Bahamas News

Refusing to accept any blame for the decision by Harrah’s to abandon its celebrated joint venture partnership with Baha Mar Development Company, former Prime Minister Perry Christie on Tuesday accused Prime Minister Hubert Ingraham of “sabotaging” the Cable Beach redevelopment deal and “pronouncing a sentence of death” on the arrangements the two companies had.

Mr. Christie called a press conference on the matter at the Office of the Leader of the Opposition on Parliament Street, but refused to answer any questions from reporters after he made a statement.

That statement came a day after Prime Minister Ingraham laid out in the House of Assembly what he said were the facts surrounding the decision by Harrah’s to pull out of the deal last Thursday.

He defended remarks he made in the House last week, expressing doubts about whether the $2.6 billion Baha Mar project would proceed as planned.

As reported by the Bahama Journal on Tuesday, the prime minister characterized his remarks made last week as an attempt to address unrealistic expectations.

“There has been a lot of hype about the Baha Mar project, and expectations for the project and from the project are high on the part of many persons in The Bahamas,” he said.

“Knowing what I knew last Wednesday, I sought to begin to dampen public expectations of a project whose commencement was likely at best to be delayed. In doing so, I chose to state an incontrovertible fact: I was not satisfied that the funding arrangement for the project was in place.”

But Mr. Christie on Tuesday accused Mr. Ingraham of misleading the country on the matter.

He said Mr. Ingraham’s own words spoken in parliament on Monday betray him.

“By his statement [on Monday] to the House, he became aware of the problems on the 3rd of March. Yet he came to parliament on the 6th of March to ask for the deal to be approved by parliament acting as if nothing had happened,” Mr. Christie said.

Last week, members of parliament debated a resolution to authorize the treasurer to transfer certain government land to Baha Mar pursuant to its agreement with the government.

They passed the resolution on Thursday, but Mr. Ingraham made it clear that the land would not be transferred right away.

In its letter to Baha Mar terminating its arrangements, Harrah’s pointed to the land issue as a key concern.

Mr. Christie said that now that deal has gone sour, the prime minister argues that his “ill-considered language” last week was used to lower the public expectations because he knew the deal was in trouble.

“The prime minister should have come clean on the 5th of March, postpone the House and work with the joint venture partners to ensure that the deal would succeed. That is what a real prime minister would do. Instead he sabotaged the deal,” he said.

“Further, the prime minister’s statement in the House of his having doubt in Baha Mar’s ability to implement the project was a lack of good faith by the government, as a joint venture partner with Baha Mar; thereby, undermining the confidence of other investors in The Bahamas.”

Mr. Christie said that to request the parliament to authorize the transfer of public lands to the Baha Mar project, while voicing a lack of confidence in the project, demonstrates that either Mr. Ingraham lacks the sound judgment expected from a prime minister or that he is motivated by something other than the national interest of The Bahamas.

“Try as he might to twist the story and make it the fault of the PLP, the prime minister must own up to his faults and his ill-considered language spoken in parliament on the 5th of March. He must accept the blame and responsibility for setting back, if not killing, what promised to be the largest single development in our history,” Mr. Christie said.

The former prime minister noted that PLP MPs “warned” Mr. Ingraham that his language would have such an effect.

“The record shows that our warning was ignored,” he said. “It is now clear that if the Cable Beach project fails, it will be Mr. Ingraham’s own fault.

Mr. Christie also said, “The fact of the matter is that in his anxiety to show that he was smarter than the PLP and could come up with a better deal, the prime minister may actually have ended up pronouncing a sentence of death on the whole Harrah’s/Baha Mar joint venture, by fundamentally changing the approach to the land transfers.”

He stressed again that the prime minister’s action in the House of Assembly was the critical element in the decision of Harrah’s to leave The Bahamas.

In its letter to Baha Mar, Harrah’s pointed to numerous factors that led to its pullout, including long delays.

“The long delays in reaching agreement with the government and completing the assemblage of the relevant land rights have contributed to considerable doubt about whether the project can be financed at all given the continuously deteriorating debt markets,” wrote Charles L. Atwood, a Harrah’s executive.

Mr. Christie noted that there were indeed other factors than Mr. Ingraham’s comments, but he insisted that the prime minister’s “intemperate language” and the fear that the land conveyances were in doubt “were the straws that broke the camel’s back.”

He accused Mr. Ingraham of seeking to “cover up, confuse and gloss over the truth.”

“Mr. Ingraham wrecked the deal,” the former prime minister asserted.

He said the Opposition feels for the Izmirlian family (the Baha Mar developers), and is gravely concerned about Bahamian contractors and others who would have benefited from the development.

“We are also deeply concerned about the present employees at the casino at Cable Beach, some of whom are now working just two days per week,” Mr. Christie said.

