A leading financial executive yesterday told The Tribune The Bahamas would face “disaster” if it signed the Free Trade Area of The Americas Agreement (FTAA) as the treaty would enable multinational corporations to enter their nation and lever their economies of scale to eliminate domestic competition, stifling entrepreneurship and pushing many small businesses into extinction.
In an exclusive interview with The Tribune, Lester Turnquest, former FNM MP for Malcolm Creek, said that with the Bahamian economy being 90 per cent service based he could see no benefits to this nation from participation in the FTAA, arguing that this nation would be “absorbed and marginalised” by the treaty.
Mr. Turnquest said: “I think it would be, and I don’t want to be dramatic, I think it would be disastrous for The Bahamas to sign on to the agreement in its present form.
Aside from the likelihood of having to reform itstaxation structure, eliminiating or reducing the customs duties that provice 60 per cent of government revenue, Mr. turnquest said the treaty would create further problems by allowing foreign companies to bid for government contracts and apply for loans from The Bahamas Development bank.
The former MP, who is a senior executive with the Britannia Consulting group, said: “The impact is as follows. Firstly no Bahamian is assured of winning bids on local government works and in addition to that, there is doubt companies from larger countries like the US and Canada – Brazil is another major player – their corporations are huge and have economies of scale not available to The Bahamian contractors.
“The result is that Bahamian companies would not compete, Bahamian workers are likely to become unemployed, and Bahamian entrepreneurship is stifled.”
Although The Bahamas and other small economies have been promised $140 million in financial assistance by the US at the recent Quito summit, earmarked for use in analysing and preparing these countires for the FTAA, Mr. Turnquest described the amount as “peanuts” as it would have to be shared between several nations.
He added: “That’s a handout. Countries don’t want a handout, they want a hand up. They don’t want to go cap in hand to larger countries; they don’t want the US and Canada to take care of them. They want to be able to develop.”
Claiming the FTAA would increase the power of multinational companies “tenfold” Mr. Turnquest said: “I believe many small businesses will cease to exist under the FTAA simply because government policy that now seeks to protect smaller entities through, for example, food stores between a certain square footage being able to open at later hours and on Sundays, that kind of service policy will not be acceptable under the provisions of the FTAA as you cannot discriminate.”
The FTAA could pose further dangers here if its rules and laws superceded Bahamian law, as court decisions would be overturned at a court established to oversee the Hemisphere-wide agreement.
National sovereignty could also be threatened if the FTAA included similar provisions to the North America Free Trade Agreement (NAFTA), which allowed mulitnational companies to sue governments if they imposed laws that harmed profits. In that situation Mr. Turnquest said power would be transferred form elected Bahamian MP’s to the mulitinationals and unelected group of bureaucrats.
He added that although the best scenario would be for the FTAA to be remodelled to suit the needs of The Bahamas, Switzerland’s economy had continued to succeed despite being outside the European Union.
Mr. Turnquest said: “The Bahamas that we know today will cease to exist and the new Bahamas will not be what the vast majority of Bahamians want to have. There is no doubt that The Bahamas will simply become a province or state of larger countries.”
By Neil Hartnell, The Tribune
