11232018 BUSINESS

business@tribunemedia.net

FRIDAY, NOVEMBER 23, 2018

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Govt invests $3.5m in Lucayan facelift

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Poor processes slash GDP growth by 1% pt annually

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

MICHAEL SCOTT

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

T

HE Government is investing $3.5m in pre-sale upgrades at the Grand Lucayan, the resort’s chairman revealed yesterday, with a preferred buyer unlikely to be selected before Easter 2019.

Michael Scott, chairman of Lucayan Renewal Holdings, the Governmentowned special purpose vehicle (SPV) that controls the hotel, told Tribune Business that “limited improvements” were being made to “maximise” the property’s earning potential

* Upgrades focus on ‘revenue generating’ areas * Buyer progress unlikely until March/April 2019 * Union deal on severance eyed for ‘next week’

GRAND Lucayan for the peak winter tourism season that began with this week’s Thanksgiving holiday.

The upgrades are focused on the Grand Lucayan’s sole open property, Lighthouse Pointe, and other

$105m deficit overshoot rationale ‘not full picture’

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net A TOP accountant yesterday argued that the Government’s explanation for the $105m deficit overshoot was “not the complete picture”, and raised fears there may be more bad news ahead.

Gowon Bowe, pictured, the Bahamas Institute of Chartered Accountants (BICA) president, told Tribune Business that many observers would likely be sceptical that the Ministry of Finance was unaware of other government agencies’ spending trends when its gave its projected deficit

•BICA CHIEF ASKS IF BUDGETS EXCEEDED •OUTTURN SPARKS ‘MORE BAD NEWS’ FEAR

outcome for the 2017-2018 fiscal year in May. KP Turnquest, the deputy

Where’s the ‘modern governance’ pledged in return for VAT hike?

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Bahamas is not getting the “modern governance” promised in return for the VAT hike, a leading reformer blasted yesterday, with people “sick and tired” of financing a bloated public sector.

Robert Myers, the Organisation for Responsible Governance’s (ORG) principal, told Tribune Business that not only had the promised governance improvements failed to materialise but the Government was also missing its fiscal deficit and debt targets.

He described the 20172018 deficit’s $105m overshoot, compared to year-end projections by the deputy prime minister, as “too big a swing” for comfort, arguing that the Government will be “perpetually struggling” with a problem “dangerous for running a country” unless it implements proper public sector controls and accounting standards.

While praising KP Turnquest and Marlon Johnson, the Ministry of Finance’s financial secretary, for their efforts to “get the fiscal house in order”, Mr Myers said the Bahamian people were continually having to pay for waste, inefficiency

ROBERT MYERS and under-performance in the public sector through ever-increasing fees and taxes.

He directly attacked the Government’s newlypublished Fiscal Strategy Report, which justified the 12 percent VAT rate increase and other tax rises on the basis that the Government was not earning sufficient income to meet the country’s needs, on the basis that Bahamians had yet to reap the benefits from losing more of their income in tax dollars.

“It talks about increasing taxes to finance modern governance,” Mr Myers told Tribune Business of the report, “but we’re not getting it. “Even more upsetting in that statement is not only are we not getting modern governance; we’re missing our targets.

“It is the largesse and

SEE PAGE 5

prime minister, in unveiling the 2018-2019 budget had forecast that the prior year deficit would come in at $310m. However, the Government’s first-ever fiscal strategy report, tabled in the House of Assembly on Wednesday, revealed that the actual deficit was $414.9m - almost $105m, or 33.8 percent, higher than projected.

Marlon Johnson, the Ministry of Finance’s financial secretary, blamed a late spending “ramp up” by government departments and agencies trying to ensure bills were not “carried over” into the 2018-2019

SEE PAGE 4

“revenue generating” areas, although the still-closed Breaker’s Cay complex will be painted and subject to “cosmetic repairs”.

Mr Scott, meanwhile, confirmed that “two dozen written expressions of interest” have been received from potential Grand Lucayan purchasers as the buyer search moves into high gear.

Colliers, the Canadianheadquartered real estate firm that handled the Baha

up by its SOEs, although it is hoping to cut this sum to $463.2m - a 31.6 percent reduction - by 2019 largely as a result of Bahamas Power & Light’s (BPL) planned rate reduction bond (RRB) refinancing that will remove some $203m from its books.

“State-owned enterprises (SOEs) represent a fiscal risk in terms of the potential call on the budget when financial difficulties arise and an explicit guarantee is provided to the SOEs in their borrowing activities,” the fiscal strategy report said.

“Contingent liabilities are projected at an estimated $474.5m at end-2018 and, based on existing debt levels and repayment schedules,

POOR governance and business processes have slashed Bahamian economic growth by an average one percent of GDP every year this century, the Government has admitted.

The first-ever fiscal strategy report, tabled in the House of Assembly on Wednesday, blamed low to negative total factor productivity (TFP) for The Bahamas’ anemic economic growth since the turn of the century.

TFP, which measures technological innovation in both the private and public sectors, and how efficiently inputs to the production process are used, was said to have “almost doubled” its negative impact on real GDP growth to two percentage points in the early 2000s.

This, the report added, undermined foreign direct investment (FDI) and other capital injections into the Bahamian economy, along with the “modestly rising” contribution of labour since the turn of the century.

Acknowledging that real economic growth was “of critical importance” to employment levels and living standards, the fiscal strategy report defined TFP as all factors other than capital and labour that impact GDP. “Based on studies completed on the subject, TFP has played a central role in the under-performance of the economy since, at least, the early 1980s,” it said. “In the 1990s, for instance, capital and labour together contributed an average of three percentage points to real economic growth, but total factor productivity reduced the actual growth rate by one full point.

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Mar sales process, is performing the same role for Freeport’s last mega resort property, but the Lucayan Renewal Holdings chairman said a preferred bidder is unlikely to be selected before March/April next year.

He added that he hoped to reach “a final agreement” over the terms and value of staff severance packages next week with the two unions representing the Grand Lucayan staff, with responses to the resort’s latest offer expected today.

“We’re doing some limited improvements focusing on the income-generating

SEE PAGE 4

‘Road map’ to end ‘severe’ risk of SOEs

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

THE Government will hire consultants to develop a “road map” for making all state-owned enterprises (SOEs) self-sufficient and eliminate the “severe” fiscal risk they pose.

The first-ever fiscal strategy report, tabled in the House of Assembly on Wednesday, labelled the risk of “substantial losses” among SOEs - and the need for taxpayer bail-outs and support - as one of the greatest threats to the Government’s fiscal targets and consolidation strategy.