“We must also consider the fate of those thousands of high school leavers who look forward to the jobs that this project was to create.”

The former prime minister urged the media not to fall prey to “the prime minister’s spin trap, which seeks to assign blame where it does not belong.”

Mr. Christie insisted that the Baha Mar project is “in deep trouble.”

“The PLP nurtured this project, kept the parties together, and kept the deal alive,” he said.

“Within 10 months, the government of stop, review and cancel has now placed the livelihoods and well being of tens of thousands of Bahamians at risk simply because they cold not see their way clear to approve a project left behind by the PLP.”

Mr. Christie said the project cannot and should not fail.

Source: Bahama Journal

In what could be described as an attempt to save the Baha Mar deal, Prime Minister Hubert Ingraham announced in the House of Assembly on Monday that his government would proceed with the Baha Mar approvals process as though the developer had a joint venture partner.

Mr. Ingraham said his administration would, by this process, seek to put Baha Mar on the best possible footing to either attract a new joint venture partner or revive its relationship with Harrah’s.

Much has been made of the prime minister expressing his doubts in the House of Assembly last week about the ability of Baha Mar to finance the redevelopment project.

Harrah’s, for example, cited the remarks as part of its reason for pulling out, and the Official Opposition PLP says the PM’s remarks were “reckless.”

Mr. Ingraham defended his remarks of last week by tabling correspondence between Harrah’s, Baha Mar and the government of The Bahamas that called into question the ability of the Cable Beach redevelopment to go forward.

He tabled a March 6 letter from Harrah’s Vice Chairman Charles Atwood to Baha Mar, laying out some of the casino giant’s issues, which states right off the bat that Harrah’s has concluded after lengthy evaluation that the Baha Mar project is unlikely to succeed as currently structured.

Harrah’s cited “long delays in reaching agreements with the government on completing the assemblage of the relevant land rights” as cause for “considerable doubt about whether the project could be financed at all.”

“These delays also raise grave concerns about increased cost and risk, and create apprehension about your ability to execute in a timely manner. When coupled with Prime Minister Ingraham’s comments to the House of Assembly (on Thursday) we do not believe the land will be delivered to the joint venture as planned,” Mr. Ingraham quoted, reading from the letter.

“As you are aware,” he continued to read, “this issue has been of utmost importance to us from the inception of our negotiations, as without these land conveyances the project cannot proceed.”

Mr. Ingraham read the entire letter into the record, which concluded by noting that there were a number of conditions between Harrah’s and Baha Mar that had gone unmet.

The prime minister characterized his remarks made last week as an attempt to address unrealistic expectations.

“There has been a lot of hype about the Baha Mar project, and expectations for the project and from the project are high on the part of many persons in The Bahamas,” he said.

“Knowing what I knew last Wednesday, I sought to begin to dampen public expectations of a project whose commencement was likely at best to be delayed. In doing so, I chose to state an incontrovertible fact: I was not satisfied that the funding arrangement for the project was in place.”

Mr. Ingraham differentiated carefully between his concerns about the challenge in financing the Baha Mar project versus the financial soundness of the principals of the project, the multimillionaire Izmirlian family.

The prime minister explained that until he got a phone call and later an email last Monday night (March 3), the government had no idea that there were difficulties between Baha Mar and Harrah’s. He explained that plans for a March 18 groundbreaking ceremony featuring Baha Mar, Caesars and Harrah’s executives had been scheduled that day.

“That same night, just after 8pm, I was telephoned at my home and informed that Harrah’s was reconsidering its involvement in the project in light of ‘the prevailing financial climate’ and that ‘the new owners of Harrah’s were considering walking away from the deal in The Bahamas,’ and that ‘a decision was likely to be made within 48 hours of Monday the 3rd of March,’” Mr. Ingraham said.

“That’s before I spoke in the House. Two days before we came to the House to speak.”

Apollo Management and Texas Pacific Group are the new owners of Harrah’s having bought the company for tens of billions of dollars, and taking it private earlier this year. And, as Mr. Ingraham noted in the House, Norwegian Cruise Line is considering buying the company now.

The prime minister told the House his government fully supports Baha Mar in its commitment to redevelop the Cable Beach strip.

“Yes, we are going to continue with the resolution in the Senate once it’s passed here. We will do all that we are supposed to do to put Baha Mar in the best position to proceed with finding another joint venture partner, or going back and talking to Harrah’s,” he said.

Referring to the resolution that would effect the transfer of government land to Baha Mar, the prime minister said, “No land will be transferred until the requirements that set out in the agreement have been satisfied. But Baha Mar is perfectly entitled to seek a new joint venture partner to meet the requirements of the agreement of 2005 and the supplemental agreement.”

