Dare to dream, Bermuda
To follow up on my piece from a fortnight ago, I thought it would be imperative of me to provide an example of entering productive ideas and what I framed as adding to the conversation.
Last month I attended an excellent investment conference at St Regis, which was quite thought-provoking and which was put on by industry legends, pioneers from the foreign perspective and Bermuda industry veterans.
One industry veteran spoke about the intersectionality of the Bermudian entrepreneurial spirit and pursuit of being bigger than the ocean that confines us. We walked through a history of the insurance industry, a lesson that everyone should hear, which spoke greatly about the world trying to put limits on our vision and the possibilities of our future. We then turned the discussion to how Bermuda international business companies have no choice but to be nimble in size, given the restricted supply of housing and limited capacity of Hamilton’s infrastructure to have several thousand personnel-sized insurance companies on island and that the possibility of bringing in 10,000 people was unlikely.
I laughed to myself because we had just spent 20 minutes talking about how others were constantly putting limits on our possibilities. We had a vision for our country almost a hundred years ago and it was constantly shut down as an impossibility at every turn by our international friends.
What did we do?
We continued and soldiered in the Bermudian way to make our vision a reality. But now our own mindset is one of limited possibilities?
Have we turned into that foreign mindset of limited possibilities with a lack of creative innovation?
I remember growing up in a Bermuda where there was immense construction and formation of new wealth. Living in that time made me feel like any dream that I wanted to pursue could be possible; that if you worked hard, you were rewarded.
We are on the precipice of a renaissance, but given that everything in life has balance there is also the chance that the precipice on which we are seated could be one of decline if not stewarded properly.
What is needed more than anything is a vision for the future, a renaissance, that would be beneficial for all. As my ideology guides me more than anything, that means we don’t need radical change and overall upheaval of legislation — and to a certain extent government policy to put that revolutionary and innovative mindset to the forefront — we just need a leader.
We need someone who will bring a vision for the future, who is willing to work hard to get buy-in from the community to embark on a journey that could lead us to prosperity for all. We need to get out of the hole that has been continuously dug through the division of modern-day politicians.
At the simplest levels, we need to grow the industry that we know is working — international business — and combine it with an industry that is about to be in growth, which is tourism. We have seen the looming announcement of the Fairmont Southampton and announcements from Brookfield about development on Front Street, and the biggest believers in our nation’s growth, the Green family, who have added new real estate to their ever-growing portfolio.
We must create a consortium of future construction projects and local vendors, and bring them together to find ways in which we can achieve economies of scale on construction supplies and other associated materials to reduce costs. Whatever concessions we can put in place through elimination of duties and other incentives, we need to also put on the table to spur growth in our gross domestic product.
We need 10,000 people not to only revolutionise the way we do business, but to actually turn the City into one that can provide the economy that Bermudian entrepreneurs deserve. Having a livable city would reduce congestion on our roads while also reducing the morning and evening rush-hour traffic, and in turn our carbon footprint.
We should see cranes and construction workers on every street working towards the common goal of revolutionising our country and a creating an economy, social culture and country that we all take pride in and bring home our loved ones who are overseas seeking opportunities that don’t yet exist on our shores.
Now I won’t get into the weeds of how creating a livable city can have a positive impact on the Bermudian dream of owning a home — through gradually making buying and renting in rural areas more affordable. This would also reduce the amount of financing cost to consumers through the influx of foreign wealth into the economy and the ability of new institutions to lend at a lower and more competitive rates.
At the conference we talked about alternative investments — insurance investment terminology — which was the part that we investors are looking at intently as we recognise that we may be nearing the end of a heightened, risk-free rate of return, and we have instead to look for new spaces to invest and seek returns once it begins to trend downwards. But, given the uncertainty of the markets and with a looming US recession, you want to invest in less risky alternatives. Nine times out of ten, we turn to investment products that are structured around the real estate market, where there tends to be opportunity.
Now this is the part where we need a visionary broker. As a community and businesses that have a social obligation to society, we should be investing in that community tenfold, as the impact on our bottom line is highly correlated. We should be building state-of-the-art, fully sustainable buildings that will take us and our industry into the future — Bacardi has just done this. We should be showing the world that we are still the No 1 jurisdiction of choice; not only on the human capital and financing fronts, but in the way we view and prepare for the future. We need to say not only to our international business partners but to our people that we should buy in. Why not buy into your own future; that is the way to get us out this crushing debt crisis and to rebuild a lasting future for our children.
This public-private initiative — by public I mean the people, not government intervention — will not only cover our need to revitalise the economy and come with a strategy to avoid the manufactured recession that may be caused by central banks’ monetary policy, but it could also suffice the space for Bermuda international business to be a leader in the environmental, social and governance space. On the operational side as well as on the investment side.
The financial burden does not have to all fall on the international business sector, which more than likely has the necessary capital in any event. If the associated risk is an issue, there is a way to mitigate that within a structured product from reputable and known playmakers in that space. It could also fall on our local venture capitalists and entrepreneurs who are seeking commercial/residential real estate exposure with high mitigating risk standards.
Bermuda has always provided solutions — this may not be the solution, but is a concept that we could work on as a community and get progressive buy-in to achieve it. Revolutionising the City and being more sustainable and independent from the grid would give us the sustainable future we can all bask in. We could grow the working base and through that lower taxes for both Bermudians and international business while providing incentive for the latter to bring additional human capital to our shores, thus providing relief to our ageing system. We lastly need to turn away from areas that bring our reputation into disrepute and focus on how we can grow what we know is growable.
Companies have the capability to grow but they need incentive and growth strategies to achieve this. The Government has consistently put barriers and constraints on growth for its own political strategy, and it is time that this comes to an end. Time to not allow the divisiveness of party politics to guide the downfall of our impending future.
We need to dare to dream, Bermuda. We need to set our goals for the future and determine that we are best-placed to see those dreams into reality. We have done it time and time again over the past 400 years, when the odds and people told us that we could not achieve greatness. We have always bucked the trend in the realising our accomplishments. Let’s do it again. Let’s dream big and create a viable option to end the political divide and relegate both parties to the lower-tier league.
• Justin Mathias is a former senator and chairman of the One Bermuda Alliance
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