The Government has currently guaranteed some $677.4m in liabilities racked

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THE TRIBUNE

The benefits from an early retirement M

ILLIONS of people across the world are voluntarily deciding to retire early.

Many in The Bahamas have watched the trend of organisations (both private and public) downsizing, offering severance packages to those who have served for long periods of time, and have determined not to wait for an invitation to leave. As uncertain as the days ahead might appear to someone contemplating early retirement, there are many who have taken the plunge and their experiences are worth hearing.

Here are a few benefits for persons choosing to leave their place of employment before expected retirement: • You will likely be

IAN FERGUSON BY

healthier. Improved mental health because of reduced stress is not the only health benefit associated with early

retirement. Not having to sit at a desk or commute means you have an opportunity to be more active than ever.

You will have plenty of time to exercise, lubricating your joints and strengthening your muscles for a higher quality of life.

• You will find new interests that truly excite you.

Having free time when you are still relatively young is better than having those same hours when you are older. An early retiree will have more energy to travel, perhaps take up a new life on a Family Island and try out physically demanding new hobbies. Maybe you will find a new hobby that ends up turning into a lifelong passion. There are an almost unlimited number of things to try, and places

FAMILY ISLANDS ENJOY ‘WHOPPING’ 20% RISE THE Ministry of Tourism believes its strategy of marketing The Bahamas as a 16-island destination helped spur a “whopping” 20 percent increase in Family Island visitors through August 2018.

And it feels its longheld ambition of creating a distinct brand identity for each island has boosted investor confidence in The Bahamas, as shown “by a deeper stake in our destination being secured by the leading cruise lines; the construction of boutique resorts throughout our islands; the building and expansion of marinas; and the coming on stream of a whole gamut of new touristic offerings”.

Addressing a Service of Thanksgiving for the Ministry of Tourism’s management and staff yesterday, Dionisio D’Aguilar, pictured, minister of tourism and aviation,

said islands such as Exuma, Abaco, Bimini, Harbour Island and Eleuthera were becoming household names among international travellers as a result.

“Our destination overall is becoming more visible in the international travel marketplace, resulting in greater investor confidence in our nation,” Mr D’Aguilar said.

“There is an ever-increasing desire for our destination among travel consumers; more and more people are coming to experience The Bahamas, (and) the majority of our guests are leaving with a good level of satisfaction about their vacation experience.

“They are sharing their experiences, and we are delighted to see our destination being recognised internationally with another award. They are sharing their experience. And we

are delighted to see our destination internationallyrecognised by a number of prestigious travel awards.”

Mr D’Aguilar said 2018 has been a growth year for Bahamian tourism so far. He added visitor arrivals show a “marked increase” over the first eight months of 2018 when compared to 2017.

“This current year, 2018, has proven to be a year of increase; for that we give thanks,” he said. “In Nassau, we have seen a 15 percent increase in stopover visitors, air arrivals, between January and August of this year when compared to last year.

“Visitor arrivals, air and sea combined, to the Family Islands have shown an increase of a whopping 20 percent between January and August of this year. (Today) we pause to give thanks for all of these positive trends and others that are taking place in our destination. Thanks be to God; we are seeing the fruits of our labour.”

to see, and early retirement simply opens those doors of possibilities.

• You will find opportunities to spend less. Many retirees do not spend as much as they used to because they have more time to look for good deals. It is not difficult to find opportunities to save money when you have the time to look for bargains and negotiate. For example, you can simply wait for something you want to go on sale.

You can also save on many events and attractions if you go during non-peak hours, which is easy to do once you no longer work. The same strategy works for travel.

The fact that you can travel off-season will save you a significant amount of money.

• You will have a great opportunity to give back to

society and family through mentorship. Perhaps, as a young grandmother or grandfather, this is your chance to give time to the rearing and care of your own or other children. Given the level of social ills, and children without supervision in our communities, we can certainly use more alert, responsible adults who can become foster guardians to the children of the neighbourhood.

• You might find other streams of income. Even if you no longer want to work at your current job, you might find other activities that end up making you money. New income streams after retirement might include online writing, baking cakes and breads, telemarketing or selling crafts or art online. The

profit from these activities may not be large, but if you love perfecting your art, getting paid for that never hurts.

Early retirement takes years of continually living within your means, saving aggressively and investing prudently to achieve. But for those who make it, there are plenty of rewards for your discipline.

• NB: Ian R Ferguson is a talent management and organisational development consultant, having completed graduate studies with regional and international universities. He has served organsations, both locally and globally, providing relevant solutions to their business growth and development issues. He may be contacted at iferguson@ bahamas.com.

BTC UNIONS MEET WITH PM’S OFFICE

FROM L: Patrick Ferguson, vice-president, BCPOU; Senator Jamaal Moss; Dino Rolle, president, BCPOU; Mrs Parker Edgecombe; Ricardo Thompson, president, BCPMU; Kendrick Knowles, vicepresident, BCPMU; and Brian Jacques, trustee, BCPMU. Photo: Letisha Henderson/BIS BOTH Bahamas Telecommunications Company (BTC) trade unions yesterday met the parliamentary secretary in the Prime Minister’s Office to discuss their challenges.

Pakeisha Parker-Edgecombe welcomed executives

of the Bahamas Communications and Public Officers Union (BCPOU), and the Bahamas Communications and Public Managers Union (BCPMU), at a courtesy call at the Prime Minister’s Office on Thursday, November 22, 2018.

Their talks focused on the challenges facing both unions regarding their members and technology in a global marketplace. Mrs ParkerEdgecombe welcomed both unions’ executives and looked forward to dealing amicably with the issues raised.

THE TRIBUNE

Friday, November 23, 2018, PAGE 3

CENTRAL BANK: LESS GOVT LEANDING TO SLASH LIQUIDITY

By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net THE Central Bank will gradually reduce its lending to the Government to help address the potential risk posed by $1.737bn in excess commercial bank liquidity, its governor has revealed.

John Rolle, pictured, speaking at the opening of a recent forum held by The Government and Policy Institute of the University of The Bahamas, acknowledged that there was a medium-term concern about liquidity levels in the Bahamian financial system.

“To address this, the Central Bank’s forward-looking strategy is to gradually reduce the outstanding lending to the Government. This

would absorb any excess liquidity that had its origin in accumulated past Central Bank financing of the Government,” he said.

Mr Rolle added that, over the medium and longer term, the Bahamian economy “has to do a better job” of retaining the foreign exchange that it earns. “More bank lending has to reach productive enterprise activities that forge linkages with tourism, provide competitive substitutes for imports and expand

Bahamas ‘sitting ducks’ over cyber vulnerability

By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net CYBER-SECURITY awareness in The Bahamas is almost non-existent, a technology entrepreneur has lamented, warning: “We are sitting ducks in this country.”

