Column: A Bermuda Economic Recovery Plan

July 3, 2020 | 2 Comments

Cole Simons Bermuda December 2018[Opinion column written by Cole Simons]

Like most countries around the world, Bermuda has been struck by the catastrophic impact of Covid- 19. We have seen lives lost and other lives compromised. From a health perspective, our recovery is admirable with the Pan-American Health Organization raising the Island’s country status from clusters of Covid-19 cases to “sporadic cases”. Without question, Bermuda has done a great job on containment.

Despite the above, we need to continue Covid 19 mitigation measures. All Bermudians must continue to make their personal contribution if we are to minimize the health devastation left in the wake of Covid 19. These mitigation measures include social distancing, self- isolation, self-quarantining, using personal protective equipment, and adhering to the standards prescribed by the World Health Organization, POCA , the US Center for Disease Control and other agencies.

On the economic side, societal disruption has been grave. Things are not as positive. We were just not prepared for this catastrophic pandemic. Somehow we have a great history of managing our way through disasters like hurricanes, but this catastrophe was really overwhelming.

Many of our sisters, brothers, mothers, fathers, aunts and uncles are losing their jobs, and they continue to be in an unenviable and uncomfortable state. We must do whatever we can in support of our families economically and socially.

We have seen the closure of business institutions which have been around for 100 years. We have seen restaurants close. We have seen popular retail stores shut their doors and major sporting events cancelled. Our tourism industry has temporarily collapsed, and some hotels and guest houses have shut. This bleak economic picture will continue until we are positioned to provide a robust national recovery plan to guide us to an economic renaissance.

Let’s be clear, this economic shock provides an opportunity for bold initiatives, and also requires us to revisit tried and proven initiatives, without political bias. We must examine new ways that we all can work together towards a common end, as we chart our way through the path of economic recovery and rehabilitation.

We must rebuild a vibrant economy, one which will be supported by economic growth, where jobs are created with a focus on equity, diversity, fair trade and real opportunities for Bermudians. We must find investors to support small business and our local economy, and we all must buy Bermuda.

We must learn from our recent experiences, and build a vibrant economy which will be resilient. This rebuilding process will be supported by a blueprint, or an economic recovery plan which will include, and speak to the following elements.

These are all high-level strategic aims. We hope that Government will consider our suggestions and we would be happy to work with Government to develop the necessary tactics to achieve those aims.

1 The Fiscal Framework:

Bermuda must review and redesign its fiscal framework. It is vital that we apply our resources to support an economic recovery plan, and to absorb future economic shocks. The immediate crisis has required governments around the world to increase fiscal deficits to support vital public services and livelihoods in the near term. Most are crafting new fiscal frameworks for the future which will kick start their economies.

2 Infrastructure investments is key to our recovery

The Government should commit robust capital investment to support the recovery. They could make a commitment to increase annual investments in infrastructure projects and our schools. This could be a fixed percentage of our GDP. This would be crucial in supporting our contractors, SME’s and small businesses, which hire a large number of Bermudians.

3 Creating Entrepreneurs through Government backing

The Government could embark upon initiatives that will examine the efficient use of, and return on government assets. This can be done by privatizing some government services where it makes economic sense to do so. This initiative could enhance the return on government assets, create entrepreneurial opportunity and at the same time, enhance the services provided to our community. A perfect example of this is the Bermuda Tourism Authority, and the fine work that they do.

4 Develop bold prospectus for Bermuda which will be attractive to potential investors

The Government must ensure a strong and bold prospectus on Bermuda is produced, and is available to investors for investment purposes. This will require a focus on business and investment opportunities. It could also be used to maximize benefits that Bermuda enjoys because of its international presence and natural resources.

5 Foster trust and a real bond with our business community

The Government and the business community should continue to take urgent action to develop a respectful and positive partnership that will form the cornerstone for Bermuda’s economic recovery.

6 Planning and regulation

The Government and regulatory bodies should review their key policies, and frameworks to better support our local business community, and our financial service sector. This will be crucial for international business, the fintech industry, for key infrastructure projects, and green energy investments such as marine renewables projects.

7. Deployment of taxes and business support

The Government should continue to deploy its tax powers, and business support interventions, to enable economic recovery. This should include targeted use of relief to incentivize economic recovery, and the greater use of workforce development initiatives. The Government can also continue by providing resources and credit to companies, for small business development initiatives. We support continuing to make available loans to support local projects, extended to include horticultural development, and green initiatives in business on undeveloped or underdeveloped land.

