By NEIL HARTNELL
Tribune Business Editor
The Ministry of Tourism's desire to "get the biggest bank for its buck" will determine whether a major golf tournament returns to The Bahamas for a seventh time.
Dionisio D'Aguilar, pictured, minister of tourism, told Tribune Business that his officials were locked in negotiations with organisers of the Pure Silk-Bahamas LPGA Classic in a bid to "make it fit into our budget" amid the constant pressure for marketing "value for money".
Revealing that the Ministry of Tourism is investing $3-$4m annually to support the hosting of professional golf tournaments in The Bahamas, Mr D'Aguilar suggested this was consuming a significant share of its limited promotional budget at a time when the Government's fiscal crisis was demanding spending cuts.
While acknowledging that sporting events generated positive effects for The Bahamas, the Freetown MP questioned whether such marketing support was an "optimum" use of the Ministry's scarce resources given that two-thirds of this nation's tourists book their vacations online.
Mr D'Aguilar has been vocal in arguing that too much of his ministry's marketing budget is locked-up in promoting sporting and other events, leaving little funding available to target social media and online travel booking/search engines, where returns on the Ministry's investment are easier to measure.
He told this newspaper that the Ministry wanted to "exit at some stage" its financial support for golf tournaments and other events, with these "standing on their own two feet" and finding their own sponsorship, rather than relying on never-ending taxpayer support.
The Pure Silk-Bahamas LPGA Classic, which traditionally kicks-off the professional ladies' calendar, has been held at the Ocean Club Golf Course for the past six years every January. It has traditionally been viewed as a major promotional boost for the Bahamas, given the TV coverage provided by the Golf Channel and other major networks, while helping to boost resort occupancies after the Christmas/New Year period.
Well-placed sources had informed Tribune Business, though, that the tournament will not be returning in 2019 because the Ministry of Tourism had decided to cease its financial support. However, Mr D'Aguilar said no such decision had been taken amid ongoing talks between the two parties.
"We're in negotiations, and haven't finished negotiations," he told Tribune Business. "I think we're re-negotiating the contract, or in the process of re-negotiating the contract, to make it fit into our budget.
"The Ministry of Tourism is investing a considerable amount of money, or has in the past, probably $3-$4 million in support of all these golf tournaments. All of them obviously have an economic benefit, but as a percentage of our annual budget it represents a significant amount; I won't go into the exact amount.
"These events go three to four days a week, and if we spend 20-30 per cent of our Budget on these golf tournaments what's the opportunity cost of that money? Where could we invest it and get a bigger bang for our buck?"
Mr D'Aguilar said that in terms of a golf tournament "pecking order", the annual Tiger Woods Classic at Albany ranked as the Bahamas' premier event, with the Pure Silk-Bahamas LPGA Classic next and two newer tournaments, held in Abaco and Exuma, at the bottom.
"There is no doubt that they all have a positive impact," he conceded. "It's just that when you deal with a limited budget there's a vexing question when we look at these types of events. Yes, they have a positive economic impact, but is that the optimum impact of the dollars spent?
"This is what is constantly raised at the Ministry of Tourism. Is this the wisest use of the funds? We have to evaluate, research whether it's in our best interests to continue with these relationships."
Mr D'Aguilar said the Ministry ultimately wanted to graduate all events from needing its financial support. "The Ministry of Tourism would like to be a part of these events, getting them off the ground and getting them going, but over time we'd prefer to exit them and move on to something new," he explained.
"The event should be able to stand on its own two feet and get its own sponsorship.... If they can't, maybe they ought to look at something new. Every time an event contract comes to an end, we will re-evaluate and make a decision.
"We don't want to get into a position where, every single year for the life of your tournament, Ministry of Tourism funding is necessary to make it economically viable."
Mr D'Aguilar said golf tournaments and similar events "will always say that the advertising value is worth tens of millions of dollars" based on social media activity, but it was difficult to determine how this "translates into more people coming to the Bahamas".
"It's not like Expedia where people book a holiday," they added. "These are things you can evaluate. These are the changes we have to make, and the fact 67 per cent of people book their vacation online. It makes a compelling case for online marketing, and using resources where it's easy to measure your investment."
While golf was watched by the high-end audience that the Bahamas seeks to attract as visitors, Mr D'Aguilar said the critical issue was "the concrete returns you are receiving".
He added: "With shrinking budgets and budget constraints, you are forced to make these tough decisions. If you are getting less, how can you do more with less? If we don't have an unlimited budget, and have to make these choices, we have to see where our investment yields the best value for our buck."