Gamin Wilson, managing director of Bahamas Cyber Shield, a security start-up, told Tribune Business that there was largely a false sense of security over this nation’s vulnerability to cyberattacks, and called for greater public awareness on the issue.

“I sense that we have a lot of misconceptions about it, and that there is a false sense of security. I realised that there was no one really trying to educate the public as a whole on this issue of cyber-security,” said Mr Wilson.

“I have noticed that Bahamians seemed very susceptible to all manner of scams, not just online.

I noticed that we are becoming more and more integrated with technology.

The mobile penetration in The Bahamas is very high, so many people are using technology, but a lot of

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people do not realise the dangers, risks and how to avoid them.”

“Worldwide we see that ransomware in really huge right now,” Mr Wilson continued. “What usually happens is a hacker will send a person an e-mail, convince them to click on a link or download some type of attachment that installs malicious malware on their computer.

“That would encrypt all of that person’s files and lock their computer, and they would have to pay to regain access. Phishing attacks are also pretty big as well.

Most cyber attacks occur via e-mail. Hackers have figured out that people are the weakest link in any information security system.”

Mr Wilson urged Bahamian businesses to take action and increase awareness within their companies on cyber threats. “I think local companies need to take action to increase awareness within their companies so that their staff are aware of the risk, and they should have policies and are able to recognise certain attacks and how to avoid them,” he added.

“When we talk about cyber awareness it’s not just telling someone to use a strong password or not click on a link. If it’s not reinforced, if they’re not engaged and it’s not a part of company culture, they will still fall victim to those mistakes.”

our export reach,” he said.

“The Central Bank’s targeted liberalisation of capital controls has also allowed such categories of enterprises direct access to financing in foreign exchange. We believe that it is a strategy that will bear fruit over the medium-term.

“The fiscal policy framework has to bolster support for the currency.

Deficits, when they arise, should anchor public investments with positive net returns to economic growth, and have a positive foreign exchange bias. More fundamentally, for our present circumstances, deficit reduction and eventually budget surpluses should become the order, with more public investments sustained from savings on recurrent expenditures.”

Mr Rolle added that

are forecasted to move lower to $432.9m over the four- year period ending 2022.

“Cognisant of this exposure, the Government has embarked on several measures to manage these risks, including improvements in operational efficiency through enhanced cost recovery and requirements for an effective governance framework which increases accountability and transparency in their operations.”

Once BPL’s governmentguaranteed debt is repaid through the RRB, the largest exposure is presented by the Bahamas Mortgage Corporation’s $160m liabilities. Others that represent a significant potential taxpayer burden include the Public Hospitals Authority (PHA) at $91.6m; the Water & Sewerage Corporation at $67.7m; Education Loan Authority at $67m; and Bahamas Development Bank at $41m.

“The Government is committed to transforming the SOEs into self-sufficient entities to reduce their fiscal impact,” the fiscal strategy report said. “To that end, the Government has directed each SOE to begin looking at a move toward a cost-recovery operating model, which might include a mix of revenue enhancement initiatives, as well as measures to reduce expenditures in line with industry benchmarks. The

SOEs are now formulating articulated strategies that are expected to achieve this optimized point within three to five years.

“To better frame the Government’s objectives in this area, a consulting firm will be engaged to provide an analysis of selected SOEs and authorities, and to create a road map with respect to best options for them becoming

that bolster investor confidence.

Where these frameworks are missing or nascent, liberalisation must impose a distinction between how we deal with direct investments versus very liquid, and highly sensitive, portfolio flows.

“If the end goal is to have fully liberalised capital flows, then we must accept that it would come with a floating Bahamian dollar. If we float, we should want to avoid the exchange rate volatility that arises when investors become jittery,” added Mr Rolle.

“If we dollarise to eliminate currency volatility concerns, then fiscal and private sector savings will remain important to provide the buffers needed to make our economy resilient. Dollarisation will not provide a short-cut out of

reforms that are needed - in terms of utilising less direct means of influencing credit and investment behaviour to safeguard financial stability; having more comprehensive real time data on economic activity, including fiscal indicators; having a larger stock of foreign reserves to cushion against shocks, and the like.

“Dollarisation would still be premised on a target value for the exchange rate at the time of the domestic currency’s abandonment.

This again raises the question of whether such an outcome could be achieved absent an effective capital flow management regime.

There is much more than can be said on this topic, and on other dimensions of the Central Bank’s role, beyond the protection of the currency.”

Hotels report ‘very positive business’

By NATARIO MCKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net BAHA Mar’s forward bookings for the 2018-2019 winter season were described yesterday as “very positive” and “much better than last year”.

Robert Sands, Baha Mar’s senior vice-president of government and community relations, told Tribune Business: “We are very satisfied with the occupancies we have for Thanksgiving this year. All Baha Mar hotels are open.

“Forward bookings for the winter season are very positive and much better than last year. We are looking forward to the festive season and the opening of Carna, our steak house, and the Sky Bar in SLS.” The 300-room SLS opened last November.

Ed Fields, Atlantis’s vicepresident of public affairs, told Tribune Business that the resort’s occupancies are currently “very strong”.

“Occupancy is very strong and as usual was boosted

by Battle 4 Atlantis,” said Mr Fields. The 12-game, three-day annual Bad Boy Mowers Battle 4 Atlantis tournament, currently

‘Road map’ to end ‘severe’ risk of SOEs FROM PAGE ONE

fiscal deficits and growing debt can make it difficult to wean the Government off borrowing from the Central Bank, and can expand foreign currency debt in ways that cannot be easily repaid.

“Better foreign exchange retention and confidence engendered by fiscal policy takes us to the topic of exchange controls,” he said.

“Some rebranding is necessary to make this more of a conversation about capital controls and capital flow management. This is essentially where our policies are more binding, but where scope for very gradual targeted easing is possible over the medium-term.

“The limit, though, is to understand that liberalisation cannot happen out of a sequence of first having in place lasting policy and accountability frameworks

self-sustaining entities.

“Specifically, the work will entail the creation of a detailed strategic approach to cost rationalisation and cost recovery for select SOEs, consistent with global best practices for similar agencies in similar jurisdictions. Future fiscal strategy reports will be able to comment more on the fiscal savings that would emanate from these initiatives.”

BAHA MAR underway, is regarded as one of the most challenging Division I men’s pre-season basketball tournaments.

