baha mar_bahamas

The Spectre of Baha Mar

Chris Sinckler, Minister of Finance

Chris Sinckler, Minister of Finance

Under even normal conditions when times are good, even in the 14 years the Barbados Labour Party was in office, not even then [would we get such a low interest rate],” he said…Very few funders…in the world would lend a developing country the size of Barbados and with the issues facing Barbados financing at the fixed rate of 2.5 per cent – Chris Sinckler, Minister of Finance signing a loan deal with Chinese Export-Import Bank of China

The government of Barbados signed what was described by Minister of Finance Chris Sinckler as a historic agreement with the Export-Import Bank of China on the 17 November 2015. The proceeds of the USD170million loan it was reported will be used to redevelop the derelict Sam Lord’s Castle property into a five star hotel by Wyndham management company. When the matter was debated in the House of Assembly the talking heads on the government side highlighted [with glee] that Barbados was able to secure the sizeable loan from the Chinese at a low fixed rate of 2.5%.

BU is not anti-investment, however, Barbadians should be concerned about a poor credit rating that has created limited options to borrow on the global capital market thus leaving the Chinese willing lenders. We have seen how the Chinese – like the others – have ‘marauded’ the African continent with an insatiable demand for natural resources. Given the geopolitical considerations developed countries use to shape foreign policy positions someone must inquire – what is in it for the Chinese given an expanding role in Barbados and the Caribbean.

There is the saying those who do not learn from mistakes made by others are condemned to repeat them.

BU has taken note that the Chinese Export-Import Bank of China (EXIM) is one of the key financial players involved in the failed hotel resort project in the Bahamas. Baha Mar is described as the largest and priciest resort in the Caribbean tagged at $3.5 billion. EXIM is also described as one of three banks in China charged with funding state sponsored projects. So far all the media reports that have chronicled the Baha Mar fiasco gives insight how a small island can be negatively impacted when the Chinese flex muscle. Then again those who support expanding the relationship will say how are the Chinese different to the Americans or Europeans. Always remember he who pays the piper calls the tune.

We should be cautious about borrowing large sums of money from the Chinese at a time we are financially vulnerable.

Those who are not familiar with the Baha Mar story follow the link – The Ghosts of Baha Mar: How a $3.5 Billion Paradise Went Bust.

Thank you to A-Fish who was a regular contributor to BU for highlighting this issue, he sends his regards to Bush Tea, Miller, Caswell, AC and the rest of the BU family.

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24 Comments on “The Spectre of Baha Mar”

  1. Well Well & Consequences2 January 6, 2016 at 7:01 AM #

    Lol….when you are inexperienced and swimming with sharks….you need a lot of bandaid.

    Like

  2. Nostradamus January 6, 2016 at 11:37 AM #

    “How it’ll end is anyone’s guess. Fernando Menendez, a senior fellow at Washington think tank Center for a Secure Free Society, says the episode says less about the Bahamas or Izmirlian than it does about China and its state-owned enterprises.

    China Exim wielded billions to guarantee work for one of its biggest customers, China State Construction. How and when that work got done didn’t really matter: Exim made sure the state-run company could never be fired. ”

    “State-owned enterprises don’t function as competitive entities,” Menendez says. “They’re protected from failure.”

    Like

  3. Well Well & Consequences2 January 6, 2016 at 11:38 AM #

    How come the yardfowls are not on here justifying Baha Mar Bahamas and 4 Seasons Barbados.

    Like

  4. Vincent Haynes January 6, 2016 at 1:11 PM #

    We must stop putting the majority of our eggs in the Tourism basket,especially the type we practice with large complexes as opposed to small Mom&Pop type operations or the AirBNB way.

    Cockroach has no right at Fowl Cock party.

    Like

  5. Due Diligence January 6, 2016 at 1:39 PM #

    David

    Great topic.

    Great link to Baha Mar story.

    Beware of Greeks bearing gifts.

    Could Sam Lords Wyndham be the second coming of Baha Mar.

    From the story.

    “Then the 2008 financial crisis hit, and would-be partners balked. When China State Construction Engineering Corp., the world’s second-largest contractor, approached Izmirlian about stepping in, he said yes. The company directed him to Export-Import Bank of China, or Exim, which promotes trade and investment under the direction of Beijing.

    Seeing a way into U.S. markets, China State Construction promptly invested $150 million. Exim kicked in $2.45 billion in construction loans — with the proviso that Izmirlian could never fire the Chinese builder, no matter what, and that workers from China would do the job. Flush with Chinese money, Izmirlian declared four Baha Mar hotels would open by 2014.”

    Will 2020 story include the following.

