THE BAHAMAS’ SMALL BUSINESS SECTOR IS IN RUINS

Prepared By Mark A. Turnquest (July 2012)

After analyzing The Bahamas’ economic conditions for the past three years and reviewing international watchdog agencies (Moody, IFC/World Bank, Standard & Poors) reports, it is imperative that the public and private sectors focus on small and medium size development (SME) Development and economic diversification. It is the only sensible approach to grow our economy in a sustainable manner, increase GDP and the entrepreneurial spirit; reduce unemployment, national debt and crime. In order to correct these problems there must be public and private sector partnership which will conduct a strategic analysis on how to make this little country, GREAT!

WHAT ARE AFFECTING THE GROWTH OF THE SME SECTOR?

(1) NATIONAL DEBT

The reality is that the national debt is almost 5 billion (50% of GDP). We spend almost 20% (298 million) of our budget on servicing our national debt.

(2) UNEMPLOYMENT

40,000 Bahamians are either unemployed, underemployed or are discouraged workers. The unemployment rate in New Providence is 15.1% and Grand Bahama is 21.2% (The Bahamas overall is 15.9%). There have been 26,000 job losses over the last 5 years.

(3) CRIME

Our crime challenges are tremendously affecting the business community (via break-ins and armed robberies) and we have four years of consecutive murder rate records.

(4) DECLINE IN COMPETITIVENESS

Several International credit rating agencies have downgraded The Bahamas’ sovereign credit rating and competitiveness in 2011 and suggested that our government raise taxes, formulate some type of value added tax system, slow down government spending, and mostly importantly, diversify our economy.

Unfortunately, The Bahamas has lost its economic competitiveness and creativity in comparison to our Caribbean neighbors in recent years. Our country has regress in the important categories of: (A) Ease of Doing Business,            (B) Starting a Business, (C) Sovereign Credit Rating and (D) Human Resource Index.

(5) INDUSTRIES CHALLENGES

Our Tourism product is uninteresting and not exciting; our financial services offering lack new innovation and our construction boost is benefiting foreigners. These three industries: Tourism, Financial Services and Construction and related industries contribute over 90% of GDP (6.5 Billion) and 80% of our employment level (152,000). We are still importing    over 500 million dollars in agricultural products and our manufacturing sector is stagnated.

(6) ROAD WORKS PROJECT & PROLONGED RECESSION

The SME sector is stagnant and contribution to GDP has deteriorated from 5% (2007)-3% (2011) because of the great recession, failed economic policies, the road improvement project, money borrowing crunch, lack of opportunities and a contracted economy.

(7) FAILED ECONOMIC POLICIES

Stakeholders who are responsible for SME Development have failed to improve our economy beyond mediocrity by not developing a Strategic Plan for SME Development. Although over the past seven years (2005- 2011) the public and private sectors collaborated with the intent to provide some form of a SME framework development      e.g. Domestic Investment Plan, SME Development Act which both have failed to become formulated and now the SME sector is in a hopeless position in mid 2012.

(8) NO FAMILY ISLAND DEVELOPMENT VISION

 Each Family Island should be analyzed to determine its economic, social and cultural potential, so that financial and other incentives can be offered to Bahamians who want to open complementary businesses and reside permanently on a Family Island.

·       This initiative will increase

·       the employment rate,

·       improve the infrastructure of the Family Islands,

·       encourage Bahamians to reside there permanently

·       and entice more domestic

·       and foreign tourists to the various islands.

Every redevelopment plans must preserve the natural, heritage and cultural resources of each island.

(9) NO SME DEVELOPMENT ACT (SDA)

The SDA, from a domestic perspective, will provide the foundation on which to improve the economic conditions of The Bahamas. From an international perspective, it will attract foreign investors who want to partner with local entrepreneurs in fields such as e-commerce, manufacturing, agriculture, and information technology. These industries are tremendously underserved and underdeveloped. These types of investments would diversify the Bahamian economy, which relies heavily on tourism and financial services.

