NASSAU, BAHAMAS — Exuma and Ragged Island MP Chester Cooper yesterday said the government’s social safety net initiatives “is not enough” to mitigate the “economic calamity” potentially facing the country.
Cooper suggested that government should identify borrowing facilities in the area of $1 billion to $2 billion in this low-interest environment in order to “shore up the economy”.
In its monthly economic report report, the Central Bank also predicted a rise in domestic and external borrowing will be required to fill the budgetary gap due to COVID-19.
The Progressive Liberal Party deputy leader made several recommendations during his contribution to the debate on the resolution to extend the COVID-19 emergency powers.
He noted he has been in discussion with Finance minister K Peter Turnquest.
“Most businesses have closed and others are operating on only a fraction of their usual revenue,” he said.
“Business owners and executives are making critical choices about the future of their enterprises that will directly impact the future of families throughout this nation.Hard choices will have to be made by the government, just as hard choices will have to be made in thousands of business and households.
“The reality is that there are tens of thousands of people whose prospects for the next few weeks have been crushed.The jobs that were their lifeline just as we were coming out of a sluggish decade of low growth, have been cut,” said Cooper.
“The government has acted, in some respects, to provide a social safety net to catch many who otherwise would have been shattered.But as it stands, it is not enough.
“Today, there are many people with rent and school fees due, and mortgages and car payments and utility bills waiting.
“Many of those people are now in households where not a single person is working, yet the needs of their households have not changed.”
Cooper underscored out the country’s main trading partner, the United States, is looking at an unemployment rate of 30 percent.
“Ours, though we won’t be able to measure it for some time unless the government gives extraordinary instruction, will surely be higher.
“Trillions of dollars of wealth has evaporated from the U.S. stock markets, meaning higher net worth individuals, many of whom are stopover visitors and investors in large projects, will move cautiously for the next few months.
He said: “The decline in the boating and private yacht sector will affect the residents of Exuma Cays and other family islands who rely on this market. The cruise ship industry has suffered a tremendous blow.Despite having relied so heavily for large-scale investments on the cruise ship industry, those projects will likely be delayed, if not rethought altogether.”
Cooper warned that even if the COVID-19 fall-out takes a turn for the better by the Summer, this nation is unlikely to see a robust return of visitors until the third quarter of this year.
He further suggested that government should identify borrowing facilities in the area of $1billion to $2 billion in this low interest environment in order to “shore up the economy”.
He said this “turning point” must be used to innovate and to re-imagine a more progressive and competitive Bahamas.
Cooper said: “If COVID-19 has done anything, it has laid bare the weaknesses in our public service systems, and shows us the critical flaw in our reluctance to embrace technology.
“At least $150 million of the borrowed funds should be used to build a state-of-the-art digital infrastructure.E-government must cease to be a buzz word and we should target making 90 percent of government services fully available online, taking advantage of the Central Bank’s digital currency and the private sector providers of mobile wallets.Many Bahamians with this expertise can be employed in this area.
“We must move toward the creation of a digital identity for all citizens and legal residents of The Bahamas.We must set the example for business, many of whom have doggedly stuck to a brick and mortar business model and were caught flat-footed, unable to adjust as things suddenly transitioned. The government should take $250 million and invest immediately in real food security.
“BAMSI is a good model but Andros is primed for growth in this area and others.”
The Opposition deputy leader said that reducing electricity bills by a minimum of 25 percent can dramatically improve competitiveness and increase GDP by at least one percent.
“The government should invest in a technologically advanced broad public transportation system for New Providence.The government should also provide an additional $50 million in food and rental assistance throughout the next six months.
The government should expand the unemployment assistance plan to $50 million dollars for at least 13 weeks, and consider funding it for another 13 weeks after that if economic conditions warrant,” said Cooper.
Cooper: COVID-19 social relief not enough, borrowing needed to shore up economy