The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Opening up the domestic ferry and mailboat market to international operators could drive efficiencies and improve inter-island commerce, an economic study is arguing.

Oxford Economics, in its study of potential growth opportunities on behalf of the Bahamas-based Organisation for Responsible Governance (ORG), said inter-island transportation was often cited as an impediment to commerce.

It added that private sector representatives interviewed suggested that the sector’s modernisation was being hindered by the National Investment Policy, which reserved shipping for Bahamian ownership and prevented the entrance of foreign firms.

“Reliance on existing mail carrier boats for the transport of goods and people between islands within the Bahamas was often raised as a business constraint,” the Oxford Economics study said on ORG’s behalf.

“In one example, a restaurateur on Abaco reported that stone had to be imported from Florida (for construction) even though better stone was available in Freeport (just 20 miles away) because shipping stone between the islands was not possible.

“One reason that shipping to Florida is easier than shipping between islands within the Bahamas is the domestic reliance on inefficient mail carrier ferries. Although the circumstances of this one particular restaurateur might be unusual, the general complaint regarding inter-island logistics was a prevalent concern.”

Suggesting that liberalisation might provide an answer, Oxford Economics said: “One shipping executive pointed to limitations on foreign shippers operating domestic ferry services as an obstacle that was preventing the modernisation of inter-island transport.

“At least one major international shipper operating in the Bahamas also operates state-of-the-art ferry services in other regions of the world, but is prevented from operating a comparable service in the Bahamas unless they are willing to take a minority interest in a joint venture with a Bahamas entity.”

As a result, the study concluded: “Opening up domestic ferry service to international competition might result in equipment and operational improvement in inter-island ferry transportation.”