Monday, Jul 22, 2019
HomeNational ReviewBoom year in tourism

Boom year in tourism

If you stay locked in to the over-the-top outrage loops on social media you’d miss what’s happening in The Bahamas this year. We are experiencing an extraordinary year in tourism.

Stopover visitor arrivals were up 15.2 percent for the first six months of 2018, compared to the same period last year. According to the Ministry of Tourism, that translates to an additional 110,000 visitors to the country during that time frame.

Stopover visitors are the big spenders. They come by plane and stay at hotels or residences. They eat regularly at restaurants. The ones who rent homes go to grocery stores.

When they are here in abundance taxi drivers have people to take around. Hotels hire more staff and extend the hours of those already employed.

Tourism officials estimate that the average stopover visitor to The Bahamas spends upwards of $1,500. Cruise ship passengers spend around $70.

In recent years, cruise arrivals have been responsible for the increase in our total arrivals number to more than 6 million.

Since the end of last year the stopover guest has returned.

There are several factors driving growth in the stopover segment. The main one is North America is booming. The U.S. economy grew by 4.2 percent in the second quarter. Canada grew by 2.9 percent. Growth is expected to continue in both economies.

On Friday, Minister of Tourism Dionisio D’Aguilar noted the North American root to our success. He said the double-digit increase in stopover visitors is largely driven by
an uptick in arrivals from the United States of 8.4 percent, and from Canada by more than 30 percent.

The other factors for the better year include the loss of rooms in the Caribbean due to storm damage from last hurricane season – Tropical Storm Isaac currently threatens those islands – and the opening of Baha Mar.

“We are very, very bullish on 2018 to see a strong finish to the year,” D’Aguilar said.

During the budget, the government projected growth of 2.5 percent this year, and 2.25 for 2019. In Moody’s August 14 report, the projection was two percent for 2018, and 1.7 percent for 2019.

A booming tourism business this year should help us meet the more optimistic target. It could also help offset any slowdown caused by the increase in value-added tax (VAT) as of July 1.

The government raised the tax to increase revenue at a time when the economy was growing again. Years of large deficits drove up debt levels.

When the VAT hike was announced, doomsday prophets predicted the near collapse of country – that despite The Bahamas still having one of the lowest VAT rates in the region at 12 percent, and no income tax.

The VAT hike did not cause collapse, of course. In the social media age we have fallen into the habit of engaging in instant analysis without sufficient reflection. The uneducated are teaching and leading the curious. There is so much misinformed speech out there.

In an interview with The Tribune business section published on Monday, Super Value owner Rupert Roberts said his stores collected 54 percent more VAT than expected for July, before the breadbasket foods were zero rated. He added that consumer tax revenues the first two weeks of August after the VAT exemption took effect were up 33 percent as compared to last year.

Super Value is the largest food store chain in the country.

People are still spending money, despite the VAT hike. Tourism is the heart of the Bahamian economy. Its robust growth this year is adding vibrancy to the economy.

Getting Grand Bahama in the game

No sensible person would argue that things are well in Grand Bahama.

Air arrivals to New Providence have been within a range 930,000 to 1.08 million since 2000. Travel to Grand Bahama has collapsed.

In 1988, 487,089 people came to the island by air. Last year there were 70,692 air arrivals to our second city. This is a drop of 85.5 percent from 30 years ago.

Grand Bahama has drifted between depression, recession and stagnation the past 15 years. The various hotel and business closures led island residents to seek lives elsewhere.

There is a sense of hopelessness when people talk about Grand Bahama.

The island’s falloff made the Family Islands, as a combined unit, the second-largest air arrivals segment in Bahamian tourism.

In 2017, a record 285,398 visitors came to the Family Islands in planes. Attractive small resorts and rentals available via online marketplaces such as Airbnb and HomeAway are driving visitors to all corners of the archipelago.

The Grand Lucayan on Grand Bahama is comprised of three hotels – Breaker’s Cay, Memories and Lighthouse Pointe. The property closed in 2016 after being damaged by Hurricane Matthew. Only Lighthouse Pointe reopened.

The government decided to buy Grand Lucayan from Hutchison Whampoa.

It feared Hutchinson would not reach an agreement with a private sector buyer in a reasonable time, ultimately leading to the closure of the last part of the hotel.

A full shuttering would leave a sarcophagus at Lucaya and further weaken the already weak Grand Bahamian economy.

It’s unclear how long this tourism boom market will last. This is an ideal time to get these hotels back into top form.

There is consensus in The Bahamas that governments should not own resorts. This administration’s plan is to find a private sector buyer to restore the property.

A Grand Lucayan renovation and reopening, with the right owner/operator, would allow it to attract well-off North American residents who clearly have lots of money to spend.

Enhancing downtown

There has been a lot of discussion as to whether or not sufficient Bahamians are employed constructing The Pointe.

The developers have an agreement with the government. They should live up to it.

What’s missing in the talk about construction labor ratios, however, is that The Pointe is good for downtown.

The Port of Nassau is one of the largest passenger cruise ports in the world. Last year around 2.6 million people came there.

The Pointe is a $250 million development. It is scheduled for a phased opening in mid-2019. It will feature a 150-room Margaritaville Beach Resort and 150 luxury oceanfront residences, of which 100 will be branded One Particular Harbour at The Pointe. Phase one was a 900-car, multi-level parking garage.

We need more cruise visitors to leave the ships and set foot in Nassau. We also need new attractions to entice them to spend more than $70 per person.

The Pointe, with its restaurants, pool and beach attractions and entertainment facilities, will help.

Additionally, its residences will encourage more services-related businesses to open in the area to cater to those residing there.

The government is also seeking proposals for the upgrade of Prince George Wharf. It would be wise to move on this project sooner rather than later.

When The Pointe is open, from Arawak Cay to East Street would be attractive on the front street. The wharf area would stand out, as would east of East Street, which is largely a derelict zone.


The growth in tourism is good news for The Bahamas after a tough decade in the aftermath of the financial crisis. Thousands of jobs and much wealth were lost.

With increased confidence in the jurisdiction from a growing economy, investment flows pick up. The Wynn Group is building a $120 million condo-hotel and residences development at Cable Beach; a heads of agreement was signed in March for the $45 million expansion of the Harbour Island Club and Marina; on Paradise Island there is the $250 million Hurricane Hole development; and in West End, Grand Bahama, a $2.5 billion project to develop the old Ginn Sur Mer property is in the works.

We have challenges as a country. But there are also successes and positive trends.

Extract yourselves, from time to time, from the people and groups who think nothing good is happening in The Bahamas. That’s simply not true.

Listening only to the chorus of complainers will make you ill-informed.

Let’s hope this boom market in tourism lasts a while. The lives of Bahamians will improve if it does.

Brent Dean

Editor at The Nassau Guardian
Brent is the General Manager of The Nassau Guardian.

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