The SDA will revitalize the entrepreneurial spirit in all islands of The Bahamas and will outline policies and initiatives that would assist in the development of SMEs–a major driving force of the economy. All current incentives, concession and legislation that are afforded to small businesses should be modified and encompass in the SDA.

(10) NO SME DEVELOPMENT CENTRE (SDC).

The new SME development centre must be developed and structured to eliminate financial and non-financial decision making based on political influences when formulating national economic policies. The SDC will establish and identify the roles and responsibilities of a Regulatory and Advisory Board that would oversee the enforcement of the SME Developing ACT (SDA).
Public and private sector executives will be selected to this Board. Members of this Board will be mandated not to make decisions based on political; gender or cultural motives. This Board will have the authority to make recommendations to modify particulars of the SDA based on economic conditions or the request of stakeholders.

(11) NO NATIONAL FUNDING SCHEME

A 15-20 million SME fund needs to be developed by local and foreign investors. Government need to eliminate legislations that make it almost impossible for SMEs to access international funding.  In addition, government, local and international lending institutions must partner to extend meaningful financial support to SMEs. Lenders need to focus on packaging loans extended to SME that have built-in accounting management, human resources and marketing support programs at an affordable cost for at least a year.

In conclusion, the PLP government must

1.  Swiftly attack this economic crisis by developing a National Strategic Plan for SME Development that focuses on sustainable economic growth and economic diversification.

2.  In addition, there must me more public –private partnership (PPT) when developing economic policies because it would prevent unnecessary roadblocks for entrepreneurial advancement that are difficult to reverse. 

I would like for SME owners to contact me so that we can collaborate to improve the economic conditions in The Bahamas  To contact me call 326-6748 / 427-3640 or log on to www.markturnquestconsulting.com.

BAHAMAS SME DEVELOPMENT


&

ECONOMIC DIVERSIFICATION PLANS – AN IMPERATIVE

Prepared By Mark A. Turnquest (May 2012)

After analyzing The Bahamas’ economic condition for the past three years and reviewing international watchdog agencies (Moody, IFC/World Bank, Standard & Poors) reports, it is imperative that the public and private sector focus on SME Development and economic diversification. It is the only sensible approach to grow our economy in a sustainable manner, increase GDP and the entrepreneurial spirit; reduce unemployment, national debt and crime.

WHAT ARE THE REQUIREMENTS TO DIVERSIFY & GROW OUR ECONOMY?

The only way to improve the overall living conditions of The Bahamas is to develop a National Strategic Plan for SME Development and Economic Diversification. This plan should articulate ten (10) main methods on how to improve the economic conditions of The Bahamas:

(1) COMMIT TO THEORY OF ECONOMIC GROWTH AND DEVELOPMENT

There are many models to choose from: The Linear –Stages Theory, Rostow’s Stages of Growth Theory, The Harod Domer Growth Model, Structural Change Models, The Lewis Theory of Development, Neoclassical Growth Theory, The New Growth Theory, and Motivation For The New Growth Theory etc. These models should be analyzed and determine which one is best suited for the Bahamas and constantly be adjusted base of economic conditions.

(2) FORMULATE A SUSTAINABLE CLUSTERING STRATEGY FOR PRODUCTIVE AND CREATIVE MARKETS

Clusters have the potential to affect competition in three ways, by: increasing the productivity of the companies in the cluster, driving innovation in the field, and stimulating new businesses in the field. Create clustering strategies for entrepreneurial ventures that develops innovative products, delivery systems, operational structures and marketing strategies in film making, agro-processing, fashion design, e-commerce, information technology, agriculture, art, e-learning, multi-media production, manufacturing, education, horticulture, software development, fly fishing, art and authentically Bahamian handicraft.

