Statement by Hon. Bernard J. Nottage on the Baha Mar Project
Oct 21, 2010 - 11:08:45 PM
To bring some order,
clarity, honesty and truth to the public debate on the BahaMar project
and issues emanating therefrom and
To articulate the
PLP’s position on the project, given the current available information
and the prevailing economic, social and political conditions.
order for this paper to achieve its purpose, it will be necessary to
provide an understanding of the current economic and social state of
The Bahamas, provide specific information on the project and finally,
articulate the PLP’s position on associated elements, which have or
might, in the foreseeable future arise as a result of the public debate.
of The Bahamas
Monetary Fund mission that visited The Bahamas last month provided this
bleak picture of its economy:
greatly affected by the recent global economic crisis, the IMF team
said, noting that there was
A sharp contraction
in local economic activity,
Higher rise in unemployment,
Drastic drop in
the tourism sector and
A fall in foreign
Mission team went on to say that while lower import prices helped to
narrow the country’s budget deficit to approximately 12.5 percent
of the gross domestic product, the output contraction deteriorated the
fiscal position and weakened the banking system. As a result the fiscal
deficit widened to 5.3 % GDP in 2009/2010 due to sharply lower government
revenues. Credit in the private sector “stalled” and non-performing
loans ratio increased to more than 10% at the end of June 2010. Anecdotal
evidence strongly suggests that has since increased considerably and
that the overall rate of loan delinquency in The Bahamas is now among
the highest in the region.
team also observed that the economy could grow modestly in fiscal 2010-11
if the country strictly implements fiscal consolidation and works to
improve its business investment climate.
has been variously estimated at between 15-22%. Government has taken
the lead in downsizing public corporations; terminating a substantial
number of long term public sector temporary workers and discontinuing
its temporary employment programme. Similarly a number of private sector
entities have laid off workers as business has declined and several
major hotel properties have closed a substantial number of rooms during
the “slow period” with employees having to take paid vacations or
in some cases unpaid leave.
Bahamas has amassed a record number of murders totaling some 148 since
2009 and 299 murders since 2007! The record will show that for this
relatively small country, 78 murders were committed in 2007; 70 were
committed in 2008; 85 were committed in 2009 and 63 murders were committed
year to date 2010. Needless to say, this carnage is totally unacceptable.
Crime and the fear of crime infest every area of Bahamian society. Law
abiding citizens do not feel safe on the streets nor in their homes. There
is too much crime and too much fear of crime. As a result the overall
social stability of The Bahamas is in grave peril. Moreover, the psychological
toll on the Bahamian people continues to act as a serious drag on the
overall sense of national and personal well-being.
State of the
Major Industrial Activities in The Bahamas
to the IMF in its recent September Article IV consultation
arrivals declined by 10% and FDI fell by 30% leading to a sharp contraction
in domestic activity and a large rise in unemployment”.
Services industry is largely foreign business, which is encouraged by
various incentives. The industry accounts for about 15% GDP. It needs
to be emphasized, however, that it is the best paying industry in The
Bahamas as salaries and related income have long been on a higher scale
than comparable rates of remuneration in the tourism sector. Indeed,
it is highly arguable that the financial services industry is largely
responsible for the creation and development of the Bahamian middle
class over the last forty years, particularly when the satellite professions
of law, public accountancy, and a variety of other industry support
disciplines are factored into the equation. As a result of the blacklisting
of jurisdictions in recent years, the industry has undergone extensive
reforms to ensure the soundness of the banking system and compliance
with best international practices. At the same time, however, The Bahamas
is undergoing a period of institutional consolidation which has resulted
in either the exodus or downsizing of a number of offshore banks with
a resultant loss of jobs for Bahamians. The trend is likely to increase.
The downward trend is being exacerbated by competitive pressures from
onshore jurisdictions and from regional competitors like Barbados, the
Cayman Islands and Panama.
Nations Economic survey into construction in The Bahamas pegs the fall
off in construction at almost 20% lower than the same time last year.
However, the Bahamas Contractors Association stresses that the UN figure
may represent the monetary fall off, but in terms of the number of projects,
the fall off is greater. Construction normally accounts for about 6%
in The Bahamas is linked significantly to FDI and the UN report notes
that the declining trend began in 2007 and reflects “a reduced investor
appetite for risk in the wake of the global recession”. It anticipates
that construction will pick up as the US economy recovers.
suggests that there has been cancellation of projects with no restart
up dates. Stephen Wrinkle, president of BCA indicates that his association
has as many as 500 registered contractors who are seeking work in a
market that has been at a standstill in the first half of 2010.
The BahaMar Project
heads of Agreement to develop a major resort, in the Cable Beach area
of New Providence, and to spend a minimum of $1 billion, was signed
between BahaMar and the Progressive Liberal Party Government on 6th
to office in 2007, the present Free National Government negotiated a
Supplementary Heads of Agreement which changed several of the provisions
of the original HOA. The cost and scope of the project were considerably
changed, bringing the former from just over $1 billion to $2.5 billion.
HOA required that BahaMar provide evidence that it obtained adequate
funding as well as the involvement of world class international hotel
and casino equity partners in the project.
regard, on 12th January 2007, BahaMar entered into a Joint
Venture Investment Agreement with one of the largest casino and hotel
operators in the world, Harrah’s Entertainment operating as Caesar’s
Bahamas Investment Corporation which became an equity partner, holding
43% of the shares, and BahaMar holding 57%.
to the signing of the Supplementary HOA between the FNM government and
BahaMar, Harrah’s Entertainment pulled out of its partnership agreement
with BahaMar. BahaMar subsequently negotiated funding of the project
with the Export Import Bank of China.
of Harrah’s from the project seemed to be due, at least in part, to
an expression by the Prime Minister of The Bahamas, of a lack of confidence
that BahaMar had the financial ability to complete the project.
other differences in regard to the size of the project, between the
2005 HOA and the 2007 HOA. The new agreement included a much larger
casino, double the meeting room space, an additional 1200 rooms and
the demolition of the Nassau Beach Hotel rather than its renovation.
vision is to create a world class resort destination which represents
the largest single-phase resort in the Caribbean. The resort incorporates
a 1,000 acre master plan supported by hotels, condominiums and amenities.
3,500 hotel room and condominium
properties will include:
A 1,000 room casino
A 700 room convention
hotel, including condominium units
A 200 room luxury
hotel, including condominium units
A 300 room lifestyle
hotel, including condominium units
The existing 700
room Sheraton Hotel
The existing 550
room Wyndham Hotel
largest casino of 100,000 sq. ft
200,000 sq. ft.
stand-alone convention center, convertible into a 2,000 seat entertainment
A 20 acre beach
and pool experience, featuring indigenous wildlife and distinctive pool
experiences for each hotel
A 60,000 sq. ft.
