Connect with us

Bahamas News

PM Minnis remarks at IDB/IMF/WB Conference re Climate Change — in Washington, D.C.

Published

on

#Washington, D.C., November 27, 2018 – U.S.A

Intervention by

 THE MOST. HON. DR. HUBERT A. MINNIS, O.N., M.P.

Prime Minister

COMMONWEALTH OF THE BAHAMAS

 

Inter-American Development (IDB)/

International Monetary Fund (IMF)/

World Bank (WB)

Conference – Building Resilience to Disasters and Climate Change in the Caribbean

 

“Improving Risk Transfer”

 

IMF Headquarters, Washington, D.C.

November 26th 2018

 

Like many other Caribbean countries, disasters in the Bahamas can have a large, direct impact on economic conditions through reduced productivity and increased national debt due to reconstruction costs.

For example, as a result of Hurricane Mathew in 2017, The Bahamas Government initially borrowed $150 million and made allocations for capital works, and transfers and subsidies for relief and reconstruction.

This widened the fiscal deficit from an estimated 1.0 per cent of GDP in 2016/17 before Hurricane Matthew to 1.9 per cent of GDP after Matthew. This represented an $81 million increase in the deficit after the hurricane.

Subsequently, we recognized that in post-disaster relief and recovery, we should have the resources and means at our disposal to finance our direct contingent liabilities more efficiently, and to be better able to provide additional aid to small businesses and low-income farmers, who are disproportionally impacted by disasters.

As the frequency and severity of disasters increase due to climate change, the intensified shocks could create debt burdens on future generations, and erode development progress.

The need for us to understand our fiscal risk and for us to create cushions against adverse economic impacts is more urgent than ever, and this highlights the importance of developing risk financing strategies and transfer mechanisms to avoid reliance on public debt.

We also need to promote insurance solutions for homeowners. The possibilities of introducing natural disaster insurance for homeowners are as varied as the disaster management strategies of different countries.

There is no single ideal or universally applicable solution for homeowner’s disaster insurance. Each country must find and adapt a model that best fits its exposures, existing insurance market infrastructure, institutional set-up and political acceptability.

The solutions in place in different countries range from comprehensive compulsory natural disaster covers offered by government-sponsored insurance entities  to privately organized voluntary disaster insurance products.

However, pooling of risks at the regional level may be the solution to overcome any shortcoming in any particular country.

We are cognizant that ex ante instruments are the most effective and efficient means of governments practicing self-insurance.

Ex ante instruments require proactive advance planning and includes reserves or contingency funds, budget contingencies, contingent debt facilities, and a range of insurance or other risk-transfer products.

These risk transfer instruments that transfer contingent liabilities to the market or other agencies make it harder to game the system for political reasons.

They will be triggered only in particular circumstances and are more easily directed to the plans they were meant to finance.

Further, they require less discipline by the user because discipline is built into the rules of the contract and is part of the service provided.

Even though we are aware of the many benefits on improving risk transfer there are still a number of challenges in accomplishing this task.

One such challenge is that policymakers often have difficulty in obtaining political and economic commitment due to other competing needs and priorities.

While  many  agree  that  reducing  disaster  risks  is  important  for  saving  lives  and  property,  few  countries such as the Bahamas  have  appropriate  measures  in place because other policy issues require greater  attention  and  funding.

This has resulted in the insufficient earmarking of financial resources for risk transfer measures. Policymakers are in need of clear evidence, including cost-benefit analysis, to convince the public and various stakeholders that a commitment to risk transfer is as practical and necessary as any other priority.

Additionally, the liquidity secured through sovereign risk transfer requires a pre-existing targeting and distribution infrastructure, such as a social protection mechanism, which is underdeveloped in the Bahamas.

Therefore substantial investments  in  targeting  and  distribution  infrastructure,  and  in  enabling  markets may  need  to  be made  alongside securing  financing  against  risk.

This suggests the need for a high level of commitment and coordination across investments.

Risk prevention and mitigation strategies must be the first priority in managing natural disasters. But no organization or country can fully insulate itself against extreme events.  To enable and sustain growth, transferring catastrophic risk must therefore be a key element in the financial strategy of every disaster-prone country or region.

We must recognize that “financial resilience is a critical component of disaster management” because the immediate availability of funds to finance the necessary disaster response and recovery is critical to take appropriate action for individuals, businesses and governments.

There is little awareness among decision makers, disaster management authorities and potentially affected households, businesses and governments about the role insurance instruments can play.  The donor community can also play key complementary roles in the development of catastrophe insurance solutions for developing countries.

These roles include: helping to subsidize insurance premium in the context of a country putting together a sound macro-fiscal framework, and increasing the capitalization of CCRIF, so that insurance premium come down automatically.

In terms of convening power, the World Bank and other IFIs can play a catalytic role in the development of efficient partnerships among countries, donors, and private markets for the financing of catastrophic risks.

