Foreign Direct Investment (FDI) for decades has played a major role in the success of the Bahamian economy, but to encourage more Bahamian ownership State Minister for Finance Michael Halkitis says the onus would be placed on the government to make it probable.
Mr. Halkitis responded to why FDI remains so prevalent in the country while a guest on local talk show, “Let’s Talk Live” with Carlton Smith.
He said this [FDI] model has worked so well in the past but something, especially in the wake of Baha Mar, has shifted.
“The foreign direct investment where you go out and see investors who want to come into you country, they bring money, they do the development and they create jobs and opportunities, while it is good,” he said.
“The challenge with this, for instance the Baha Mar development is it’s a traumatic event that will force us to look at ways to get local Bahamian capital together, and where that is not sufficient where you can get local Bahamian capital together, pool it and then leverage it because that must be the way to go.”
In order to make this happen however he says the government would have to perpetuate a system to fuel this.
“You will see it coming forward in some small ways that we expect to be announced shorty however going forward my view is, is that we must begin to look at a model where the Government of The Bahamas,” Mr. Halkitis said.
“Through a corporation or fund is able to look at a particular situation and conceptualize a development whether it be tourist agriculture, fishing or and facilitate people pooling monies together and doing that development and then sharing in the profits.”
He went on to note that the country has had ownership in the past in the tourism industry but not to any great extent via the hotel corporation.
Just this past June the World Investment Report 2016 found that FDI inflows into the Bahamas in 2015 declined by more than $1.2 billion compared to year-before levels.
Much of last year’s decline was likely related to the construction slowdown at the Baha Mar development.
