The Tribune

By Roderick A. Simms II

Advocate for Family Island development

E-mail: RASII@ME.com

As the search continues for new ways to grow the Bahamian economy, Mayaguana’s potential contribution towards its growth merits a closer look at. In the previous segment on Mayaguana, the island was described as a “blank slate” for investment. This article dives deeper into recent conversations about transforming the island into a transshipment hub that could service international routes, as well as remodeling the airport to become one of the best in the southern Family Islands. While conversations about these projects have been around for some time, an attempt to find out the what, why and how is needed.

Port Mayaguana

At a recent local civic meeting, residents of Mayaguana met with a top government advisor who presented a potential project called “Port Mayaguana”. To be clear, this potential project has yet to be pitched at, or approved by, the government and is currently a working idea that both government officials and residents of Mayaguana need to collaborate on. But based on research provided in the presentation, project “Port Mayaguana” has the ability to provide a sustainable means of economic growth for the island and, by extension, The Bahamas.

For starters, it was pointed out that Mayaguana’s geographical location is ideal for a transshipment hub since it is located in a major shipping lane. Minimum dredging is required since there has very easy access to deep waters. The proposed port would be located at the southern part of Betsy Bay, and would be owned in its entirety by the Bahamian government.

It was also revealed that since Mayaguana’s land mass is 40 percent larger than New Providence, this proposed port could mean bigger - and better - business than the current Arawak Cay container port in the capital and in Grand Bahama. Another win for Mayaguana is that there is no constraint on available land, meaning that there would be no legal issues involved in defining the port’s site as this - and the surrounding land - is 100 percent crown land, meaning it is owned by the government. The island also has a high-quality limestone, which would facilitate lower development costs for industrial projects of this kind. While it appears that the proposal has the potential to increase commerce and employment on Mayaguana, there are some challenges that may come along as details unfold regarding the funding and development of this venture.

Challenges

One of the most important considerations for this project is how it will be financed. There are many different vehicles that the government can use to fund a project of this size, but a cost has yet to be pinned to it. The government also has to hire a port developer to provide advisory services, which would be another cost to consider.

Since the government is operating at a multi-million dollar annual deficit, borrowing funds to facilitate this venture would have a dampening impact on its current fiscal position. It was also mentioned that this project, in the long run, could provide 5,000 direct and 12,500 indirect jobs. Mayaguana currently has nowhere near enough housing, let alone a sufficiently large and trained workforce, for such a project.

The island currently has a population of 200 persons. Therefore, if the project comes to fruition, phase one should focus heavily on education and training for local residents, while also urging Bahamians from other islands to embrace new opportunities. It may not be difficult to find investors are willing to pay for housing communities and training sessions once things start to kick-off on the proposed port. Investors are sure to flock where revenue-generating projects are reliable and stable enough to invest in.

The best deal

In a project of this size, the question is always asked: “Who will benefit the most?” Ideally, the ratio of Bahamians to foreign workers should be very high. The government must take into consideration feedback from residents, business owners, environmentalists and local civic groups. It is important for it to consider allowing Bahamians to have an ownership stake in this proposed historical venture. That way, Bahamians will be more incentivised to ensure business is always booming.

Airport Improvement

Mayaguana’s airport has been in need of remodelling for quite some time. At the meeting, it was revealed that approval was granted by Cabinet for construction of a new terminal building. If construction does follow through, this would be a great start towards economic development on the island. The most well-known investment group pinned to Mayaguana has been the Boston-based I-Group, which proposed a $1.8bn development back in 2006. The then-government entered into a Heads of Agreement with Mayaguana Island Developers (MID), a joint venture entity owned 50/50 by the government through the Hotel Corporation of The Bahamas (HCB) and the I-Group. A $7m airport development was proposed for the island. But events did not pan out as planned. Without a proper airstrip, making Mayaguana a commercial hub for the southern Family Islands will prove difficult.

Conclusion

If everything goes as planned, the best way to describe the outcome of these proposed ventures is a “commerce boom”. With a functional container port, an improved airport and a trained workforce, Mayaguana will top the list of islands in The Bahamas that are worth investing in. Local and international entrepreneurs will be more than incentivised to do business in The Bahamas. In addition, tourism projects such as a proper marina and cruise port terminal could be an easy pitch to potential investors once they are able to see the growth and competitive advantage this island could achieve. Not only could Mayaguana be a pillar of economic growth for The Bahamas, but it will also give competing regional countries such as Puerto Rico and Jamaica a run for their money.