THE BAHAMAS STRIKE OFF ON THEIR OWN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001100160044-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 12
• Document Creation Date: December 20, 2016
• Document Release Date: August 21, 2006
• Sequence Number: 44
• Publication Date: June 28, 1973
• Content Type: IM

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Secret
Intelligence Memorand um
Th e Bahamas Strike Off on Their Own
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' 28 June 1973
No. 1656/73
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THE BAHAMAS STRIKE OFF ON THEIR OWN
Summary
On 10 July, the Bahama islands will become the 33rd independent mcmher of
the British Commonwealth and the fifth British colonial possession in the Atlantic-
Caribbean area to gain nationhood in the last 1 1 years. Full independence will be
more a formality than a bold new departure for the Bahamas, since the islands have
been almost wholly self-governing for several years. What will be new are the
opportunities the Bahamians will have to set their own policy courses abroad and to
make themselves heard on international issues.
The Bvvhamian Government is likely to play a generally responsible role in the
international community. A sense of nationalism and identification with the Causes
backed by the less developed countries will sometimes impel the Bahamas along
piths divergent from those of the US and the other large powers. Many Bahamians
already have mixed feelings about their giant neighbor to the northwest, and
independence can be expected to accentuate the differences. The islands' long-
standing ties with Britain and the US, their dependence on US tourism and money,
and the basic practicality of the Pindling government will tilt the scales heavily in
favor of a continued clos association with the US and the West.
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Comments and queries on this publication are welcome. The may be directed to
of the Office of Current intelligence,
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Lynden 0. Pindling
Prime Minister
Paul L. Adderley
Minister of External Affairs
Arthur D. Hanna
Minister of Finance
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Pinclling and His Government
Prime Minister Lynden O. Pinclling, 43, has headed the government
since 1967. He was the first black prime minister in the Bahamas, where 80
percent o1' the 195.000 citizens are black. A popular leader. sometimes
hailed by his people as a modern-day Moses, he led his Progressive Liberal
Party to a thumping victory in the elections last September on a platform
that stressed "independence now." He has exhibited a deep-rooted national-
ism in his public speeches, but as the leader of an almost independent
country he has shied away from inflammatory and irresponsible statenments.
He has steered an adroit and prudent course on controversial issues and has
remained closely attuned to the majority of his countrymen. On the other
hand, he is not a strong administrator, and the only real challenge to his
authority in recent years has come from within his own party. Party
dissidents came close to bringing Pindling down on a no confidence vote in
October 1970, but since then Pindling has apparently strengthened his
position.
On the whole, Pindling's cabinet inspires less confidence than Pindling.
Most of its members are people of mediocre ability. Those that have
demonstrated some abilities have, at the same time, been controversial and
hard to handle. One of these, Deputy Prime Minister and Minister of Finance
Arthur Hanna, is a radical nationalist with a sleep-seated distrust of Ameri-
cans and Britons. He was home affairs minister until early this year, and in
that post he was the chief architect of the "Bahainianization" policy that
sought to replace foreign workers with Bahamians, few of whom were
trained for the jobs they were to assume. Hanna's restrictions on foreign
workers have recently begun to be eased in order to halt the exodus of
skilled technicians. Another cabinet minister who has caused problems for
Pindling is Minister of Development Carlton Francis, also an avid nationalist.
Until last March, he had been finance minister for six years and had set
policies that alienated many domestic and foreign businessmen. Eventually
he came under considerable public criticism for mismanagement of the
treasury and for frightening away foreign investors.
Pindling's most capable lieutenant is probably Minister of' External
Affairs Paul Adderley, an intelligent if somewhat abrasive "conservative" in
the local political context. In recent months Adderley has become a close
adviser of the prime minister, but their relationship is probably more a
marriage of' convenience than a permanent relationship. Adderley may well
harbor ambitions of someday succeeding Pindling.
One of the first problems that the government will face after independ-
ence is a dearth of trained and qualified civil servants. The islands, only
recently self-governing, have not had sufficient time to develop an adequate
number of administrators and technicians. The problem was made more
acute when a number of supporters of' the opposition party were purged
from government jobs following the elections last fall.
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The Opposition
The Pindling government can at least devote most of its time and
energies to dealing with the problems that independence will bring, since it is
not likely to face elections before early 1977 and since there is no vigorous
and popular opposition party to challenge it. The most important opposition
party is the Free National Movement, an amalgam of dissidents from
Pindling's party and remnants from the old United Bahamian Party that
controlled the government until 1967. Although the movement's candidates
garnered nearly 40 percent of the vote last fall, it won only nine of the 38
seats in the lower house of the national legislature. Party leader Cecil
Wallace-Whitfield, a former colleague of Pindline. failed to will ;e-election
last year and turned leadership over to Kendal Isaacs, an outspoken critic of
the government and a former attorney general. Isaacs was not an effective
leader, and on 8 June he stepped down, leaving a weak, seriously divided
organization. Chances seem poor that the Free National Movement's dis-
parate components, ranging from young, black political activists to a small
group of wealthy white Bahamians who formerly monopolized local com-
nmerce and politics, can achieve sufficient unity and discipline to become an
effective party.