(3) PREPARE A SUSTAINABLE FAMILY ISLAND DEVELOPMENT PROGRAM

Each Family Island should be analyzed to determine its economic, social and cultural potential, so that financial and other incentives can be offered to Bahamians who want to open complementary businesses and reside permanently on a Family Island. This initiative will increase the employment rate, improve the infrastructure of the Family Islands, encourage Bahamians to reside there permanently and entice more domestic and foreign tourists to the various islands. Every redevelopment plans must preserve the natural, heritage and cultural resources of each island.

(4) CREATE A NATIONAL BUSINESS SUCCESS MODEL FOR SMEs

A national business success model will increase the national economic value of SMEs in The Bahamas. In addition, its purpose is to synchronize and unify the efforts of the government, financial lending institutions, non-governmental organizations (NGOs), SMEs and other stakeholders as it relates to small business development in The Bahamas. Most importantly, a business success model will identify how local and international investors and entrepreneurs can qualify for incentive and stimulus programmes when it comes to financial and non-financial assistance for introducing / developing innovative products and services

(5) A NATIONAL FUNDING SCHEME

A 15-20 million SME fund needs to be developed by local and foreign investors. Government need to eliminate legislations that make it almost impossible for SMEs to access international funding. In addition, government, local and international lending institutions must partner to extend meaningful financial support to SMEs. Lenders need to focus on packaging loans extended to SME that have built-in accounting management, human resources and marketing support programs at an affordable cost for at least a year.

(6) FORMULATE A SME DEVELOPMENT ACT (SDA)

The SDA, from a domestic perspective, will provide the foundation on which to improve the economic conditions of The Bahamas. From an international perspective, it will attract foreign investors who want to partner with local entrepreneurs in fields such as e-commerce, manufacturing, agriculture, and information technology. These industries are tremendously underserved and underdeveloped. These types of investments would diversify the Bahamian economy, which relies heavily on tourism and financial services.

(7) CREATE NEW MARKET OPPORTUNITIES

Medical, health and wellness, sports tourism, e-commerce, Information and Communication Technology (ICT), apiculture (bees agriculture), green energy production, innovative manufacturing and agriculture (coconuts etc) markets must be effectively and efficiently exploited in order to successfully grow and diversify the economy.

(8) REVITALIZE EXISTING AND REVIVING DORMANT INDUSTRIES

The Government must be more proactive and find ways to reduce the high electricity cost and other constraints that are killing SMEs and hampering the revival of dormant industries. A comprehensive incentive and concession plan should be developed to stimulate economic development. The government and its partners should focus on revitalizing the cultural tourism, agriculture, fishing, fish farming and manufacturing industries and reviving the hemp, sisal, sponging and forestry industries.

(9) CREATE A SME DEVELOPMENT CENTRE (SDC).

The new SME development centre must be developed and structured to eliminate financial and non-financial decision making based on political influences when formulating national economic policies. The SDC will establish and identify the roles and responsibilities of a Regulatory and Advisory Board that would oversee the enforcement of the SME Developing ACT (SDA).
Public and private sector executives will be selected to this Board. Members of this Board will be mandated not to make decisions based on political; gender or cultural motives. This Board will have the authority to make recommendations to modify particulars of the SDA based on economic conditions or the request of stakeholders.

(10) CREATE A MINISTRY/DEPARTMENT OF COMMERCE

My advice to the government is to create a Ministry of Commerce without incurring any costs or expenses. Simply transfer a few existing staff from the Ministry of Finance and empower the present Minister of State for Finance to head it. If additional persons are needed, I am optimistic that business persons from the private sector would volunteer their services (on an advisory board) to improve the economic conditions of the Bahamas because it would be in their best interests to do so. I would be a volunteer if asked.

After the May 7, 2012 general election, the new government must swiftly attack this economic crisis by developing a National Strategic Plan for SME Development and Economic Diversification that focuses on sustainable economic growth. In addition, there must me more public –private partnership (PPT) when developing economic policies because it would prevent unnecessary roadblocks for entrepreneurial advancement that are difficult to reverse.