Donors can play a major role in financing public goods that contribute to the creation of a risk market infrastructure, which facilitates the development of market-based risk financing solutions.

Public goods include information collection and management systems, catastrophic risk assessment programs, risk modeling development programs, awareness and education campaigns, and institutional capacity building.

By being the provider of technical assistance for innovative catastrophe insurance solutions, donors can promote the emergence of innovative risk financing solutions, including index-based insurance products, national and regional catastrophe insurance pools (for example, TCIP, CCRIF), and risk transfer vehicles (such as reinsurance, catastrophe bonds, weather derivatives).

IFIs such as the IMF can help to subsidize insurance premium in the context of a country putting together a sound macro-fiscal framework.

For example with the assistance of the IMF and CARTAC, the Bahamas has passed Fiscal Responsibility Legislation which aims to bring discipline to the Government’s fiscal agenda with a view to attaining future fiscal surpluses.

With this in our tool kit, the Government has pledged to set aside two to three percent of these surpluses in a fund that can be used to pay the CCRIF premiums and assist to rebuild after a natural disaster.

Moreover, public intervention in catastrophe insurance markets, supported by the donor community and the World Bank, should be country-specific.

Low income countries, where the domestic non-life insurance market is undeveloped, should focus in the short term on the development of sovereign catastrophe insurance solutions and the promotion of public goods related to risk market infrastructure.

These countries are usually not developed enough for the promotion of catastrophe insurance pools for private homeowners.

Middle-income countries, where the domestic non-life insurance market is more developed, should help the private insurance industry offer market-based catastrophe insurance solutions to homeowners and to small and medium enterprises, including those in agricultural and fisheries industrie

Continue Reading

Bahamas News

Caught in the Net, Not Accused of Wrongdoing

Published

on

What the Attorney General must do now to protect Bahamian exports

Deandrea Hamilton | Editor

NASSAU, Bahamas — The United States’ decision to impose a 12.5 percent tariff on Bahamian exports is about more than higher costs for seafood, rum and other goods entering the American market. It is a warning that The Bahamas must move quickly to strengthen or clarify its legal framework governing forced labour and supply-chain enforcement.

The tariff, which takes effect July 24, is part of a sweeping U.S. trade action affecting 60 economies following a review by the Office of the U.S. Trade Representative (USTR). The review concluded that the listed countries have not adequately prohibited or enforced measures against goods linked to forced labour in global supply chains.

The action follows a recent U.S. Supreme Court ruling that invalidated an earlier series of Trump-era tariffs imposed under emergency powers. In response, the Trump administration shifted to a different legal authority—Section 301 of the Trade Act of 1974—using findings from a U.S. Trade Representative investigation into forced-labour compliance to support a new round of tariffs affecting 60 economies, including The Bahamas.

Importantly, the action does not accuse Bahamian businesses of using forced labour. Instead, it reflects the U.S. view that The Bahamas’ legal or enforcement framework does not yet meet the standard Washington expects.

That distinction matters.

The Attorney General’s Office now has the responsibility to lead the country’s legal response. That begins with determining precisely what concerns the U.S. Trade Representative identified, reviewing whether Bahamian law adequately addresses those concerns and, where necessary, recommending legislative or regulatory changes. If deficiencies exist, legal amendments and stronger enforcement could help position The Bahamas for removal from the tariff list.

The government may also seek formal discussions with U.S. officials while those reforms are undertaken, outlining a clear timetable for compliance and demonstrating that the country is committed to meeting international labour standards.

A Nassau Guardian front-page report on July 24 drew attention to the tariff action, prompting broader questions about why The Bahamas was included among the 60 economies affected by the U.S. trade measure and what steps are now needed to restore full confidence in the country’s trade framework.

For many Bahamians, the immediate concern will be the fisheries sector, one of the country’s largest export industries. Commercial shipments of lobster, conch, fish, crawfish and other products entering the United States could become more expensive because of the additional tariff, potentially affecting exporters’ competitiveness.

The broader lesson is that international trade increasingly depends not only on quality products, but also on strong business relationships and confidence in the legal systems that govern them.

For The Bahamas, this is less a finding of wrongdoing than a reminder that international credibility is earned through modern laws, effective enforcement and trusted partnerships. The challenge now is for the Attorney General’s Office to lead a swift legal review, identify any deficiencies and chart a clear path toward compliance so Bahamian exporters are not burdened any longer than necessary.

Continue Reading

Bahamas News

What 45 Shell Casings and New Murder Charges May Mean for Three Officers in the Azario Major Case  

Published

on

By Deandrea Hamilton | Editor

NASSAU, Bahamas (July 16, 2026) — The allegation is as shocking as it is consequential. Prosecutors now contend Azario Major was struck by additional gunfire after he was already dead.  That conclusion has prompted the Director of Public Prosecutions to upgrade the case against three police officers from manslaughter to murder ahead of a judge-only trial.

