Studies and director of the Program on US-Korea Policy at the Council on Foreign Relations. He describes the summit as “produced by Kim, directed by (South Korean President Moon Jae-in), and inspired by Trump.” Each man has his motivations: Hard-hitting sanctions and a desire for legitimacy brought Kim to the table. Moon’s efforts to avert a potentially catastrophic US first strike pushed Trump and Kim to take a risk. And Trump is the first US president willing to sit-down with Kim with so few concessions, believing his self-professed negotiating prowess will guide him though uncharted diplomatic waters. Raising expectations in advance of the meeting, Trump said the outcome will depend heavily on his own instincts. The US president said he will know “within the first minute” of meeting Kim whether the North Korean leader is serious about nuclear negotiations. “I think I’ll know pretty quickly whether or not, in my opinion, something positive will happen. And if I think it won’t happen, I’m not going to waste my time. I don’t want to waste his time,” Trump said. “This is a leader who really is an unknown personality,” Trump added of Kim. “People don’t know much about him. I think that he’s going to surprise on the upside, very much on the upside.”

White House aides described Trump in the days after receiving the initial Kim invitation as being obsessed by visions of winning the Nobel Peace Prize and of using the skills he laid out in his book “The Art of the Deal” to put his mark on the global order. In recent weeks, though, Trump’s enthusiasm has been tempered somewhat by the challenge of deal-making with such an unpredictable opponent. And there are worries from the White House to East Asian allies that Trump’s desire for an agreement will lead him to accept any deal — even if it’s a bad one. Trump is dangling before Kim visions of protection, economic investment and even a White House visit, in return for a commitment to abandon his nuclear weapons programme. Kim, US

officials say, has agreed to put his stockpile of 50 or more weapons on the table for negotiation, but the two countries have offered differing visions of what that would entail. Despite Kim’s apparent eagerness for a summit with Trump, there are doubts that he would fully relinquish his nuclear arsenal, which he may see as the guarantor of his survival. US defense and intelligence officials have assessed the North to be on the threshold of having the capability to strike anywhere in the continental US with a nuclear-tipped missile — a capacity that Trump and other US officials have said they would not tolerate. Trump reiterated his promise Saturday that the US “will watch over and we’ll protect” Kim and his

NOTICE In the Estate of STEPHEN LAERTES WHITE late of Ocean Club Estates Subdivision on Paradise Island another of the Islands of the Commonwealth of The Bahamas, one of the Islands of the Commonwealth of The Bahamas, deceased. NOTICE is hereby given that all persons having any claim or demand against the above Estate are required to send the same duly certified in writing to the undersigned on or before the 9th day of July A.D. 2018, after which date the Executor will proceed to distribute the assets of the deceased having regard only to the claims of which he shall then have had notice. AND NOTICE is hereby given that all persons indebted to the said Estate are requested to make full settlement on or before the date hereinbefore mentioned. HARRY B. SANDS, LOBOSKY & COMPANY Attorneys for the Executor CHAMBERS Shirley House 253 Shirley Street Nassau, Bahamas.

MARKET REPORT THURSDAY, 7 JUNE 2018

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

BISX ALL SHARE INDEX: CLOSE 1,932.50 | CHG 1.38 | %CHG 0.07 | YTD -131.07 | YTD% -6.35 BISX LISTED & TRADED SECURITIES 52WK HI 4.50 19.17 7.50 3.85 1.48 0.19 4.05 8.90 6.60 5.30 10.40 2.71 1.61 8.21 6.10 11.48 7.29 13.67 12.51

52WK LOW 3.50 17.43 7.50 3.32 0.90 0.12 3.10 8.40 6.00 3.15 9.00 2.30 1.40 7.25 6.00 8.78 5.67 3.25 12.50

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 Emera Incorporated Famguard Fidelity Bank Finco Focol J. S. Johnson

1050.00 1000.00 1000.00 1000.00

1000.00 1000.00 1000.00 1000.00

Cable Bahamas Series 6 Cable Bahamas Series 8 Cable Bahamas Series 9 Cable Bahamas Series 10 Colina Holdings Class A Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Fidelity Bank Class A Focol Class B

PREFERENCE SHARES

1.00 103.00 100.00 106.00 105.00 103.00 100.00 10.00 1.01

1.00 100.00 100.00 100.00 105.00 100.00 100.00 10.00 1.00

SYMBOL AML APD BPF BWL BOB BBL CAB CIB CHL CBL CBB CWCB DHS EMAB FAM FBB FIN FCL JSJ

E J K L M N

CORPORATE DEBT - (percentage pricing) 52WK HI 100.00

52WK LOW 100.00

CAB6 CAB8 CAB9 CAB10 CHLA CBLE CBLJ CBLK CBLL CBLM CBLN FBBA FCLB

SECURITY Fidelity Bank Note 22 (Series B) +

SYMBOL FBB22

Bahamas Note 6.95 (2029) 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 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