Caribbean inspired retail entertainment village with distinctive show
An 18-hole Jack
Nicklaus signature golf course
largest destination spa
A timeshare component
It is important
to know that there are not 3,500 new rooms in this development. Between
the Nassau Beach, the Wyndham Hotel and the Sheraton Cable Beach Resort,
there were in fact a total of some 1950 rooms. Therefore, when built
out, the new BahaMar resort will only have an additional 1,550 rooms.
It should be
noted that the land involved in this project is the same in both the
original HOA and the Supplementary HOA, save and except that in the
Supplementary HOA, BahaMar agreed not to purchase the land upon which
the Gaming Board and the Development Bank are located and a portion
of West Bay Street and the median strip. Additionally, BahaMar agreed
to lease the 50 acres property in Gladstone Road for the Back of the
House activities rather than purchasing it outright.
of land from The Bahamas Government to Baha Mar is required for the
project to go forward. This can be divided into five groups which include:
1 - A joint venture will be formed between the Government and Baha
Mar for the new Jack Nicklaus golf course where
all the Golf Course
land is leased to the Joint Venture by the Government. This includes
the Water & Sewerage Corporation of 99.8 acres and the Prospect
Ridge Parcel of 2.365 acres.
The Government will continue to own
2 - The Gladstone Road parcel of 50 acres will be leased to Baha
The Government will continue to own this land;
3 - Five parcels of land, amounting to 20 acres,
will be swapped. They include:
Cecil Wallace Whitfield
Center to BahaMar
in return for a cash payment of
$18 million and 2.259 acres of land.
Cable Beach Police
Station to BahaMar in return for a new, expanded Police Station;
Old West Bay St.
for a new expanded West Bay St. and facilities;
New Corridor 7
in return for a newly constructed access road to West Bay St.; and
BEC parcels of
2.73 acres to BahaMar for utility works
in return for 2.73 acres
of new West Bay St. road access
4 - Fee simple purchases of Government lands of 92.226 acres for
approximately $62.6 million. These land purchases are the Wyndham
Nassau Resort of 13.45 acres, Nassau Beach Hotel of 7.546 acres, Hobby
Horse parcel of 70.964 acres and Fidelity Bank of 0.866 acres; and
5 - the purchase of 170 acres of private land, 100 acres of which is
being contributed to the Golf Course Joint Venture with the Government,
and 70 acres of which is being donated for the development of a wildlife
this, $1 million will be spent on improvements to the wildlife sanctuary
and $1 million will be placed in a maintenance Trust at BahaMar's expense.
BahaMar, the transfers of freehold titles of land from the government
to BahaMar were supposed to have taken place as follows:
BAB (1.5 acres), HHH (68.877 acres) and JFK Connector (2.267 acres)
land transferred to BahaMar
Wyndham and Nassau Beach (20.996 acres transfers to BahaMar)
Old W. Bay St., Police and Fire Station, Cecil Wallace Building, transfer
Casino reaches 100ft., BEC sub-station (0.223 acres) and BEC wayleave
(2.571 acres) Prospect ridge road (2.372 acres) transferred to BahaMar
transfers have not yet occurred because of the delays in the project’s
concern has been expressed that the title to the land involved is being
transferred to the Chinese and they are becoming the new owners of these
prime properties in The Bahamas, perhaps the most valuable land. The
fact is that the land, which BahaMar does not already own will be transferred
to BahaMar - and
NOT to the Chinese – and for an estimated
price of $80 million plus other considerations.
has indicated that the land, which is being transferred for the specific
use in this project, will not be transferred until the financing is
formally in place and construction is to begin. Indeed, the original
2005 HOA had in it provisions for the land transfers to be reversed
if the development did not take place as planned. The current 2007
HOA did not change that and the Prime Minister, in his September Communication
to the House of Assembly, also indicated that “…should the development
not proceed the land must return to the Government”.
the ground rules set under the PLP. The Ingraham government did
not introduce them at all.
Impact of BahaMar
will undoubtedly have a significant economic impact both during the
construction phase and especially after completion, opening and operation.
Based on a study performed by Oxford Economics, one of the world's largest
providers of economic forecasts and analyses, BahaMar is projected to
have the following economic impact:
Generate over $740 million in annual Gross Domestic Product (GDP), which
represents 10% of our current GDP;
$878 million in spending in direct taxes into the Bahamian economy in
the first year of operation and, over 25 years, it is expected to generate
$6.2 billion in Government taxes
and indirectly sustain over 8,500 jobs
$6.1 billion in local wages and salaries over 20 years, and
2.3 million visitor room nights annually
here to emphasize that those projected benefits must, of necessity,
be evaluated in the context of the otherwise moribund economic situation
that we described in the opening part of this statement. There is nothing
else on the economic horizon that even remotely promises to generate
the level of employment opportunity and economic stimulus that the BahaMar
Project is poised to provide.
of the Chinese
of the People’s Republic of China has given its approval to the project,
which is being financed by the Export-Import (Ex-Im) Bank of China,
which is providing a loan of $2.65 billion.
Contractor for the project is the Chinese State Construction and Engineering
Corporation Ltd (CSCEC Ltd.), which has its headquarters in New Jersey.
This corporation is also investing $150 million in the Project.
indicated that the general contractor has been awarded the contract
to build the concrete and steel superstructure. All other contracts
will go out to competitive bidding to local and international contractors.
the Credit Agreement signed by the Ex-Im Bank of China and BahaMar,
the latter is required to secure the issuance of 5,000 work permits
for foreign workers to work on the Project during the course of the
construction. There has been a verbal expression from BahaMar and the
Government of The Bahamas that the need will be for 8,150 work permits
for foreign workers during the Project.
(for 8150 work permits) is not contained in the agreements with either
the Ex-Im Bank or the CSCEC Ltd.
10(d) of the Credit Agreement between BahaMar and the Ex-Im Bank of
China, (page 142 of the Credit Agreement) provides that a condition
precedent is the receipt of "a certified copy of evidence of application
by the Company (BahaMar) for, and the agreement of the Government of
the Bahamas to grant, approval in principle for the number of work permits
set out in the Initial BIA Approval."
of Initial BIA Approval includes "the grant of approximately
5,000 work permits for foreign workers by the Department of Immigration of
the Bahamas." (See page 21 of the Credit Agreement).
provided to the PLP, verbally, by BahaMar was that up to 7,500 work
permits would be needed during the course of the 42 month construction
time; that the maximum number of such foreign workers on the project
at any one time would be 5,000 for a period of approximately six to
eight months. The number provided by the Prime Minister in his Communication
is a maximum of 8,150.
as has been done suggests that it will be difficult to find the requisite
number of Bahamian skilled construction tradesmen to complete the project
within the 42 - 44 month schedule that has been set for completion of
of Chinese Construction Workers
There has been
much discussion about the number of Chinese nationals who will be required
to work on the construction phase.