To assist in the formulation of the National Strategic Plan for SME Development and Economic Diversification please feel free to contact Mark A. Turnquest at: Telephone: (242) 326-6748 / 427-3640, email markaturnquest@gmail.com or web site www.markturnquestconsulting.com.

'STIMULATE' SMALL BUSINESS THROUGH $15-$20M FUND

Published On : Monday, January 23, 2012

By NEIL HARTNELL

Tribune Business Editor

A $15-20 million Small Business Development Fund would be enough to "stimulate" the sector's development and further financing, a well-known consultant telling Tribune Business it should double its Bahamian GDP share to 10 per cent in "three-five years".

Telling Tribune Business that the Government and others had been "talking for too long" when it came to Bahamian small business and entrepreneurial development, Mark Turnquest said an overall development framework for the sector was required to unleash - and direct - financing and other support mechanisms.

The head of Mark A. Turnquest Consulting, a well-known small business consultant, said a Small Business Development Fund would be formed by "pooling" finance from the likes of commercial banks, angel investors, venture capitalists and philanthropists.

Urging that there be no government involvement in the Fund's decisions, Mr Turnquest said it should focus on start-ups and small businesses with the ability to hire persons, and those with the ability to export goods and services.

With the fast-approaching general election in danger of postponing the Government's much-trumpeted Small Business Development Bill, perhaps indefinitely, Mr Turnquest urged the administration to at least hold the necessary consultation with industry leaders and stakeholders prior to going to the polls.

"If the PLP gets into power, they will not look at what's been done, and we'll all have to wait three years as they start all over again," Mr Turnquest said. "If we don't have the consultation in process, they have to start all over again."

Staging private sector consultations now, Mr Turnquest said, would at least provide "some type of reference" point. So, if the Government did change, the new administration "don't have to reinvent the wheel".

The most important development, he added, was for the Bahamas to devise and implement a "small business development framework". This would create an institutional element that could even encourage partnerships between Bahamian and international persons/organisations when it came to financing and supporting small business development.

Calling for Bahamian and foreign lenders to "pool resources in a Small Business Development Fund", Mr Turnquest said: "It would have to have about $15-$20 million to start with, and after that everything will fall into place.

"A lot of people, even in the Bahamas, have money to invest, but they do not have a structure to assist them. The framework is actually a stimulus package where it will develop small business in the Bahamas. Currently, there's no direction."

The Small Business Development Fund would be guided by this framework, Mr Turnquest said. He said it should "focus on developing innovative companies who hire a sufficient amount of people, and economic growth.

"Everyone is talking about job creation, but there's no strategy. You fund businesses who can hire 25 people, pay taxes and develop themselves so they can export goods and services. That's how we improve the 5 per cent of GDP share we have now. We should be at least 10 per cent in the next three years."

Calling for a focus on small business exports, Mr Turnquest said the Small Business Development Fund had to be run by banks, financiers and private sector executives who understood lending and what to look for in business plans.

"The banks have not been interested in small business development. That's not their focus. But they have a lot of people who understand how to lend to small business. All they need is a policy framework to tell them what to do," he added, urging that there be no government representatives on the Small Business Development Fund.

"Let's focus," Mr Turnquest told Tribune Business, "We've been talking too long. We're talking every day about small business. We want the political parties to stop the gamesmanship on small business, and come up with sound business proposals on how they're going to change the environment in the short and long-term."

 

HAS THE BAHAMAS TOURISM MARKETING PLAN IMPROVE AFTER 2004?

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Bahamas SME Act Needs New Direction

INTER-STAKEHOLDER SYNERGY:

“Diligently transforming the Bahamas SME Development Act from formulation to implementation”

By Mark A. Turnquest

After my organization hosted the first Small Business Summit in 2009, it was evident that The Bahamas needed a national strategic plan for the development of small and medium sized enterprises (SMEs). However, our country, for 38 years, has had a flaw for not developing a practical strategic national plan for anything (crime, economic development. immigration etc).

