Concessions soon to end in the Hawksbill Creek Agreement

So we have looked at the “Bend or Break” speech, checked out it results, (a quasi order for Bahamians to become unequal business partners) and the fall out from all of it. We have also looked at the actual Hawksbill Creek Agreement.

I can say for the most part the Port Authority has lived up to its part on the bargain for most of the agreement. For some they may not have done so as a body, but they were intricate in “causing” such things to be done.

We have the deep water harbour and commerce that arrived including the industrial businesses in the “Port” area.

However, there were three portions of the agreement that are being debated even now and are up for review.

The bottomline on the part of promises from the part of the Port Authority were met as promised. The promises by the Government by and large were met, but there were concessions that ran out in 1992, and were prolonged to 1993 when some amendments were made to the agreement.

This time, the Port Authority had to take over (acquire) the hotels on the Lucayan stretch from the then government, take over (acquire) the business of supplying utilities to the entire island of Grand Bahama, among of these.

For this, the three concessions that were to expire were to be extended for review in 2015.

The reason the concessions were pushed back and are in just as much trouble now is because (I feel) Freeport/Grand Bahama has not reached the stage that was anticipated in which these concessions would not matter.

But with the swift departure of investors and very few replacements, we are still not “secure” enough to take on these concessions.

For those who did not read all of the Hawksbill Creek Agreement, these concessions are: Section 2 (6)

"(6) That for Thirty years from the date of this Agreement no real property taxes or rates and no real property levies (whether capital or periodic) of any kind shall be levied charged or collected by the Government within the Port Area or upon or against any land building or structure within the Port Area.

(7) That for Thirty years from the date of this Agreement no personal property taxes or rates and no capital levies and no taxes on capital gains or capital appreciation shall be levied charged or collected by the Government within the Port Area or upon or against any personal property within the Port Area or upon or against the shares, debentures or other securities of any company incorporated within or without the Colony and having its Registered Office and principal place of business within the Port Area, and for the purposes of this subclause of this clause the term “principal place of business” shall mean that place where not less than Eight per centum of the volume of a company’s business and trade within the Colony is transacted. Provided Always that the exemptions granted by this subclause shall extend only to personal property, shares, debentures or securities of the Port Authority or any Licensee actively engaged within the Port Area in one or more of the classes of business set out in subclause (23)(1) of clause 2 of this Agreement or in such other business or businesses as the Governor in Council, his discretion, may from time to time approve.

(8) That for Thirty years from the date of this Agreement no taxes of any kind shall be levied upon or against the earnings of the Port Authority in the Port Area and outside the Colony or upon or against the earnings of a Licensee in the Port Area and outside the Colony or against any rentals or licence fees paid by any lessee or by a Licensee to the Port Authority or upon or against any interests or dividends paid by the Port Authority or by any lessee company of the Port Authority or by a Licensee to the holders of the evidences of indebtedness and/or shares or other securities of the Port Authority or of the company holding such lease from the Port Authority or of a Licensee or upon or against any salaries and remuneration by way of bonus participation in profits commission or otherwise paid by the Port Authority or by any lessee from the Port Authority or by a Licensee to any person employed by the Port Authority or by such lessee or by a Licensee within the Port Area, Provided that the person receiving such salary and/or remuneration is ordinarily resident within the Port Area.”

For these concessions to come into effect it was said that the economy in Freeport should be at a certain point which it has not reached.

With just over a year to go, some have talked about the fact that discussions need to begin, there has not been much discussion on what will happen in 2015.

Again my questions are? Did anyone have a plan B for the exit of the investors? Was the government aware of its effects? What did they have in mind to “fix” this situation over the past 50+ years? 

In considering more than just these concessions, the Government and Port Authority are talking about the plans for the introduction of the VAT, which could/may affect Freeport and if its does, does that mean an ending of the Hawksbill Creek Agreement?

How far will we go without forethought for the people, the economy, the progress of the city/island?

These are my thoughts for those at the top. 

For the everyday Joe, have you decided what you want to see that may bring back the “magic” and are you working on it?

I can say for my part, this blog is just part of what I want to do to bring the “magic” back. I want to use it to talk about the issues to think about and act on. It’s the small steps at the right time by all that will get us where we need to be/Where we should be.

So what are you doing?