been raised as to the skill levels of the Chinese and whether they will
be employed doing tasks which Bahamians can do. Bahamians want to know
whether there will be Chinese labourers imported to perform any unskilled
tasks that Bahamians are capable of performing. There would be strong
objection to that.
to know whether there are construction methods being used on the Core
Project, which are new and unknown to Bahamian workers. If the answer
is yes, they should be defined and in accordance with the original 2005
HOA, arrangements should be made to ensure that there is transfer of
skills and technology to Bahamian workers during the course of this
As it is very
likely that Chinese financing will be used for future projects, it is
incumbent on the government (GOB) to ensure that the lack of such skills
can no longer be used as an excuse for depriving Bahamian workers of
the opportunity to work on projects in their own country.
also been expressed as to how the government will evaluate the workers
who are brought in as to their character, their health and their skill
levels. The accusation that some workers may have criminal records should
be dealt with. The need to ensure the good health and freedom from contagious
diseases must be satisfied. The skill levels must be monitored
also been expressed as to the terms and conditions of employment for
the migrant workers. Will they be paid according to Bahamian wage scales
in accordance with ILO Conventions? What are the living conditions under
which they will be accommodated? What Health and Safety Regulations
will be in place?
One of the
concerns of the developers of the project is that Bahamian construction
workers do not have any experience working at the heights that will
be required for the 24 storey buildings. There is fear about the safety
of the local workers.
and Safety Act was passed but has not been enforced because of the lack
of regulations needed to support it. In the meantime, there have been
several serious incidents on construction sites, which have resulted
in loss of life, which might have been avoided had the appropriate regulations
been compiled and enforced. It is essential that this be done in time
for the start of this project, which will have conditions requiring
them. Additionally the safety of the construction environment must be
monitored by agents of the Ministry of Labour.
have suggested that there are no special skills or new construction
technology to be utilized in the Core Project. There is a view that
what is different is the rate at which the foreign workers will be compensated
and the conditions under which they will be working and housed. Further
there is a view that, having regard to the cultural and language differences,
the chances for disharmony cannot be discounted. There is a need to
ensure that the environment is created to avoid such problems.
There are also
concerns that workers who are brought in for this project may stay in
The Bahamas after the project has been completed and further deprive
Bahamians of jobs in the future. It is understood, however, that part
of the agreement is that all persons brought in for this project will
be repatriated at the end of construction. It is incumbent on the government
to ensure that this is done.
has indicated that as an imperative of Chinese foreign policy, all over
the world where the government owned Chinese Export-Import Bank of China
has financed construction projects, part of the agreement has been that
materials used in the project are sourced in China where possible and
that Chinese workers be utilized in the construction work. Hence the
requirement for the 8,150 work permits.
in its own $58 million borrowing for the construction of a 4 lane highway
from the airport to the new six way roundabout, has agreed for the highway
to be designed and built by the CSCEC Ltd and to use some 200 workers
in that project. (It is interesting to note that 200 Chinese workers
in a $58 million project equates approximately to 8,150 in a $2.6 billion
also been expressed about the quality control with respect to materials
used in the construction. There have been incidences where materials
which are substandard and hazardous have been used in the construction
of luxury and high end developments in other parts of the world resulting
in expensive losses and even abandonment of homes. This must be avoided
and will require that the government engages quality control specialists.
for Bahamian Contractors, and Construction Workers
Project Phase will be built exclusively by Bahamian contractors and
will have an estimated value that will be in the range of $200 million,
site preparation, earthmoving, landscaping, demolition, construction
of a new West Bay Street and Corridor 7 highway which will cost approximately
A new commercial
Village at a cost of $25 million;
A new Back of the
House Facility which will be located on Gladstone Road to facilitate
parking for resort employees who will be shuttled to the resort, laundry,
warehouse and ancillary facilities at a cost of $30 million;
A Golf Clubhouse,
freestanding villas, retail, restaurants and other buildings in beach
and pool areas and retail at an estimated cost of $20 million.
It is expected
that the significant part of these works will be completed in the first
18 months, providing a substantial boost to the local economy and creating
immediate employment for the local construction industry. Early phase
works will require more than 30 Bahamian contractors, employing up to
1,200 workers with a limited number of expatriates for specialized tasks.
In the Prime
Minister’s Communication, it is said that, “…The terms of the
funding…include a requirement that the overwhelming majority, if not
virtually all of the workers to be engaged on the “Core Project”,
over the life of the project, be foreign workers – some 8150 persons.
in the same Communication, when discussing to the engagement of Bahamian
contractors in a number of “trade packages”, he said, “…This
we are informed is expected to result in the engagement of 3,300 Bahamians
at the height of construction of the Core project”.
There has been
considerable concern expressed about the large number of foreign workers
and the fact that the ratio, as expressed by the Prime Minister, of
71% foreign workers to 29% Bahamian workers, on the Core Project, is
in violation of previous government policy.
policy set in 1958 was that Bahamian workers should make up 75% of the
workforce for such hotel projects “…if such natives of The Bahamas
are available to perform the several and respective services required”.
This ratio has been violated over the years with the construction of
the Cable Beach and the Crystal Palace hotels as a result of the claim
that Bahamians were not familiar with or trained in the technology which
was used in their construction.
the Prime Minister, during the Atlantis development, the Bahamian component
of the labour force was 70% to 30% foreign.
(It could be
argued however, if the number of 1200 Bahamians estimated to be employed
on the non-Core (Phase 1) of project are included, that the ratio is
8150 to 4500, or 64% to 36%, foreign to Bahamian, a modest improvement).
The PLP, in
meetings with the developers, was told that foreign workers will be
working exclusively on the Core project, i.e. the construction of the
new hotels, the casino, and the convention centre etc. According to
the BahaMar representatives, it is intended, at the height of the project,
to work 24 hour days, three shifts per day. The highest buildings will
be 24 storeys high and they feel that it is unlikely that the number
of workers prepared to work at such heights can be found in The Bahamas.
It is reported
by its representatives however, that BahaMar has agreed to involve Bahamian
contractors and tradesmen in the Core Project by reaching a position
with the general contractor, The Chinese State Construction and Engineering
Corporation, to engage Bahamian contractors to perform a number of “trade
packages”. Such packages will include general site clearing and preparatory
work, masonry, dry wall, ceilings, painting, electrical, mechanical,
site security, fencing, beach restoration, remediation and landscaping,
etc. These are likely to have a value of $40 million.
is no substantive evidence of such an agreement in any documentation,
which we have seen.
and Skills Transfer to Bahamian Construction Workers
Contractors Association (BCA) indicates that it has been in successful
discussions, which are at an advanced stage, with BTVI and Daytona State
College in designing courses for both contractors and for construction
Congress of Trade Unions has recommended that a portion of the work
permit fees collected for this project be utilized to expand and redevelop
BTVI. They further recommend that the Ministry of Education and the
CSCEC Ltd. develop a Training and Apprenticeship Programme to provide
skills acquisition for high school students.