“And we will give Baha Mar all the support that we can,” he added, “to permit them to seek to find a replacement joint venture. We will not seek to exercise any rights we may have (now) that they do not have a joint venture partner.”

He said the government would continue to treat Baha Mar as though it has a joint venture partner until the March 2009 deadline, by which time the company is expected to “deliver.”

The prime minister also sought to assure Harrah’s that it is welcome to invest in The Bahamas at any time.

Source: Bahama Journal

The Bahamas Telecommunications Company (BTC) has launched a new feature – international texting – as part of an expansion in cell phone services designed to keep up with customer expectations.

It means Bahamian cell phone users will be able to text persons on other networks such as DigiCell, Cable and Wireless, AT& T, Verizon, Sprint, or T-Mobile.

Marlon Johnson, Vice President of Marketing, Sales & Business Development, told the Bahama Journal the demand for new features is extremely high, both on the cell phone side and land-line services.

BTC did a soft launch on the new service on Wednesday, but Mr. Johnson explained that there would be a phased approach to full implementation.

He said the introductory rate for the new service will be 15 cents for this month only and then it will go up to 25 cents.

“The 25-cent rate is the standard rate across the region for texting customers in other jurisdictions. We felt necessary to add this feature as we are moving away from the TDMA system to the GSM system,” he said.

The complete crossover is expected to take place by the end of September.

“Eventually we hope to expand the service to include over 200 countries and more telephone networks but we just want to test it right now with those few networks,” Mr. Johnson said.

Mr. Johnson explained that once a person has text messaging on their cell phone they would automatically be able to access the service.

“We are trying to evolve as a company and need to be able to meet our customers needs,” he said. “In that effort we are about to launch some new features to provide better customer services.”

Mr. Johnson said BTC would be launching more of these new features this month pending approval from the Public Utilities Commission (PUC).

“We are trying to create new rates for late night talking and the like and also to give bonus minutes for persons who buy a certain denomination phone card,” he said.

“The higher the denomination of minutes you buy, we will give you an extra bucket of minutes because we are trying to do that to reward customers who have been very loyal to us.”

Mr. Johnson also told the Journal that the company is upgrading its voicemail platform services for cell phones and land line systems.

“We are asking customers to go through their voicemail systems and take out any important information they need because we are going to upgrade the system. What will happen is that messages more than seven days old will be automatically deleted,” Mr. Johnson said.

Mr. Johnson said he would advise customers to start looking at their voicemails as of Friday before the automatic deletion takes place in the company’s system.

He also said that passwords and access numbers would stay the same.

Source: Bahama Journal

Businessman Dionisio D’Aguilar has a simple solution to the illegality of Bahamians who are intent on flaunting the law and gambling: legalize it.

He advanced the position Monday that the government should remove the legal impediment to gambling for locals and accrue revenue through taxation.

“Let’s get on and get over this topic. It is so rife. It’s everywhere in this country. Everyone is gambling. Everyone sees it. It’s happening in the country and the government isn’t making one dollar off it,” said Mr. D’Aguilar on Monday while on the Issues of The Day talk show on radio Love 97.

“I don’t care what the churches say – and I may be controversial here. It’s happening and I don’t know where you live, but I live on this island. I see all the web shops.”

Mr. D’Aguilar, who is also the president of the Bahamas Chamber of Commerce, said the chamber does not have an official position on gambling since it has not yet considered it.

Gambling has been a hot button topic in The Bahamas for many years with many Bahamians participating in the operation and the religious community blasting its very existence.

Although there is a level of taboo surrounding illegal numbers houses, they are well known, with some of the operators even heading well-organized Internet operations.

During a recent debate on crime in the House of Assembly, Prime Minister Hubert Ingraham suggested that gambling for Bahamians should be legalized since it appears to be such a challenge to enforce the laws against it.

“The reality is that it is not an enforceable law and the society is doing it every day. There’s a web shop here and a web shop there, all over the island,” Mr. Ingraham said at the time.

“…There are web shops in Abaco, web shops in Bimini, web shops in Exuma. It’s nationwide.”

The prime minister also touched on the question of a national lottery. He said “…you might as well legalize the whole thing since you can’t enforce it.”

However, the Bahamas Christian Council responded promptly to the prime minister’s comments and its head Bishop John Humes insisted that the government should observe the laws of the land.

“To say that everyone is doing something, especially illegal, should be reason to legalize them, then God help us. If this is our rationale for operating our country, then what is next? I urge the prime minister to have the courage and will to do what is right in the sight of God and written in our constitution and laws.”

The bishop also called for legislation to be put in place to control the amount of web shops that are opening, adding that The Bahamas is currently under a strong attack of lawlessness.

But despite the objections, Mr. D’Aguilar expressed no reservations about legalizing gambling for Bahamians. The law allows for tourists to gamble.

