The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas must “deepen the spend” if it is to maximise the “fabulous” 17.5 percent increase in stopover visitors for the year to end-May 2019, a Cabinet minister conceded yesterday.

Dionisio D’Aguilar, minister of tourism and aviation, told Tribune Business that increasing per capita visitor spending, strengthening the links between tourism and the domestic economy, and retaining more tourism dollars locally will “always be the challenge” for The Bahamas despite its “robust” arrivals figures.

Revealing that some Bahamas-based hotels are complaining that other parts of the tourism industry have failed to match their improvements in quality, Mr D’Aguilar argued that this nation needed to encourage “expansion, innovation and creativity in the parts of the sector Bahamians do own”.

Unveiling a 121,000 year-over-year increase in stopover visitors for the first nine months of 2019, Mr D’Aguilar said the “double digit” growth rate was projected to slow to single digits as The Bahamas entered the slower summer months.

He disclosed that forward bookings for the three-month July to September period were tracking around 8 percent ahead of 2018 figures based on forecasts from the ForwardKeys service, and acknowledged that the hotels and wider industry still have much work to do to “kill the valleys” that persist in the tourism calendar during September and October.

Mr D’Aguilar, agreeing that the tourism industry’s performance was about much more than arrivals numbers, said: “The destination still has a considerable amount of appeal and our numbers continue to be very, very robust.

“The difficulty is deepening the spending, deepening and strengthening the linkages between tourism and the domestic economy, and getting more of the spend to remain here. We’re still very challenged to provide excursions and interesting venues for people to spend their money.

“Bahamians have to become a lot more creative in giving people a reason to experience something new. That continues to be the challenge. Growing numbers is one thing; getting them to spend more money here is the challenge and will always be the challenge.”

Studies have shown that around 85 cents of every $1 spent by tourists in The Bahamas “leaks out” of this economy - the highest such rate in the Caribbean. This has been blamed on the ‘mega resort’ nature of the tourism industry, and the inability of small-scale domestic producers to meet the supply quantity and quality demanded by hotels - something many local businesses will likely dispute.

Mr D’Aguilar’s remarks also allude to the concerns/feelings expressed by many observers who believe that the current increases in tourism arrivals have yet to translate into economic benefits that are felt by all Bahamians across society.

The minister, meanwhile, said “there are a number of complaints” of insufficient activities and excursions for large groups numbering between 1,500 to 1,800 persons to do once they exit the resort property.

While Bahamian providers were well able to cope with several hundred visitors at a time, Mr D’Aguilar said they lacked the necessary scale to deal with the increasingly large groups that the likes of Atlantis and Baha Mar are attracting to their convention centres.

“With the quantity of high-end groups they’re getting at Atlantis and Baha Mar, they want to do things at a particular level in terms of quality and interest,” he added. “While there are some tours, they are not at the scale to deal with that capacity.

“This is the challenge. Some of the hotel operators are complaining that while they’ve upgraded the quality of their hotels, people have not upgraded the quality of their tours. People are still using the same boats they had 25 years ago, operating as they always have done, and we’re getting 500,000 more visitors.

“There needs to be an upgrade and expansion in capacity, and I think that’s where we’re lagging in encouraging Bahamians to expand, and be creative and innovative, in the part of the industry Bahamians generally control.”

Mr D’Aguilar had earlier this year projected that visitor arrivals growth rates would slacken during 2019 once the peak winter season was over, and Ministry of Tourism data released yesterday did backed up his forecast.

The Ministry, in a statement, said inbound visitor booking tracked by ForwardKeys showed that The Bahamas’ May arrivals rose by 7.1 percent largely due to visitors from the major source markets of the US and Canada.

“Due to the summer holidays, forward bookings for the next three months are running 8.4 percent ahead with June, ahead by 12.3 percent, showing the most favourable outlook,” the Ministry of Tourism added.

The Bahamas will also have been aided by the negative publicity associated with the US tourist deaths in the Dominican Republic, although that will likely be only a temporary boost with rival low-cost destinations - the likes of Jamaica - probably the prime beneficiaries.

Mr D’Aguilar said the “soft periods” in the Bahamian tourism calendar remained a challenge, adding: “As we maximise our air arrivals we’ve still got a lot of headroom. Our business is very cyclical with peaks and valleys.

“It’s how you kill the valleys. The peaks are at their maximum. I spoke to someone trying to come to The Bahamas for Christmas 2019 and they said they couldn’t find a room anywhere. It was booked out.

“But obviously September and October continue to be extremely challenging months. There are a lot of rooms, not a lot of demand, and the hotel operators have to get creative in how they fill their rooms.”

Mr D’Aguilar said total visitor arrivals for the first five months of 2019, combining both air and sea visitors, were up by 13.2 percent or 378,000 persons year-over-year. Focusing on stopover arrivals for that period, he revealed that New Providence was up by 21.3 percent - a pattern repeated for most destinations with the exception of Grand Bahama.

Abaco’s stopover arrivals were ahead by 8 percent, the minister added, with the figures for Eleuthera and Exuma ahead of prior year numbers by 17.7 percent and 16.9 percent, respectively. Stopover visitors to Bimini were down by 23 percent or 3,000 persons, which Mr D’Aguilar blamed on the end to Bahamasair’s service.

However, total arrivals to Bimini were up by 2.4 percent for the first five months of 2019 as a surge in boating arrivals offset the stopover decline. Mr D’Aguilar said the “double digit” increases for the period to end-May were ahead of the 2018 growth rates of 15 percent for stopovers and 3.1 percent overall.

“They were fabulous, very robust,” he told Tribune Business of the 2019 tourism figures to-date. “Our tourism economy continues to expand by double digits, spread over the major destinations in the country. The only soft spot is, of course, Grand Bahama which is in a state of flux until we cure the problem down there.”

Mr D’Aguilar said the Government was “still within our schedule” in talks with the ITM Group/Royal Caribbean joint venture to acquire the Grand Lucayan and redevelop Freeport Harbour, adding that both sides were “haggling back and forth, but that’s normal in negotiations”.