June 27, 2023
In light of the Prime Minister’s comments in parliament yesterday regarding Freeport and Grand Bahama, we feel the need to respond to licensees, residents and foreign direct investors, who have raised significant concerns about the uncertainty created by these comments.
The Hawksbill Creek Agreement (HCA) contains commitments on the part of both GBPA and The Bahamas Government. The projects mentioned by the Prime Minister yesterday, specifically healthcare, education, the airport, and the Grand Lucayan Hotel, are actually Government commitments – not GBPA commitments under the HCA.
Further, Government’s claims under clause 1(5) of the HCA are contested. GBPA is yet to be satisfied that the Government’s purported claims, which have lain dormant for more than 50 years, are justified and supported by credible evidence. They are, however, being reviewed and will be fully addressed.
We would add however, that the claims under this clause, which has not been amended since 1965, when Freeport was in its infancy, have little relevance today. At the time, Government merely collected Excise Tax; today, they extract a multitude of additional taxes which include, but are not limited to, cruise and airport passenger taxes, environmental taxes, road taxes, room taxes, as well as import/export duty and VAT, to name but a few. It is also an anomaly to ask the GBPA to fund the Ministry of Grand Bahama. The fact of the matter is, Freeport has always been, and continues to be, a net contributor to the Bahamas Treasury, despite the increased Government imposed bureaucracy and red tape, in breach of the HCA, which has held Freeport back.
GBPA remains focused on advancing the economic and social development of Freeport, despite these challenges. The licensees and residents of Freeport, however, also deserve a ‘New Day’, where Government and GBPA are working together, positively, to propel Freeport’s economy forward and ensure a positive future for all residents and licensees. The HCA’s huge potential can only be achieved if Government is willing to work collaboratively with GBPA.
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