So did my suggestion have any merit, Mr. Cox?

It certainly did have merit. You should note however, that tourism and services represent the largest industries on earth. They fuel everything including agriculture. I really don't believe the agro industry will ever be big in the Bahamas.The pay is too low. The natural link for us is banking and tourism. What I think we could do is create an industry that'll maintain our food reserves with respect to specific products like potatoes, onions and tomatoes in case another 911 happens in America and we are unable to buy food. The point is; our economy is already diversified. Most Bahamians confuse diversification with security and reserve building. We should build up our cash reserves so that we have enough US$ for 12 months of expenses instead of the usual 2 - 3 months. And we should also build food reserves as well. Food planning as a leadership skill in the Bahamas is long overdue.

Thanks for your comments and regards,
Lester R. Cox, MA, LL.M

I really don't believe the agro industry will ever be big in the Bahamas.The pay is too low.


Au contraire, mu good friend. Do you ever read the wisdom of Peter F. Drucker? He talks about paradigm shifts in industry that change the whole situation. One of his examples is the automotive tyre cord example. The tyre cord industry was dominated by one player. They grew smug, and they could never see the need for change. Then came the paradigm shift - Michelin invented the steel belt radial, and within two years, the vast tyre cord company was gone.

We are living a paradigm shift right now. The internet became commercially widespread in 1992, and it changed the way that we communicate and express ideas. There is a paradigm shift in the agro business right now.

For starters we have an ideal climate with the sunshine and warmth for most of the year. Agriculture is undergoing a revolution. There is now the field of tissue culture, where not whole plants are grown for their goodness, but just the tissue that produces it. For example, just the cells that produce the savoury parts of spices are grown in a large bio-reactor housed indoors. Such a deployment produces the same amount of spice as a conventional farm a few hundred acres in size, in half the time. Look at the huge hydoponic farm set up to cater to the domestic market. There are many many opportunities in agriculture, but it requires vision and technology.

Technology doesn't stop at growing things. We have excellent sea ports. Technology now processes agricultural products using nanotech and super-critical fluids for stuff like coffee and chocolate processing. The jobs are skilled and high paid, and the Bahamas could be a world leader if it wanted to.

There will be many paradigm shifts, and with just tourism and banking, we will be struggling behind the curve forever.

Sounds good, sounds like the future. I love Drucker's work. You are absolutely right, we are in the middle of the largest paradigm shift in the history of mankind. Information and brainpower makes the agro and industrial economies less powerful and less important. The real value is in services and creating experiences for affluent markets. Most of us see service wrong, service is not only me to you, it is also, me to groups of people and it is also the marketing and presentation of ideas and experiences. Farming is not and will never be the next big thing unless of course farmers find a plant that can keep us young and healthy forever and even then, the value won't come from the plant (raw material), it will come from marketing and packaging. Services and creating unique experiences rule my friend. Now before our readers get me wrong, let me state for the record; we should not be resting on our laurels (banking and tourism), we should be exploring ideas in agro from good people like yourself. However, we should keep our 'good' eye on the value ball.

First of all, our banking system is all wrong to create millionaires. Bahamians do not have access to venture capital or domestic merchant banking (there was a venture capital fund announced by Carey, but it is of the micro-cap variety).



Can you explain excatly what is Domestic Merchant Banking and the micro-cap venture capital fund please? I don't know alot about banking/investing terms and I am curious.

Let me remind you, we have loads of millionaires in the Bahamas. We can perhaps fine tune the system and make it easier for smaller players to play but the system works fine. I would love to see us become a real international banking center like New York where transactions can begin and end in the same spot. Most of our international transactions clear through America and Europe. It would be a real strategic advantage if we could do transactions with Mexico and Brazil without the Americans.

I really don't know what Domestic Merchant Banking means but merchant banking is generally understood to mean private financing of deals like buying companies, financing to start or expand businesses, bridge loans like financing certain deals like stock purchases, bond issues etc. The term is historical and was that part of banking that dealt with wealthy merchants and their families. I don't know of any Domestic Merchant banks in Nassau, but a whole lot of private partnership investments happens in the system. As to micro-cap fund, the small business group was agitating for such a fund for a long time that would help people who wanted to start small businesses find easier access to capital. I think the Government is considering funding it with about $1,000,000 and according to published reports; they are looking for an administrator. In fact, I will call Marlon Johnson from Colina and secretary to the small business association to find out what's going on. (Ring, ring). He told me that the Government will select an administrator shortly and the fund should be a go soon.

