The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The deputy prime minister yesterday admitted that The Bahamas has "gotten caught behind the eight ball" over the need to upgrade its airport infrastructure with discussions now also focusing on expanding the country's main gateway.

Chester Cooper, also minister of tourism, investments and aviation, speaking to media at the HEALinc Further Health Innovation Summit, said there was renewed focus on how Lynden Pindling International Airport (LPIA) will be able to accommodate the surge in tourist arrivals that The Bahamas is seeing.

Speaking after the Government extended the deadline for initial responses to its $260m, 14-airport, bid process by two weeks to end-April, he said: "We want to ensure the best possible outcomes. And we also want to ensure that we were expediting this process. And, therefore, there is a balance between providing more time and, at the same time, ensuring that we move this along.

"The people of North Eleuthera, for example, have outgrown the airport many, many years ago, perhaps decades ago. So we have, frankly, gotten caught behind the eight ball with airport developments in The Bahamas over the course of the last 20 years. And we have a lot of catching up to do.

"LPIA, for example, even though this has been developed just over the last few years, on Saturday alone, we're seeing 8,000 to 10,000 visitors come to the airport. And there's now discussion at the moment as to how we're going to accommodate the increased level of growth. And therefore we have to be expeditious while we try to create the kind of balance that's needed."

Explaining why the Government has extended the deadline for interested bidders in the Family Island airports to respond to the pre-qualification phase, Mr Cooper added: "We've had a significant level of interest and requests not just locally but from around the world for what we call the Family Island 'renaissance' project. As you know, we're building out 14 airports. This is no small undertaking.

"And we have attracted the interest of major airport developers and managers around the world. They've indicated that the information we requested was quite onerous. We want to get this right. We want them to provide the information that we need so that we can do the proper analysis. And, based on the level of interest, we thought it prudent to extend the process to ensure that we get all of the information, but also the most credible bidders, off the table to participate.

"These airports are the gateway to the Family Islands. Connectivity is absolutely critical for our way of life, but also for our tourism industry. As you know, the Government owns 30 airports across the country. We simply do not have the resources to redevelop and renovate all of them. And therefore we thought that a PPP process is the way to go.... I'm looking forward to what we will receive over the course of the next 30 days," he continued.

"It's a very onerous process. We want to know full details on all of the partners involved. So there might be a financier, there might be a builder, there's an airport manager, there might be an operator. So some of these consortiums may have five different companies. And we're required to do the vetting and the due diligence, and all of them were required to have proof of funding. And therefore this is a process. We acknowledge this from a business perspective, and we want to ensure we give people the best opportunity to respond adequately."

The Ministry of Tourism, Aviation and Investments is estimating that a collective $263m investment will be required to turn the 14 selected airports into hubs of a size and standard appropriate for their location. Exuma and North Eleuthera are projected to require the greatest capital spend, at around $65m each, with Governor’s Harbour, Rock Sound, New Bight and Deadman’s Cay (Long Island) all pegged at around $18m apiece.

San Salvador was projected to carry a $15m price tag, with the quartet of Marsh Harbour, Sandy Point, Treasure Cay and Congo Town in Andros all projected to need a $10m investment. The smaller aviation gateways in the Exuma cays - Staniel Cay, Fowl Cay and Black Point, were each pegged at $2m.

The Government is seeking private partners for the redevelopment, upgrade, financing and management of the 14 selected airports via public-private partnership (PPP) agreements with the winning bidders. They will be granted 30-year PPP leasehold concessions similar to that for LPIA. Shortlisted parties will be invited to participate in the Request for Proposal (RFP) stage, which is tentatively scheduled to be released in May 2023.

Enhancing the Family Island airports will provide for better airlift and transport connectivity, enable these facilities to accommodate increased flights and visitor numbers, and offer an improved first and last impression of The Bahamas for tourists.

Bidders were informed that airline seat capacity into The Bahamas for December 2022 was up 4 percent on pre-COVID comparisons from the same month in 2019. While capacity into Nassau was down 7 percent, Freeport and Marsh Harbour were up by 261 percent and 348 percent, respectively. The latter comparisons, though, are somewhat misleading because both destinations were still struggling to recover from Hurricane Dorian in December 2019.

“International airlift to the Family Islands was up 65 percent over December 2019 on average,” potential bidders were informed. “Seat capacity increases for Freeport and Marsh Harbour were exceptionally high in December 2022 over 2019 because of the small numbers in December 2019 post-Dorian. A better benchmark would be 2018.

“Accordingly, international seat capacity for December 2022 was 35 percent less than December 2018 for Freeport and 2 percent higher for Marsh Harbour for the same period.” The Government also sought to entice potential airport investors with projections about the foreign direct investment (FDI) pipeline for the Family Islands.

It forecast projects worth potentially $1bn as being on the drawing board for Abaco, along with $692m targeted at Grand Bahama; some $685m for Exuma; $137m for Eleuthera; and $250m for Long Island. These figures, though, were not broken out or potential investors identified.