They also expressed
a desire to work with BahaMar through the NCTU Labour College, to provide
training for both construction and resort workers.
propose that a National Redundancy Fund be established into which investors
in such projects make a contribution related to the size of the investment
to ensure that Bahamian workers are protected from investors who leave
the jurisdiction without properly compensating them.
The PLP supports
The Trade Union
Congress, which has three construction unions among its membership,
expressed ignorance as to the categories and skills and other specifications
of the workers for the project that would necessitate the large number
of Chinese workers.
They are not
opposed to anything that is progressive for the country. They do not
feel that the Bahamas Contractors Association can speak for the workers
in the country.
that any work permits should be specific and that specific tabs should
be kept on permit holders, including their skills, health, and character.
Group permits should not be issued in order to avoid the problems which
as have others, that a training programme be initiated without further
delay, to train as many Bahamian construction workers in the variety
of trades, which are needed for this and other projects going forward
and that a National Certification Programme be developed so that the
number of verifiable skilled tradesmen can be permanently increased.
should meet international standards and there should be the means for
refresher courses and upgrading from time to time. Such a programme,
in this case, should be funded by the promoters of the project and
be overseen by a consultative committee which should
include representatives of construction worker unions, both umbrella
trade union entities, the Bahamas Contractors Association, COB, BTVI
Chamber of Commerce etc. Funds could also be allocated by
the government from the enormous work permit fees which will be issued
for expatriate workers.
was overwhelmingly in support of this project, indicating that the project
was the biggest ever in The Bahamas and that its importance was difficult
The BCA has
indicated that there are now over 500 Bahamian contractors who are now
members and who are seeking employment on this project. Some of them
have been invited to bid on aspects of the non-Core phase of the project
which is reserved for Bahamian contractors.
The BCA has
also indicated that there is no local Bahamian construction company
which is able to undertake the Core Project on its own. It was noted
that small contractors have a global struggle to participate in such
large projects. Additionally, they indicated that at the Atlantis project,
local contractors were able to participate in the last phases and were
now able to handle jobs to the value of $100 million.
are seeking is to do is to train contractors in order to develop their
skills in bid preparation and the requisite related issues which would
enable them to bid on what are called
“trade packages” as sub contractors. They would then use their company
staff as opposed to persons seeking employment with Baha Mar or the
general contractor on the job site. This, if successfully achieved would
secure, hopefully, significant participation for local contractors in
the Core Project although the estimated $35 to $40 million mentioned
in the Prime Minister’s communication is not impressive.
also pursuing the creation of an international standard certification
for all local contractors as well as the passage of legislation to enact
a Contractor’s Bill as soon as possible.
both of these initiatives.
does not appear that the training is a feature of the government’s
approach to its approval of this project although the BCA has indicated
that they await the government’s response to their submissions on
the subject. It also does not appear that the government has any hard
data on the number of skilled and unskilled construction workers in
The Bahamas, nor has it come to any firm commitment from or agreement
with BahaMar with respect to the amount of Bahamians who will be engaged
in the Project and at what skill levels.
be incumbent on the Executive Branch of Government and the appropriate
Union leaders to ensure that Bahamians who are able and willing to work
are given an opportunity to do so. However, Bahamians must fully appreciate
that incompetence, insubordination, absenteeism and a sub-standard work
ethic will not be tolerated. Similarly the Government must meticulously
scrutinize the Chinese who come here to work, and obtain an undertaking
from Baha Mar and the Chinese Government that at the conclusion of their
employment, all foreign workers will be repatriated.
Chamber of Commerce
of the Chamber has given his full support to the BahaMar project. Similar
views have been expressed by a former president who, along with Richard
Coulson, has been the object of derisive criticism by the Prime Minister
for his support of BahaMar.
Under the HOA
Section 11, the government has agreed to cause the relocation of all
power and utility lines underground on the JFK Connector road and to
expand the facilities of BEC and BTC to support the project. There has
been a public expression of concern about the ability of the Utilities
corporations to fund the necessary expansions.
Issues – perceived advantages, disadvantages, opportunities, concerns
Type of Resort
and Size of the project
been expressed about the size of the project and the decision to complete
it over such a short period of time. The question arises as to whether
the speed of completion contributes to the need for the large number
of foreign workers. Additionally, there is a view that the size of the
buildings is inappropriate for New Providence, which should concentrate
on smaller, preferably locally owned and operated facilities.
Capacity of BahaMar
owners to successfully complete and run resort
to the apparent difficulties being experienced by BahaMar in meeting
the funding obligations to the bank of Nova Scotia; the foreclosure
on its large property development in London and the annual closure of
its existing Cable Beach Wyndham for up to two months each year for
the past three years, questions are being asked as to the financial
soundness of the company and its ability to manage such a large resort.
Lack of confidence
of events and circumstances has led to the expression of a lack of confidence
in the BahaMar principal owners of the Project by many persons in the
Concerns of Residents
the Westward Villas Neighbourhood Association, which borders the Project
have expressed concern about the project with respect to the transfer
of land, the destruction of wetlands, the business track record of the
developers, the noise, traffic congestion and potential environmental
disruption occasioned by the construction work, as well as the impact
on their community of the presence of the large numbers of Chinese workers,
having regard to the cultural differences. They are also concerned with
potential security issues from the entire workforce. These concerns
also need to be addressed primarily by BahaMar
the General Contractor
It is important
to know whether the contractor will be required to pay business licence
fees, NIB contributions, and work permit fees as required by law in
addition to meeting the labour law conditions as pointed out elsewhere
in this document.
the Labour Force
There is also
concern that close attention be paid to the recruitment of Bahamians
and the management of the non-Bahamian work force. Will the Immigration
and Labour Departments ensure that persons brought in are doing jobs
which they were brought in to do and or which Bahamians cannot be found?
Also who will ensure that on completion of the work they were brought
in to do, the foreign workers will indeed be repatriated?
on Disposition of the Development in the case of Default on the Loan
been expressed about what would happen to the land in the case of default
by the developers. The concern is based on the fact that the mortgagee
is essentially a foreign government, which is believed to be the de
facto owner of the Ex-Im Bank of China.
265 acres of land upon which the development will be located is considered
by Bahamians to be some of the most valuable in The Bahamas with a fair
market value in the region of $500,000 per acre and is worth an estimated
to the strongly held view that such valuable land should not fall into
the hands of any foreign government, it is suggested that in the unlikely
event of default by the developers, further clauses be agreed and inserted
in the Supplementary HOA or in separate agreements as to the process
that should take place as follows:
the Lender shall have the right to seek the following remedies in the
Power to sell the
Property as set forth in the Mortgage / Security Agreement
Appointment of a
receiver to take possession of the property, operate the property, and
dispose of the property.