    “When in 2015 the GOB was still mired in or blaming the 2008 financial crisis, and would-be investors balked, China State Construction Engineering Corp., the world’s second-largest contractor, approached GOB about stepping in; and GOB said yes. The company directed GOB to Export-Import Bank of China, or Exim, which promotes trade and investment under the direction of Beijing.

    Exim kicked in $170 million in construction loans — with the proviso that GOB could never fire the Chinese builder, no matter what, and that workers from China would do the job. Flush with Chinese money, Stuart, Sinkler and Sealy declared the Sam Lords Whyndam would open by 2018.”

    Like

  6. Nostradamus January 6, 2016 at 1:45 PM #

    Didn’t Estwick say that he was looking to the Chinese to finance the West Coast Sewage Project?

    Like

  7. David January 6, 2016 at 2:15 PM #

    Didn’t Estwick say he had a mid-Eastern investor to liquidate our total debt?

    Like

  8. Exclaimer January 6, 2016 at 3:57 PM #

    @ David,

    The Baha Mar saga is a pre-cursor to a region that is on the verge of imploding.

    Our Caribbean region has very few natural resources. However it is a location that remains remarkably attractive to foreigners. They can see the true value of the Caribbean unlike the majority of Caribbean citizens and their corrupt governments.

    The world is forming a queue to take a slice of the Caribbean. Prepare yourself for a massive expansion of the region. China is currently building islands in The South China Seas. Even our very own “Road Builder” Cow Williams would like to build an island of Barbados.

    People you have not seen nothing yet!

    Like

  9. David January 7, 2016 at 4:30 AM #

     

    Then: Canada opened its markets. Now: we need a reset with China

    JOSEPH CARON

    Contributed to The Globe and Mail

    Published Friday, Jan. 01, 2016 5:00AM EST

    Last updated Friday, Jan. 01, 2016 5:00AM EST

    Joseph Caron is a former Canadian ambassador to China and to Japan, and former high commissioner to India. He is a distinguished fellow with the Asia Pacific Foundation of Canada.

    It’s time to reset Canada’s relations with China.

    Canada has always been actively and positively open to the world, because it must. For the past half-century, China has taken its place among our most important international partners, and has become central to our foreign policy. John Diefenbaker expanded trade and opened the immigration doors to China, Pierre Trudeau established diplomatic relations, and the subsequent decades have seen the development of a full panoply of people-to-people and government-to-government relations.

    http://www.theglobeandmail.com/report-on-business/rob-commentary/then-canada-opened-its-markets-now-we-need-a-reset-with-china/article27974638/

    Like

  10. David January 7, 2016 at 4:34 AM #

    An update: Is Harlequin investment still being mention by the central bank governor and members of government?

    Industry bill for Harlequin clean-up could hit £120m

    Main distributors already triggered £60m payout

    harlequin2

    The cost to the financial services industry of addressing losses linked to Harlequin Property and advisers who sold its products is likely to run to £120m, according to investors’ lawyers.

    A redress bill to cover poor advice from the main distributors of Harlequin investments has already hit £60m, figures from the Financial Services Compensation Scheme (FSCS) have revealed.

    http://www.professionaladviser.com/professional-adviser/news/2440749/industry-bill-for-harlequin-clean-up-could-hit-gbp120m

    Like

  11. David January 7, 2016 at 4:36 AM #

    BU is curious about those laptops given by the Chinese to Barbados. According to news reports the Speaker gleefully accepted the gift and promptly distributed them to the M.P.s. Were the hard drives scrubbed and software reinstalled?

    Like

  12. David January 7, 2016 at 6:33 AM #

    Some funny business unravelling in the Chinese market:

    January 6, 2016 9:24 am

    China meltdown a tale of policy mis-steps

    Tom Mitchell in Beijing

    Effort to pursue reforms while distrusting risk is a toxic mix for investors

    A man is reflected on a monitor screen displaying stock index at a brokerage house in Handan in north China's Hebei province, Monday, Jan. 4, 2016. Shanghai's stock index plunged nearly 7 percent on Monday, sparking a halt in trading of Chinese shares, after weak manufacturing data and Middle East tensions weighed on Asian markets. (Chinatopix via AP) CHINA OUT©AP

    C

    hina’s stock market meltdown reverberated around the globe this week, reviving memories of last summer’s rout and again shining a light on Beijing’s erratic policymaking.

    Attempts to stem Monday’s meltdown looked remarkably similar to last year’s ad hoc market rescue and poorly communicated currency adjustment: a medley of verbal intervention, state-orchestrated buying and extending a ban on big share sales, while simultaneously

    http://www.ft.com/intl/cms/s/0/e38af180-b410-11e5-8358-9a82b43f6b2f.html#axzz3wYNF0Qma

    Like

  13. Bush Tea January 7, 2016 at 7:18 AM #

    @ Due Diligence
    Will 2020 story include the following….
    ++++++++++++++++++++++++++++++++
    Without any doubt.
    However, by then Froon and his band of morons will be long gone from the scene and, if karma is true to form, suffering much like their late leader did in his last year…

    @ David
    We probably need not worry about those laptops. The Chinese hackers will by now be totally pissed at having to watch them all playing solitaire and logging onto BU….