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

MUTUAL FUNDS 52WK HI 2.15 4.16 2.00 178.69 157.58 1.55 1.70 1.62 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 1.48 1.62 1.57 1.04 6.41 7.62 5.66 8.65 10.54 9.57

LAST CLOSE 4.40 17.43 9.09 3.85 1.01 0.18 3.10 8.89 6.12 4.10 10.05 2.53 1.60 7.53 6.10 11.00 6.30 3.25 12.51

CLOSE 4.50 17.43 9.09 3.85 1.01 0.18 3.15 8.89 6.12 4.10 10.05 2.54 1.60 7.55 6.10 11.00 6.30 3.25 12.51

CHANGE 0.10 0.00 0.00 0.00 0.00 0.00 0.05 0.00 0.00 0.00 0.00 0.01 0.00 0.02 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 1.00

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

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

LAST SALE 100.00

CLOSE 100.00

CHANGE 0.00

107.83 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

0.00 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

107.83 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

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 1,000

1,000

120

20

VOLUME

35

NAV 2.15 4.13 2.00 179.39 153.02 1.55 1.68 1.63 1.09 7.15 8.14 6.41 11.26 11.68 10.24

EPS$ 0.361 0.932 -0.306 0.283 -0.973 0.000 -1.465 0.638 0.573 0.171 0.627 0.102 0.330 0.000 1.129 0.679 0.610 0.293 0.543

DIV$ 0.080 1.130 0.000 0.230 0.000 0.000 0.000 0.320 0.220 0.120 0.620 0.060 0.050 0.084 0.320 0.500 0.200 0.120 0.580

P/E 12.5 18.7 N/M 13.6 N/M N/M -2.2 13.9 10.7 24.0 16.0 24.9 4.8 N/M 5.4 16.2 10.3 11.1 23.0

YIELD 1.78% 6.48% 0.00% 5.97% 0.00% 0.00% 0.00% 3.60% 3.59% 2.93% 6.17% 2.36% 3.13% 1.11% 5.25% 4.55% 3.17% 3.69% 4.64%

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

0.000 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 Prime + 1.75% 6.95% 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% YTD% 12 MTH% 1.23% 4.12% -0.16% 5.10% 0.74% 2.38% 4.66% 3.89% -0.25% 4.57% 1.04% 4.26% -1.06% 2.15% 0.58% 3.61% -0.48% 4.84% -1.08% 1.77% -5.96% -3.05% 1.90% 4.59% 7.24% 11.96% 2.77% 3.88% 3.94% 4.69%

MATURITY 19-Oct-2022 20-Nov-2029 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 NAV Date 30-Apr-2018 30-Apr-2018 26-Apr-2018 31-Mar-2018 31-Mar-2018 31-Mar-2018 31-Mar-2018 31-Mar-2018 31-Mar-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018 30-Apr-2018

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

government in return for him giving up the nuclear programme. With his Singapore summit, Trump is looking to temporarily escape his flaring personal conflicts with key US allies over trade as well as domestic pressure like the swirling Russia probe. Acutely aware of his coverage in the media, Trump has enjoyed how the impending North Korea

summit has overshadowed some of the more negative coverage of his tumultuous White House. Still, Trump’s team has not always been on the same page, with secretary of state Mike Pompeo — who has been leading the administration’s efforts — more supportive, while the hawkish national security adviser John Bolton has been more skeptical.


PAGE 10, Monday, June 11, 2018

THE TRIBUNE

NORTH KOREA QUIET ABOUT SUMMIT UNTIL DAY AFTER KIM’S ARRIVAL

NORTH KOREA Associated Press

WITH all the international attention focused on Singapore and the historic summit between President Donald Trump and North Korean leader Kim Jong Un, Pyongyang must have

been buzzing with excitement on yesterday, right? Well, it might have been, if anyone there had known what was going on. Instead, it was like the center of the storm. With few sources of information other than the state-run media, gossip and word of mouth, most

North Koreans were still largely in the dark about the momentous — and potentially life-changing — events about to take place outside of their isolated nation. The official media had reported that the two leaders plan to meet, but offered few specifics,

including where and when. On yesterday they offered no official word that Kim had left the country and arrived in Singapore, hours before Trump. It was only this morning North Korea time that the Korean Central News Agency reported that Kim was in Singapore, had met

with Prime Minister Lee Hsien Loong and would meet Trump on tomorrow. One dispatch said North Korea and the US would exchange “wide-ranging and profound views” on establishing new relations, building a “permanent and durable peace-keeping mechanism”, achieving

denuclearisation and “other issues of mutual concern, as required by the changed era”. Before that, the top news in North Korea had been tremendously mundane, all things considered — a visit by Kim to a seafood restaurant in Pyongyang.