Foreclose on the
However, in the event
of foreclosure, the Lender shall provide notice, of intent to foreclose
on the property, to the Government of the Bahamas, and the Government of
the Bahamas shall have the first right of refusal to satisfy the outstanding
debt and take possession of the property.
the Government should be given notice of any event of default that will
give rise to any of the remedies in the order listed, then in the event
it is deemed necessary to foreclose by reason that the engagement of
the preceding remedies failed, then and only in this event notice to
engage foreclosure proceedings shall be given to the government which
will have the option to either acquire the project by the issuance of
bonds or to seek to find a buyer.
will also have the ultimate option to compulsorily acquire the Project
in the public interest having regard to the impact that the project
will have on the country.
*In this regard
we must look at the bigger picture. We are now dealing with Chinese
investors. This brings a new and radically different complexion to what
we are facing. We see the Project through the eyes of 10 years…the
Chinese through eyes of 100+ years.
We must assess
the Chinese involvement in this project by looking at their impact,
in Freeport, on the tourism product. Have they assisted with bringing
Chinese tourists to Freeport? Have they demonstrated that they are resort/hotel
It seems that
the tourism product in Freeport has declined and that no leadership
has been brought by the Chinese. While in the case of BahaMar, the Chinese
are not to be the operators of the Project and the HOA calls for, and
BahaMar has promised, to engage world class international resort, hotel
and casino operators, how do we know that the same dilemma won’t occur
at Cable Beach (in the event of default or sale)?
On the other
hand, the ownership of the hotel properties in Freeport, by the Chinese
investors, has enabled the hotels to remain open in the most adverse
economic circumstances, when other investors may have closed down, as
others before them have done, and left a larger number of uncompensated
and unemployed workers.
of Land in The Bahamas by Foreign Governments
Prior to the
election of the first FNM government in 1992, the policy of the PLP
government of The Bahamas was that no foreign government could come
into possession of land in The Bahamas other than the land upon
which its Embassy or housing for staff was located.
was incorporated into the Immoveable Property (Acquisition by Foreign
Persons) Act in 1981.
of the FNM government, with whom limited consultations have been held,
have indicated that they had no knowledge of such a policy and that
the current government had no such policy. Indeed research has revealed
that when the FNM government rescinded the 1981 Act and replaced it
with the International Persons Landholding Act (1993), the relevant
provision was not included.
While the Immoveable
Property Act, in article 6 subsection 3, stated that, “… where a
foreign government, or an institution owned by or emanating from a foreign
government acquired by device or such property falls into possession
thereof, that property shall be deemed to vest in the Treasurer of The
Bahamas who is to hold it in trust for the Bahamas Government, which
is to use it for public purposes. Such government or entity will not
be allowed to hold the property”.
Both Acts did
recognize the right of foreign governments to own Bahamian property
if such rights were conferred by agreement or treaty and it was and
is under this proviso that specific exceptions could be made as is the
case with the AUTEC Base in Central Andros.
Position of the FNM Government
Phasing of the
It is unfortunate
that even after BahaMar has settled its debt with the Bank Of Nova Scotia,
the position of the government of The Bahamas, as expressed by the Prime
Minister, has vacillated on the question of the size of the project
and the phasing of its construction.
At an impromptu
and rambling press conference, which was broadcast live on the Parliamentary
channel on Wednesday September 28th, the Prime Minister expressed
concern about the proposal to build the project in a single phase. He
noted that when the project reaches the appropriate stage** he would
consult with BahaMar and the CSCEC Ltd and the Chinese Ex-Im Bank about
developing the project in phases similar to what Sol Kerzner did with
the Atlantis project.
He is reported
as saying “…If they are going to do it in phases it will end up
costing more money and they will need fewer Chinese workers in The Bahamas.
And so to the extent where there can be a tradeoff we do not know but
we will make a decision as to what we think is best for The Bahamas”.
In the course
of the same press conference, the Prime Minister also said that “…you
have persons who believe that you cannot put 3,500 rooms on the market
at one time; that we do not have the capacity to attract the visitors
to make such a thing successful and that we would put ourselves in a
position where either there will be competition down to the bottom in
terms of rates where we would end up impacting negatively both Paradise
Island or Cable Beach or just one or the other. If you build them all
or open them all that is not likely to bring an acceptable result”.
the Prime Minister has gone on the record, at the September press conference,
to indicate that Phase 4 of the Kerzner/Atlantis project and the Baha
Mar project could not be done at the same time. This was followed, a
day later, by a press release from Kerzner/Atlantis to the effect that
it will not consider moving forward with its Phase IV expansion plans
until the BahaMar project comes to a final conclusion.
the Prime Minister, in his press conference, had also complained about
BahaMar, “…dumping 1000 new rooms onto the market”, Kerzner’s
general manager said that “…Atlantis does not want to saturate the
room inventory of Nassau/Paradise Island…We can’t over saturate
The Size of the
Project and the Branding of the Hotels
The Prime Minister
also is reported as saying that if approval is given to the project
as presently designed, BahaMar would be building the largest single
resort in the country with foreign labour**; there would be no transfer
of knowledge to locals and…there would be no major hotelier involved.
of such a facility would be critical from The Bahamas Government’s
point of view”, he said, adding that “…At the moment, all we’ve
got is a deal between Baha Mar and the China company and The Bahamas
cannot be in a position where it is in a take it or leave it proposition”.
expressed by the Prime Minister with respect to the lack of branding
of the proposed hotels has been answered by the developers. They indicated
earlier that they expect to be able to identify the brands by the end
of the year having regard to the high level of interest being shown
by some of the world’s top brands. They have already signed a Letter
of Intent with Rosewood Hotels and Resorts to operate the 200 room luxury
hotel, the Morgan’s brand for the lifestyle hotel and Hyatt for the
700 room hotel. Others are expected to be announced over the next several
dissatisfaction that BahaMar could generate sufficient demand for the
resort, citing its difficulty filling the existing 1800 rooms, leaving
many closed at the Wyndham Hotel!
The Use of Chinese
He also expressed
concern that if the BahaMar project was allowed 5000 Chinese workers,
Atlantis, which has “Favored Nation Status”, would also need to
be allowed a similar number of work permits at some subsequent occasion.
brought the resolution to the House of Assembly for debate, which included
approval of some work permits for Chinese (foreign) workers, the Prime
Minister told the press on the same day, that he and his party’s Members
of Parliament would vote for the resolution and that he and his party
“…were prepared to take whatever political ramifications will come
if they are ‘forced to go it alone’ on the ‘controversial’ labour
He is reported
as saying that “I will not take account of what the political consequence
of it is. I will do what is best for The Bahamas and if that means that
there will be a political price to pay then I will pay it and my party
will pay it”.
In recent times,
the Prime Minister has said that there would be no Bahamian labour used
on the Core project, which makes up by far the bulk of the construction.