“Everybody knows who’s doing it. Everybody knows what’s happening. Let’s figure out a way to regularize it and get some revenue out of it. I support it 100 percent. That’s my personal opinion and not the opinion of the chamber,” he said.

While he was chairman of the Gaming Board, former PLP MP Kenyatta Gibson reported that The Florida Lottery conservatively estimated that US$100 million is spent every year by Bahamians playing the Florida Lottery.

Mr. Gibson further suggested at the time that this money could be kept in The Bahamas.

One conservative estimate is that 29 web cafes in New Providence believed to be operating illegal numbers houses have business licenses.

Source: Bahama Journal

In the latest twist to the debacle surrounding the pullout of Harrah’s from the Cable Beach re-development deal, Baha Mar on Monday made public the letter Harrah’s wrote the company last Thursday announcing that it was abandoning the partnership.

The letter confirms that Harrah’s did indeed point to comments made by Prime Minister Hubert Ingraham in the House of Assembly last Wednesday as one of the reasons it was pulling out.

But in a statement it released to the press on Sunday, Harrah’s did not list those comments as a reason why it was terminating its arrangements with Baha Mar.

The company said in the Sunday statement it greatly appreciated the efforts and cooperation of the Bahamian government throughout the negotiation process that led to a signing of an agreement confirming its involvement in the $2.6 billion project as one of Baha Mar’s joint venture partners.

“There is no question that Prime Minister Ingraham was committed to the project and recognized its potential contribution to his nation’s economy,” the Harrah’s press statement said.

But in its letter to Baha Mar, Harrah’s said given comments made by the prime minister in the House of Assembly, it had doubts about government land being turned over to Baha Mar in accordance with Baha Mar’s heads of agreement with the Government of The Bahamas.

On Wednesday, the prime minister said the passage of the resolution in parliament would not mean the government would immediately transfer the land in question.

“All it means is that Parliament is authorizing us to do so,” Mr. Ingraham said. “The land will only be transferred if and when Baha Mar honours the deal. And if the deal is not honoured by March 2009, then there will be no deal.”

He added, “We expect that the benchmarks which have been agreed will be honoured. The first benchmark is March 18; that is not going to be met and I would doubt that the benchmark for next month is going to be met.

“But I am not unduly concerned about the individual monthly benchmarks. I am concerned about the cumulative total – March 2009. When we arrive at that point it is either a deal or it is not a deal.”

In its letter, Harrah’s pointed to long delays that were already affecting the project.

“The long delays in reaching agreement with the government and completing the assemblage of the relevant land rights have contributed to considerable doubt about whether the project can be financed at all given the continuously deteriorating debt markets,” wrote Charles L. Atwood, a Harrah’s executive.

“These delays also raise grave concerns about increased costs and risk and create apprehension about your ability to execute in a timely manner. When coupled with Prime Minister Ingraham’s comments to the House of Assembly [Wednesday], we do not believe the land will be delivered to the joint venture as planned. As you are aware, this issue has been of utmost importance to us from the inception of our negotiations, as without these land conveyances, the project cannot proceed.”

In the House of Assembly last week, Mr. Ingraham also said that while he believes Harrah’s has the means to carry out the Cable Beach project, he was not satisfied that Baha Mar had the financial resources to do so.

Harrah’s also pointed to these comments in its letter to Baha Mar.

“When we entered into the Sub scri ption and Contribution Agreement on January 12, 2007, we expected that you would satisfy all the necessary conditions no later than June 30, 2007. That did not happen,” Mr. Atwood wrote.

“You requested an extension until December 31, 2007, which we granted on several conditions set out in a letter agreement on October 4, 2007. The December 31, 2007 deadline came and went as well. At your request, we had considered another extension prior to that date, but discussions failed because you were unwilling to resolve disputes that had arisen between us.

“As of today (March 6, 2008) conditions remain unsatisfied and the prime minister has publicly stated that he questions your financial wherewithal and ability to meet the deadlines imposed by the government, both of which are crucial to the success of the project.”

But Harrah’s did not completely close the door on any possible future involvement in the Baha Mar project.

Mr. Atwood wrote, “Please be aware that if you are able to resolve these issues and continue with Baha Mar, we hope you will consider exploring alternatives by which a Caesars-branded casino and hotel might be included in the project.”

Late Monday afternoon, Prime Minister Ingraham read the letter in the House of Assembly and also tabled it.

He said that he learnt on Monday March 3, 2008 that Harrah’s was reconsidering its joint venture arrangements with Baha Mar. The prime minister noted that that was two days before he commented on the Baha Mar deal in the House.

Mr. Ingraham said he was merely seeking to dampen the public’s expectations about the Baha Mar project.

Source: Bahama Journal