Industry leaders from the professional and medical services; manufacturing, agriculture, fisheries, wholesale merchandizing and retail; construction, tourism, hospitality, commercial banks and government indicated during the 2009 Small Business Summit that an Act to developed the SME sector was far overdue. As a result, a report was developed to identify how this SME could be formulated and implemented in an effective and efficient manner. This report: Act As One: The Importance of Stakeholders’ Collaborative Efforts When Developing the Small Business Act of The Bahamas, can be viewed at http://www.markturnquestconsulting.com/Entrepreneurship.html, After consulting with the government, I applaud the Ministry of Finance team for creating the political will to develop the Bahamas SME Development Act and to create a new strategic framework to enhance the productivity level of the sector.

However, there were too many questionable decisions in 2010 on how to perform infrastructural development (mainly the road improvement works) and what formula of tax increases to apply on import duties. I hope that these two decisions will not reduce the effectiveness of the SME Development Act in the future. In 2010, the main focus to stimulate the SME sector should have been to provide incentives and concessions to mitigate the impact of the recession. There was a small window of opportunity to “stop the bleeding” and it was not taken advantage of, hence, I witness hundreds of SME failures and the death of many entrepreneurial dreams. Governments must realize that sometimes negative effects of policy decisions without proper consultations are sometimes irreversible.

My main concern with the formulation process so far is that there has been limited participation by the Act’s main stakeholders- SMEs. If this had occurred, then the $7,500 Jump Start Program (Grant Funding) would not have been given a green light. The grant is not enough and other sources of funding are required by local and international financial Institutions to be pooled together to benefit new and existing SMEs.

 Other concerns are as follows:

·         There should be town meetings with the wider SME community in order to gather information about the major problems and opportunities facing the sector;

·         In addition, there needs to be more industry-specific (construction, agriculture, merchandising, hospitality, manufacturing, technical services, tourism, hospitality, fashion design etc) discussions, so that local and international issues that affect individual industries could be addressed in the Act.

The formulation process of the SME Development Act needs to be evaluated and corrective measures should take place. I am aware that there were consultation with The Inter-American Development Bank, The Bahamas Chamber of Commerce and Employers Confederation and a few others, but this not an effective  way to develop  such an important Act. There needs to be “inter-stakeholder synergy”; this means that more trade organizations, banks, industry leaders and especially SME owners should be involved in the formulation process before the Act is debated in Parliament.  

This inter-stakeholder synergy between the government, NGOs, trade associations, financial institutions, industry leaders and SMEs owners would align resources and capabilities to craft a SME Act that is meaningful to the sector. Although this Act should not precede a strategic national plan for SME development, it is a good start because our SME sector is lagging behind in competitiveness, globally.

The main policies that must be adapted by key stakeholders when diligently transforming the Act from formulation to implementation are as follows:

GOVERNMENT

I.            Ensure that possible amalgamation of Bahamas Agricultural Industrial Corporation,  Bahamas Development Bank  and Bahamas Entrepreneurial Venture Fund focuses on leveraging the  strengths and correcting the weaknesses of the organizations; 

II.            The new SME development framework that is being developed must be structured to eliminate financial and non-financial decision making based on political influences. This is the main reason why the Bahamas Development Bank is near bankruptcy;

III.            Focus on family island development but keep the  natural, heritage  and cultural resources of each island;

IV.            Reduce the barriers that make it almost impossible for SMEs to access international funding; 

V.            Promote and encourage e-commerce activities and remove policies that make opening on-line merchant accounts very difficult;

VI.            Adapt public policy tools to SME needs: especially facilitating SMEs’ participation in the public procurement process;

VII.            Consider creating a Ministry or Department of Commerce to protect the SME sector from the EPA and to develop strategies to improve on its 5% contribution to GDP.  To view an article that addresses the importance of a Ministry of Commerce, log on to:

     http://markaturnquest.blogspot.com/2011/07/bahamas-minsitry-of-commerce-is-needed.html