Bermuda must reward businesses who have made a commitment to promoting Bermudians, and embracing diversity along the way.

8 Digital Infrastructure

The Governments should continue to mobilize investment in Bermuda’s digital infrastructures and digital industries.

9 Prioritization and delivery of green investments

The green economic recovery is central to recovery overall. The Government should prioritize delivering transformational change with clear sector plans, where the coincidence of emissions reduction, the development of the blue economy and natural capital and job creations are strongest.

10 Investment in natural capital

The financial services sector, and the Government, should develop and promote nature-based investments to protect and enhance Bermuda’s natural capital. This should include the development of financial solutions to fund the development of our marine resources, and other nature-based solutions and services.

11 Tourism and hospitality

The tourism and hospitality industries should continue to work in partnership with the Government to develop a sustainable future strategy; the Government should continue to consider a targeted reduction in business rates and to support the sectors’ recovery.

12 The Arts and Creative Sector

Given the significant contribution of the arts, culture and creative industries to Bermuda’s economy, and to our social fabric, the Government should take steps to protect the sector and seek to increase public and private investment in the arts in Bermuda.

13 Seniors’ Care

The Government should continue its work on reforming senior care, and should urgently review the structure, funding and regulations of the sector. This will ensure its sustainability and quality going forward. The review should address workforce issues and care, and should recognize and support the contribution of unpaid caregivers.

14 The Philanthropic Sector

The Government should take action to protect the capacity and financial sustainability of the Third Sector, in recognition of its important role in building and supporting Bermuda’s social fabric. We should examine the scope for longer-term funding arrangements for social services which support our families, seniors and the development of young people. There should be new initiatives to incentivize private investment in the sector.

15 Supporting students as a result of Covid 19

The Government needs to continue to assess the loss of learning in our schools due to the Covid pandemic and make sure students have the necessary support when they go back to school. This is important to overcome the risk of reduced educational attainment.

16 Workplace changes and patterns

The business community should work with the Government to accelerate the new business paradigm. We must look at ways and legislation to support remote and home working, flextime, remote working security. We should also look at the gig economy and do all this work in conjunction with our trade unions.

17 Skills and the labor market

The Government should refocus its skills strategies to address the risks of unemployment. They must continue to recognize and support small businesses, tourism and our international business sectors. They must renew their commitment to improving the provision of lifelong learning, to enable people to reskill.

18 Bermuda College:

Government should protect Bermuda College from the financial impact of the crisis, so that it can maintain and enhance its critical role within our community, and take decisive steps to align their teaching and learning provision to meet business and employer needs.

19 Apprenticeships

The Government should continue to collaborate with the College and businesses to prioritize apprenticeship training. They should respond to youth unemployment with a flexible learning response including more robust online learning options.

20 A jobs guarantee

The business community, with the support of the Government, should continue to develop business-led jobs guarantee schemes. This would address the possible increase in unemployment among young people.

The unemployment situation for our young people is grave, and will be a blemish across their working lives, if there is no priority or focused intervention to address this challenge. As an option businesses could work with Government or government agencies to offer short term job placements to our young people. The scheme could offer secure positions for a period of up to a year or two. They will be paid a competitive salary, have access to training, access to apprenticeships and the possibility of progression.

21 To promote an economic framework that values all of Bermuda’s assets

The Government should consider adopting a framework in forming its future economic strategy, and reporting against it. This framework should take account of the full range of our national assets – natural, social, human – as well as the purely financial and physical, that encourages a more rounded and holistic policy approach. More importantly, the recovery Bermuda needs will require all parts of society to work together with a collective endeavor which values the contribution of all.

22 Implementation Government’s Recovery plan

To create momentum and build confidence, the Government should set out regular updates on its recovery plan. This economic recovery plan will be a blueprint for the future. Our Government must define and execute its recovery plan with purpose, urgency, and in partnership with business and other key stakeholders. It will require commitment, pace, focus and discipline.

- Cole Simons

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Comments (2)

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  1. RIP oba/UBP says:

    Everything you said is already being considered tell Bermuda something new?

    • Red rose says:

      But nothing is being done – tell us what the plan is?!

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