By NEIL HARTNELL
Tribune Business Editor
The closure of Luciano's restaurant, and loss of 72 jobs, makes it "even more critical to open our tourism industry as rapidly as possible", a Cabinet minister said yesterday.
Dionisio D'Aguilar, minister of tourism and aviation, speaking after George Myers' Restaurant Services Ltd confirmed the East Bay Street location will be closing permanently, warned that COVID-19's economic fall-out was likely to claim more "casualties" in the private sector.
Acknowledging that businesses were likely to find it ever more difficult to survive the longer lockdown restrictions remain in place, Mr D'Aguilar told Tribune Business: "It's incredibly unfortunate that such a world-famous brand as Luciano's decided to close its doors. For any business that feels that's necessary as a result of COVID-19 that's an incredibly unfortunate outcome.
"That is why it's even more critical to try and open our tourism industry as quickly as possible. The longer the pandemic goes on, the greater the cash burn rate while you are closed, and the higher the failure rate of businesses.
"It's just incredibly unfortunate this pandemic came upon us, and incredibly unfortunate that businesses are becoming casualties. Whether I expect more or not will be a function of how long the shutdown persists, and how long it takes for business to return."
Mr D'Aguilar, himself a businessman before entering Parliament and ministerial office, said many Bahamian companies are being drained by recurring costs such as rent and electricity that must be paid even if they are closed. He added that even those with "little pots of money in savings" were finding it hard to cope with this, keeping key staff on payroll and assisting those furloughed with no revenues being earned.
"There is a cash burn rate, your revenues are zero and you are going through your savings to try and get to the other side of the pandemic," the minister added. "When the economy open up, and your business opens up, is one date, and the date customers return is another.
"The date of re-opening is one hurdle and, to be able to tide yourself over until a decent amount of customers return, you're going to burn cash. If you don't have sufficient savings in place it's going to be a struggle. That's why timing is critical to re-opening the domestic economy and the international economy to get businesses up and running again.
"Unfortunately there are- and there will be - casualties of this pandemic. Tourism was extremely robust, and tourist arrivals were record-breaking. In that environment, far more businesses could survive. When you get to a situation where sales are zero, and at what rate they come back you don't know but hopefully they will eventually ramp-up, you have to survive that journey from a cash standpoint. The longer the shutdown lasts, and the longer visitors take to come back, the more casualties there will be."
Mr D'Aguilar told Tribune Business that the Government is "anxious to get the economy back open again and get people back to work, hoping and praying we have sufficient protocols to ensure as safe and healthy a return as possible".
The Government, facing a 30 percent unemployment rate and loss of much of the country's foreign currency earning capability, is aiming to re-open The Bahamas' borders to commercial air travel "on or before July 1".
"There will probably be bumps in the road, but we have to be strong enough to overcome those bumps," the minister added.