COMMERCIAL BANKS

I.            Partner with government and international leading institutions to develop comprehensive SME Funding Scheme (SFS) so that more financial support can be extended to SMEs;

II.            The $7,500 grant that is currently being offered to a  few SMEs by the government could be used as a down payment so that local and international banks, and private investors could give more meaningful funding in order to prevent business failure due to undercapitalization;

III.            Focus on packaging loans extended to SME that have built-in accounting management, human resources and marketing support programs at an affordable cost for at least a year.

  

THE BAHAMAS CHAMBER OF COMMERCE AND EMPLOYERS’ CONFEDERATION

I.            Focus on providing new SMEs with more market information about various industries. The organization should partner with The College of the Bahamas and the Inter-American Development Bank to perform more market research on the economy of the Bahamas;

II.            Become more visible in the SME market (over the hill) and remove the perception that the organization only focuses on big businesses;

III.            Encourage professional and trade associations, and SMEs to become more knowledgeable about the pros and cons of the Economic Partnership Agreement (EPA).

SMEs (NEW & ASSISTING)

       I.            SMEs must be committed to acting in a socially responsible manner ( paying business licenses, NIB, correct custom duties etc);

    II.            SMEs must become knowledge about all aspects of their business model ( operations, marketing, accounting/finance, human resources etc);

 III.            All SMEs must have sound marketing, management, human resource and accounting systems. SMEs must invest in the Quickbooks Accounting Software; it is an invaluable tool for businesses.          

THE BAHAMIAN CONSUMER

At the heart of the new Act, there should be the conviction that achieving the best possible framework conditions for SMEs depends first and foremost on society’s recognition of entrepreneurs.

Bahamian consumers must support the implementation of the new Act and SME framework to buy authentic Bahamian made products and discourage criminal activities that would negatively affect local SMEs. The Bahamian consumers should understand that vibrant SMEs will make The Bahamas more robust to stand against the uncertainty of business cycles (especially recessions and depressions).

Finally, Framers of the initial draft of the Act must consider the following important matters:

         I.            Ensure that presidents of trade and professionals associations clearly identify problems that their members are experiencing from local regulations and international competitors;

      II.            Build in major incentives in the Act for entrepreneurial ventures that creates innovative  products, delivery systems, operational structures and marketing strategies in film making, fashion design, e-commerce, information technology, agriculture, manufacturing, education, software development, art and handicraft;

   III.            Create added concessions to protect “socially responsibly” SMEs that employ over 25 Bahamians during future recessions;

   IV.            Provide special assistance to local SMEs that focuses highly on exporting authentic Bahamian products and creative services;

      V.            Provide regulatory policies to protect the management consultancy sector from unfair and unethical practices that are performed by international service providers.

I hope that the initial draft of SME Development Act is brought to the business community by September 2011.  The government must host a series of town meetings and workshops so that all aspects of this Act could be diligently crafted. My advice to the government is not to dilute the process, but have adequate consultation with SMEs owners and not to force this Act down the throats of SMEs owners. The government must understand that this is an important Act and not to delay communicating the contents of it to SMEs throughout the Bahamas.

In addition, Members of Parliament must become more involved in the formulation of the Act. They should immediately host meetings and obtain information about the challenges and other issues that SMEs are experiencing in their constituencies. This is important so that they (MPs) can have intellectual debates when discussing this Act in the House of Assembly.

 I would like for SMEs to contact me so that we can ensure that is Act is diligently formulated and implemented. To contact me call 326-6748 / 427-3640 or log on to www.markturnquestconsulting.com.