He also asserted that as a result there would be no transfer of skills
to Bahamian workers. This assertion by him is in contrast to the information
given by BahaMar in its statement about the Core project Phase, of November
2009, stated that “…It is anticipated that this part of the development
will employ some 3,300 Bahamians, as well as 8,100 expatriates, totaling
over 11,400 over the course of the project”. Further BahaMar
has stated that the company is prepared to fund training for Bahamian
is more amazing is that this same information about 3,300 Bahamian workers
in the Core Project is included in the Prime Minister’s own communication
to the House of Assembly made on September 8th, and is implied
in the Resolution tabled in the House of Assembly on the same date!
He then indicated,
as the PLP has been saying since the resolution was tabled, that such
a large number of expatriates working on the project are unacceptable,
if there are Bahamian workers capable of doing the work. He then suggested
that the reason so many expatriate workers may be necessary is that
the work is not being phased and suggested that with phasing there would
be sufficient Bahamians to do a greater portion of the work. Consequently
he also suggested that he would be undertaking discussions about these
matters with the Chinese government and representatives of the Ex-Im
Bank and CSCEC when he visits China later in the month.
It should be
noted here that the government spokespersons, in debating resolution
seeking approval of the House of Assembly to borrow $58 million from
the Chinese government to build a new 4 lane highway from the airport,
conceded that a condition of that loan was that the project design and
construction was being done by the Chinese and that 200 Chinese workers
would be brought in to construct the road. Further it was said that
the use of Chinese labour is Chinese government policy, wherever the
government gives such loans. This position was confirmed by the Chairman
of the FNM while discussing the fact that the government has a facility
to borrow some $100 million from the Chinese government for other suitable
We must ask
here for the Prime Minister’s source for these conclusions.
There are some
1500 of the 3500 rooms on Cable Beach at present and prior to the closing
of the Nassau Beach there were over two thousand rooms and they all
co-existed. The new development’s 3500 rooms will include the existing
Lack of Engagement
It should be
noted that the Supplementary Agreement between the Government of The
Bahamas and BahaMar was signed prior to BahaMar securing financing from
the Ex-Im Bank of China and securing the CSCEC as the general contractor.
The Government of The Bahamas appears to have taken a hands-off approach
to the details of those agreements until now. This has led to the dilemma
which it now faces as it indicates at this very late stage concern about
many of the essential conditions already signed and sealed between the
developer, the financier and the general contractor. They ought to have
been involved at every stage of the process.
The fact that
the Government brought a resolution to the House of Assembly for its
approval, which included provisions, which it now says it finds unacceptable,
is truly amazing and smacks of ignorance of the provisions and indecision,
at best and negligence at worst.
The Bank of Nova
the government, when it tabled the resolution seeking Parliament’s
approval of the BahaMar project, made it a condition that it would only
proceed with the debate after BahaMar had settled its outstanding debt
with the Bank of Nova Scotia, to the government’s satisfaction. Two
weeks later, the government served notice on Parliament that it was
no longer willing to delay the debate primarily because it did not wish
to be blamed for holding up the project. A week later it changed its
mind again, saying this time that its immediate previous declaration
was really based on information that an agreement was imminent.
it appeared that the government was hopelessly undecided and that in
fact the Prime Minister did not support the project proceeding at all.
When it was
finally learned, on October 6th, that BahaMar had in fact
reached a satisfactory agreement with the Bank, the Prime Minister held
a press interview, on the same day, which was described by the press
as “repetitive in many respects”, and appeared to set a litany of
new conditions, moving the goal post as it were, calling for major adjustments,
before the project could receive his government’s approval.
The foreign labour
Building the project
in one phase with completion by the year 2014
Insisting that there
was “…more than enough land between the Nassau Beach hotel and the
land east of it for them to construct their 1000 room hotel, their casino
and whatever else they wish to construct and open it!”
said further that “…And nothing prevents them from building the
others at the same time. There’s no need whatsoever for all to be
built and opened at the same time. That is not in our interest. That
may be in the interest of the financiers, the construction company and
the owners of the project, but what about our interest/ it is not in
at this late stage, the government and specifically the Prime Minister,
who previously indicated his government’s support for the project;
who brought the resolution to Parliament; who said he would debate the
matter and that his Members would support it, have done an amazing and
reckless about turn!
members of the Press, on October 7th, that he “told”
the Chinese Construction Corporation that, “…it is next to impossible
for The Bahamas to approve 8,000 or so Chinese workers on the site at
the same time with no Bahamian workers on the site at the same time
and no transfer of skills to Bahamians at the same time”.
is, “When did he do that…before or after the resolution was put
on the agenda of the Parliament…before or after he told the press
at the original live Press Conference at which he said he and his government
were willing to pay the political price for the 8150 work permits?”
It is difficult
to avoid pointing out that the Prime Minister’s stories are more and
more appearing to be just that! On Monday October 18th, he
now says the following: “We told the Chinese State Construction Engineering
Corporation from the first time we saw them more than a year ago that
it was not possible to have that number of foreign workers on a job
site with the Bahamian content being so low. Nothing has changed. We’ve
been telling them that for more than a year now”. If that is really
the case, how does he explain the resolution which he brought to Parliament?
that there would be no Bahamian workers on the project “at the same
time” as the Chinese workers, is diametrically opposite to his Communication
to Parliament on September 8th. Then he said that his government
was willing to pay the political price! Since he said in that same press
conference that he was not “…putting them to a per centum, (such
as was done with Kerzner)…” we ask what the problem is.
in his original submissions to Parliament, said that 1200 Bahamians
would be employed in the first phase and that some 3,300 plus Bahamians
are expected to be employed in the Core Project!
In a most amazing
reaction to public statements on the matter by private citizens and
businesspersons, he then said, “…I don’t want to be pressured
by anybody” and that he was “…sick and tired” of “…stories
being put in people’s heads that weren’t true”!
The truth is
that when the government negotiated the Supplementary Heads of Agreement
with BahaMar, it had every opportunity to deal with any and all matters
contained in the 2005 HOA with which it did not agree. It did not do
so and rather than keeping engaged with the developers it chose to ignore
their pursuit of new financing after the arrangement with Harrah’s
Role of the Government
government has, since it came to power, done more than any other entity
to downplay this Project. The Prime Minister himself from the beginning
expressed no confidence in the project. It is almost as if he wanted
the project to fail just to show that a PLP sponsored project could
not succeed. Moreover, his statements suggest that he favors Kerzner/Atlantis
to the detriment of expansion of the tourism product, creation of employment
for Bahamians, and the growth of the Bahamian economy. He has used scare
mongering tactics that have had the effect of diminishing confidence
of investors in the economy of The Bahamas.
in the economy and in the country is the job of the government. This
government’s utterings have instead had the effect of driving investors
Now he has
shamelessly begun to adopt the positions that the Progressive Liberal
Party has adopted on the essential features of the development.