Jermaine Wright general manager of Comfort Suites on Paradise Island, described business as “positive”. He

told Tribune Business: “Comfort Suites Paradise Island’s business is positive.

We hope the trend continues through the Thanksgiving holiday period, with individual guests and groups coming to enjoy some Bahamian sunshine and relaxation.

“We will also be hosting special Thanksgiving activities around the property with holiday food and beverage offerings in Crusoe’s Restaurant for both in-house guests and patrons from the local community.”

PAGE 4, Friday, November 23, 2018

THE TRIBUNE

GOVT INVESTS $3.5M IN LUCAYAN FACELIFT FROM PAGE ONE

parts of the resort, namely the Lighthouse Pointe, the golf course and the convention centre,” Mr Scott told Tribune Business.

“They involve repairs to the air conditioning system at Lighthouse Pointe, repairs to the roof, that sort of thing, In the case of the golf course, it’s bringing the contours of the golf course and the green up to scratch pending the sale, and repairs to the roof at the convention centre.

We’re doing some cosmetic repairs, painting, to the facade outside Breaker’s Cay. “All told, it’s $3.5m, starting now, and taking place through December and into next year. We’re doing it one step at a time. We’re working on sprucing up the quality of the rooms, particularly the higher revenue rooms at Lighthouse Pointe, and making some improvements for the winter season, doing some marketing in conjunction with the Ministry of

Tourism,” he added.

“We’re trying to ensure we put what’s there in position to maximise earning potential for the upcoming winter season.”

Mr Scott and the Lucayan Renewal Holdings Board will be seeking to balance essential upgrades, upon which returns can be generated, with the need to limit the Bahamian taxpayer’s financial exposure and ensure no investment is unrecoverable.

Besides the Grand Lucayan’s $65m purchase price, the Government has already committed to a $2m subsidy to cover Hutchison Whampoa’s operating losses between August 1 and the September 11 closing. It also waived the payment of $3.25m in stamp duty on the conveyancing by the Hong Kong conglomerate, which then walked away with $80-$85m in Hurricane Matthew insurance proceeds rather than put them into repairs.

On top of this, the Government has now committed to $3.5m in upgrades and several million dollars

more in severance packages for Grand Lucayan staff. The growing costs will raise fears among some that the resort could become a financial albatross for the Bahamian taxpayer and Public Treasury if a buyer cannot be found quickly, especially since KP Turnquest, deputy prime minister, previously said the property’s financing costs could ultimately hit $124m.

Mr Scott, meanwhile, pledged that a “methodical” approach will be taken in selecting a buyer for Freeport’s “anchor resort” property via a process that will be “fully open and transparent”.

“We’re in a process,” he told Tribune Business.

“We’ve got Colliers, we’re receiving them and processing them [offers], and qualifying them. There’s not going to be a summary decision made on this; it’s going to work its way through the process.

“You’re not going to see much before March/April next year. It’s going to be a methodical, well thoughtout process. We’ve got to

vet these people, they’ve got to be qualified, experienced in the hotel industry, and have got to have the money. We’ve got Colliers in the mix to objectify the process, and ensure it’s open and transparent.”

The Government initially expressed hope that the Grand Lucayan’s sale to a private sector buyer could be achieved within six months of the September 11 closing, and Mr Scott’s timeline already places it at the edge of this deadline.

Many observers have privately suggested that a sale “will not happen overnight”, especially since the Government is seeking a top-notch purchaser with the vision and wherewithal to not only acquire the hotel but transform the wider Lucayan Strip and rebuild airlift into Freeport and Grand Bahama.

The prime minister and his Cabinet ministers recently revealed that around “two dozen” expressions of interest in the Grand Lucayan have been received, a figure that Mr Scott confirmed

yesterday was correct.

Around half of these were said to have qualified to be given access to a data room containing financial information on the resort.

“Many call but few are chosen,” Mr Scott told Tribune Business. “You whittle those numbers down to six to eight who are serious, and from there whittle it down even more. It’s like a beauty pageant. Some drop out, some realise it’s too much for them to bite off and withdraw themselves, and others we mutually agree that it’s not their project.”

The Lucayan Renewal Holdings chairman also indicated that progress had been made with the trade unions in narrowing the two sides’ differences over the value of separation packages for resort staff wishing to leave.

“We’re still in discussions and I’m hoping to have a final agreement by next week,” he said. “I’ve sent a position to Obie Ferguson and one of his representatives at the Bahamas Hotel Managerial Association,

who I met with on Monday, and I’m waiting for them to get back to me; hopefully by tomorrow.”

Talks are also ongoing with the Commonwealth Union of Hotel Services and Allied Workers (CUHSAW) in a bid to resolve a multi-million dollar gap where staff payout demands exceeded the resort’s offer by $4.6m.

Tribune Business previously revealed that the BHMA, which represents the Grand Lucayan’s middle management staff, was demanding a collective $5.4m payout for its members - double the $2.7m offered by the resort’s board.

And the Commonwealth Union of Hotel Services and Allied Workers (CUHSAW), which acts for the line staff, was asking for over $3m - a sum near-triple the Grand Lucayan’s $1.1m proposal. The two trade unions were thus asking for a total $8.4m payout, which represents a sum more than double, or 121 percent higher than the resort’s total $3.8m offer.

$105m deficit overshoot rationale ‘not full picture’ FROM PAGE ONE fiscal year as the cause of the overshoot.

Mr Bowe, though, challenged this explanation given that the Government had made much of the multi-million dollar

unfunded arrears it had inherited from the former Christie administration.

He said the Government had also moved to a “modified” cash financial reporting basis that required it to account for spending commitments

PUBLIC NOTICE

INTENT TO CHANGE NAME BY DEED POLL

The Public is hereby advised that I, SHARRECK FORBES of St. Charles Vincent Street intend to change my daughter’s name from RAINIQUE AALIYAH MONDELUS to RAINIQUE AALIYAH FORBES. If there are any objections to this change of name by Deed Poll, you may write such objections to the Deputy Chief Passport Officer, P.O. Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of the publication of this Notice.

PUBLIC NOTICE

INTENT TO CHANGE NAME BY DEED POLL

The Public is hereby advised that I, RASHAD SHANDON DORSETT of Davis St., Thompson Blvd., P.O.Box N3553, Nassau, Bahamas intend to change my name to RASHAD SHANDON ADDERLEY. If there are any objections to this change of name by Deed Poll, you may write such objections to the Deputy Chief Passport Officer, P.O. Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of the publication of this Notice.

when they were made, thus providing a more complete picture of its financial position.