Regards,

I really don't know what Domestic Merchant Banking means but merchant banking is generally understood to mean private financing of deals like buying companies, financing to start or expand businesses, bridge loans like financing certain deals like stock purchases, bond issues etc. The term is historical and was that part of banking that dealt with wealthy merchants and their families. I don't know of any Domestic Merchant banks in Nassau, but a whole lot of private partnership investments happens in the system. As to micro-cap fund, the small business group was agitating for such a fund for a long time that would help people who wanted to start small businesses find easier access to capital. I think the Government is considering funding it with about $1,000,000 and according to published reports; they are looking for an administrator. In fact, I will call Marlon Johnson from Colina and secretary to the small business association to find out what's going on. (Ring, ring). He told me that the Government will select an administrator shortly and the fund should be a go soon.

Regards,


Thanks for the info. Mr. Cox. I hope to see developments in due course.

Technology doesn't stop at growing things. We have excellent sea ports. Technology now processes agricultural products using nanotech and super-critical fluids for stuff like coffee and chocolate processing. The jobs are skilled and high paid, and the Bahamas could be a world leader if it wanted to.


I don't get the connection here between the sea port(s) and building resources one atom at a time. Does that mean that we could ship things to and from consumers easier? Or are we using the water in some way? :dgi:
i.e. like we get a shipment of coffee beans via boat, grind 'em up, and send it back?

By the way, earlier you mentioned Bahamian entreprenuers in Turks. What precisely is/are T&C doing that the Bahamas isn't to produce and retain these 'homegrown' businesspeople?

Lastly, someone mentioned the "Sunshine Boys". Who exactly are these people and what did they do?

I don't get the connection here between the sea port(s) and building resources one atom at a time. Does that mean that we could ship things to and from consumers easier? Or are we using the water in some way? :dgi:
i.e. like we get a shipment of coffee beans via boat, grind 'em up, and send it back?

By the way, earlier you mentioned Bahamian entreprenuers in Turks. What precisely is/are T&C doing that the Bahamas isn't to produce and retain these 'homegrown' businesspeople?

Lastly, someone mentioned the "Sunshine Boys". Who exactly are these people and what did they do?



Lester had it all right about the merchant banking and micro-cap. What is meant by domestic merchant banking is a bank set up specifically for Bahamian entrepreneurs, or a merchant bank for the domestic commercial scene. Essentially in a domestic merchant bank, let us suppose that you are a Bahamian supplier. You have sold a bunch of stuff on terms net 30 (they have 30 days to pay). But in the meantime, you need some cash to invest in something else. What you can do, is walk off the street to a domestic merchant bank, and they will 'buy your paper'. In other words, they will assess your accounts receivable, and advance you say 80% of them (depending on the creditworthiness of your clients). This is a money multiplier and a business multiplier. And it is a very common practice.

Most of the world's trade in dollar value is shipped by sea. We have a hell of a seaport in Freeport. If we became valued added processors (like using supercritical fluids or nanotechnology processes) to do stuff like de-caffeinate coffee or process chocolate, or use alumina bauxite ore to make paint pigments or stuff like that. Essentially, the cargo would detour through the Bahamas, get processed in some way, and continue on its merry way with valued added to it and money in the Bahamian pockets.

In the Turks & Caicos, you can get a business licence the next day. You can also open a foreign bank account without currency restrictions. This enables you to stash foreign funds to buy supplies etc. In the Bahamas, the Central Bank controls such stuff, and makes you convert your foreign reserves to Bahamian. Or more importantly, they control the rate of how much Bahamian money is converted to foreign money. You don't need that hassle to run a business. The reason that the Central Bank does this, is that we are pegged to the American Dollar, and if we don't control the currency, there would be a capital flight, and we would have to devalue Bahamian currency. So, if the Bahamian entrepreneur really wants to join the ranks of the global village entrepreneurs, we have to re-define our entire monetary policy, or as other Bahamians have discovered, its quicker to set up in T&C.