According to court filings and the DPP’s review of the forensic evidence, prosecutors allege that additional rounds entered Major’s body after death, a finding they say fundamentally changed their assessment of the case and justified the more serious charge of murder.

Investigators recovered 45 spent shell casings at the scene of the Boxing Day 2021 fatal shooting of Azario Major, a striking piece of forensic evidence that has remained central to the case from its earliest days.

Major, 31, was fatally shot by police outside Woody’s Bar on Fire Trail Road on December 26, 2021. While police initially maintained the shooting was justified, the circumstances surrounding the incident were heavily scrutinized during a Coroner’s Court inquest, where jurors ultimately returned a verdict of homicide by manslaughter.

The officers later challenged that finding, but the Supreme Court upheld the Coroner’s Court ruling, paving the way for criminal proceedings. They were subsequently arraigned on manslaughter charges and pleaded not guilty.

The DPP’s decision to elevate the charges to murder significantly raises the legal stakes. Unlike manslaughter, which does not necessarily require proof of an intent to kill, a murder conviction requires prosecutors to establish the legal elements of the more serious offence beyond a reasonable doubt. The prosecution’s case is now expected to focus heavily on forensic evidence, ballistic analysis and the sequence of gunfire during the fatal encounter.

The case is also notable because it will proceed without a jury. Barring further delays, the trial is expected to open on September 14 before Justice Guillimina Archer-Minns in a judge-alone trial, where a single judge—not a jury—will decide the fate of the three accused officers.

The proceedings will determine not only whether the three officers are guilty or innocent of murder, but whether prosecutors’ extraordinary allegation—that Azario Major was struck by additional gunfire after he was already dead—can be proven in court.

Continue Reading

Bahamas News

CARICOM Targets Affordability as Bahamas, TCI Continue to Feel the Pinch  

Published

on

By Deandrea Hamilton

 

Cheaper shipping. Lower energy costs. Better access to healthcare. Stronger consumer protections.

Those are among the measures CARICOM Heads of Government believe could finally begin reducing the stubbornly high cost of living for millions of people across the Caribbean.

Meeting in Saint Lucia, regional leaders agreed that making life more affordable must become one of the Community’s highest priorities. Their emerging strategy includes reducing freight costs through a regional ferry service, accelerating renewable energy projects to lessen dependence on imported fuel, expanding regional healthcare partnerships, strengthening consumer protection, and encouraging governments to adopt successful cost-of-living measures already being implemented across the Caribbean.

“Our discussions over the past four days were guided by one central objective – ensuring that CARICOM delivers results that people can see and feel in their everyday lives,” CARICOM Chairman and Saint Lucia Prime Minister Philip J. Pierre said.

Few places may welcome that relief more than The Bahamas and the Turks and Caicos Islands.

Although inflation has moderated in both countries from the sharp increases experienced following the pandemic, the cost of living remains stubbornly high. Families continue to complain about grocery bills that stretch household budgets, rising housing costs, expensive electricity, healthcare expenses and fuel prices that remain among the highest in the region.

Governments have responded.

In The Bahamas, successive reductions in Value Added Tax on selected goods and other targeted tax measures have sought to ease pressure on consumers. In the Turks and Caicos Islands, the Government this weekend opens applications for its $500 Cost of Living Relief Programme, acknowledging that many households continue to struggle despite the country’s economic success.

Yet affordability remains elusive.

The contradiction is difficult to ignore.

The Turks and Caicos Islands continues to post one of the region’s strongest tourism-driven economies, with robust investment, record visitor spending and sustained construction activity. The Bahamas has also strengthened its economic position, earning improved sovereign credit ratings as tourism, government revenues and fiscal performance continue to recover.

Yet those encouraging economic indicators have not translated into noticeably lower household expenses.

The reason is largely structural.

Both The Bahamas and the Turks and Caicos Islands produce relatively little of what they consume. Food, fuel, medicines, vehicles, building materials and countless household essentials are imported. Both countries also record significant trade deficits, illustrating their dependence on overseas suppliers. Every increase in global shipping costs, fuel prices or supply chain disruptions is eventually reflected in supermarket prices, utility bills and the cost of everyday living.

That is why CARICOM’s agenda matters.

If regional leaders succeed in lowering freight costs through an inter-island ferry network, expanding renewable energy, improving regional cargo movement, strengthening consumer protections and making healthcare more accessible through cooperation, the benefits could extend far beyond government balance sheets.

For Bahamians and Turks and Caicos Islanders, success will not be measured by another tourism record or another credit rating upgrade. It will be measured at the supermarket checkout, on the monthly electricity bill, at the gas pump and in the simple ability to afford a better quality of life.

Continue Reading

FIND US ON FACEBOOK

TRENDING