Suggesting there were likely other factors involved in the deficit overshoot, Mr Bowe questioned whether it meant some departments and agencies had exceeded their 2017-2018 budget allocations without permission.

“I don’t think persons would readily accept that he [Mr Turnquest] was not aware of the expenditure that departments would have been doing,” the BICA president told Tribune Business.

“In reality, it means they exceeded their budget allocations without asking, or there was a known reason for why they exceeded them.

“The argument that they were paying bills to avoid moving them into next year’s budget is not the complete picture, because it has already been said that they inherited a number of obligations from previous years and indicated they were moving to a modified cash basis of accounting.”

Mr Bowe, who headed the Chamber of Commerce’s Coalition for

Responsible Taxation (CRT) at the time valueadded tax (VAT) was first implemented in January 2015, said the scale of the 2017-2018 deficit overshoot - compared to both Mr Turnquest’s May forecast and the initial $320m projection - would likely attract the credit rating agencies’ attention.

“The fundamental question is going to be: How much more is yet to come?

That will be the question from external observers: Is there any further negative performance to come?” he told Tribune Business.

Standard & Poor’s (S&P), which downgraded The Bahamas to “junk” status at Christmas 2016, is currently completing its annual analysis of this country’s sovereign creditworthiness that will be released before year-end.

Any further ratings actions will likely accompany its release.

Its fellow rating agency, Moody’s, has maintained The Bahamas’ investment grade status - albeit one notch above “junk” - and has given this nation around 18 months to show it is making headway in putting

its fiscal house in order.

Moody’s did, though, recently praise the Government’s launch of quarterly fiscal reporting as a move that will help regain lost “policy credibility” for the Government. It added that enhanced fiscal transparency and reporting will help restore confidence among global investors who were rattled by the Minnis administration’s prior revelation of $760m in unfunded spending arrears.

Mr Bowe echoed similar sentiments over the fiscal strategy report, describing its publication as another step towards moving The Bahamas “to 21st century financial reporting”.

“This is another rung on the ladder in terms of stepping up,” he told Tribune Business. “You look at the quarterly reporting, and now the medium-term strategy in terms of setting out a review of what happened in the actual numbers.

“It’s certainly moving us to financial reporting that’s 21st century. You’re setting a precedent you can’t really turn back from and that’s a positive. You gain that level of transparency, that level of information. The only

thing people will expect going forward is enhancement and a demonstration of continued commitment to the Fiscal Responsibility Act.” The fiscal strategy report must be tabled in Parliament by the third Wednesday in November as part of complying with the newly-passed Act, which is designed to usher in greater transparency and accountability over the Government’s management of the public’s tax dollars.

Mr Bowe said the analysis of prior year fiscal performance, coupled with budget projections going out three years, will create “improved budgeting” by enabling the Bahamian people to measure forecasts against actual performance.

Budgets can now be assessed for their credibility, and the BICA president added: “It’s [the fiscal strategy report] certainly presented in a more readable form than the budget in May. It certainly allows some flavour and reasoning behind what is the thinking of the Government, and is open to criticism - both positive and negative.”

NOTICE Pursuant to the provisions of Section 138 (4) of the International Business Companies Act, (as amended) NOTICE is hereby given that DMURE LIMITED is in dissolution and the date of commencement of the dissolution is 21st November, 2018.

Lorna Kemp and Magdaline Carey LIQUIDATORS c/o Clairmont Trust Company Limited Pineapple Grove #5 Lyford Cay P.O. Box SP-64284 Nassau, Bahamas

NOTICE Pursuant to the provisions of Section 138 (4) of the International Business Companies Act, (as amended) NOTICE is hereby given that FAF LIMITED is in dissolution and the date of commencement of the dissolution is 21st November, 2018.

Lorna Kemp and Magdaline Carey LIQUIDATORS c/o Clairmont Trust Company Limited Pineapple Grove #5 Lyford Cay P.O. Box SP-64284 Nassau, Bahamas

THE TRIBUNE

Friday, November 23, 2018, PAGE 5

Where’s the ‘modern governance’ pledged in return for VAT hike?

FROM PAGE ONE inefficiency of our public sector that causes these increases in costs and taxes.

They’ve got no control over these state-owned enterprises (SOEs) which are over-staffed, inefficient and under-performing. It’s high time they address the largesse and inefficiency of the public sector.

“They can’t keep coming to the public and raising fees and increasing taxes, and not address that gorilla in the room. The public are saying they are sick and tired of increasing fees and taxes to support largesse in government. Create a modern government that’s efficient and not bloated.”

The fiscal strategy report, which sets out the

Government’s mediumterm budget projections and thinking, said the Minnis administration had no choice but to increase revenue yields via tax hikes because it was not earning sufficient income to meet its needs and those of the Bahamian people.

“As amply demonstrated in recent years, the revenue yield of the tax system was grossly inadequate to the needs of modern governance,” the report said. “The various revenue measures in the 2018-2019 budget, including the increase in the rate of VAT from 7.5 to 12 percent, are projected to secure a boost in revenue collections from 16.1 percent to 19.9 percent of GDP. “While lagging regional norms at that level, the

Poor processes slash GDO growth by 1% pt annually FROM PAGE ONE “In the early 2000s, the combined contribution of capital and labour was similar, but the negative impact of TFP was almost doubled to two full percentage points.” The fiscal strategy report added that negative TFP growth, and its damaging impact on the Bahamian economy, was identified by the IMF which estimated it had averaged -1 percent of GDP “since at least 2000”.

With capital’s “large positive contribution” having decreased over the years, and labour’s increasing slowly, the fiscal strategy report said these issues explained why the International Monetary Fund (IMF) is forecasting that Bahamian GDP growth will return to its long-run average of 1.5-1.6 percent between 2020 to 2022 following its recent Baha Mar-related boost.

“Clearly, such a relatively weak potential rate of growth is inadequate to the needs of Bahamian society and workers, both those seeking full-time employment and those entering the labour force every year,” the report said.

“As such, beyond policies to improve human and physical capital, efforts must be devoted to addressing the key factors that impinge on the growth of total factor productivity.”

While the efficient use of technology was critical, the report reaffirmed how the Government plans to improve The Bahamas’ competitiveness through deregulation and liberalisation, plus improving the ease of doing business.

“Sound public institutions and governance, as well as good management

systems, for instance, in respect of the protection of property rights and respect of the rule of law, are also vital,” the fiscal strategy report said.

“Competition, through privatisation and policies to facilitate market entry of new firms, and openness to trade, are critical as well. Trade liberalisation also enhances competition and provides channels for technology transfer from abroad, and capital deepening and foreign direct investment, for their part, enhance the absorptive capacity of the economy through advanced technology spillovers.”