    Like

  14. Well Well & Consequences2 January 7, 2016 at 7:57 AM #

    Very true, since that time of the laptop gifts, the Chinese would have figured out that they only need to remote into the computers periodically to check on which Cow-an or Del Mastros criminal Froon Froon and his gang are luring into the island for some big money scam, without the people’s knowledge. I am sure it makes for good entertainment for the Chinese.

    Like

  15. Due Diligence January 7, 2016 at 12:12 PM #

    On the subject of the Del Mastros, I see that Dean had to miss the 50th Celebration launch to return to the Great White North to try ton stay out of jail. I guess one of those empty seats, was reserved for him.

    http://www.thepeterboroughexaminer.com/2016/01/05/del-mastros-lawyer-makes-case-for-appeal-in-oshawa-court

    Like

  16. Well Well & Consequences2 January 7, 2016 at 12:48 PM #

    Lol..

    “Justice Lisa Cameron erred in that she never considered any of that, Adler said.”

    This is the only argument Del Mastro has in the hope that the conviction will be overturned. Too bad he never produced the evidence he claimed he had re evidence he did nothing wrong….tòo bad the McCarthy dude convicted with him, never appealed, by the end of today, we shall hear the verdict of the appeal in Oshawa….mmmm…mmmm..mmmm. lol

    Like

  17. Donna January 7, 2016 at 1:42 PM #

    Uh-oh!

    Like

  18. Due Diligence January 7, 2016 at 2:10 PM #

    David January 7, 2016 at 4:34 AM #

    “An update: Is Harlequin investment still being mention by the central bank governor and members of government?”

    And is the Pure Beach Resort & Spa investment opportunity still being mentioned by the Attorney General?

    https://barbadosunderground.wordpress.com/2013/09/07/pure-beach-resort-the-second-coming-of-harlequin/

    Wonder when the litigation from those who bought into that scam will start?

    Like

  19. Due Diligence January 7, 2016 at 3:01 PM #

    Del Mastro to hear results of appeal April 5

    http://www.thepeterboroughexaminer.com/2016/01/07/del-mastro-to-hear-results-of-appeal-april-5

    “After the proceedings wrapped up, Justice Bryan Shaughnessy said he wanted to deliberate.

    A date was set for April 5 at 2 p.m. for him to release his findings in Oshawa court.

    In the meantime, Del Mastro is free on bail for almost three months.

    When asked what he’ll do with that time, he was succinct.

    “Work. Support my family,” he said. “Today is my wife’s birthday, so I’ve got to catch up with her.”

    His wife Kelly and baby daughter Charlotte, who attended the trial throughout, weren’t at the appeal.

    Del Mastro is free to be with them in the interim – and that’s what he’s planning.

    “I’ll just try to be a good husband and a good father and support my family,” he said. “That’s what I’m going to do.”

    It his not clear if bail conditions permit this fine family man to to return with his wife and baby daughter to work in the Gem of the Caribbean.

    Like

  20. Gabriel January 7, 2016 at 3:11 PM #

    That Baha-mar hotel and casino was touted as employing 4500 staff!!If you want updated stuff on these chimes impostors,read Kaieteur News and what hell Guyana is going thru with a Chinese company called Baishilin,plus the inferior work this China State did in Trinidad and in Jamaica.They were on the job at 4 Seasons and making good progress when the stinking Dems bombarded the Brasstax call in programme aided by the former GS of the BWU calling for more Bajans to be hired and for the chinks to be reduced.Fuvchrs all.Now we would be happy for a 3 Seasons let alone a 4.

    Like

  21. flyonthewall January 7, 2016 at 3:39 PM #

    Why are the Chinese being so generous to Caribbean countries? Is it because they are genuinely supportive of our developmental ambitions? I don’t think so. I believe their long-term strategy is the gradual erosion of US influence in the region. The Chinese are patient: they think and plan in in terms of decades.

    Like

  22. David January 7, 2016 at 3:47 PM #

    China State construction built Queens College and the Gymnasium.

    Like

  23. racehrse January 8, 2016 at 9:23 AM #

    Pie in the sky! How least we forget that Paradise was the pre-courser to Four Seasons, and now we want to take on Sam Lords Castle . What about the Villages at Coverley. What is Wyndham putting in this venture, or will they be taking most of the profits with little risk? What about the income tax refunds that haven’t been paid for ‘2014 Mr Swindler……How much of that loan will fall into political pockets thru contracts, etc.

    Like

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