The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

The Grand Bahama Port Authority's (GBPA) acting chairman has confirmed that the Government's acquisition of Grand Bahama International Airport is “Imminent".

Sarah St George told Tribune Business via a short statement that the sale of a key infrastructure asset that was devastated by Hurricane Dorian's September 2019 storm surge is “nearing completion”.

"For many years the Government has expressed an interest in ownership of the airport, and there are obvious synergies from an airlift standpoint, management of and control of airspace, and other sovereign aspects, in integrating Grand Bahama with all the other airport operations under Government ownership in The Bahamas," she said.

"The Grand Bahama airport is unique. It is the largest privately-owned international airport in the world. It was first commissioned in 1958, and since that time it has not only met the needs of the people of Grand Bahama, but it has operated as a major hub for inter-island flights to all of the neighbouring Family Islands, and served as a major gateway to The Bahamas for the world’s largest air carriers and millions of passengers from all over the world.”

However, many observers believe the GBPA and Hutchison Ports Holdings, which jointly own the airport 50/50 with the latter having management control, failed to live up to their governance and developmental obligations under the Hawksbill Creek Agreement in Dorian's aftermath by effectively walking away from their responsibility to rebuild the airport.

Ms St George, though, said: “While the GBPA, together with the airport owners, have ensured a functional temporary facility was put in place to meet international standards for airport operations after the catastrophic destruction of the terminal buildings by Hurricane Dorian, we appreciate that the acquisition of the GB airport by the Government is in the fulfillment of its overarching responsibility to ensure that the island is efficiently and adequately served by aviation facilities. It is our view, therefore, that for the reasons expressed above, the imminent acquisition is in the best interest of the island.”

The initial terms of the acquisition deal between the Government and the airport’s owners involved a $1 purchase price. In return, Hutchison and the GBPA were to hand over responsibility for rebuilding and redeveloping the facility to the government while also retaining the Hurricane Dorian insurance proceeds.

Reconstruction costs have been estimated at $60m to reconfigure the airport and harden it against future storms. With the Public Treasury increasingly cash-strapped due to COVID-19, the Government is looking to a private-public partnership (PPP) to raise the necessary financing and construction/management expertise similar to the Nassau Airport Development Company (NAD) model.

Magnus Alnebeck, Pelican Bay’s general manager, while hailing announcements that an acquisition is close as “fantastic news” this week warned the Government that it must tackle Grand Bahama International Airport’s (GBIA) high costs if its prospective purchase is to “grow the destination”.

The resort executive said it was vital that such a key infrastructure asset, which acts as the tourism and commercial gateway to Grand Bahama, be owned by a proprietor that wanted to expand the island’s economy rather than an entity seeking to extract as much profit as possible from a diminishing customer base.

Arguing that the present ownership duo fell into the latter category, Mr Alnebeck said the airport “has to be better” than its post-Hurricane Dorian appearance of “a tin and some rusty chairs”. He added that airline connectivity at competitive costs and fuel prices was more important for the island’s revival as a tourism economy.

The present airlift situation, with the island being served by minimal carriers and flights, was described as unsustainable especially since ticket prices were more expensive between Miami and Freeport than those for the Nassau route.

“There has been the challenge with the operating costs at the airport that are generally passed on to airlines and passengers, and make it too expensive that no one wants to fly there,” Mr Alnebeck added.

“If this purchase happens it will be fantastic news, and then I hope they [government] find a solution as to who operates the airport as opposed to messing with the airport themselves. It’s a wonderful idea that the people of The Bahamas own the airport as opposed to a private company that wants to make money out of it.”