THE TRIBUNE

Monday, June 11, 2018, PAGE 11

Why Trump’s combative trade stance toward allies poses risks WASHINGTON Associated Press INSULTING the host, alienating allies and threatening to suspend business with other countries: President Donald Trump was in full trade-warrior form for the weekend summit of the Group of Seven wealthy democracies in Canada. The president’s acrimony raised the risk of a trade war that could spook financial markets, inflate prices of goods hit by tariffs, slow commerce, disrupt corporations that rely on global supply chains and jeopardise the healthiest expansion the world economy has enjoyed in a decade. Leaving the conclave in Quebec on Saturday, Trump threatened to “stop trading” with America’s allies if they defied his demands to lower trade barriers. And he shrugged off the risk that his combative stance would ignite escalating tariffs and counter-tariffs between the United States and its friends — the European Union, Canada, Japan and Mexico. “We win that war a thousand times out of a thousand,” the president declared before jetting off to negotiate the denuclearisation of the Korean peninsula. Later, he picked a Twitter fight with the host of the G-7 conclave. Calling Prime Minister Justin Trudeau of Canada “very dishonest and weak”, Trump said the US was withdrawing its endorsement of the G-7’s communique, in part over what he called Trudeau’s “false statements” about US tariffs at a news conference. “I think the way this plays out is we end up with our trading partners responding in kind — a threat for a threat, a tariff for tariff,” said Rod Hunter, a lawyer at Baker McKenzie and a former economic official on the National Security Council. “You end up with gradual escalation.” The summit at Quebec’s Charlevoix resort failed to produce any truce in an intensifying trade conflict. Trump has imposed tariffs on steel and aluminum imported to the United States from the EU, Canada and Mexico. He has justified the tariffs by claiming that a reliance on foreign steel and aluminum threatens US national security. Outraged, the allies have responded by targeting American products, including cheese, bourbon and pork. On Saturday, Trump warned that “if they retaliate, they’re making a big mistake”. Trudeau’s assessment was glum. “If the expectation was that a weekend in beautiful Charlevoix with all sorts of lovely people was going to transform the president’s outlook in the world,” the Canadian prime minister said, “then we didn’t quite reach that bar”. Trump had run for the presidency on a vow to shrink the gaping US trade deficit — $566bn last year. To him, the gap between the value of what America sells and what it buys in foreign markets reflects economic weakness, trade accords that are unfair to the US and abusive policies by other countries. Turning his campaign rhetoric into action against friend and foe, he has taxed imported solar panels and washing machines, imposed tariffs on steel and aluminum, threatened tariffs on up to $150bn worth of Chinese products and ordered an investigation into whether imported cars, trucks and auto parts should be taxed — on national security grounds. “He’s a puncher or a counterpuncher, and he thrives on conflict,” Hunter said. “He’s not likely to change. As long as he’s president, this is the approach we have to expect.” Tim Buthe, a Duke University political scientist who studies trade, said, “Is it possible that Trump sees this mostly as a poker game and is just bluffing, and if the others cut him a deal, we’ll return to normal relatively soon?”

Yet Buthe cautioned: “These kind of things can spiral out of control fairly quickly” as countries hammer each other with escalating retaliatory tariffs. Speaking to reporters at the end of the summit, Trump repeated his assertion that other countries — including friendly allies — have outwitted US negotiators in the past, capitalised on flawed agreements and run up big trade surpluses with the United States. The United States last year posted a trade gap in goods and services of $101bn with the EU, $57bn with Japan and $69 with Mexico. (The US managed a $3bn surplus with Canada.) Trump has condemned Canada’s tariffs on imported dairy products and the EU’s tariffs on auto imports. “We’re like the piggy bank that everybody is robbing,” Trump said. “And it’s going to stop. Or we’ll stop trading with them.” Ending trade with the other G-7 countries, the president asserted, would prove “a very profitable answer, if we have to do it”. Economists and trade analysts note that the rules of world trade rules aren’t as one-sided as the president argues. According to the World Bank, America’s average tariff is 1.6 percent, the same as the EU’s, only slightly higher than Japan’s 1.4 percent and double Canada’s 0.8 percent. The rules of the World Trade Organization do allow Canada’s punishing tariffs on dairy and the EU’s on autos. But in WTO negotiations, the United States bartered those and other things away for what it wanted, including strong protections for intellectual property, or IP. As a result, Hunter

said, America has become “the world’s leading IP-based economy”. During the talks in

Quebec, Trump surprised G-7 leaders by proposing an end to all tariffs and trade barriers. The “ultimate

thing,” he said, would be, “you go tariff-free, you go barrier-free, you go subsidyfree.” The president offered

no roadmap to a tarifffree world, and analysts greeted the proposal with skepticism.

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