THE KISS OF DEATH FOR SMALL BUSINESSES

Published On:Thursday, July 28, 2011

By NEIL HARTNELL
Tribune Business Editor
 
THE New Providence Road Improvement Project has proved to be "the kiss of death" for many small Bahamian-owned businesses in the Robinson Road and Market Street areas, a leading consultant to the sector telling Tribune Business "at least 25" had gone out of business.
 
Mark A. Turnquest, of Mark A. Turnquest Consulting, which provides advisory services to small and medium-sized businesses, said that when combined with the effects of the recession, the Project's roadworks had been too much for many companies to bear.
 
"That was the kiss of death," he told Tribune Business. "The recession started it, and the roadworks finished it. That was like the kiss of death for people on Robinson Road, East Street, Market Street and Blue Hill Road. Because of that, a lot of them are out of business."
 
When asked by Tribune Business how many small firms had been forced to close their doors, Mr Turnquest, whose own office is based on Robinson Road, said it was "at least 25 on Robinson Road and Market Street. I can physically see it. You're looking at a lot of businesses that could not even survive that".
 
Adding that it "could be more", given that he was not as aware of the impact on Blue Hill Road and East Street-based businesses, Mr Turnquest said he and others on Robinson Road had been forced to endure its closure for six to eight months.
 
Some firms, he added, were still only earning $20 a day in revenue. Given the road closures and access issues created by the roadworks, even long-standing loyal patrons have avoided driving to businesses in the impacted areas. The New Providence Road Improvement Project's unintended consequences have been to further exacerbate the problems facing many Bahamian-owned businesses due to the slump in consumer spending and demand.
 
Mr Turnquest said planning for the Road Improvement Project should not have taken place in isolation, adding that the Government could have achieved the twin objectives of infrastructure development and aiding entrepreneurs if it had considered both together.
 
Compensation
 
He even went so far as to suggest that the $120 million Inter-American Development Bank (IDB) loan that is financing the New Providence Road Improvement Project should have included provisions to pay impacted business owners compensation for revenue losses that resulted.
 
"You have to have what I call a National Vision to do these things - to be creative and to help entrepreneurs, and also to develop infrastructure," Mr Turnquest said. "But you cannot do one and not think about the other.
 
"The IDB, along with the Government, should have done a Business Assessment Report to determine the negative effects of the roadworks, and compensation should have been packaged in the loan, so that a business received a percentage of their losses.
 
"That would have been a better approach than killing the businesses off and leaving them to die."
Rather than extend the National Insurance Board's (NIB) unemployment benefit queue, Mr Turnquest reiterated that the Government should have introduced temporary incentives aimed specifically at small businesses, with the aim of encouraging them to maintain staffing levels.
 
For those companies employing between 10-15 persons or more, Mr Turnquest said the Ingraham administration should have given them a one-year break on paying the employer component of National Insurance Board (NIB) contributions.
 
This, he added, should have been introduced once it became clear just how prolonged and deep the recession was likely to be, along with a 10 per cent reduction on all import duty payments for every business operating for at least three years.
 
The Government also needed to work with Bahamian commercial banks to encourage them to be "more friendly" to entrepreneurs and companies with viable business plans and good track records.
 
Banks
 
"That is why we're in the mess we are in now, because the Government does not want to work with the banks and financial institutions the way they should," Mr Turnquest said. "Because of that, there is no harmony between the two."
 
He added that when he spoke to Scotiabank (Bahamas) three months ago, the financial institution was unaware of efforts to develop the Small and Medium-Sized Enterprise Development Bill or what was likely to be included in it.
 
Reiterating his plea for all involved in financing and supporting Bahamian small businesses to come together to make "one plus one equal three, not two", Mr Turnquest added: "We are already at a competitive disadvantage because we are the last country in the Caribbean to have a Small Business Act.
 
"The only thing going for us is that we have good foreign reserves levels and a lot of foreign direct investment......... Ask any small and medium-sized business now, they will not know what is going on and how they can contribute to the Act. If they'd consulted with SMEs, they'd not have given the $7,500 Jump Start grant the green light, because it could not work."