The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Abaco’s Chamber of Commerce president says the cost of living is “getting out of control” as she warned the island can absorb no further hikes following the summer’s “exorbitant” light bills.

Daphne DeGregory Miaoulis told Tribune Business that protections such as home and health insurance “are not affordable for the average person any more” as she warned that Abaconians “cannot afford any more increases” when it comes to the general level of prices and cost of imports.

She recalled how a recent rebuilding project at her Abaco Neem farm exceeded the budgeted costs by 20 percent largely due to the increased cost of imported building materials rather than labour, and added: “Every additional cost is being borne by the consumer.”

Speaking amid concerns that the Government’s bid to outsource financing and management of Marsh Harbour’s commercial shipping port will lead to the imposition of new and increased fees, and thus lead to further cost rises in Abaco’s import-dependent economy, Mrs DeGregory Miaoulis said: “The cost of living is becoming out of control.

“There needs to be consideration that Abaco can only absorb so much more, which is nothing on top of the exorbitant power bills and high increases in the cost of everything. I still think the Government should reconsider the VAT on breadbasket items and food and medicine. Those things are still essential.

“I just went to the doctor’s office today just to have a mandatory check-up and there are so many people who were there suffering, ill, and cannot afford medical insurance. They don’t have home insurance either. Insurance is basically not affordable for the average person any more, and they’re all looking for hand outs to help with operations. They need this, need that. It’s really sad.”

Mrs DeGregory Miaoulis said she knows personally of what she speaks when it comes to inflation and price hikes. “The price increases on building materials, everything’s imported. That’s where the price increases come from to a great extent,” she added.

“I did a rebuild on our farm recently and expected to spend $35,000. I ended up spending $42,000. I budgeted at $35,000 and ended up at $42,000. That was including labour and everything else. The increase came from the cost of materials not the cost of labour or anything else.

“The import adds to the cost. The increases to the operators get passed on to the consumer some way, such as VAT; they get passed on. Every additional cost on getting anything to the consumer will be borne by the consumer.”

The Government is eyeing up to a combined $100m investment to transform Abaco’s two commercial shipping ports into facilities that meet global best practices and standards via public-private partnership (PPP) deals, which will result in the winning bidder financing the overhauls necessary at Marsh Harbour and Cooper’s Town while taking over management of the facilities.

The winning bidder will also be able to propose a variety of tariffs and fees, including security; gate; landing; and utility charges, plus demurrage levies on equipment that is landed by the shipping carriers and charges for the storage and detention of cargo, containers and vessels. No indication was given, though, as to the likely amount of each charge or fee, and whether any maximum limits will be imposed.

Mrs DeGregory Miaoulis again reiterated the reservations she and others in Abaco’s private sector have about the imposition of such fees given the already high costs of living and doing business on Abaco. She added that the length of time over which the winning bidder intends to recover its upfront capital investment will be key to determining the level of these charges.

The Government is looking to lease both facilities to the winning bidder for a 25-year period, and the Abaco Chamber president said: “I can understand having increased fees to pay for the port, but if they are going to recover their investment in the short-term versus the long-term, that will determine how much the fees go up.

“Are they going to try and recover their investment in a five-year period or a ten-year period? That would be one of the things I would question.” Mrs DeGregory Miaoulis said she would prefer the “desperately and badly needed” Marsh Harbour port overhaul be awarded to a Bahamian group with a “proven track record” in port operations.

While not naming BISX-listed Arawak Port Development Company (APD), the Nassau Container Port operator, which has bid on Marsh Harbour, she said: “Hopefully they do it with a company that has a proven track record, such as a Bahamian company acceptable to them.

“I know they will have more than one proposal, but hopefully they give it to a Bahamian company that has made the offer and has proven themselves at providing the service at the level we want it to be from day one. I’d love to know what they’re [the Government] waiting for.

“I’d love to be able to say this is awarded before the end of the year, so that on January 1, 2024, they’re going to get it started. This is not something you knock up overnight. You’re looking at a good year to start and complete the project.”

Michael Maura, APD’s chairman, wrote in that company’s annual report that fee increases are inevitable to finance the project and ensure the private sector partner and its investors earn a reasonable return on their investment.

APD previously revealed to Tribune Business that it has bid on the Marsh Harbour port PPP, and Mr Maura wrote: “The Government has invited qualified and interested port operators to submit proposals for the redevelopment and operation of Marsh Harbour port.

“APD has responded to this invitation and is presently reviewing this opportunity to determine if the fit is right for APD, our shareholders and the community of Marsh Harbour. While we are confident that APD can bring operational and development expertise to Marsh Harbour port, we continue to study the opportunity carefully.

“This analysis will also include determining if the good people of Marsh Harbour, Abaco, have a real interest in partnering with APD. The reality is the redevelopment of the port comes at a cost and fees will need to be introduced to provide a return to the investor.”