The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The cruise industry’s 30-day shutdown will be “extremely devastating” for Bay Street and all who rely on the sector for their livelihood, the Downtown Nassau Partnership’s co-chair warned yesterday.

Charles Klonaris told Tribune Business that while downtown merchants, tour and excursion providers, straw vendors and hair braiders will “feel the brunt of the shutdown”, it represented merely the beginning of what he described as “a domino effect” that is unlikely to spare any part of the Bahamian economy and/or society.

While a “dead” city of Nassau would show “the physical impact at the door”, he added that increased unemployment, and reduced personal and business incomes, would have a “severe” impact throughout New Providence as a result of the coronavirus crisis.

Arguing that “we’re not in a position to deal with this crisis” due to The Bahamas’ reliance on imports for virtually all it consumes, Mr Klonaris said the lack of local food and other supply chains exacerbates the country’s vulnerability to COVID-19 because so little is produced here.

He called on the government, private sector and civil society to unite and find “ways to keep the island afloat until the crisis ends”, suggesting that the COVID-19 fall-out was “a wake-up call” for The Bahamas’ economic future.

The cruise industry’s major operators, Carnival, Royal Caribbean, Norwegian Cruise Lines and Mediterranean Shipping Company (MSC), all stopped sailing from the US as of midnight on Saturday, closing down a sector that brought 5.4m, or 75 percent, of the total 7.2m visitors that came to The Bahamas’ shores in 2019.

“I would say it’s going to be extremely devastating,” Mr Klonaris told Tribune Business of the impact. “As you know, the majority of the shoppers downtown are from the cruise ships and visitors from the hotel.

“It’s going to be a huge and very serious impact on our economy, especially on the retail outlets and tour operators. They are the ones that are going to feel the brunt of the shutdown more than anybody right now.

“But it’s not just them,” the Downtown Nassau Partnership (DNP) co-chair added. “It’s a domino effect. One thing leads to another. Right now it’s hard for me to determine the full impact, but understanding how Bay Street works it’s serious situation. It’s going to affect the economy totally.

“How do people deal with debt? How do people deal with income, purchasing power? All this has an effect. There has got to be a concerted effort on the part of everybody to see how we can mitigate this crisis that is upon us.”

Mr Klonaris added that the biggest unknown for Bahamians, and their economy, was how widespread the Covid-19 pandemic will become at home and abroad, and how long it will last. And he questioned if the cruise industry’s suspension will last for more than the stated 30 days.

“The most disturbing part about this is how long it’s going to last. They say 30 days. Hopefully that is what it is. We don’t know,” Mr Klonaris said, revealing that he had experienced nothing like the coronavirus and its economic impact before.

“The ripple effect is not going to be Bay Street. We will see the physical impact at the door, but then there is the unemployment rate and effect it will have on the entire economy of The Bahamas. Physically, you’re going to look at a city that could perhaps be dead, but what does it mean for the economy of the island itself? It ripples out.

“You have two issues. One is containment of the virus, and the second is the economy, and that’s going to impact every one of our islands severely. We’ve come through Dorian and now have this coronavirus, which from an economic perspective could be even more devastating.”

Ed Fields, the Downtown Nassau Partnership’s co-chair, yesterday said the private sector has already engaged the Government over how to minimise the economic repercussions for businesses, employees and the wider economy.

“With respect to downtown, the economic impact is not precisely measurable but it is safe to say it will be significant,” Mr Fields said via e-mail. “The business community will be working with government to make recommendations about how to mitigate the situation and those discussions are underway. To go beyond that at this time would be speculative at best as this situation is changing by the hour.”

Mr Klonaris, meanwhile, said The Bahamas’ status as a small, open economy that relies on imports for all it consumes had left it especially vulnerable to a coronavirus-type pandemic because so little is manufactured or produced here.

“The uncertainty is the part that’s most worrisome to everybody,” he added. “We’re not in a position to deal with this crisis. We’ve got to keep the island alive, and everybody has to come together in a realistic and pragmatic way to see how best to solve this situation.”

Arguing that such an effort required the collaboration of all government agencies, the private sector and civil society, the DNP co-chair warned: “The island is going to practically shut down. The jobs are going to disappear quickly. All these areas will be impacted, and we have to come together to see how we can mitigate and keep us afloat until this is over. The key is how do we keep the island afloat?

“For us it’s more difficult because we’re relying on external forces. We don’t have control over the cruise ships, we don’t have control over the airlines. It’s a serious situation. It could be a wake-up call for for how we look at this island and economy. There are going to be hard answers and difficult decisions to be made.”