The Minnis administration pledged that the private sector will drive higher economic growth, with “Bahamian investment and creativity, especially that of Bahamian small businesses” targeted as “underpinning” expansion.

“To that end, the Government is moving to significantly improve both the ease of doing business and the business environment, as the goal is to enhance the competitiveness of the Bahamian economy,” the fiscal strategy report said.

“Another key dimension of this goal is to transform and modernise the public sector, including making the SOEs (state-owned enterprises) more efficient and self-sustaining.

Through planned membership in the World Trade Organisation (WTO), the Government is also seeking to enhance competition and openness to trade, with the potential for improved efficiency of resource allocation in the Bahamian economy and greater exposure to global technical and business knowledge.”

To advertise in The Tribune, contact 502-2394

FIDELITY FIDELITY BANK (BAHAMAS) LIMITED

NOTICE TO SHAREHOLDERS The Board of Directors of Fidelity Bank (Bahamas) Limited is pleased to notify all shareholders that a dividend of $0.27 per ordinary share has been declared to be paid on November 30, 2018 to all shareholders of record as of November 28, 2018.

increase in the tax yield is nonetheless appreciable and is poised to make a significant contribution to the attainment of the Government’s key fiscal objectives.”

Mr Myers, though, argued that Bahamians had yet to get anything in return - in terms of improved governance and public services - for reduced living standards, higher living costs and lower disposable income that have resulted from the VAT increase and higher energy costs.

These were cited as the principle grievances among protesters who took over Rawson Square and Bay Street on Wednesday, and the ORG principal also challenged the Government’s decision to compare revenue yields to those of

other Caribbean states.

Mr Myers told Tribune Business that the Government was “trying to make itself look good by comparing itself to the rest of the Caribbean”, which was just as - if not more - inefficient, and included countries such as Jamaica and Barbados whose national debts exceeded the size of their economies.

He added that the private sector never compared itself to poorly-performing rivals, saying: “If we did that in business, we’d all be out of business.”

Mr Myers said the 20172018 fiscal deficit, which overshot both the initial and year-end forecasts by $94m and $105m, respectively, highlighted the need for the Government to rapidly transition to

accrual-based accounting that recorded spending commitments when they were made and thus presented a more complete picture of its financial affairs.

“We’re not happy about the lack of fiscal controls that happened at a time prior to the Fiscal Responsibility Act,” he said, while praising Messrs Turnquest and Johnson for their intent. “My impression, and I think they deserve credit, is that they are trying to get their fiscal house in order.

“But this further wildly indicates they have to move to accrual-based accounting or they will remain perpetually struggling, with the right hand not knowing what the left hand is doing. That’s just

dangerous from a budget standpoint and trying to run a country.

“That’s too big a swing.

It’s too big of a swing,” he added of the $415m deficit. “It’s a function of your accounting processes. It’s telling you; it exemplifies the fact there aren’t enough controls in the current accounting system, and we must move rapidly to an accrual system. They need to make good on that promise. We’ve got to stop talking and do something about it otherwise we’re failing the country down the road.”

Emphasising that he was not picking on the current administration, Mr Myers said inaction would simply push The Bahamas further away from fiscal sustainability.

PAGE 6, Friday, November 23, 2018 BEIRUT Associated Press LEBANON marked 75 years of independence with a military parade yesterday in Beirut, but many anxious Lebanese feel they have little to celebrate: the country’s corruption-plagued economy is dangerously close to collapse and political bickering over shares in a new Cabinet is threatening to scuttle pledges worth $11bn by international donors.

The World Bank issued a stark warning last week, with one official saying that unless a government is formed soon to carry out badly needed reforms, “the Lebanon we know will fizzle away”.

It’s been more than six months since Lebanon held its first national elections in nine years but the prime minister-designate, Saad Hariri, still hasn’t formed a government to undertake the reforms necessary to unlock the donors’ funds.

The vote, in which the Shiite militant Hezbollah group and its allies made significant gains, did little to pull Lebanon out of a political impasse. Anger against politicians’ apparent indifference, worsening public services and distress over down-spiraling finances and gloomy predictions are building up.

Last Friday, heavy rains caused Beirut’s sewage system to burst, turning the city’s famous Mediterranean coastal avenue into a river of filthy, foul-smelling black water that engulfed motorists along the otherwise scenic route. On the same day, the military had closed a main artery for drills ahead of the Independence Day parade, paralysing traffic for hours. Flights from Beirut’s international airport were missed and a woman reportedly went into labor on the road. The army later apologised.

Yesterday, Lebanese President Michel Aoun and the country’s top officials watched an hour-long military parade along Beirut’s waterfront as helicopters hovered overhead. The city center was closed off for the duration of the spectacle.

As soon as the parade

THE TRIBUNE

Lebanon’s economy faces stark choice: Reform or collapse

A LEBANESE protester shouts slogans, during a protest against corruption and criticising long-serving politicians for failing to form a government, in Beirut, Lebanon, yesterday. Lebanon is marking 75 years of independence with a military parade yesterday in Beirut, but many anxious Lebanese feel they have little to celebrate: the country’s corruption-plagued economy is dangerously close to collapse and political bickering over shares in a new Cabinet is threatening to scuttle pledges worth $11bn by international donors.

Photo: Hussein Malla/AP ended, dozens of protesters took to the streets to voice their impatience with the political stalemate. Some denounced corruption, while others ranted about electricity shortages, fraying infrastructure or increasing pollution levels. Many wore T-shirts with the inscription: “Our independence from you exploitation.”

Despite a population of over 4.5 million that is among the most educated in the region, Lebanon still

has a primitive infrastructure, widespread electricity and water cuts and a longstanding waste crisis that over the past few years saw trash piling in the streets for weeks at a time.

“There is no independence (to celebrate) because corruption is eating us up,” said Mohammed al-Rayyes, a shop owner in Beirut’s Hamra district.

“The coming days are going to be very difficult.”

The tiny Arab country

has coped with multiple political and security crises over the past decades and also suffered from the seven-year civil war in neighboring Syria, a conflict that has occasionally spilled over the border and brought more than one million refugees into Lebanon, putting even more pressure on its dysfunctional infrastructure.

