The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Prime Minister yesterday said he had negotiated a 38 percent “discount” on the cost of shipping containers coming into The Bahamas from the Far East as the Government ramps up efforts to combat soaring inflation.

Philip Davis QC, addressing his office’s weekly press briefing, indicated that this deal had been worked out with one shipping company that he declined to identify, and said his administration was awaiting word on the savings it could expect on containers coming from Florida.

Shipping container costs as much as tripled/quadrupled due to the COVID-19 pandemic, subsequent shipping backlogs and global supply chain crisis, and the Prime Minister said: “What I have done is I have engaged with several of our shipping airlines, shipping agencies and I have been able to work out an arrangement with one of them that has already agreed and put into effect the reduction of the cost of containers coming into the country.

“I don’t want to identify them because you don’t want a challenge as to what they’re charging, but we have negotiated up to a 38 percent discount on containers coming to The Bahamas particularly from the Far East and we are waiting to hear what that discount will be from Florida. Those are the efforts we have been engaged in to assist in mitigating the inflation and impact.”

Nassau’s major commercial shipping port earlier this year pledged it will not increase any tariffs despite growing fuel and energy cost pressures that threaten its profit targets for the 2022 financial year. 

Dion Bethell, Arawak Port Development Company’s (APD) president and chief financial officer, told Tribune Business had had given such assurances to the Prime Minister. Some 90 percent of New Providence’s commercial sea freight comes through the Nassau Container Port, and its tariffs impact the cost of all goods purchased by New Providence residents.

“One thing we assured them of is we haven’t increased rates for eight years, and there are no plans to increase rates now,” Mr Bethell disclosed. “The greatest impact on global cargo costs is outside our control related to global shipping costs.

“No assurances were made to decrease our rates, but assurances were given that we won’t be increasing them. In unique circumstances, we do what is necessary to ensure that the impact of the services we provide is not a financial burden to the general public because, over the years, we have not increased our rates. We certainly won’t be increasing them in times like this.”

Meanwhile, Mr Davis yesterday said the Government was still awaiting conclusions from the Cabinet sub-committee appointed to review the North Andros aggregate mining project proposed by Cameron Symonette, head of the Symonette Group, and his business partners.

“They are doing their due diligence,” he said, noting that several sub-committee members were present in North Andros for last weekend’s Town Meeting to gauge the views of local residents on the venture. “The timing [of that decision] will be tied to when the sub-committee has done their work and reported to us. I don’t know when that will be,” Mr Davis said.

The proposal, which was first presented to the Minnis Cabinet, is understood to have been shown to the Davis administration at end-January and a decision is now awaited as to whether it will be given approval in principle so Mr Symonette and his partners, known as Bahamas Materials, can begin the process of obtaining their environmental approvals and holding Town Meetings with the community in North Andros.

Sources familiar with the project, speaking on condition of anonymity because they were not authorised to do so, said it planned to create 163 direct jobs in Andros along with numerous spin-off entrepreneurial opportunities. They dismissed any climate change concerns, saying the project will be located on “fallow” land in the shape of the Water & Sewerage Corporation’s 5,500 acre wellfields that have been inundated with seawater from past hurricanes.

Bahamas Materials plans to mine the site for calcium carbonate (limestone). The extracted rock would then be crushed and screened at a purpose-built plant before being exported by sea to either Florida or New Providence for use by the construction industry in a variety of construction applications.

However, the plans go beyond mere aggregate mining to explore how the land could be reclaimed, and repurposed, for other productive use such as real estate once all the rock has been extracted. Bahamas Materials Company is proposing a corporate structure where a subsidiary, Morgan’s Bluff Development Group Ltd, owned by local residents would control/own the land and lease portions to it for mining via a phased approach.

“The control remains with the Government and the people,” a source said. “This project will pay royalties, it will pay taxes and it will pay Business Licence fees.”