National ReviewUncategorized

A sober look

There is a strongly held view in certain segments of the country that there are billions of dollars in natural resources waiting to be exploited.

The view held by many is it would save The Bahamas from economic damnation, give all of us a superior quality of life and preserve the same for future generations of Bahamians — if only the powers that be would tap into these God-given resources and act in the best interest of the people.

Just about daily in the social media sphere and on talk radio, we hear the familiar call for the country to seize its natural resources. Many hold the view that foreign elements are the ones benefitting from this supposed birthright while Bahamians are left with the scraps.

Many believe that successive administrations, which face an increasing debt burden, are turning a blind eye to this obvious national wealth, instead choosing to bury us deeper and deeper into debt and make the task of repaying more onerous for our children and their children.

The debate, sadly, is often based on emotions and not facts.

In the last few days, a document purported to be from the United States Custom and Border Protection made the social media rounds.

It claimed that 119 individual shipments of limestone, including limestone sand, from Freeport, was valued at $5.4 billion. This so-called analysis suggested a value of $1.31 per kilogram.

We could find no evidence to suggest this information had any grounding in fact.

One of the companies listed on the purported U.S. customs document, actually says in its Securities and Exchange Commission filing that limestone sales were at $16 per ton.

Still, some commentators suggested The Bahamas is being stripped of its limestone resource without reaping the benefits due.

In the absence of hard evidence, others are not so convinced, however.

One Facebook user questioned: “…How evil and ignorant do they really think successive governments are not to reap the benefits? Would not such a bounty result in a happy people and staying in power forever? The only product we have had pass through these islands in that quantity and at those prices has gone up people’s noses.”

Still, the number of Bahamians who seem to believe that limestone could reap such a bounty is astounding.

Widespread distrust of those in authority means that even when they are shown that the resources are not as valuable as they are being made to believe, they do not believe what government officials say to them.

While some will take the time to do their own research, as they soberly seek the facts on these matters, others, perhaps due to intellectual laziness, or to preconceived ideas that they are not open to moving away from, are just not interested in an evidence-based approach to this matter.

We have seen this before.

In 2014, The Bahamas National Citizens Coalition, the National Congress of Trade Unions of The Bahamas and others claimed that aragonite was selling for $900 per metric ton on the open market, but the government was only getting $2 per metric ton.

We decided to do our own research.

Sandy Cay Development Co. Limited, the company that was mining aragonite at Ocean Cay at the time, provided invoices to us that showed they were selling aragonite on the open market for $12.50 per metric ton.

Company President Tony Myers at the time estimated that the resale cost of aragonite — after his company sold to U.S. companies and they completed the refining process — increased to around $75 per metric ton for the glass market and up to $400 per metric ton for the plastics market.

“It takes a huge amount of labor, specialty equipment and electricity cost to take this mineral down to a size of three microns — a very, very small particle size, basically the size of smoke,” he said.

Aragonite is a naturally occurring unique carbonate mineral found in abundance in our ocean.

We were told by the citizens coalition of union leaders, pastors and civic activists that Bahamians were being raped by developers mining our precious natural resources — and that successive governments signed sweetheart deals with investors ruthlessly scarring our environment to our detriment.

The series we did on aragonite, backed by days-long research, was a great learning experience.

Around that time, Kenred Dorsett, who was minister of the environment, said the government was conducting a review of the country’s aragonite sector and how we can reap greater benefits from our natural resources in general.

He said experts in his ministry had confirmed to him that the numbers being quoted by some activists relative to the value of aragonite were inaccurate.

“The aragonite issue is quite huge in terms of what we believe the potential represents for the country,” he said, “particularly if you look at the value-added component.”

While Dorsett committed to “leading by science”, he never presented his promised report to Parliament on the country’s natural resources.

In 2018, the new environment minister, Romauld Ferreira, said the Ministry of Environment will present a paper to Cabinet on aragonite and put forward recommendations on its sustainable use.

“The Ministry of Environment has really been looking into aragonite and its economic value, where it’s found in The Bahamas and how sustainable it is,” Ferreira said.

He said the Minnis administration intended to have a “rational discussion” on how to best utilize this resource for the benefit of all Bahamians.

“What we can see from the study thus far is that The Bahamas can definitely earn more royalties, but it will not make everybody a billionaire.”

That was June 2018.

In June 2020, Ferreira said while there is no denying The Bahamas’ vast resources of aragonite, the science shows it takes too long a time to develop naturally for it to be mined on a large scale.

“The results are clear and we need to have a serious discussion about this and we need to bring some level of reason to the whole debate, putting aside emotion and how we want it to be and accepting it for what it is,” he said in Parliament.

“The resources are vast; nobody can deny that. They are abundant to our country; nobody can deny that, but the data suggests, raw data, scientific data both by university and government-commissioned study suggests that aragonite doesn’t produce quickly enough.”

Ferreira also told Parliament, “Any potential mining area, once stripped of aragonite, will take hundreds of thousands of years to recover. Ocean Cay, where mining occurred for 40 years, shows no sign of recovery.

“This is why the government placed a moratorium on aragonite mining to better understand the processes. This is why my ministry, in June 2018, submitted a mining policy and draft legislation to the Office of the Attorney General for review.”

A broader look

 Of course, aragonite is not our only natural resource.

Last week, Centreville MP Reece Chipman, a former FNM and now an independent MP, won approval for a select committee of Parliament to investigate all matters relative to the natural resources of The Bahamas, and to, among other things, “suggest the best ways to ensure that the birthright of every Bahamian is legally protected”.

The seven-member select committee (which includes four government members) is also empowered to recommend to Parliament mechanisms to enhance accountability and transparency in awarding contracts for exploration and extraction and receipt of disbursements.

“We can only be empowered when we first have knowledge, and this select committee will bring the knowledge to the people,” Chipman pledged.

He pointed to the Sovereign Wealth Fund Act, the purpose of which is to save and invest surplus funds derived from oil, gas, minerals and other natural resources to provide a heritage for future generations of Bahamians.

“The Sovereign Wealth Fund Act (passed under the previous administration) created a framework for use of the country’s natural resources for sustainable economic growth and development,” Chipman noted.

“And, although it was largely spurred on by increased interest in oil exploration, it provides the framework to tap into revenue from other natural resources, potentially reopening the national discussion on resources such as aragonite and sand.”

Chipman said based on the act, we should have $4.5 million in the Sovereign Wealth Fund.

But we are not aware of any such fund ever being established. Further, what positive cash flow does our government have to put into such a fund?

In moving for the establishment of the committee, Chipman said, “Let’s get the Sovereign Wealth Fund working. Let’s get our laws giving The Bahamas and its people what they deserve.”

The select committee has until October 1 to present its report. That is a short window.

It will be interesting to see what the committee comes up with and whether its findings will have any traction.

Chipman joined a group of protesting Bahamians on Independence Day last Friday, demanding that Bahamians have more benefits in their country.

Some of the protestors have been among the more outspoken individuals in support of The Bahamas reaping a bounty from its natural resources.

Chipman previously tabled in Parliament a petition to the government to establish a Ministry of Natural Resources. It was signed by 25 Bahamians from across the country.

We look forward to a factually-based report being presented by the select committee and hope the environment minister, too, will widely circulate his own ministry’s scientific look at this whole issue.

It is time for us to put to rest fairytale views of getting rich quick without any hard work or investment. Believing in pie-in-the-sky propositions without sound reasoning or evidence that can be accessed by all is foolhardy.

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