A soaring debt of $84bn and unemployment believed to be around 36

MARKET REPORT THURSDAY, 22 NOVEMBER 2018

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

BISX ALL SHARE INDEX: CLOSE 2,012.91 | CHG 9.11 | %CHG 0.45 | YTD -50.66 | YTD% -2.45 BISX LISTED & TRADED SECURITIES 52WK HI 4.50 20.91 7.50 4.46 1.22 0.52 3.92 9.30 6.60 4.93 12.50 2.74 1.78 8.21 6.30 13.20 6.75 4.49 13.50

52WK LOW 3.50 19.17 7.00 3.32 0.90 0.16 2.25 8.60 6.10 3.54 9.00 2.30 1.50 7.25 6.00 10.10 5.67 3.25 12.50

1050.00 1000.00 1000.00 1000.00

1000.00 1000.00 1000.00 1000.00

PREFERENCE SHARES

1.00 103.00 100.00 106.00 105.00 103.00 100.00 10.00 1.01

1.00 100.00 100.00 100.00 100.00 100.00 100.00 10.00 1.00

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 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

52WK LOW 100.00

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 ##########

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

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

LAST CLOSE 4.45 17.43 7.00 4.46 1.01 0.52 2.30 9.30 6.16 4.00 12.42 2.50 1.78 8.05 6.30 12.98 6.41 3.62 13.01

CLOSE 4.45 17.43 7.00 4.46 1.01 0.52 2.30 9.30 6.16 4.07 12.42 2.50 1.78 8.03 6.30 12.98 6.41 3.62 13.01

CHANGE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.07 0.00 0.00 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

CLOSE 100.00

CHANGE 0.00

107.31 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

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

LAST SALE 100.00 107.31 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

VOLUME

7,650

913 50

VOLUME

EPS$ 0.214 0.932 -0.306 0.317 0.059 0.000 -0.588 0.700 0.441 0.154 0.627 0.102 0.209 0.000 0.670 0.701 0.578 0.277 0.631

DIV$ 0.100 1.260 0.000 0.240 0.000 0.010 0.000 0.710 0.220 0.120 0.620 0.060 0.060 0.084 0.280 0.500 0.150 0.130 0.600

P/E 20.8 18.7 N/M 14.1 N/M N/M -3.9 13.3 14.0 26.4 19.8 24.5 8.5 N/M 9.4 18.5 11.1 13.1 20.6

YIELD 2.25% 7.23% 0.00% 5.38% 0.00% 1.92% 0.00% 7.63% 3.57% 2.95% 4.99% 2.40% 3.37% 1.05% 4.44% 3.85% 2.34% 3.59% 4.61%

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%

MATURITY 19-Oct-2022 ############### 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

MUTUAL FUNDS 52WK HI 2.18 4.16 2.02 182.41 158.55 1.58 1.70 1.66 1.10 6.99 8.54 6.15 10.52 11.46 10.46 10.00 8.69 11.79

52WK LOW 1.67 3.04 1.68 164.74 116.70 1.52 1.68 1.61 1.08 6.41 7.62 5.66 8.65 10.54 9.57 9.88 8.45 11.20

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 Colonial Bahamas Fund Class D Colonial Bahamas Fund Class E Colonial Bahamas Fund Class F

NAV 2.18 4.16 2.02 182.41 158.55 1.58 1.69 1.66 1.09 7.36 8.47 6.53 11.32 11.67 10.54 9.92 8.69 11.79

YTD% 12 MTH% 2.90% 4.07% 0.44% 4.38% 1.70% 2.35% 2.08% 3.47% 3.35% 5.94% 3.22% 4.22% -0.38% 3.34% 2.39% 4.01% -0.38% 0.53% -1.08% 1.77% -5.96% -3.05% 1.90% 4.59% 7.24% 11.96% 2.77% 3.88% 3.94% 4.69% -0.71% 0.16% 3.96% 7.75% 8.34% 14.88

NAV Date 30-Sep-2018 30-Sep-2018 28-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-2018 30-Sep-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

percent are compounding concerns that the country will finally cave in.

“It is a shame because so much time is being wasted,” Ferid Belhaj, the World Bank’s vice president for the Middle East and North Africa, said during a meeting with a group of journalists last week.

For years, he said, Lebanese officials have been promising to work on solving the electricity crisis, which costs the country

about $2bn a year and has been the main factor in accumulating Lebanon’s debt.

Of immediate concern is the future of $11bn in loans and grants pledged by international donors at a meeting in Paris in April, which Lebanon risks losing if no Cabinet is in place soon to unlock the funds and approve reforms that were set as conditions by the donors and which have been delayed for years. In April, Hariri pledged to reduce the budget deficit by five percent over the next five years.

The crisis has prompted some Lebanese to change their deposits from the local currency, which has been pegged to the US dollars since 1997, to US dollars for fear the Lebanese pound might collapse. Riad Salameh, the Central Bank governor, has been repeatedly reassuring the markets, saying the local currency is stable.

Mohamad Shukeir, head of the Chambers of Commerce, Industry and Agriculture, told the local MTV station that 2,200 businesses closed doors so far this year.

Aftershocks of rising tension between the United States and Iran are also felt in Beirut, with Tehran ally Hezbollah being blamed by opponents for preventing Western-backed Hariri from forming a national unity government.

Hezbollah has demanded that six Sunni lawmakers allied with the Shiite group and opposed to Hariri be included in his Cabinet — something that Hariri, the country’s top Sunni Muslim leader, categorically rejects.

Despite the dangers, political bickering is not likely to end soon and the debt is mounting.

“The level of debt that we have in Lebanon requires us to act very quickly,” said economist Kamel Wazne.

“Any delay will expose us to financial collapse.”

Belhaj of the World Bank said that reforms would act as a buffer to the crisis. But in their absence, “the crisis can be very nasty”.

“If we don’t go about these reforms fast, the Lebanon that we know will fizzle away,” he said.

ARTIFICIAL INTELLIGENCE IMPROVES HIGHWAY SAFETY IN LAS VEGAS LAS VEGAS Associated Press ARTIFICIAL intelligence is helping improve safety along a stretch of Las Vegas’ busiest highway.

The Nevada Highway Patrol says a yearlong partnership between public safety agencies and a startup technology firm resulted in a 17 percent reduction in crashes along a portion of northbound Interstate 15 just west of the Las Vegas Strip.

The Las Vegas ReviewJournal reports Waycare, a provider of artificial intelligence-based mobility products and services for smart cities, helped lead the crash prevention pilot programme.

They hope to use it in other parts of the Las Vegas Valley, including a stretch of US 95 between I-15 and the Rainbow Boulevard curve.

The programme uses in-vehicle information, cameras, sensors and other traffic data to develop prediction models to reduce congestion.

