Fidelity Bank & Trust Chief Financial Officer Gowon Bowe yesterday criticized the Minnis administration as being “disingenuous” in including a $975 million loan offer in its announcement of $1.5 billion in pledges received for Hurricane Dorian relief efforts, saying there is nothing wrong with a company saying it has funds to lend, but that government should be upfront about what the $1.5 billion is.
“I would use the term ‘disingenuous’ because I think any financial person would appreciate there’s a very distinct difference between what I’m going to call ‘subvention donation’ and lending,” Bowe said.
“And lending is certainly not free money, whereas donations and pledges are considered to be free money. So, it would be disingenuous to either term it as a pledge or to leave the perception that it is a pledge or a contribution and donation. It should be very clear.”
He added, “I think we should clearly say that we have persons who are prepared to make contributions with no strings attached, no repayment terms – those are pledges and donations; [and] we have persons who are prepared to provide, I’m going to say ‘concessionary lending’, which may be on very favorable terms, but they are indeed that – lenders, not donors.”
On Monday, government, in conjunction with the United Nations Development Programme, held a conference to raise money for recovery and reconstruction following the catastrophic Category 5 storm which devastated parts of the northern Bahamas in September.
In a press release after the conference, the Office of the Prime Minister did not indicate that the lion’s share of those “pledges” represented loans, but it did say, “The pledges included initiatives in homebuilding and repair; educational assistance; renewable energy partnerships; relief aid; grants; direct assistance to storm victims; parks restoration; loans and financing.”
It was later discovered that $975 million of the $1.5 billion constituted a loan offered by U.S.-based The P3 Group, Inc (P3).
Disaster Recovery Authority Managing Director Katherine Forbes-Smith told The Nassau Guardian that P3 made it clear that it was a loan from the start, but that no decision has yet been made as to whether any portion of the loan offer would be accepted.
She also said that by the end of this week, a complete breakdown of all the pledges received will be posted publicly “so people could see what this $1.5 billion looks like”.
Bowe said, “There’s no embarrassment, there’s no, what I’m going to say, negative connotation to the fact that you have persons who are prepared to provide financing and funding on the specific terms.
“And you should look at that as no different than saying that if I went out to the global markets and had to raise money. So, I think we need to be candid; we need to be honest in our assessment of what the monies are…”
When the government-UNDP conference was announced last month, the prime minister said the government was “quite urgently” seeking to raise funds “to complement the government’s $10 million already given for home repairs”.