Pindling is also fortunate in that there are relatively few organized
extremists in the Bahamas. There is no Communist party and no sizable
black radical movement. The closest thing to a revolutionary party is the
small Vanguard Nationalist and Socialist Party, which includes both "black
power" and extreme leftist elements, but which thus far has stayed away
from violence.
The government is, however, keeping a wary eye on the island of Great
Abaco, where a small group of militants, many of them whites, has been
loudly agitating to secede from the Bahamas and remain under British rule.
The loosely organized group, which calls itself' the "Council for a Free
Abaco," lobbied extensively but unsuccessfully in London for permission to
remain a British colony. Most persons associated with the group deny any
intention of fomenting violence, but the group includes young toughs who
are believed to have access to weapons and explosives and could, if they
chose, generate a violent incident of some sort around the time of independ-
ence. The Pindling government as a whole seems to regard the Abaco
secessionists as little more than a nuisance, but Pindling himself has tended
to take them very seriously.
In the event of an internal security problem, the government would rely
on its police force; Pindling has no plans for an army. The capable, Brit-
ish-trained police force, which now numbers about 900 men, may be
somewhat expanded following independence. It should be able to handle
almost any domestic security problems.
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The Economy
The economic outlook in the Bahamas is mixed. A number of factors
give the new nation somewhat better prospects than many of' its island
neighbors enjoy. Per capita income is high-about $1,S00 per year-and the
unemployment rate of seven percent, although increasing, is still low by West
Indian standards. Perhaps the islands' strongest pluses are their idyllic cli-
mate and their proximity to the US. The Bahamas are among the top tourist
attractions in the world. Last year, more than 1.5 million persons visited
them. Their proximity to the US makes the islands especially attractive to
US investors, particularly those interested in tourist facilities and, more
recently, petroleum refining.
There are also difficulties. The most important right now is the perva-
sive uncertainty about the intentions and capabilities of the Pindling govern-
ment in handling economic issues. The economy remains seriously vulnerable
to sudden fluctuations in the tourist business-a notoriously unpredictable
industry. Some consider the islands to be overly dependent on US invest-
ments. in time, an expanding petroleum refining and transshipping industries
could come into direct conflict with the tourist business.
Shortly after Prime Minister Pindling won re-election last fall and
announced that he was taking the country to independence this year, a
business panic of sorts developed. So many foreign investors, alarmed by the
newly independent and avowedly nationalistic government, packed up and
left that the government was forced to enact hasty measures placing tight
restrictions on the outflow of foreign exchange. The ebb of business confi-
dence was not helped by rumors that the government was deeply in the red
and that a massive budget deficit was looming.
Subsequent developments proved some of the concerns of the investors
to be exaggerated. The budget deficit last year turned out to be less than $10
million, instead of the $15 million originally predicted, and the exodus of
foreign capital gradually slowed. In early 1973 there were humors that
Pindling would move away from his earlier stress on economic nationalism
toward more moderate and prudent financial policies. Thus far, however,
Pindling has made no move to replace some of' the more irresponsible
Bahamians charged with economic policymaking, and foreign investors,
although perhaps less jittery, seem inclined to wait and see what the
government does after independence.
Pindling appears to be basing sc,mne of his hopes for future economic
prosperity on the oil business. Only one refinery is now located in the
islands-the Bahamas Oil Refining Company situated at Freeport on Grand
Bahama Island. The company is owned by two US refining companies. Their
facility, which began production in 1970, is being expanded, and its output
should reach about 500,000 barrels daily by late this year. Other companies
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are considering setting up refineries on Grand Bahama. The British-owned
Burmah Oil Company is now constructing a $45-million oil transshipment
terminal on Grand Bahama that can be used by supertankers to transfer their
cargoes to smaller vessels for delivery to the US cast coast. This facility will
provide employment for 900 Bahamians, and the Pindling government, with
an eye on the oil-hungry US market, can be expected to advertise its fine
deep-water port in an effort to attract other investments of this type.
Pindling apparently recognizes that in the long run his country's eco-
nomic fate is strongly linked to and dependent on the US. Tourism, which
continuc3 to provide the lion's share of the Bahamas' foreign exchange
earnings, income, and employment, waxes and wanes in direct relation with
US economic conditions; some 87 percent of the islands' visitors in 1970
came from the US. American direct investment in the Bahamas totals over
$1 billion and is growing. With assets of this magnitude at stake, Pindling will
probably try to avoid actions that scare of'f' new investment. His success in
doing so. however, may be limited by strong domestic pressures for con-
tinuing ::nd expanding the "Bahamianization" process.