The Regional Transportation Commission of Southern Nevada, the Nevada Department of Transportation and the Nevada Highway Patrol teamed up for the pilot program with Waycare. The Israeli startup already carried out a similar program in Tel Aviv, and it started a crash prevention programme last year in Tampa, Florida.

The Nevada Highway Patrol says the results from the initial project on I-15 in Las Vegas between Charleston Boulevard and Russell Road came without any additional resources from state or local agencies.

“Groundbreaking partnerships like this enable Southern Nevada to continue to lead the way in leveraging advanced technologies to

dramatically improve traffic safety and efficiency,” RTC general manager Tina Quigley said.

“These latest statistics coupled with the fact that we are identifying accidents up to 12 minutes faster with the Waycare platform helps translate what public and private partnerships can do and that AI is working to modernise and create a better transportation system for all.”

The platform uses invehicle information and municipal traffic data to understand road conditions in real time. When an area at high risk for an incident is identified, Waycare alerts traffic agencies when and where to take preventive action.

The RTC uses dynamic message boards to relay advanced warning of an incident, alerting drivers to reduce speed and drive cautiously.

The NHP then deploys its vehicles in high-visibility mode along the freeway in conjunction with NDOT, which assures that safety barriers are in place for the police officers on freeways.

During the program, 91 percent of drivers traveling at more than 65 mph slowed down to under 65 mph in areas where preventive measures were deployed, RTC said.

“The results of this pilot program are a clear signal that AI and deep learning, when deployed in collaboration with traffic management and enforcement agencies, can have a dramatic impact on improving the safety of even our busiest and most at-risk freeways,” said Noam Maital, co-founder and CEO of Waycare.

THE TRIBUNE

Friday, November 23, 2018, PAGE 7

Nissan board fires Ghosn as chairman following arrest TOKYO Associated Press NISSAN Motor Co fired Carlos Ghosn as chairman yesterday, curtailing the powerful executive’s nearly two-decade reign at the Japanese automaker after his arrest for alleged financial improprieties.

In an hourslong meeting, the company’s board of directors voted unanimously to dismiss Ghosn as chairman and as a representative director, Nissan said in a statement. It said its own internal investigation, prompted by a whistleblower, found serious misconduct including under-reporting of his income and misuse of company assets.

It was a stunning downfall for one of the biggest figures in the auto industry. Ghosn had helped drive turnarounds at both France’s Renault SA and at Nissan and then managed an alliance between them that sold 10.6 million cars last year, besting its rivals.

Renault is still reeling from Ghosn’s Monday arrest, and its share price has yet to recover. Its acting chief, Deputy CEO Thierry Bollore, spoke publicly lastnight for the first time since Ghosn was sidelined, and sought to soothe markets, car buyers and his employees by promising continuity.

In a video released by Renault, Bollore said the carmaker still plans to release several new models next year. Acknowledging the “particular situation” the company is in, he pledged his “full commitment” to Renault’s 180,000 workers and its partners and customers. Renault’s board decided not to fire Ghosn,

A SECURITY guard stands near the logo at Nissan Motor Co Global Headquarters in Yokohama near Tokyo yesterday. Nissan’s board of directors met yesterday to decide whether to dismiss its chairman Carlos Ghosn following his arrest on suspicion of underreporting his income.

Photo: Eugene Hoshiko/AP instead installing temporary leadership.

The French government, which owns 15 percent of Renault, is also worried.

French Finance Minister Bruno Le Maire said yesterday that France has yet to receive information from Japan about what Ghosn is accused of and insisted on “respect for the presumption of innocence”.

Speaking to The Associated Press, Le Maire said “this turbulence shouldn’t weaken” the Renault-Nissan alliance or its hundreds of thousands of jobs.

Nissan said in a statement filed to the Tokyo Stock Exchange that its investigation uncovered misuse of company investment funds and expense money for

personal gain.

The Wall Street Journal, citing an anonymous source close to Nissan’s investigation, reported that Ghosn used company funds to buy personal residences and enrich his sister.

Another Nissan executive, Greg Kelly, was arrested in Japan on suspicion of collaborating in the wrongdoing and also will be dismissed as a representative director, Nissan said.

Their replacements will be decided later, it said.

Ghosn, 64, is suspected of under-reporting $44.6m in income from 2011 to 2015, according to Tokyo prosecutors.

Nissan’s board consists of nine members, including Ghosn and Greg Kelly. The

seven other board members voted at the meeting, including two members from Nissan and two from Renault.

Ghosn and Kelly will remain on Nissan’s board for now as that decision will be up to shareholders. No date has been set yet for a shareholders meeting.

Ghosn is also chairman at Mitsubishi Motors Corp, a smaller Japanese automaker that’s partnering with the Renault-Nissan alliance and plans to hold a board meeting next week.

He has been held since his arrest on Monday at a Tokyo detention centre, under the same Spartan conditions as other detainees, Tokyo deputy prosecutor Shin Kukimoto

told reporters yesterday. He gave few details about the case.

Under Japanese law, suspects can be held for 20 days per possible charge without an official indictment.

Additional charges can be tagged on, resulting in longer detentions. Neither has been charged so far.

The maximum penalty upon conviction for violating finance and exchange laws is ten years in prison, a 10 million yen ($89,000) fine, or both.

A French citizen born in Brazil, Ghosn became something of a corporate superstar in Japan as he led Nissan’s revival from near bankruptcy after Renault sent him to help in 1999.

Ghosn served as Nissan’s

chief executive from 2001 until last year. He became chief executive of Renault in 2005, leading the two automakers simultaneously.

In 2016, he also became chairman of Mitsubishi Motors Corp after Nissan took it into the alliance.

Kelly, 62, joined Nissan, maker of the Leaf electric car and Infiniti luxury models, in the US in 1988.

He became a board member in 2012. His background is in human resources and alliance management.

Analysts say the future of Nissan’s alliance with Renault may be at stake, though Nissan’s statement yesterday said the company’s leadership was determined to minimise the impact from Ghosn’s case on the partnership. Renault owns 43 percent of Nissan, and Nissan owns 15 percent of Renault.

The economy ministers of Japan and France met in Paris yesterday to discuss the issue and released a statement saying both sides are committed to supporting the alliance.

Nissan said its board will study setting up a thirdparty committee to beef up governance in management and compensation at Nissan.

Janet Lewis, managing director and head of industrial research, Asia, at Macquarie Capital Securities in Tokyo, said in an interview that an adjustment was needed to give Nissan more say in the alliance with Renault.

The partnership remains crucial for both companies, she said, since apart from financial ties the companies share technology and parts.

The automakers need to be more like roommates than a married couple, she said.

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