Listening –and talking
Earlier this week, Evan Greenberg, the chief executive officer of Ace, urged Government not to treat business as “the source of evil”.
Those were tough words, and something of an exaggeration, but for all of that, they certainly reflect a feeling among international business leaders that in recent years they have been tolerated rather than welcomed.
Given that, it is important to note that there have been some positive steps taken in recent weeks by the new administration of Premier Paula Cox. The first was the promise in the Throne Speech to extend the tax exemption guarantee for international companies. This was never in any doubt, but the lack of a commitment to extend it was creating uncertainty. In general, Premier Cox's calls for unity will also help.
Having said that, there is still a long way to go to restore confidence in the Bermuda market. If changes in the term limit regime are unlikely, the efforts by Government in recent weeks to produce statistics explaining just how many people have received waivers and exemptions will help, even if it does not remove the general uncertainty surrounding work permits.
Likewise, the efforts by Ministers Patrice Minors and Kim Wilson to meet with private sector leaders and to listen to their concerns bodes well for the future. That occurred under Premier Dr. Ewart Brown's administration as well, but there is no doubt that the tone and tenor of the discussions is now different and more constructive.
The decision by Government to remove the uncertainty hanging over the Corporation of Hamilton's ability to levy wharfage taxes over the next year shows the same kind of approach, albeit to a municipality and not to the business sector. But the fact the Corporation was able to meet and make progress in talks in a matter of a month where it had not with the Government previously over the course of a year speaks volumes.
It is important to say that this does not mean the Government will do whatever the private sector wants. There will be areas of disagreement and policy differences. But the fact the Government is prepared to listen and to negotiate is positive. And businesses and others need to do their part as well. In the Corporation of Hamilton's case, it has been asked to present its budget, and “deliverables” or services it provides, presumably to make a case for continuing to levy the wharfage tax. That's reasonable, and although the Corporation has dropped some programmes and future plans to take account of the economic situation, it needs to do more to reduce its own spending. It cannot demand autonomy and independence on the one hand and then be looking for handouts if it does not have its own fiscal house in order. That is precisely the position that the Corporation of St George is now in.
Nonetheless, these are positive signs for the future of Bermuda's economy. Continuing and building on them is critical. It would not hurt to follow Mr Greenberg's advice on this. He said: “You need to be attractive to business and that means you've got to be competitive. And generally that involves an enlightened regulatory environment, an infrastructure that is cost-competitive and a bureaucracy that is not overly burdensome.”
That, in effect, was the “Bermuda Inc” model and we need to get back to it.