The government has cut funding for planned upgrades to airports on Exuma, Long Island, North Eleuthera and Abaco and is instead seeking to implement a public-private partnership (PPP) program to complete the projects, Prime Minister Dr. Hubert Minnis said yesterday.
The affected projects include the Exuma International Airport, the Long Island International Airport, the North Eleuthera International Airport, and upgrades to the Leonard Thompson International Airport in Marsh Harbour, Abaco.
“Given the current state of public finances, the government has had to make some very tough decisions,” Minnis said during the annual Bahamas Business Outlook.
“As a temporary measure to avoid any further deterioration in our fiscal position, we are reducing new capital expenditure for the current fiscal year.
“However, for a number of planned new projects, the government is exploring creative alternatives to finance such critical infrastructure.
“These projects include site works at the Exuma International Airport; the Long Island International Airport at Deadman’s Cay; the North Eleuthera International Airport, and upgrades to the Leonard Thompson International Airport at Marsh Harbour.”
In December, Minister of State for Finance Kwasi Thompson told the Senate that the government is seeking to reduce capital and recurrent expenditure by as much as $200 million for the remainder of the fiscal year.
Though he did not specify which projects would be affected, Minister of Public Works Desmond Bannister said planned capital works projects have to be postponed until there are more available funds.
Minnis said yesterday the government is looking at PPPs to provide the funding for the promised infrastructure.
“Similar to the Lynden Pindling International Airport model, the government intends to aggressively implement a public-private partnership program to complete these capital projects,” he said.
“Such public-private partnership methods may include the use of passenger facility charges and other airport usage fees to fund the development of our Family Island infrastructure, as opposed to funding exclusively via the public treasury.
“While we must adapt the mode of financing for a number of key infrastructure projects, our commitment to develop Family Island infrastructure remains as strong as ever.
“Such significant investment in airport infrastructure will support increased airlift to our Family Islands as tourism rebounds.
“It also represents some $150 million in infrastructure stimulus spending in these islands.”
The government had allocated $515.5 million in the 2020/2021 budget for the massive expansion of public infrastructure projects to stimulate job creation and build a resilient economy.
In the latest budget, $11.8 million was allocated for the airport infrastructure program.
Officials said the total cost for the airport projects on Abaco, Long Island, North Eleuthera and Exuma is roughly $150 million: between $65 to $68 million each for Exuma and North Eleuthera; between $15 and $18 million for Long Island and $10 million for Abaco.
In June 2018, the government secured two loans from the Inter-American Development Bank (IDB) in the amount of $70 million – $35 million of which was slated for infrastructural upgrades of four airports: Exuma International Airport, North Eleuthera Airport, Treasure Cay Airport and Leonard M. Thompson International Airport in Marsh Harbour, Abaco.
The government indicated then that it would have to spend another $18 million from the public treasury for the upgrades.