The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Eighty percent of the spending that kept Bay Street afloat has dried up via a cruise industry shutdown just extended to October 1, the Downtown Nassau Partnership’s (DNP) co-chair has revealed.

Charles Klonaris told Tribune Business he does not foresee the sector’s return much before November’s Thanksgiving holiday at earliest after US health watchdogs pushed their ‘no sail’ order out a further two-and-a-half months.

Speaking after the Centres for Disease Control and Prevention’s (CDC) move, Mr Klonaris predicted that some merchants will fall “victim” to downtown Nassau’s protracted shutdown of at least six-and-months and “be unable to survive”.

And he warned that many of those who did re-open were likely to do so with much-reduced staffing levels, as they aligned costs with shrivelled revenue streams and/or found they could sustain their operations with fewer workers.

“It’s gone way beyond what most people anticipated,” Mr Klonaris told this newspaper of the COVID-19 pandemic, “and for the city of Nassau I would say tourists generate 80 percent of consumer spending.

“It’s going to be a very difficult time in how people cope between now and November. It’s a very difficult and serious situation. I don’t think anyone has an answer in terms of having the right balance between being locked down and opened up. It doesn’t look good now, it really doesn’t.”

The CDC’s action, in extending a ‘no sail’ order that was due to expire on July 24, pushes the cruise industry’s sailing resumption back at least two weeks beyond the September 15 suspension it previously announced voluntarily through the Cruise Lines International Association (CLIA).

“In line with CLIA’s announcement of voluntary suspension of operation by its member companies, CDC has extended its ‘no sail’ order to ensure that passenger operations on cruise ships do not resume prematurely,” the US regulator said.

“Cumulative CDC data from March 1 through July 10, 2020, shows 2,973 COVID-19 or COVID-like illness cases on cruise ships, in addition to 34 deaths. These cases were part of 99 outbreaks on 123 different cruise ships.

“During this timeframe, 80 percent of ships were affected by COVID-19. As of July 3, nine of the 49 ships under the ‘no sail’ order have ongoing or resolving outbreaks. According to US Coast Guard data, as of July 10, 2020, there are 67 ships with 14,702 crew onboard.”

The CDC then made clear its concern that cruise ships are a floating breeding ground for COVID-19 to spread rapidly, especially given how congested they are at full occupancy and how frequently crew members and passengers interact among themselves and with each other.

“On cruise ships, passengers and crew share spaces that are more crowded than most urban settings,” the CDC added. “Even when only essential crew are on board, ongoing spread of COVID-19 still occurs.

“If unrestricted cruise ship passenger operations were permitted to resume, passengers and crew on board would be at increased risk of COVID-19 infection and those that work or travel on cruise ships would place substantial unnecessary risk on healthcare workers, port personnel and federal partners (Customs and Border Protection and the US Coast Guard), and the communities they return to.”

The local effect of the CDC’s order means a longer period with minimal to zero income for Bay Street and downtown Nassau merchants; tour operators, excursion and attraction providers; restaurants; taxi drivers; straw vendors; hair braiders and all others that rely on the cruise industry for their income and livelihoods.

And that was before the Prime Minister yesterday announced that all commercial passenger vessels travelling between the US and The Bahamas will not be permitted to pass this nation’s borders. That will have minimal commercial impact at present, given the cruise industry’s shutdown, with the main effect likely to fall on the Balearia ferry service thought to have brought back many COVID-19 infected Bahamians from Florida.

Mr Klonaris, meanwhile, said cruise industry-dependent businesses now face having to hang on for even longer as a result of the CDC’s action. “The only encouraging thing is Global Ports Holding are moving ahead with the port development,” he told Tribune Business.

“Then you have The Pointe and Margaritaville; I don’t know the timeframe for when they will be open, but it looks pretty close - maybe at the end of the year. You have the US Embassy well underway with the construction.

“Those are some very positive points for the city, but how we cope between now and then, when these things come to fruition, will be very difficult. Everyone should try and keep going, but it’s a real conundrum,” Mr Klonaris continued.

“I expect some of the businesses are not going to return. I think that’s going to be obvious. There are some that are not going to survive this shut down of the city. I don’t know what effect that will have on retail and office space, but it will have some effect, especially on leases that come up for negotiation in these difficult times. Hopefully those that do come through come through stronger than before.”

Mr Klonaris said “just a handful of stores” were open when he walked down Bay Street last week, and added: “I just hope that by the end of the year, I wouldn’t say back to normal, but I would hope the city is functioning by 70 percent.

“There will be those that won’t survive, but hopefully there will be a sufficient amount to revive the city and, by November, it will be a reasonably thriving city of Nassau. I don’t see it happening before November, and that’s a long shutdown.

“It might be a lesson on how the industry depends on just one industry for survival. That’s a problem we may never get rid of. The banks moved out of the city, and they provided the high net worth individuals that supported the restaurants. Now the city is just tourist-oriented.”