Foreign Relations
Independence is unlikely to result in a significant shift in the Bahamas'
normal alignment with the US and the UK, although nationalism will impel
the government to side with some of the smaller countries of the so-called
Third World on some issues. Proximity and a common heritage will incline
the Bahamas toward a closer relationship with the countries of the British
Commonwealth Caribbean than with Latin American countries. As a new
nation with an English-speaking, predominantly black population, the
Bahamas may also identify to some degree and make common cause with the
English-speaking countries of black Africa. The country's limited budgetary
resources and shortage of experienced diplomats will mean that its role in
international diplomacy will be minor. In the beginning, at least, the fledg-
ling Bahamian diplomatic service is likely to be able to come up with no
more than ambassadors to the US and the UN, a high commissioner in
London, and consular officers in New York, Miami, and a suitable Caribbean
post.
The Bahamians may feel compelled to establish diplomatic ties with
Cuba, which is as close a neighbor as the US. Problems involving maritime
boundaries, Cuban fishing activities in and near Bahamian waters, and
pos:ble Cuban exile activities in the Bahamas are likely to keep cropping up,
and these will lead to pressures on Pindling to establish relations. On the
other hand, there is little cultural or political affinity between the two
countries. Pindling is reported to hold Fidel Castro in some respect, but
neither lie nor any sizable group in the Bahamas can be described as
"pro-Castro."
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While the Pindling government is unlikely to become embroiled in
serious international wrangling, it is likely to take a stand on territorial
waters that could lead to friction with other countries, including the US.
Bahamian officials from Pindling on down have declared that they intend to
adhere to an archipelagic concept in defining the nation's sea boundaries--
that is, the Bahamas will claim all waters within 12 miles of the outer
perimeter of the entire 700-island Bahamian island chain. This would mean,
in effect, that the Bahamas Government would have jurisdiction over sea
lanes now heavily used by US and other foreign shipping. The Bahamians
assert that they will seek to guarantee free passage tlurough these waters. but
insist that sovereignty must remain Bahamian for reasons of' national secu-
rity, control over smuggling, and environmental protection. The matter can
be expected to provoke considerable discussion and controversy before and
during the international Law of the Sea meeting in Geneva next year.
US Military Bases
In general, however, US-Bahamian relations are good. Foremost among
the bilateral issues still to be settled are the three defense-related US bases in
the Bahamas, established during World War II by US-UK agreement. The
Bahamians Heretofore have received no remuneration for the US use of these
bases, and the terms under which they will continue operating are still to be
negotiated. The three bases, valued roughly at $ 180 million, are maintained
by some 700 US military and civilian personnel and employ about 250
Bahamians. Of the three installations, the most important is the Navy's
anti-submarine warfare facility on Eleuthera Island. Another, the Atlantic
Undersea Test and Evaluation Center on Andros Island, is especially well
located for research and development of naval weapons systems. Both the
US and the I'K use the latter facility and regard it as important. Relocation
of' the three bases would be costly and would take from two to four years.
The Pindling government has given no indication that it wants the bases
removed. To the contrary, Pindling has said that he considers their continued
presence "no problem." No difficulty is anticipated in getting his govern-
ment to agree to extend the existing base arrangements temporarily until
new ones can be negotiated.
While the Bahamians have yet to communicate formally what sort of
price tag they intend to attach to the new agreements, preliminary indica-
tions are that their demands will be substantial. During the election cam-
paign last fall, some members of' Pindling's party told voters that they
expected to solve the government's financial problems by exploiting the US
military bases to the fullest. In May it was reported that the Bahamians
intended to use the undersea t.st center as the principal bargaining point in
negotiating with the US. A Balamian official told the US consul general in
early June that cabinet ministers were "thinking of" an annual base rental
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figure of $5 million, or alternatively a sizable grant of equipment like
fixed-wing aircraft, helicopters, marine patrol craft, and radio-equipped
jeeps.
The Bahamians have held their cards very close. They have been very
discreet about what positions they will assume during the negotiations, but
there are indications that they will be well-prepared for the talks. Pindling
seems firmly convinced that close cooperation with the US is the best
guarantee for Bahamian national security, and thus protracted arguments
over base agreements or repeated efforts to get more money for the bases
seem unlikely for now.
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The Bahamas
..........
Lino of separation of sovereignty
Major tourist development
Fishing grounds
Shipping lane
6,000 Population of major Islands'
M~ssdu
rrrcAiml
Shifty,,
*
FrooporL-
GRAND
BAHAMA
26,000
GREAT
ABACO'
+BIMINI
ISLANDS
BERRY
ISLANDS
7,000
I
?Dunmoro Town
US. NMry Facilely
ANDROS
ISLAND
0,000 ,
LONG
ISLAND
CA
100 Milos
100 I(ilomolars
NASSAU*Governors Harbor.+
ELEUTHERA''.
Andros
NEW
PROVIDENCE
6,000
~? Rock Sound
Town.
102,000
~j.5. Navy
Aflnntir
Undersea
rent ,uirl
CAT
ISLAND
U.S Coar,f Guard
1, wall stiq 11
v
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GREAT
EXUMA
George-+
Town
SAN
SALVADOR
ACKLINS
ISLAND
,MAYAGUANA
GREAT INAGUA
I l
I
U.S. Na gal Base
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