Liberal Party’s Position
The Work Permit
record of standing up for Bahamian labour is unmatched. We have always
believed that if there is a job going a Bahamian must have first shot
at it. We have fought for this during the entire history of our party.
We were distinguished in Government for having invented the phrase,
“Bahamianization” and for putting it into action as an essential
tenet of national development. So we stand on our record of wanting
jobs for Bahamians. But we are also realists. We realize that if a project
of the nature of Bahamar is to ever be built and provide benefits for
the Bahamian people and the economy, then it must be built quickly.
The real economic potential of this development is not in the construction,
although this will be significant in today’s economy, but in its sustained
period of operation. The sooner the doors of BahaMar open the sooner
will there be permanent jobs for Bahamians. That is what we want to
see. We want to ensure that the thousands of jobs that will flow from
the project will bring real economic and financial benefits to our people.
One of the
problems of our country today is that we often speak without any real
analysis of the issues. If a cursory labour economic analysis of the
BahaMar project versus the Kerzner/Atlantis project was to be undertaken,
it will show that the capital expenditure of Bahamar at $ 2.5 billon
(or ultimately $3.5 billion) would far outstrip the various Phases of
the Kerzner project. It is also important to note that the project is
inclusive and will not be built in phases and so there is a definite
time line as to its completion. Its impact will therefore be far greater.
Taking this analysis a bit further, a basic extrapolation of the construction
cost versus the foreign labour component, would easily show that the
percentage of foreign labour required as a ratio of the investment dollar
figure on the BahaMar project would be
far less than that experienced
in the three phases built by Kerzner. There is proportionality to economic
analysis and manpower must relate to the size of the investment. The
figure of 8,150 foreign workers might appear very high but it is in
relation to a $2.5 billion investment as compared to say, 3,000 (a thousand
per Phase on the Kerzner/Atlantis Project) which was in relation to
a total construction cost of around $1 billion for Kerzner. It
is also reasonable to expect that once one aspect of the work is completed
those persons so engaged will depart from The Bahamas. In other words,
drywall plasters will not be required on the project at day one and
steel riggers will not be required at the ending phases of the project.
We are also assured that the Chinese will return to China while in fact
many of the specialist labour used by Kerzner/ Atlantis are still engaged
in the construction trade here in Nassau waiting for the next big project.
by the Chinese represents certain important geo-political considerations
which must be taken into account as we deal with it. There are inherent
pitfalls in not handling it properly. The Chinese economy is now the
world’s second ranked economy, having overtaken Japan and now ranked
only behind the United States. It follows therefore, that in today’s
world, the Chinese Government wields tremendous economic and political
clout and its influence is very strong in many areas. By any yardstick,
this is a considerable investment for any company, local or foreign
to undertake. The amount of $2.5 billion is, in any circumstance,
a large investment. This investment is financed by a Chinese company
and by extension, the Chinese Government. Private sector investment
initiatives in China are hardly indistinguishable from investments by
the Chinese Government. This investment is therefore a cross-cutting
issue that reaches into the core of the Chinese bureaucracy.
treatment of this investment proposal by the government can have far
reaching consequences. How we treat this investment could have a negative
effect if not done right. We are not dealing with a single investor.
We are dealing with a large nation which, having done its due diligence
thinks it feasible and prudent to invest $2.5 billion dollars to a private
developer in an off-shore location. We think that it is
a mark of confidence in The Bahamas and the region that this is happening
and that the Chinese Government would want to back such an investment.
Clearly the Chinese Government is watching and watching closely to see
how the Government of The Bahamas deals with this initiative. The way
in which the Government has handled this matter to date could redound
negatively in other areas of the Bahamian government’s interests in
global and international affairs, not to mention economic investments.
To think otherwise is to have a blinkered and isolated view of things.
The Chinese have long memories and a longer reach.
Need for significant
development in the tourism, hotel and resort sector
For years it
has been accepted that the Cable Beach strip has been in need of a renaissance.
Repeated initiatives by successive governments since the seventies have
been unsuccessful in finding developers with the desire or the means
to bring about the transformative revitalization that is required.
Beach and Ambassador Beach hotel properties have been virtually given
away in the past and have had significant success as all inclusive properties.
The size and
scope of this project represent the magnitude of what is needed to provide
jobs for the vast number of Bahamian citizens who emerge onto the job
market on an annual basis.
with the exception of the Atlantis property and the Sandals and Breezes
properties on Cable beach, the entire tourism inventory needs upgrading
or replacement. Notably, the ownership of Breezes has expressed strong
support for the approval of the BahaMar project and is ready to further
expand its own facilities on Cable Beach.
if successfully built out and operated will go a long way to meeting
the needs and along with the renovation of the downtown experience could
revive Bahamian tourism and place The Bahamas once again among the elite
destinations in the Caribbean.
Creation of linkages
and entrepreneurial opportunities for Bahamians
Project offers The Bahamas the prospect to realign several sectors of
its economy. For years, successive governments have touted the establishment
of linkages to tourism and administration after administration has failed
to make this a reality. Hence thousands of Bahamians have been shut
out from the economic benefits which tourism has generated.
offers the opportunity to reverse this trend thereby deepening tourism’s
contribution to our economy and expanding the number of Bahamian beneficiaries.
will earn substantial foreign exchange from visitor spending, food for
the visitor, entertainment for the visitor, plants for hotel property
landscaping, textiles like bedding and uniforms for the hotels and the
manufacturing of a number of items for sale to the hotels and their
like agriculture, light industry and manufacturing can be revitalized
thereby saving substantial foreign exchange which can be earned from
a functioning food production sector, the light industry sector, manufacturers,
and service suppliers i.e. the burgeoning computer and information technology
Bahamian tourism has been creating jobs outside of The Bahamas. The
time has come to expand job creation in The Bahamas not solely and directly
in the hotels, night clubs or restaurants but in the diverse ancillary
sectors and industries.
At this juncture
in our development, Bahamians should share in more of the tourism largesse
than simply as hotel workers because the Bahamian citizen is giving
up a part of his birthright via the granting of lucrative concessions
to the developers.
has to play a significant role in bringing a new genre of entrepreneurs
and small businesses as participants in an enlarged Bahamian economy.
should not be arbitrary but stipulated in the Heads of Agreement. Indeed,
the original 2005 Heads of Agreement does make for such provisions and
it is up to the administration of the day to ensure that the stipulations
in that agreement are adhered to and implemented to the benefit of Bahamians.
be designation (by %) of local content in food purchased, entertainment
provided, textiles used, nursery plants, training in a full range of
amenities including golf course maintenance and development, retail
store operators, franchise holders etc.
be an integral part of the deal, not on the peripheries. Not on the
margins, but full centre.
