EDITOR, The Tribune.
IN the late 1990ies, when Hutchinson Whampoa announced their development plans and partnership with the GBPA, an era of optimism swept through Grand Bahama – a new container port and an ambitious investment in resort properties. They both came to fruition, employed a sizable number of Bahamians and for a while appeared to be good corporate citizens. Sadly, they had little or no idea how to profitably operate hotels in this hemisphere and resigned themselves to losing millions of dollars a year at the Grand Lucayan Resort. The Container Port was, however, their major focus and its foothold in the region would suggest it has been a worthwhile enterprise.
Losing millions, a year in any business can get old, even though there is a popular idea that compared to their global portfolio, Hutchinson’s Freeport investments hardly appear on their balance sheet, such is its insignificance. However, hurricane Matthew in October 2016 changed the game plan, and the extensive damage to the hotel properties seemed the perfect excuse to cease operations. Much better (and cheaper) to remain closed, layoff all the staff and submit a gigantic insurance claim and make it known that these hotels could be purchased at an unrealistically inflated price.
A few groups made a stab at it and we were told the Christie administration had a deal on the table before they were ousted from office. The pre-election promises of Dr Minnis would have voters believe he had a quick fix and all would be well in short order.
Six months on, the silence is deafening and as we head into what is essentially ‘a lost’ winter tourist season and some would say well beyond that. I surmise that Dr Minnis had no idea how difficult Hutchinson are to deal with. It is thought that they have received a good chunk of their multimillion dollar insurance claim and logic would suggest that they should cut their losses and quickly sell at a highly discounted price just to get rid of the headache and the properties off their books. The Chinese mentality has come to the fore and is such that there Is apparently no hurry to make any deal. Their blatant disregard for the community they once employed is of no consequence. “Screw you former employees, we hope you have another miserable Christmas”.
Additionally, any semblance of being a responsible community-minded company has been totally eroded over the past twelve months as we pass by their hotels shuttered and crumbling. The torn siding on the Grand Lucayan and the twisted metal around the casino and Memories remains untouched after fourteen months. What a great impression for the (few) tourists we have passing by. One is tempted to put up a sign “This derelict slum is owned by Hutchinson Whampoa”.
Perhaps ‘the bigger picture’ is even more depressing. Part of the initial Hutchinson acquisition with the GBPA was the 50010 stake in the Freeport Harbour Company, the Grand Bahama Airport Company and the Grand Bahama Non-Development Company - with Management control. In simple terms that means they call all the shots- all the policy and decision making. All these entities are micro managed from Hong Kong, often much to the frustration of the local employees.
Hutchinson weaseled a deal with the Christie administration to allow Carnival to build their own cruise port in exchange for tax exemptions on undeveloped land (together with the GBPA) for the next 20 years and made a vague promise about some sort of a sustainable development plan. None of this, of course, will happen as Hutchinson has no desire to develop a single acre on Grand Bahama. They have their prize - control of a major harbour and airport -100 miles from the US mainland. In retrospect this was and has proved to be a shockingly bad deal for Grand Bahama. Their philosophy is simply that they have the control and the ability to squeeze the very life out of the local economy at will – a job they are currently excelling at.
It is a bed that we have to lie in, and in the unlikely event someone will write Hutchison a cheque to go away, the situation will not change any time soon. While most of this is old news, it does however put into focus more than ever the urgency to breathe some life back into Grand Bahama.
Dr Minnis is trying, and encouraging entrepreneurs to open new businesses is commendable. The problem Is that many small businesses are struggling to survive and any new enterprises will face the same challenges mainly due to the very small market base. The population of Grand Bahama has shrunk dramatically over the past five years as people left to seek employment elsewhere.
The reality is that Grand Bahama needs at least 5000 new residents to make any significant impact on the local economy. The proposed introduction of the Commercial Enterprises Bill, although may need some tweaking, seems like a step in the right direction to encourage foreign investors to establish new companies, employ Bahamians and inject some much-needed cash into the island. The Bill currently applies to all the Bahamas, but there should be even more incentives for investors in Freeport, (does anyone remember the Hawksbill Agreement?) as we are constantly reminded this is the ship that is sinking the fastest.
Whatever form it ends up in, there should follow a massive global marketing campaign by both the Government and the GBPA shouting from the rooftops that Grand Bahama Is open for business. Industry, hotels, technology, manufacturing, medical tourism, real estate development, second homes- it doesn’t matter-just bring it on.
December 1, 2017.