And finally, I'll let someone else explain the Sunshine boys. I am too indiscreet to be polite about this.

Sorry -- forgot to explain terms. When a business is started, the money infused into it to start the business, is the capitalisation of it, or the cap. A micro cap venture fund means that less than $100,000 is being lent out in each case to start a business. Usually the amount lent by a micro-cap is denominated in the thousands of dollars. In many African countries, a micro-cap lends a hundred dollars, and it is enough to launch a seamstress business or ting like dat.

*snip*

And finally, I'll let someone else explain the Sunshine boys. I am too indiscreet to be polite about this.


LOL :shaky:

Thanks. All of the info. was excellent. I wish that we could be on the producing end as well though.
Bahamian coffee has a nice ring to it.

We need political LEADERS - we are inundated with Political piranahs.

We have too much foreign investment, at the cost of too many freebies - Bahamians will work for foreigners, who will make the bulk of the profits.

Bahamian land will soon be too expensive for Bahamians. Every nook and cranny in Nassau will soon be prime real estate. We need a plan!

Excellent piece, Lester, and I wholeheartedly concur with it, except I don't agree with point 6 under "The Way Forward". I believe using the number millionaires as the criteria to measure success would be misleading and shallow, especially when we realize that such a goal can be achieved in different ways, many of which can be harmful to our country as a whole. Actually, the USA, though a strong economy, is in may respects a dying nation in that they are losing their moral compass. They are being held hostage by activist, tyrannical judges who run their courts and nation. To the fore of my mind is the recent court sanctioned starving to death of Terry Schiavo and the USA Supreme Court's upholding of a ruling that made unconstitutional the Idaho law that required the notification of the parents of minor girls seeking an abortion. So no matter how many millionaires they produce, these other more weighty factors must be considered when measuring their "success" as a nation.

That said, I believe if we do all the other things right as you have indicated, the economic results (like producing millionaires) will be just that...results, like cause and effect. We need to focus on the causes and not the effects. Point 6 relates to effects. We should focus on producing goods and services to serve many, many people well, and as I have said, the results will follow.

I also encourage you to publish this piece in the three local daily newspapers.

Lester, I know what you are saying is doable, however, in order to achieve it, we will have to make some other drastic changes to produce better citizens, like overhauling our educational and penal/justice systems among others, and electing different kinds of leaders from those we have elected in the past.

Last point: I think you are spot on, but what you are proposing is long term and most politicians (especially ours) don't see beyond 4 or 5 years. But who knows...you might convert some!


Mr Moss I agree with your assessment of millionaires as a mark of success as a nation. However, you still seem to care about preserving the "old" way. For example, you agree that only a drastic change will make the needed change that transform a nation, yet the long-term result of your advice only serves to preserve the same system! Lets stop trying to change elements within the system to better the people. The system's masters (most notable is our father of the nation) have perfected the means whereby dissenters are crushed!! Historically this has never worked and probly never will...the power brokers has never given a single group of people liberty, equity, justice and right to economic life. All recorded history shows that a people that gained fair play from a "noblistic" social minority had to overthrow their oppressors!

Pick any nation on earth and you will see that radical change comes with radical ideas and courage to effect change by any means necessary!! Any means! Are you willing to do that? If not, you are not ready to change this nation!! And if you are ready, never look to the old guard to assist you! Look among your peers for radical ideas such as decentralized government where Islands have their own constitution and right to establish international relationships etc. You and your peers are our hope for a changed nation. But you must be willing to stop at nothing in your quest to do so. You must be true to the very meaning of the word Radical! It means: To change at the root! It has never implied pruning the tree! In other words, its a new dawn, its a new day, its a new how I feel!

Remember that despite Sir L.O. Pindling's eventual becoming a feudal lord over his people, he TOOK power by total disregard for the established order of his day...he throw the symbol of power out of the house! In other words, the old guard knew that their a&*^%$&# where next! He took no middle ground...the line was drawn! The end result...he got a new dawn...he got a new day...he achieved a new way to feel! :rip: