THE International Monetary Fund (IMF) yesterday warned the Government’s 2031 debt target will be “out of reach” without “further revenue reforms” including a possible VAT rate increase.
The Washington D.C.-based Fund, in a statement on its recent Article IV visit to The Bahamas, asserted that ambitions to cut the country’s debt-to-GDP ratio to 50 percent will not be achieved through the Davis administration relying solely on compliance and enforcement measures alone. However, the Government late last night said it has “no intention” of raising the VAT rate due to the ‘cost of living’ crisis. Besides potentially raising the VAT rate from its present 10 percent, the IMF also called for
Water & Sewerage Corporation tariffs to be increased for “heavy users” and urged that the Public Hospitals Authority (PHA) collect patient fees from those with insurance and the ability to pay, while also voicing scepticism over
GRAND Bahama Power Company’s top executive yesterday said he believes it has made sufficient reliability improvements for regulators to restart their review of its proposed 6.3 percent base rate increase.
Dave McGregor told Tribune Business that the island’s sole electricity supplier has “shored up” its electricity generation to such an extent that the Grand Bahama Port Authority (GBPA) would be justified in restarting its analysis as he promised residents and businesses “we are taking bold steps to rebuild your trust” following frequent summer load shedding and outages.
The GBPA, which acts as GB Power’s regulator, suspended consideration of a base rate rise that was proposed to take effect from New Year’s Day 2025 due to the latter’s well-publicised service challenges. However, Mr McGregor said the utility hopes to meet with GBPA executives soon to further update them on its progress and feels it can make the case for the review’s restart.
“They haven’t announced it has resumed,” he told this newspaper of the GBPA’s position. “We’re hoping
to meet with them shortly and review our reliability, particularly over the last couple of months, and see what else we might need to do to ensure they have trust in our plans. We’re hoping to meet with them shortly to see where we’re at in terms of the resumption of the review of the rate application.”
Asked whether GB Power’s improved service reliability since early October is strong enough to merit the regulator restarting its review, Mr McGregor replied: “I would say so. We have shored up reliability with temporary generation. We have a very robust maintenance plan going forward. We have the original equipment manufacturer engaged.
“I would say so. The head of the Chamber of Commerce in Grand Bahama commended us on the improvement in reliability that has taken place over the last month-and-a-half. The feeling is reliability is much better... and it will continue to be so. I would say we’re in a position to resume.”
That may not be what many Grand Bahama residents and businesses want to hear given the fears about a further increase in energy costs and what it
the size of the Government’s forecast Budget surpluses.
In particular, it warned that the forecast $448.2m surplus targeted for the next fiscal year will likely be “smaller” than projected as revenues will “underperform”
THE Government’s fiscal deficit for the 20242025 Budget year’s first quarter more than tripled year-over-year to $194m with close to one-third of that ‘red ink’ incurred during September.
The Ministry of Finance, in a statement detailing the Davis administration’s September fiscal performance, revealed that month’s deficit rose by almost $20m or 44 percent year-over-year to strike $64.7m when compared to the $44.9m incurred in 2023. The expanded deficit, which measures by how much the Government’s spending exceeds its revenue, was driven by modest slippage on both sides.
By NEIL HARTNELL
THE International Monetary Fund (IMF) yesterday urged The Bahamas to slash crime, reform its labour market and build more hotel rooms to prevent economic growth “slowing” to its 1.5 percent historical average.
The Washington D.Cbased Fund, in a statement on its recent Article IV mission to this nation, praised its “remarkable recovery” from Hurricane Dorian and COVID-19 but warned that “long-standing challenges remain” with a return to consistent
unless the Government enacts further reforms. However, the Davis administration has repeatedly ruled out new and/ or increased taxes, instead putting its faith in economic growth and enforcement/compliance
Based on the $129.3m deficit for the two months to end-August, the addition of September takes the gap between the Government’s spending and revenue income to $194m for the 2024-2025 first quarter. The latter figure is more than double the projected $69.8m deficit for the full fiscal year, standing
pre-pandemic growth rates the likely fate unless structural impediments to higher gross domestic product (GDP) are eliminated.
Asserting that increased investment in technology and digitisation will be critical, the Fund acknowledged that The Bahamas has regained all the output and jobs that were lost as a result of the COVID19 pandemic’s lockdowns and other health-related restrictions.
“The Bahamian economy has staged a remarkable recovery following Hurricane Dorian in 2019 and the COVID-19 pandemic,” the IMF said.
measures to drive revenues and eliminate annual deficits. Other revenue-raising measures suggested by the IMF, several of which have been recommended before in past IMF Article IV consultations, include replacing the Business Licence fee by extending the 15 percent corporate income tax to “large domestic firms”. These were not defined, although a tax based on profits as opposed to top-line turnover will likely find favour with the private sector due to improved equity. The Fund had previously called for The Bahamas to implement “a personal income tax for the top earners”, a measure designed to prevent companies avoiding or evading corporate income tax through the payment of salaries - rather then dividends - to their shareholders. And it also renewed its argument for the elimination
some $124.2m above that target, and is also higher than the $186.7m deficit for the just-completed 20232024 Budget period.
This gives an insight into the ground that the Government will have to make up over the 2024-2025 fiscal year’s remaining nine months. Kwasi Thompson, the Opposition’s finance spokesman, yesterday warned that the “ballooning deficit” indicated by these figures “threatens to cripple our nation’s economy”, and described the public finances as being “in a state of crisis”.
However, both Prime Minister Philip Davis KC and Simon Wilson, the Ministry of Finance’s financial secretary, have recently asserted that the early 2024-2025 fiscal performance is “no cause for alarm” as it only represents
“Activity and employment have recovered to their pre-pandemic levels and inflation has fallen back below pre-pandemic levels...
“Over the medium-term, growth is expected to slow to its long-run potential of 1.5 percent as capacity constraints in tourism become more binding. Barring global commodity price shocks, headline inflation is expected to converge to around 2 percent.
the equivalent of the first quarter score in an NFL football game.
Mr Davis, when faced with similar concerns voiced recently by Michael Pintard in the House of Assembly, urged the Opposition’s leader to focus on the full-year - rather than the first quarter - outcome given the traditional cyclical nature of the Government’s finances and the Budget.
The Government’s first quarter fiscal performance is not necessarily a good guide of how the full 2024-2025 fiscal year will pan out. The first half
“Nonetheless, longstanding challenges remain. Income per capita continues to diverge from that in the US. At the same time, expensive electricity, a shortage of skilled labour and obstacles to business formation and expansion continue to weigh on growth,” the Fund added.
“As in many other countries, government debt-GDP jumped during the pandemic and borrowing costs remain uncomfortably high. The archipelago is also highly susceptible to natural disasters and rising sea levels, both of which argue for increased investments in resilience and building fiscal buffers so as to better respond to climate-related shocks.” The IMF reaffirmed recent projections that
IMF: Climate investments can boost Bahamas’ GDP by 9%
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
THE Bahamas could expand its annual economic output by 9 percent over the “long-term” it if makes substantial multimillion investments in climate change adaptation and protecting its natural assets. The International Monetary Fund (IMF), in a statement on its recentlyconcluded Article IV visit to The Bahamas, said investing in preserving mangroves and seagrass beds as well as infrastructure that is more resilient
against hurricanes and sea level rises will be critical to securing this nation’s future.
“Investing in climateresilient infrastructure will substantially decrease output losses from slowmoving aspects of climate change, for example sea level rises, and natural disasters,” the Fund asserted. “Public investments in adaptation and the preservation of natural capital could increase real GDP (gross domestic product) by up to 9 percent over the long-term.
“Adaptation investment needs in The Bahamas are substantial, and are likely
to be larger than the estimates in the Nationally Determined Contribution (NDC). To align with the authorities’ medium-term fiscal plans, greater revenue mobilisation is needed to fund such adaptation investments.
“In addition, international and private sector support - particularly in the form of grants - will be important. Beyond the resources needed for such investments, it is likely that even further fiscal adjustment will be needed over the medium-term to build up a contingency fund for future natural disasters while adhering to the 50
percent debt target in fiscal year 2030-2031.”
Staying with the climate change-related theme, the IMF added: “Efforts to enhance disaster insurance coverage for vulnerable populations are a positive step, but should be complemented with measures to mitigate moral hazard. The Government and the private sector are designing a partially subsidised, natural disaster microinsurance product for the most vulnerable.
“To avoid leakage and minimise fiscal costs, effective targeting of this
Company with 1,000 Bahamas homes deal sees ‘carbon negative’ concrete validated
A COMPANY that has an agreement to build up to 1,000 homes per year in The Bahamas yesterday said its building materials have been certified as “carbon negative” by the world’s leading standard-setter.
Partanna Global, the climate technology company co-founded by former Bahamian professional basketball player, Rick Fox, disclosed in a statement that the verification of its carbon dioxide-capturing concrete product by Verra paves the way for the creation of carbon credits.
It added that Verra, a non-governmental organisation that sets voluntary carbon market standards, has registered Partanna’s ‘carbon negative concrete’ using the VM0044 methodology under Verra’s verified carbon standard (VCS) programme.
Partanna added that the validation means it is one of only two concrete companies worldwide to achieve this status with Verra. Its patented, sustainable cement avoids the energy intensive and decarbonation production process
GB
used to produce Portland cement (OPC), thereby eliminating carbon dioxide emissions associated with conventional cement production.
Partanna said its processes, in contrast, employ brine and industry waste, while Portland cement has been shown to account for 9 percent of the world’s carbon dioxide emissions.
Partanna added that its cement acts like a tree in removing carbon dioxide from the atmosphere, leading to emissions reduction and active carbon dioxide capture.
The company predicted that, over the project’s current ten-year carbon crediting period, its concrete is expected to reduce and sequester an average of 644,000 tons of carbon dioxide per year, translating to more than 6.4m tons of carbon dioxide by 2032. This, it added, is the equivalent of removing all emissions for a year from a small country such as Cyprus or Luxembourg.
Partanna said its goal is to remove a total one billion tons of carbon dioxide from
the atmosphere, enabling sustainable growth without compromising climate targets. It added that it has a Heads of Agreement with the Government to deliver up to 1,000 homes per year in The Bahamas using its carbon negative cement binder.
Beyond reducing construction emissions, it added that these homes are designed to withstand extreme weather conditions such as hurricanes while its cement becomes stronger
Power chief: Rate rise review can restart
in salt water, providing extra durability in marine environments.
“As one of only two companies in the world to have secured Verra project validation and registration approval for direct air capture and carbon removal in cement, this milestone is a major accomplishment for Partanna,” said Mr Fox, also Partanna’s chief executive.
“This is a clear demonstration that carbon credits in construction can
be rock-solid. With our technology, we’re creating credits that are not only measurable and verifiable, but permanent. Our sustainable cement binder doesn’t just avoid emissions; it actively removes carbon dioxide from the atmosphere.
“Verra’s validation means companies and developers can trust our credits to make a real impact, and that’s exactly what the planet needs right now.”
Partanna said its verified carbon removal and reduction credits, generated from the project in The
Bahamas, will be available for purchase to investors seeking credible climate projects that can offset their carbon emissions.
The project boundary for the verification of Partanna’s credits is The Bahamas and US, but with more regions expected to follow. Global emissions need to fall by 42 percent come 2030 to set the world on a path to limit temperature rises according to the Paris goals. The UN has stated that at current trajectories, the world will see three degrees of warming, blowing past the target.
Between 2025 and 2100, the world will face a carbon removal shortfall of 49 gigatons of carbon dioxide in a scenario where warming is kept to about 1.5 degree, according to Oxford University research. Carbon credits are a positive mechanism to support the world to reach its climate goals, and have been endorsed as vital solutions by the University of Oxford and UN climate envoy, Mark Carney.
FROM PAGE B1 outages, which caused the most disruptive summer for many years, stemmed from unexpected mechanical failures on key generation units that took time to fix.
will mean for their finances. Tribune Business previously reported that GB Power’s frequent load shedding and
However, Mr McGregor and other GB Power executives yesterday met with the island’s private sector and other stakeholders to reiterate that the proposed base rate increase will be offset for many customers by projected reduction’s in the fuel charge component of their bill. As a result, the all-in cost or total bill will not rise for most.
“We took the opportunity to remind people that have not really heard the message before,” Mr McGregor told Tribune Business of the impact on all-in electricity costs. “I don’t think that message has landed, and it hasn’t landed.
“We need to make sure people understand that when they are paying their electricity bill they are paying a fixed portion that covers the [utility’s] capital and operating costs, and a fuel portion that does vary slightly from time to time. It’s now in the 12-14 cent range.
“Together, although the base rate needs to go up, in our view the fuel rate will be coming down so the net effect is to cancel them out... but we understand no one wants to see an increase in their bill ever.”
Mr McGregor and his fellow executives said the financial boost provided by the rate increase is “critical” to enabling GB Power to funding $53m worth of capital investments over the next three years that are intended to make energy more affordable, reliable and sustainable for Grand Bahama businesses and residents alike.
If the proposed rate adjustment is not implemented in full, or at all, he warned that GB Power would then have to “prioritise” which projects to undertake and “defer” others to a later date. “It is critical,” he added. “That is where the funding for those investments comes from. It all comes from customers at the end of the day. That’s how it works.
“We’re a cost of service utility. Our base rate covers operating costs and capital investments, and fuel is the other half of the bill. In fact, one of our customers asked what if we don’t get all of what we asked for. Our answer is we have to look at those investments and prioritise them. Some will get done, and others will get deferred.”
Of the $53m in targeted capital investments, Mr McGregor said 55 percent of this sum will be allocated to grid modernisation; substations; protection and control; and battery storage. Of the remainder,
one-quarter or 25 percent is planned to go on energy Infrastructure such as generation, engine overhauls, capital spares and upgrades, with the final 20 percent “sustaining capital” for facilities, IT and customer service enhancements.
The GB Power chief acknowledged that the utility and its 100 percent Canadian owner, Emera, must work to regain consumer confidence following the summer outages and load shedding. “Over the past months you have faced disruption caused by generation shortfalls,” he told attendees at yesterday’s event.
“While we have worked diligently to address these issues we do understand that this has not been enough. Today, I want to assure you that we are taking bold steps to rebuild your trust and deliver more reliable and affordable power infrastructure.”
Besides securing additional generation capacity before summer 2025 to ensure there is no repeat of this year’s events, Mr McGregor added that GB Power is also investing in a “mobile sub-station” to improve grid redundancy, reliability and overall supply.
And, alongside investments in battery energy storage systems (BESS) to better integrate renewable energy and ensure the grid can meet night-time demand, GB Power is also investing in “critical spare parts and maintenance” to ensure its generation units work optimally and overhauls are properly scheduled such that they do not disrupt the grid.
Nicole Godbout, GB Power’s vice-president of people and risk, reiterated that the proposed base rate change will be largely offset by a lowering of fuel costs that make up around 47 percent of the overall electricity bill. “The fuel charge is expected to reduce over the next three years such that the base rate increase is largely offset by the reduction in fuel,” she said.
“We have carefully structured this adjustment to minimise the impact on consumers, thus making it more affordable.” She added that, if projected fuel prices materialise, GB Power’s residential consumers will seen “an overall rate reduction of 0.2 percent to 1 percent” over the three years between 2025 and 2027.
Commercial and industrial customers, with the fuel costs factored in, “are expected to experience and overall increase of between 1.2 percent to 1.6 percent”, while large general service clients will see no overall impact in their total bills and large industrials will see “a slight decrease of less than 1 percent; about 0.2 percent”.
PARTANNA HOME FOR THE WORLD
RICK FOX
GB FERRY SERVICE PARTNER: ‘WE’VE BEEN TORN DOWN’
By ANNELIA NIXON
THE partners behind a proposed ferry service between Grand Bahama’s West End and Florida have voiced their unhappiness over how quickly so many persons have written-off their chances of success.
Omar Isaacs, managing director of BuyBahamian.
biz, an investment management firm based in Grand Bahama, said the level of “scrutiny” he and his partners are facing is “discouraging” as they sought to uphold West Capital Ferry’s credibility during a town hall meeting..
“West Capital Ferry is a 100 percent wholly-owned, limited liability company, and it’s 100 percent owned by Bahamians,” Mr Isaacs said. “And you can clap it up for that. And I’m speaking from the spirit right now because it is so discouraging that us young entrepreneurs have to justify ourselves.
“My background is that I worked for government for 15 years, and my last five years was at the Bahamas Investment Authority as an investment officer. And I saw many foreign companies come inside here and not have the scrutiny that we’ve had to go under - on national television, across social media. But here we have some young black entrepreneurs trying to do something and we’ve been, I mean, we’ve been torn down.”
He spoke out after Chester Cooper, the deputy prime minister, who West Capital Ferry had publicly thanked for his support in previous press releases, said he had no knowledge of their plans to launch a ferry service to West Palm Beach during the 2025 first quarter.
“I have no information on this ferry service from West End. I saw a very curious press statement,” said Mr Cooper, also minister for tourism, investments and aviation.
“I have asked my team, and the team from the Ministry for Grand Bahama, who are also unaware of this new ferry service, to
conduct a briefing on this potential investment. As far as I am concerned, the Port Authority in Nassau did not have a great level of detail either.”
Mr Cooper said that, while the Government welcomes new ferry services, “we want to ensure they are properly licensed and that communication is clear so everyone is on the same page regarding these developments”. He added: “In principle, the more the merrier, but I cannot comment specifically on this company.”
Tribune Business understands that West Ferry Capital would also need US Department of Transportation approvals to offer a ferry service into Florida, as well as the relevant permits in The Bahamas including Port Department permissions as it will be operating outside Freeport.
Mr Isaacs, though, told the meeting that the venture has been in development for three years and would not be possible without its partners “going to the relevant authorities”. He said they “went through the proper channels”, and identified his partners as Fredrick Black, who he said owns Air, Land and Sea Cargo Services, and Kyle Smith, president of Harbour Launch Services, a maritime company in Freeport.
“We have a limited liability company that is registered at the Registrar General for those fact checkers, but those stakeholders in this limited liability company are sitting right before you,” Mr Isaacs said. “We have Air, Land and Sea Cargo Services. which is owned by Fred Black, who has been approved, licensed and qualified by the Bahamas government to import and export logistics.
“Then we have Harbour Launch Services, which has been approved, licensed and qualified to run domestic ferry service as well as international ferry services. So when we talk about approvals and licences, you can’t get no better than this. This limited liability company, West Capital Ferry, has already signed
GOV’TS Q1 DEFICIT MORE THAN TRIPLES TO $194M
of the year - from July 1 to end-December - has traditionally always been weaker and a period when the Government - regardless of which party was in power - often incurs heavy deficits.
These are then slashed by the revenue-rich first four months of the calendar year, which coincides with the winter tourism season high and peak economic activity as well as the payment of Business Licence fees, the bulk of real property taxes, and commercial vehicle licensing in March. Thus it is too early to write-off the Government’s chances of hitting its $69.8m full-year deficit target.
Mr Wilson echoed this, and the Prime Minister, at last week’s Bahamas Institute of Chartered Accountants (BICA) conference when he voiced continuing confidence that the full-year fiscal deficit will still come in below $100m and close to the projected target. Figures for the 2023-2024 fiscal year provide some support and comfort for the Government’s position. While it incurred a $258.7m deficit for the first half to end-December, this was then partially offset by the more than $150m collective surplus generated during the February-May 2024 period, which helped to contain the full-year deficit at $186.7m.
A full analysis of the Government’s fiscal performance for September and the 2024-2025 first quarter was not possible as the full report had yet to be published when Tribune Business went to press. Only the press release was issued. However, the $194m
a three-year contract and lease with Old Bahama Bay...
“This limited liability company has already gone about getting a $1m insurance policy. And this limited liability company at last has all the pre-requisites to open up banking when we start taking on bookings. So I can say that the basis of West Capital Ferry’s investment is founded on recruiting more like-minded entrepreneurs who want to share in the spirit of unity, collectivism and revitalisation.”
Mr Isaacs put forward four initiatives for further public consultation. These were a deck space leasing subscription programme, a West Capital Ferry doorstep delivery trucking programme, a West Capital Ferry travel agent network, and an affiliate marketing programme.
“The first programme will be a deck space leasing subscription programme,” Mr Isaacs said. “Freight forwarders, couriers, small and medium-sized business. Just like in a department store, we’ll be leasing space on the deck of the vessel that you can lease out up to six months, and you can do with it as you please. You can sub-let it. That’s your business. Literally.
“The second programme that we propose rolling out is a West Capital Ferry doorstep delivery trucking programme. This is where qualified and licensed truck drivers will be taught and trained how they can go about moving goods from our hub here at Old Bahama Bay to and from West Grand Bahama and then into the city of Freeport.
“The third programme is West Capital Ferry travel agent network. West Capital Ferry will develop qualified home-based travel professionals to sell seats on the ferry. We want to sell pallets, we want them to sell bins, but most importantly we want them to sell bundled packages - ferry and state packages on behalf of Old Bahama Bay, Paradise Cove, Blue Marlin Cove, government-owned Grand Lucayan, Pelican Bay and the list goes on,” Mr Isaacs added.
“Now the last programme that we would like to roll out, this is a side hustle. You don’t need a Business Licence for this. Now the first three you’re going to need a Business Licence for because we want more likeminded entrepreneurs to join us. The last programme is an affiliate marketing programme.
“This is where, if you sign up when our booking engine is done and completed and launched, you will register. When you register on that booking engine you will get a unique promotion code. Anybody, your mom, your pal, your friends, your colleagues, anybody who books on West Capital Ferry using your unique promotion code, you will get a 2 percent commission.”
Mr Smith detailed departure and arrival times, coping with bad weather, and the safety and comfort of both passengers and cargo. “Those persons I would like to give thanks to, who went step by step, who started with the Port Department. Janet Russell, she did a fabulous job taking us on and helping us to matriculate our way through,” he added.
“Then she sent us to the Department of Immigration. Greta Knowles, who helped us in submitting everything that they needed at the Department of Immigration. They then passed us along to Customs. Whitney Kenny has sat with us, liaised with us, saw our proposed terminal there in the back at Old Bahama Bay, and he wanted especially to make sure the Customs officials were comfortable.
“Last, but certainly not least, the boss of those Customs officers... We submitted to Simon Wilson, the financial secretary. Like I said, all those who are in the room who fact check in, please call one of these persons up and we can pull some receipts.”
Mr Smith continued: “HLS (Harbour Launch
Services) proposes a 160foot fast supply boat with with top speed of 24 knots and a cruising speed of 18, and a seating capacity of 86 persons. We propose to leave Old Bahama Bay 6am to arrive in West Palm Beach for 9am, giving an estimated time of arrival for three hours, give or take an additional 30 more minutes just for pilotage and Homeland Security clearances.
“Once the vessel is allfast, meaning that once the vessel is at the dock, we’ll be able to take passengers and show them to the terminal where they will be processed. During that time the cargo will then be loaded on board the boat and we’re looking at a departure time out of West Palm for 12.30pm. Once the clearances have been granted, we’re looking at an estimated arrival time to Old Bahama Bay of 4pm.
“In the event we encounter some adverse weather, and we have to alternate the
course a few degrees north or a few degrees south, the vessel is capable of meandering through. Sometimes what we find, we have these heavy squalls and sometimes water spouts,” he added.
“As you’re sitting comfortably in your seat and you have a 75-inch TV, watching your best Netflix series, something will come to mind and you’re going to say, ‘Man, boy, I see rain out there. Wonder if my cargo getting wet?’ Rest assured your cargo is well secured, it’s properly palletised and there is a tunnel covering that covers the entire aft deck of the boat.
“Which means that in the event it does rain or there’s some sea spray, your cargo is safe. Once we get into Old Bahama Bay, we return into the basin, we back that baby up, and we tie the lines up and drop the ramp and we get ready for the disembarkation.”
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PUBLIC NOTICE
INTENT TO CHANGE NAME BY DEED POLL
The Public is hereby advised that I, YVES-MARIE LAMBERT of Murphy Town, Abaco, The Bamas Mother of JOHNLEY RICARDO JONES A minor intend to change our child’s name to JOHNLEY RICARDO RICHARD. If there are any objections to this change of name by Deed Poll, you may write such objections to the Deputy Chief Passport Offcer, P.O. Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice.
deficit incurred for the first three months represents a steep increase compared to the prior year’s $61.6m comparative.
Yet, by comparing the few details that were released, it was clear that September’s expanded deficit was the product of a modest revenue drop-off and slight rise in overall government spending. Economic activity for the period will also likely have been down against September 2023, with major resorts recently describing the month as “very soft” in comparison. The Government’s total revenues for September were down by $8.2m, or 4.2 percent, compared to 2023 standing at $187.5m as opposed to $195.7m. Total spending was higher by $11.6m, reaching $252.2m as opposed to $240.6m. Recurrent spending, though, which covers the Government’s fixed costs such as civil service wages, rents and debt servicing, fell to $214.3m compared to $222.5m the year before. Instead, the increase in spending was largely driven by a rise in capital expenditure. “During the review month, revenue receipts totaled $187.5m, a 4.2 percent decline from the prior year. Tax revenue accounted for $167.5m and was dominated by VAT collections of $85.3m, and taxes on international trade and transactions of $55.2m,” the Ministry of Finance said.
“Non-tax revenue collections totalled $20.1m, with $19.6m obtained from the sale of goods and services.
Aggregate expenditure settled at $252.2m, with the recurrent and capital components at $214.3m and $37.9m, respectively.
“The year-over-year $8.2m decrease in recurrent expenses was primarily associated with lower interest payments ($10.5m) and other transfers ($3.5m). Under capital spending, the acquisition of non-financial assets, which makes up 81.5 percent of the total, expanded by $13.9m.” The Ministry of Finance added that the central government’s outstanding direct debt fell by $18m during the period.
Mr Thompson, though, pointed out that September’s $85.3m in VAT revenue represented a 7.3 percent, or $6.7m decrease, compared to the $92m collected the year before. And the $167.5m in tax revenue was also lower than the prior year’s $176.6m.
He argued that the data “confirms what Bahamians have felt for months: Our nation is headed in the wrong direction..... VAT collections, a cornerstone of government revenue, decreased from $92m in September 2023 to $85.3m in September 2024”.
And, noting the increase in spending, Mr Thompson said: “The consequences of reckless spending and declining revenue are clear: The deficit for September 2024 skyrocketed to a staggering $64.7m, a significant leap from the $44.8m deficit recorded in September 2023.
“This ballooning deficit is unsustainable and threatens to cripple our nation’s economy, leaving future generations burdened with debt. They cannot hide the truth: Our nation’s finances are in a state of crisis.... We urge the Government to heed the warning signs and take immediate action before it’s too late.”
Neither Mr Wilson nor Michael Halkitis, minister of economic affairs, responded to Tribune Business calls and messages seeking comment before press time.
IMF: Raise VAT rate or debt goal ‘out of reach’
of the $60,000 real property tax ‘cap’ to ensure wealthy homeowners pay more.
Noting the Government’s ambitious goal of achieving a 3.5 percentage point increase in its primary surplus over the three fiscal years to end-June 2026 , the IMF also suggested this target should be spread out over a longer period to give the private sector more time to adjust to fiscal retrenchment.
The Davis administration is forecasting that it will achieve a primary surplus, which measures by how much its revenues exceed recurrent or fixed-cost spending with debt service payments stripped out, of more than $1bn in its 20252026 fiscal year - a jump of more than half a billion dollars or $524m compared to the outturn for the recentlycompleted 2023-2024 fiscal year.
However, the Fund argued that the Government cannot depend on tax enforcement and compliance alone to hit its fiscal targets. “The authorities’ debt target of 50 percent of GDP by fiscal year 2031 provides a useful anchor for policy. The 2024-2025 Budget targets an overall
fiscal balance of –0.5 percent of GDP [a deficit], and 2.8 percent of GDP in 20252026,” the IMF wrote.
“Improved tax administration and lower interest payments will get the fiscal position part of the way to the Government’s targets. However, in the absence of additional policy measures, revenues are likely to underperform and the fiscal balance will be smaller than assumed in the authorities’ forecast - especially in 20252026) - putting the debt target out of reach for 2031.
“Further revenue measures are needed to support the targeted fiscal adjustment,” the IMF added. “The budgeted 3.5 percentage points of GDP increase in the primary balance between 2023-2024 to 20252026 was achieved only once in the 18 years prior to the pandemic, and that was as a result of an increase in the VAT rate and a sharp reduction in expenditure two years after recovery efforts following Hurricane Matthew.
“However, the adjustment could be spread out over a moderately longer horizon, raising the primary balance to 5.5 percent of GDP by 2025-2026 and to 7 percent of GDP by 20282029. This would still bring
debt to 50 percent of GDP by 2030-2031, and would allow the private sector a longer horizon to adjust to the withdrawal of fiscal resources.
A primary surplus equal to 5.5 percent of GDP for 2025-2026 would be lower than the 6.4 percent ratio targeted by the Government. “Such an adjustment could be achieved through some combination of” a series of revenue-raising options, the IMF said, including the potential VAT rate increase; shift to a corporate income tax; personal income tax for high earners; and greater water tariffs for major consumers.
“These measures, along with supply side reforms, would ensure the debt target is met and help build fiscal credibility while still generating resources to increase investments in education, targeted social transfers and climate resilient infrastructure,” the Fund added.
The Government, though, is under no obligation or pressure to accept or adopt the IMF’s recommendations. A number are likely to prove unpalatable, especially any increase in the VAT rate, given the Prime Minister’s focus on reducing the cost of living
and how his administration touted its reduction immediately after they took office.
Philip Davis KC also recently ruled out any increase in Water & Sewerage tariffs which have not been raised since 1999, and implementing patient fees at PHA facilities is also likely to be off the table given the potential voter backlash with a general election less than two years away.
Eliminating the real property tax cap and switching from a Business Licence to 15 percent corporate income tax are the elements in the IMF package likely to gain most traction with the Government, with options for the latter move having been discussed in its 2023 ‘green paper’ on tax reform. However, any changes beyond those impacting the largest multinationals are unlikely to take place until after the next election.
The IMF did credit the Government for improving the public finances post-COVID, while noting that borrowing costs have fallen. The Davis administration’s $186.7m deficit for the 2023-2024 full-year also beat the IMF’s own $379m forecast by almost $200m.
BAHAMAS NEEDS STRUCTURAL FIX TO PREVENT 1.5% GROWTH ‘SLOW’
show the pace of annual economic expansion gradually declining over the next two years, with GDP growth dropping from the forecast 1.9 percent this year to 1.7 percent in 2025 and 1.6 percent in 2026. The unemployment rate, though, is forecast to also slightly decline to 9.8 percent in 2025 and 9.7 percent the following year.
Inflation, though, is projected to remain below 2 percent for both 2025 and 2026, which will boost the Government in its efforts to combat the cost of living crisis impacting Bahamian lower income and middle class families.
However, the IMF is forecasting a much slower fiscal correction than the Davis administration, projecting a balanced Budget for 2025-2026 which, while eliminating the annual fiscal deficit, is far short of the Government’s projected $448m surplus. And it believes The Bahamas’ debt-to-GDP ratio may also fall more slowly than forecast, sliding from 78.8 percent at end-June 2024 to 75.3 percent at the 20252026 close.
To address the slowdown, the IMF urged: “Long-term growth needs to be lifted by investing in human capital, closing digitisation gaps, relieving capacity constraints in tourism, reducing labour market informality and fighting crime. Incentivising private sector investments in hotel capacity, particularly outside of New Providence, would expand potential growth in the tourism sector.
“Expanding vocational and apprenticeship programmes, improving skill databases and job placement services, would build skills, support job matching and reduce youth unemployment. Reducing crime will require investments in crime mitigation strategies, a larger police force, better leveraging data analytics to target intervention and continuing recent efforts to enhance the effectiveness of the criminal justice system.”
The Government will likely argue it is aware of much, if not all, of these issues and has already begun to take steps to address it including the National Apprenticeship Programme which has yet to be enacted despite the
excess risk taking with respect to climate-related
to underpriced
NOTICE
NOTICE is hereby given that DANIA FLEURISMA, General Delivery, North Eleuthera, The Bahamas, applying to the Minister responsible for Nationality and Citizenship, for Registration Naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 20th day of November, 2024 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, New Providence, The Bahamas.
enabling legislation being passed.
And Chester Cooper, deputy prime minister, has already called for The Bahamas to double its hotel room inventory to around 30,000 within the next 10 years to overcome capacity constraints and accommodation shortages. The IMF, meanwhile, did not neglect governance reforms and the financial services industry, adding: “To enhance fiscal transparency, beneficial ownership information should be published for all companies that are awarded public contracts. The audited financial statements and procurement information for public corporations should also be published.”
And it revealed that plans to create a Bahamas Financial Stability Council are expected to be completed by year-end 2024. “Plans to establish the Bahamas Financial Stability Council, which are expected to be finalised by end-2024, should help provide a more co-ordinated approach to macro-prudential policy,” the IMF said.
“Deposit insurance premiums have been increased and the bank resolution
curtailed through integrating disaster risk management considerations into zoning regulations, strengthening the enforcement of robust building codes, and improving access to information on climate risks.”
Calling for an oversight mechanism with better co-ordination and accountability on climate objectives, the Fund said: “The Government
framework has been improved. The creation of a real estate price index is also advancing. Supervisory oversight would be further aided by the collection of loan-level data from bank and non-bank lenders.
“The Central Bank is seeking to improve access to financial services. The expansion of digital banking and the introduction of the moveable collateral register could help with the cost of, and access to, credit. Encouraging new financial technologies may require improvements in data availability, expanding geographic internet connectivity, investing in financial literacy and potentially establishing regulatory sandboxes and/or innovation hubs.”
Turning to digital assets regulation, the IMF praised the improvements introduced by the upgraded Digital Assets and Registered Exchanges (DARE) Act but called for increased on-site inspections of licensees as well as ensuring there are sufficient resources for proper regulatory oversight.
“The new Act widens the coverage of oversight and strengthens anti-money
is incorporating climate change considerations into planning, supported by development partners, including through expected updating of the 2005 National Policy for the Adaptation to Climate Change and developing a detailed national adaptation plan.
“Similar to the 2022 Disaster Risk Management Act, this could include a comprehensive
“The fiscal deficit was 1.3 percent of GDP in 20232024, around 2.5 percentage points of GDP lower than fiscal year 2022-2023,” the IMF said. “The adjustment was driven by both revenue increases - better tax compliance, a cyclical rebound and policy measures - and expenditure containment [involving] lower transfers to public corporations and some under-execution of capital spending.
“Central government debt fell to 78.8 percent of GDP in 2023-2024, but there has been an upswing in the reliance on Central Bank advances - now at 2 percent of GDP. Global factors have pushed down sovereign spreads on foreign currency debt, but domestic financing has increasingly relied on issuance of short maturities, raising the near-term gross financing needs.”
As for the recent passage of legislation to give effect to the 15 percent corporate income tax on multinationals with annual turnovers above 750m euros, the Fund added: “Additional legislation will be needed to lessen disincentives to invest in tangible depreciable assets through accelerated depreciation or refundable tax credits, and to bring
laundering and combatting the financing of terrorism (AML/CFT) requirements. The priorities are now to ensure sufficient resources for effective oversight, increase on-site inspections and address data gaps,” the Fund asserted.
“Additional steps could include introducing a requirement to collect, hold and share originator and beneficiary information, and ensuring that registrable activities do not include anonymity-enhancing services such as mixers, tumblers and other highanonymity technologies. The scope of the Act could be expanded to include other decentralised finance products and services.” As for the risk-based approach to anti-money laundering and combating terror financing, the IMF added: “The authorities are finalising a national risk assessment (NRA) for money laundering and will then turn to completing the NRA for terrorism financing. The findings of these risk assessments should then feed into the update of the national AML/CFT strategy.
“Efforts to align the beneficial ownership regime with evolving international standards should continue - ensuring that registered agents are collecting and
offshore indirect transfers of Bahamian property into the tax net......
“The authorities have taken steps to increase the transparency and effectiveness of domestic debt management operations. This has included instituting competitive auctions for primary issuance and building a cash buffer to accommodate potential shocks.
“Fully staffing the debt management office, publishing rules for changing the composition of securities issued, and improving the capacity for liability management operations would help to further strengthen debt management,” the IMF added.
“The reconstitutions of the Fiscal Responsibility Council and the Public Sector Audit Committee are welcome. Members of both committees should be independently selected. To enhance fiscal transparency, beneficial ownership information should be published for all companies that are awarded public contracts. The audited financial statements and procurement information for public corporations should also be published.”
updating adequate information on their customers, requiring domestic companies to retain beneficial ownership information of their own shareholders.”
Turning to the financial system itself, the IMF suggested: “The credit gap remains negative after several years of credit contraction, and household and corporate leverage are both at modest levels. Banks are well capitalised and hold a fifth of their domestic assets in cash or reserves. However, banks’ high exposure to public sector debt represents an important vulnerability.
“Improving liquidity forecasting and introducing tools such as inter-bank repos (repurchases) or 30-day Treasury Bills could better manage systemic liquidity over the long-term. Reducing the statutory limit on Central Bank advances to the Government, and repaying the outstanding stock of advances, would help absorb liquidity and strengthen the credibility of the fixed exchange rate regime.
“A well-defined ‘escape clause’ could be introduced to allow a temporary increase in the limit on Central Bank advances in exceptional, emergency circumstances.”
legislation on adaptation to climate change which identifies responsibilities of line ministries and sets up mechanisms for accountability through an inter-ministerial commission that reports to the Parliament.
“Further recourse to climate financing would reduce borrowing costs.....
Undertaking debt-fornature swaps that have a third-party guarantor, as contemplated in the 20232024 Budget and initiated in November, could provide resources for specific investments in preservation of natural habitats.”
nationality and Citizenship, P.O. Box N-7147, Nassau, New Providence, The Bahamas.
“Such a shift in the energy matrix would, over the medium term, help narrow the current account deficit, reduce vulnerability to commodity price shocks and boost growth,” the IMF said.
“In implementing the Government’s plan, strengthening of the institutional framework for public-private partnerships (PPPs) will be an important pre-condition and, more broadly, there should be a clear definition of risk sharing between private and public sectors. Improving the operations, lowering costs and optimising the capital structure of Bahamas Power & Light (BPL) would help support these reform efforts.”
Finally, noting the Government’s energy industry reforms, the IMF said the framework governing public-private partnerships (PPPs) needs to be enhanced and “risk sharing” between the public and private sectors needs to be better defined.
NOTICE
NOTICE is hereby given that VERNA MAE
, of
sherwood drive, San
The Bahamas, applying to the Minister responsible for Nationality and Citizenship, for Registration Naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/ naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 13th day of November, 2024 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, New Providence, The Bahamas.
MUSGROVE
#54
Souci, Nassau,
Congressional panel urges toughing the USChina trade relationship
By DIDI TANG Associated Press
A
CONGRESSIONAL
panel has recommended that the U.S. toughen its trade relationship with Beijing, pushing to roll back a nearly 25-year-old decision that helped bring about China's rapid economic growth but that many in Washington now see as hurting U.S. interests.
In its annual report to Congress released Tuesday, the U.S.-China Economic and Security Review Commission called for the first time for ending permanent normal trade relations with Beijing. It echoes moves by prominent Republican lawmakers — including Sen. Marco Rubio, President-elect Donald Trump's pick for secretary of state — as the trade war with China is expected to intensify under the incoming administration.
The change would mean the U.S. reintroducing annual reviews of China's trade practices and gaining more leverage to address "unfair trade behaviors," the commission said in the report.
"This move would signal a shift toward a more assertive trade policy aimed at protecting U.S. industries and workers from economic coercion," the report said. It is among nine pages of recommendations put forward by the commission, created in 2000 to monitor the national security implications of the new trade relationship between Washington and Beijing.
The congressional decision in the last year of the Clinton administration facilitated China's entry into the World Trade Organization in 2001, with the hope that integration into the U.S.-led global
economy and economic prosperity could lead to political liberalization in China.
That has not happened, and the trade relationship took a turn in 2018, when Trump launched a trade war with China to tackle trade imbalances.
This year, on the campaign trail, Trump vowed to levy 60% tariffs on Chinese products to further narrow the trade deficit, a threat that experts say could set back China's economy and drive up consumer costs in the United States. The trade imbalance stood at $279 billion for 2023, down from $418 billion in 2018.
In September, a group of Republican senators, including Rubio, introduced a bill to end permanent normal trade relations with China. The designation significantly lowers trade barriers.
"Giving Communist China the same trade benefits that we give to our greatest allies was one of the most catastrophic decisions that our country has ever made," Rubio said when introducing the bill.
Trump picked Rubio — known for his ideological opposition to communism and his hard-line stance on China — to lead the State Department. The choice needs to be confirmed by the Senate.
"Our country's trade deficit with China more than quadrupled, and we exported millions of American jobs. Ending normal trade relations with China is a no-brainer," Rubio said.
Last week, Rep. John Moolenaar, a Michigan Republican who leads the House's Select Committee on the Chinese Communist Party, introduced a corresponding bill.
TRUMP CHOOSES TV’S DR. OZ TO RUN MEDICARE AND MEDICAID, WALL STREET EXEC LUTNICK FOR COMMERCE
By FATIMA HUSSEIN and AMANDA SEITZ Associated Press
PRESIDENT-ELECT
Donald Trump on Tuesday tapped Dr. Mehmet Oz, a former television talk show host and heart surgeon, to head the agency that oversees health insurance programs for millions of older, poor and disabled Americans. Trump also selected Wall Street executive Howard Lutnick to lead the Commerce Department as he fills out his Cabinet.
"Dr. Oz will be a leader in incentivizing Disease Prevention, so we get the best results in the World for every dollar we spend on Healthcare in our Great Country," Trump said in a statement. "He will also cut waste and fraud within our Country's most expensive Government Agency, which is a third of our Nation's Healthcare spend, and a quarter of our entire National Budget."
Oz, who ran a failed 2022 bid to represent Pennsylvania in the U.S. Senate, has been an outspoken supporter of Trump and in recent days expressed support for Robert F. Kennedy Jr.'s nomination for the nation's top health agency, the Department of Health and Human Services.
As the administrator for the Centers for Medicare and Medicaid Services, Oz would report to Kennedy.
"Americans need better research on healthy lifestyle choices from unbiased scientists, and @robertfkennedyjr can help as HHS secretary," Oz said in an Instagram post last week,
sharing a photo of him with Kennedy.
If confirmed by the Senate, Oz would be responsible for the programs — Medicaid, Medicare and the Affordable Care Act — that more than half the country relies on for health insurance.
Medicaid provides nearly-free health care coverage to millions of the poorest children and adults in the U.S. while Medicare gives older Americans and the disabled access to health insurance. The Affordable Care Act is the Obama-era program that offers health insurance plans to millions of Americans who do not qualify for governmentassisted health insurance, but do not get insurance through their employer.
Trump has said he wants to overhaul the Affordable Care Act but has said he only has "concepts of a plan" for how that redesign would operate. During his first term in office, he tried unsuccessfully to scrap the program altogether. Last month, Republican House Speaker Mike Johnson promised that health care reform would be a big part of Trump's second term agenda.
Other Republicans have vowed to downsize Medicaid and the Affordable Care Act, after years of record enrollment during the Biden administration.
During his campaign for senate, Oz promised to expand Medicare Advantage, the private-run version of Medicare that has become increasingly popular but also a source of widespread fraud.
Notice is hereby given that in accordance with Section 138(4) of the International Business Companies Act, 2000, SYKES CAPITAL (2) LTD. is in dissolution.
The date of commencement of dissolution was November 18th, 2024.
Annabelle Sykes, Unit 6a, The Village, 1723 King Street, Reading RG1 2HG, United Kingdom is the Liquidator.
CHINA’s President Xi Jinping gathers for the world leaders’ group photo at the G20 Summit, in Rio de Janeiro, Tuesday, Nov. 19, 2024.
Photo:Silvia Izquierdo/AP
Lula urges G20 members to take action to slow global warming
By MAURICIO SAVARESE, ELÉONORE HUGHES and DAVID BILLER Associated Press
BRAZIL'S president opened the second day of a meeting of the world's 20 major economies Tuesday by calling for more action to slow global warming, saying developed nations must speed up their initiatives to reduce harmful emissions.
President Luiz Inácio
Lula da Silva's comments came the day after representatives of the G20 nations endorsed a joint statement that called for a pact to combat hunger, more aid for Gaza, an end to the war in Ukraine and other goals, amid global uncertainty surrounding the incoming administration of U.S. President-elect Donald Trump.
The president of Brazil, the host of the two-day meeting, opened Tuesday's session focusing on environmental challenges, saying developed nations should consider moving their 2050 emission goals forward to 2040 or 2045.
"The G20 is responsible for 80% of greenhouse effect emissions," he said. "Even if we are not walking
the same speed, we can all take one more step." In addition to a $325 million contribution for the World Bank clean technology fund, U.S. President Joe Biden has announced a series of climate and development related initiatives. But many of them would require buy-in from Trump, who opposes such projects and has called the climate crisis a "hoax."
Biden has also urged G20 members to each commit $2
TRUMP AND MUSK SOLIDIFY THEIR BOND WITH TEXAS TRIP FOR ROCKET LAUNCH
By CHRIS MEGERIAN and MICHELLE L. PRICE
Associated Press
FOR two weeks, Donald Trump has welcomed Elon Musk into his world. On Tuesday, it was Musk's turn to play host to the president-elect.
Trump flew to South Texas to watch as Musk's SpaceX launched a Starship rocket near the Mexican border. Trump listened intently as the world's richest man explained how the test would work and demonstrated with a model. And then Trump squinted into the bright sky to watch liftoff.
It didn't go perfectly -–the reusable booster did not return to the launch pad as it had done on a previous test last month. Instead, the booster was directed to a splashdown in the Gulf of Mexico.
But Trump's presence at the launch was a remarkable display of intimacy between the two men, one with implications for American politics, the government, foreign policy and even the possibility of humans reaching Mars.
Musk spent around $200 million to help Trump beat Democrat Kamala Harris in the presidential race, and he's been given unparalleled access. He's counseled Trump on nominees for the new administration, joined the president-elect's phone call with Ukrainian President Volodymyr Zelenskyy and been tapped to co-chair an advisory panel on cutting the size of the federal bureaucracy.
In addition to political influence, Musk could benefit personally as well. SpaceX, his rocket company, has billions of dollars in government contracts and the goal of eventually starting a colony on Mars. He's also CEO of Tesla, which manufactures electric vehicles, and has battled with regulators over safety concerns involving autonomous driving.
"Trump has the biggest possible regard for people who break the rules and get away with it," said William Galston, a senior fellow in governance studies at the Brookings Institution, a Washington-based think tank. "Musk has demonstrated extraordinary accomplishment in doing that."
To top if off, Musk owns the social media company
X, formally known as Twitter, which he has harnessed as an influential perch to promote Trump and his agenda.
"Stop the Swamp!" he wrote Tuesday as he shared a warning that entrenched Washington interests are trying to undermine Trump before his inauguration.
Before the election, Musk rejected the idea that he was expecting any favors in return for supporting Trump in the presidential race.
"There is no quid pro quo," he posted on X in September. "With a Trump administration, we can execute major government reform, remove bureaucratic paperwork that is smothering the country and unlock a new age of prosperity."
However, Trump has hardly gone anywhere without Musk in the two weeks since beating Harris. Musk joined Trump at a meeting with House Republicans in Washington and sat next to him at an Ultimate Fighting Championship match in New York. The trip to Texas for the rocket launch was just Trump's third time outside Florida since the election.
As Trump's protective motorcade left the launch site Tuesday evening to return to the airport, one of Musk's angular, shiny Tesla Cybertrucks was tucked in the middle of the formation of black SUVs.
Much of Trump's activity is happening with little public access for the press. Unlike his predecessors, he has opted against regularly making his travel plans or events open to journalists.
The relationship between Trump and Musk was not always so close.
Two years ago, Trump was mocking Musk in stump speeches and Musk was saying it was time for Trump to "hang up his hat & sail into the sunset."
"Trump would be 82 at end of term, which is too old to be chief executive of anything, let alone the United States of America," Musk wrote on social media.
But Musk swiftly endorsed Trump after the former president survived an assassination attempt in July. He quickly became a central figure in Trump's orbit, appearing at times more like his running mate than Ohio Sen. JD Vance.
billion to replenish a pandemic fund established in 2022. Biden has pledged the U.S. will provide up to $667 million by 2026, but that would require Congressional approval.
Condemnation of wars but without casting blame
The joint statement approved Monday night called for urgent humanitarian assistance and better protection of civilians caught up in conflicts in the Middle East, plus affirmed
the Palestinian right to self-determination.
The war in Gaza has killed more than 43,000 Palestinians, according to local health officials, who don't distinguish between civilians and combatants when counting the dead. More than 3,500 people also have been killed in Lebanon due to Israel's offensive against Hezbollah, according to Lebanon's Health Ministry.
The document didn't mention the suffering of
Israel, which is not a G20 member, nor the 100 or so Israeli hostages still held by Hamas in Gaza.
Looming large at the meeting on Monday was news of Biden easing of restrictions on Ukraine's use of longer-range U.S. missiles to allow it to strike more deeply inside Russia also played into the meetings.
"The United States strongly supports Ukraine's sovereignty and territorial integrity. Everyone around this table in my view should, as well," Biden said.
Russian President Vladimir Putin didn't attend, and instead sent Foreign Minister Sergey Lavrov. Putin has avoided such summits since the International Criminal Court issued a warrant that obliges member states to arrest him.
The G20 declaration highlighted the human suffering in Ukraine and called for peace, but didn't name Russia.
"The declaration avoids pointing the finger at the culprits," said Paulo
Velasco, an international relations professor at the State University of Rio de Janeiro. "It doesn't make any critical mention of Israel or Russia, but it highlights the dramatic humanitarian situations in both cases."
The entire declaration lacks specificity, Velasco said, calling it "a declaration of goodwill" with "very few concrete, tangible measures."
Push to tax global billionaires, fight global hunger and reform the UN
The declaration also suggested taxing global billionaires, which would affect about 3,000 people around the world.
Brazil's government stressed that Lula's launch of a global alliance against hunger and poverty on Monday was as important as the final G20 declaration. The alliance is backed by the Rockefeller Foundation and the Bill & Melinda Gates Foundation and, as of Monday, 82 nations had signed onto the plan, Brazil's government said.
Starting a small business is hard. Exiting can be even harder, but planning early is the key
By MAE ANDERSON AP Business Writer
STARTING a small business is hard. Figuring out what to do with a small business when an owner is ready to retire can be even more difficult.
Small business owners say it is best to have a plan well in advance of making a big change like ceding a business to someone else.
Mike Roach started Paloma Clothing in Portland, Oregon, as a co-owner with his mother in 1975. In 1981, he became co-owner with his wife, Kim Osgood. But after nearly 50 years of owning the business, Roach, 74, knew he needed to start thinking about what came next.
His manager, Traci Burnes, helped steer the company through the pandemic, during a fraught time when they could have shuttered, by figuring out how to retain employees and stay afloat during the shutdown.
"At that point, we started thinking, this is really a lot more than the manager. She should be a co-owner, right?," Roach said. "So then we sort of started trying to think about how we could engineer that and and really got serious about it about a year ago."
He worked with his longtime accountant, who has a law degree, to formulate a plan. Roach offered Burns a third-co-owner position, with the understanding she eventually could take over the business.
About 51% of small business owners are over the age of 55, according to the U.S. Census. Given that most people in the U.S. retire in their 60s, that time will soon be coming up for many owners.
The most common options for exiting a business include creating a succession plan for a family member or someone already involved in the business; selling the business to an outsider; or simply winding down the business and shuttering it.
The best path depends on what a small business owner wants to get out of retirement — and an honest
“At that point, we started thinking, this is really a lot more than the manager. She should be a co-owner, right? So then we sort of started trying to think about how we could engineer that and and really got serious about it about a year ago.”
Mike Roach
assessment about the health of a business.
Settling on the right plan can take time. Taylor Trapani's mother started Trapani Communications in Midland, Michigan, in 1994. They started working on a succession plan five years ago. Taylor took over the business in January of this year.
"It was kind of like buying a house in the sense that it just took a lot of time when we transitioned the business ... in terms of paperwork and meeting with attorneys," Trapani said. "And I wasn't really expecting that and how complicated that got." Now the owner, she recommends talking to other small business owners with similar situations to find the best path.
"It's helpful to see how other people organize that piece of it," she said.
Once a business owner has decided on a course of action, they should make plans to get the business in shape to sell or turn over to the next owner. It's important to start early because of the potential time involved. Those who wait until the last minute to make an exit plan risk losing value they could have had if they started earlier.
Finally, an owner should be transparent with employees and clients so they aren't surprised or upset when the change occurs.
"Make sure you plan early and and get ahead of it, that you have a clear strategy and path forward," Roach said.
WORLD leaders attending the G20 Summit pose for a group photo in Rio de Janeiro, Tuesday, Nov. 19, 2024. Photo:Silvia Izquierdo/AP
PRESIDENT-elect Donald Trump listens as Elon Musk explains the operations ahead of the launch of the sixth test flight of the SpaceX Starship rocket Tuesday, Nov. 19, 2024 in Boca Chica, Texas.
Photo:Brandon Bell/AP
A CUSTOMER sits for a shoe shine at a shoe repair shop on Feb. 3, 2023, in New York.
Photo:Mary Altaffer/AP
Nvidia helps pull US indexes higher
By STAN CHOE AP Business Writer
NVIDIA helped pulled U.S. stock indexes higher on Tuesday after they stumbled in the morning on worries about escalations in the Russia-Ukraine war.
The S&P 500 rose 0.4% after erasing an early drop of 0.7%. The Nasdaq composite also shook off an early loss to turn 1% higher, while the Dow Jones Industrial Average slipped 120 points, or 0.3%.
Nvidia's 4.9% climb accounted for the vast majority of the index's gain. The chip company's stock rallied ahead of its profit report for the latest quarter, which is coming on Wednesday, and vaulted its gain for the year to nearly 197% thanks to the craze around artificial-intelligence technology.
Activity in the options market suggests Nvidia's profit report may be the most anticipated event on Wall Street for the rest of the year, beating out the upcoming jobs report and even the next meeting of the Federal Reserve on
interest rates, according to strategists at Barclays Capital. It's "a testament to the outsized impact of AI, and the apparent resurgence of upside chasing by" smaller-pocketed, everyday investors known as retail traders, according to Barclays' Stefano Pascale and Anshul Gupta.
Nvidia's rise helped calm the stock market, even as indexes sank across Europe after Russia said Ukraine fired six U.S.made ATACMS missiles at it. Earlier in the day, Russian President Vladimir Putinformally lowered the threshold for Russia's use of its nuclear weapons. Both France's CAC 40 and Germany's DAX fell 0.7%.
The worries also sent investors into U.S. Treasury bonds, which are seen as some of the world's safest investments. The rise in their prices in turn lowered their yields, and the 10-year Treasury yield fell to 4.39% from 4.41% late Monday. Gold also rose 0.6% and recovered some of the losses it sustained following
Donald Trump's victory in the U.S. presidential election, as investors herded into places traditionally considered safer during times of trouble.
Early in the day, such cautiousness overshadowed optimism coming from reports by big U.S. retailers showing fatter profits for the summer than analysts expected.
Walmart climbed 3% after topping forecasts for both profit and revenue. The nation's biggest retailer said it saw broadbased strength across its
categories, including sales made both online and in stores. It also said it served more upper-income households, while raising its forecasts for sales and profit for the full year.
Lowe's likewise delivered bigger profit and revenue for the latest quarter than analysts expected, but its stock nevertheless dropped 4.6%. A report in the morning said construction crews broke ground on fewer new homes last month than economists expected, and rival Home Depot slipped 0.9%.
Other big companies set to report their latest quarterly results this week include Target on Wednesday and Deere on Thursday. Elsewhere on Wall Street, Super Micro Computer jumped 31.2% after it filed a plan to keep its stock listed on Nasdaq's exchange. It hired an independent auditor, BDO USA, which can help it file financial statements needed in order to comply with Nasdaq's listing requirements. The company's stock has been on a wild ride. It more than quadrupled in the first two and a half months of this year because the company makes servers used in AI. But it gave up all that and more, with losses accelerating after Ernst & Young resigned as its public accounting firm. A special committee of the company's board later said that a three-month investigation found "no evidence of fraud or misconduct on the part of management or the Board of Directors."
Berry Global Group fell 1.3% after Amcor said it would buy the maker of prescription vials, bags and other products in an allstock deal. Amcor dropped 2.6%.
Incyte sank 8.3% after the biopharmaceutical company said it's pausing enrollment in its ongoing study of a potential treatment for hives in chronic spontaneous urticaria. It also said data from another study evaluating a potential treatment for cholestatic pruritus does not support further development.
All told, the S&P 500 rose 23.36 points to 5,916.98. The Dow dropped 120.66 to 43,268.94, and the Nasdaq composite rose 195.66 to 18,987.47. In stock markets abroad, indexes in Asia were more stable than in Europe. They rose 0.7% in Shanghai and 0.4% in Hong Kong, rebounding from early losses.
MARINE FORECAST
THE MORNING sun shines on Wall Street in New York’s Financial District on Tuesday, Nov. 19, 2024. Photo:Peter Morgan/AP
