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At Macao Forum DPM Touts 3Ps to Address Future Infrastructural Development

The government will continue to promote the three Ps of Public Private Partnerships as a means of delivering on the infrastructural requirements needed to move the country forward at the socio-economic development level especially in the Family Islands, Deputy Prime Minister Philip Davis told a key international forum in the People’s Republic of China.

Mr. Davis assured senior representatives of global and regional countries that the government is committed to “doing all that it can” to ensure that not one single Bahamian should live below the poverty line.

Addressing the opening session of the first China-CELAC Infrastructure Cooperation Forum in the peninsula of Macao, Mr. Davis said the eradication of poverty levels in the country is “a matter which the present government is seeking to address in a number of ways and through a plethora of social and other programmes” including public-private partnerships.

Deputy Prime Minister Davis said the need for such partnerships is critical to addressing the country’s infrastructural needs.

“The Bahamas has much to do to ensure sustainable development and it requires investments beyond what we can directly fund within our budgetary framework,” Mr. Davis said.

“We struggle in a world where development assistance is predicated on the basis of per capita income as the sole indicator of need. Our per capita income is skewed upwards by the presence that makes up a small minority of the workforce of high net worth individuals, and, as such, does not properly reflect the fact that we have islands where no high net worth individuals live and where poverty is the rule and not the exception,” Mr. Davis said.

“Additionally, there is a an imbalance even among the average workers who live in the urban centres as opposed to those who live in the Family Islands, many of whom live at subsistence levels or who have no income at all.

“We have incorporated some of the infrastructure funding to be borne by developers in the Family Islands to be repaid through multiyear concessions. However, the Ministry of Finance is also tasked with structuring public-private frameworks to bring more private capital to bear on these outcomes,” Mr. Davis added.

The Deputy Prime Minister said while The Bahamas continues to meet its national and international financial obligations, the country does so “not without a struggle predicated on the basis of per capita income as the sole indicator of need.”

Mr. Davis said almost 13 percent (12.8 percent) of the population of the Commonwealth of The Bahamas is living below the poverty line.

“While it is true, from a statistical point of view, that the percentage of persons who live below the acceptable poverty line is small in relation to the overall population, especially those who reside in the urban centres, the Bahamian reality is too often, we have been denied funding because of our per capita income.”

Mr. Davis said The Bahamas has “tenaciously advocated for the revision of the definition of ‘per capita income’ as the sole criteria for access to international grant funding for over 20 years.

“We have failed in this regard because to date, we have not qualified for such grants.

This disqualification has challenged our national development in respect of infrastructure for potable water, education, electricity, healthcare, transportation, communications, and security.”

Deputy Prime Minister Davis said while other nations have to provide for infrastructure on a singular landmass, The Bahamas – because of its archipelagic makeup – “has to replicate these essential services many times over, for a small population base in many cases.”

“Dozens of sea ports and airports must be maintained and secured as critical adjuncts to tourism, trade, and retail and corporate business development,” Mr. Davis said.

To further illustrate his point, Mr. Davis said the price tag to bring Family Island airports up to international standards is more than $200 million “to firmly establish these islands as sustainable development zones.”

Mr. Davis said the government believes that the Three Ps Initiative is one that it can use to bring about the social economic and infrastructural development needed in Small Island Developing States such as the Commonwealth of The Bahamas.

He said the island of New Providence has been the beneficiary of major integrated infrastructural works through PPPs in the past – most recently the construction of the Lynden Pindling International Airport, which is fully government-owned and which was built by way of a Public Private Partnership arrangement.

That facility, Mr. Davis continued, is currently being managed by a private company. The deputy prime minister outlined other successful 3Ps ventures in The Bahamas.

“The Airport Gateway Project (provided for by a loan from the Export/Import Bank of China) and the New Providence Infrastructure Project (funded by the IDB) both brought significant build of dual carriageway roads and sorely needed utility upgrades. We have also seen a $3 billion private investment for the Baha Mar Casino & Hotel (by China Exim Bank), which we expect to open very soon. All of these constitute critical integrated infrastructure to facilitate our tourist-dependent economy.”

Mr. Davis said the government is committed “to bringing major investment to our Family Islands as we have done for New Providence.”

“Loan funding from the Caribbean Development Bank has assisted our building or upgrading of docks on the islands of Andros and Eleuthera. Similarly, investment is committed on the island of Abaco with the North Abaco Port (financed by EXIM Bank).”

Mr. Davis said the government has now turned its attention to securing significant investments in Exuma and Cat Island and the Glass Window Causeway project on Eleuthera.

“Feasibility studies, design activities and negotiations over associated funding agreements are required. Physical capital, both private and public, is also essential for stronger growth of the economy. In the public sphere, such capital of course includes roads, airports, harbours and ports and basic public utilities such as water and electricity.

“Given the great needs for investments in these areas across our nation and the fiscal constraints that we face, it is clear that this is an area in which innovative thinking and new ways of doing things are not only appropriate, but necessary [as] we simply do not have the means for the upfront financing of all of these by taking on debt through the Public Treasury.

“In this light, my government envisages an important role to be played by public-private partnerships, or PPPs, in the future development of public infrastructure in this country. And, where and when necessary and appropriate, we must also be prepared to envisage the need for users to contribute to the costs of certain infrastructural investments,” Mr. Davis added.

Written by Jones Bahamas

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