Validity of the Objective of the Resolution
There are three
branches of government, which are constitutionally separate. These are
the legislative made up of the House of Assembly and the Senate, the
Judicial, made up of the courts, and the Executive represented by the
It is our understanding
that the legislative branch of government makes laws which set out the
parameters for executive decision making. The executive’s decisions
are subject to critical review in the parliament and to legal review
in the courts.
as drafted, invites the legislature to take part in the executive responsibility
of the approval of work permits for foreign workers, which is contrary
to stated public policy. This act, if undertaken threatens the constitutional
separation of powers and flies in the face of the spirit and intent
of the constitution.
Liberal Party supports the Baha Mar Project, which calls for the construction
of four new hotels, a larger casino and convention facilities and the
other amenities as stated. The PLP supports the employment of the maximum
number of skilled and unskilled Bahamian contractors and workers on
all phases of the Project and the provision of formal training in traditional
and new skills and technology, and certification to international standards
to enable Bahamian workers to perform proficiently. Further the PLP
is not opposed to the employment of essential foreign labour consistent
with the Heads of Agreement which it signed in 2005.
We are opposed,
however, to trifling with the constitutional separation of powers and
are of the firm view that the government should carry out its duties
to the Bahamian public and in the public’s best interests.
to the Resolution
to all that has been discussed in this Paper, the PLP suggests that
amendments to the resolution, which is currently before the House, be
offered to do the following:
Support the Project
Maximize the participation
of Bahamian construction and related labour content
Minimize the foreign
construction labour content
and skills transfer for Bahamian construction workers
Ensure that Bahamians
are trained and available for permanent jobs in the operation of the
Intervene in the
national interest to prevent any freehold in the project vesting in
a foreign state
A draft resolution
is attached (Attachment 4).
Benefit to The
Bahamas and Bahamians
It should be
very clear, even to the most casual of observers that for almost two
decades the tourism product of The Bahamas has been in the doldrums.
Since 1994 when Sun was established in The Bahamas, the entire Nassau
/ Paradise Island tourism product has been dependent to a very large
degree on the Atlantis brand.
Indeed to many,
Atlantis is the only destination in The Bahamas and a monopoly has been
created. There is no doubt that Atlantis has been good for The Bahamas
and Bahamians to an extent and has served to employ more Bahamians that
any other single employer in the country except the government.
and particularly Nassau/New Providence, especially the Cable Beach strip
is virtually on life support and that is bad news for The Bahamas and
it is safe for one to predict that in the long run this will hurt the
Ministry of Tourism’s overall marketing thrust to get tourists to
The Bahamas. It also has a deleterious effect on pricing and will, if
not already happening, in the long run make the Bahamas tourism product
far too pricey for the average traveler who is now turning to other
destinations, equally as attractive but far less costly. In short, a
virtual monopoly has been created with only one beneficiary.
As a consequence,
many visitors to Nassau leave disappointed as they believe that there
is a shortage of experiences. This does not bode well for return visitors.
This is hurting the Bahamian tourism industry and the economic spin-offs
that would normally have flowed to the average man and woman through
taxis, sale of products, shopping, dining and nightlife are now lost
and are concentrated in a single location. Even those visitors who stay
at other resorts or who come on cruise ships are being lured through
tours to Atlantis which has become an attraction. The down side of this
is that the perception has been created that it is the only product
and that Nassau/Cable Beach is an inferior destination. This is a view
that is shared by Bahamians. It is a dangerous perception and could
ultimately lead to the ruination of our overall tourism product that
has been built up so successfully over the last one hundred or so years.
We have seen
evidence of this in the failure of other hotel and tourism developers
over the past decade.
This is the
“push-pull” effect that had prompted the PLP Government to lobby
so hard for an alternative product on Cable Beach. Not only would BahaMar
provide a robust competition to Atlantis but it would do much to revitalize
some parts of the city, such as Bay Street and western New Providence.
But more to the point, if four or five new hotels were to be built on
Cable Beach it would increase the level of visitor arrivals and spending
with the subsequent uptick in employment and other spin-offs. The GDP
will be enhanced and it will add some further economic security to a
troubled and frightened labour force.
with any modicum of concern for the Bahamian worker would run with such
a proposal once the details are worked out.
have reason to believe that the Prime Minister will be attempting to
conclude a new deal with the Chinese when he visits China in just a
few days from now. Indeed he may already have struck one. No doubt the
Prime Minister will, upon his return to The Bahamas, if not before,
claim credit for any renegotiated deal.
We wish him
well in his efforts in this regard but must continue to rebuke him for
having waited so late in the day to involve himself front and centre
in ironing out the problems and bringing the BahaMar Project forward
so that its long awaited benefits for The Bahamas can finally be put
in train to help alleviate the economic woes that so many thousands
of our people are feeling while Mr. Ingraham has been either twiddling
his thumbs or standing in the way of progress.
We ask that
he inform himself satisfactorily with respect the phasing of the project
since it is our understanding that radical change in this aspect could
have serious implications for the financial success of the project.
In our view
the Prime Minister, if he is discussing this very important project
with the financiers should have had initial discussions with the developers,
BahaMar, to ensure the acceptability of his proposals to them. He has
said publicly that he has not spoken to them and we believe that to
be a mistake since ultimately they would be subject to whatever are
the results of the Chinese negotiations. This approach does not bode
well for good government – investor relations. In fact it is our view
that BahaMar should be involved in any such discussions. They should
be at the table.
For our part,
we expect that any deal would include the following:
Maximize the participation
of Bahamian construction and related labour content including both skilled
and unskilled workers
Minimize the foreign
construction labour content to that which is required for the successful
completion and implementation of the project
and skills transfer for Bahamian construction workers during the course
of the entire project
Ensure that Bahamians
are trained and available for permanent jobs in the operation of the
Ensure that there
will be a myriad of opportunities for Bahamian entrepreneurs to benefit
from in the resort when completed
urge the Prime Minister to discontinue playing politics with this project,
which, successfully implemented will help to revitalize the tourism
industry. His recent flip flopping on so many of the conditions of this
project is reason for much alarm and uncertainty among hotel workers
and among potential investors.
which he has expressed for world class hotel operators in respect of
those who were recently announced as potential partners with BahaMar
in this project would not inspire their confidence.
project is not perfect but it represents the best opportunity at this
time for bringing new life and activity to Cable Beach and hence the
New Providence destination.
Project is not the same as that which was negotiated by the PLP government.
That Project did not have the same financiers, nor did it contemplate
anywhere near as large a number of foreign workers as is the case here.
all things considered, the long term prospects, not only for
thousands of sustainable jobs, but for opportunities for
ambitious and talented Bahamians through entrepreneurship, are enormous
and the PLP supports this project subject to the conditions and reservations
that we have been careful to enunciate in this statement.
© Copyright 2010 by thebahamasweekly.com -