The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

AN international financier with experience in infrastructure projects in The Bahamas has cautioned the country’s airport expansion projects need “significant planning”.

Andre Wright, executive vice president of Standard International Group, told Tribune Business the government’s airport expansion initiative throughout the Family Islands needs a “significant amount of planning”, particularly taking into account the shift in customer tastes and demographics brought on by the COVID-19 pandemic.

The various Family Island airport expansion projects are slated to cost over $150m, with $50m being earmarked for the Exuma International Airport alone.

Mr Wright said: “Not that we have a crystal ball, but we advise our clients that when they’re doing their capital improvement planning that this needs to take into account not just what they’re seeing in their home country, but what they’re seeing throughout the region.

“I think The Bahamas has a unique opportunity, but it also has a lot of risks. People tell you that in a low interest environment to build, build, build and that’s a good thing to do while rates are low, but the airport projects themselves are long-term capital projects that require a significant amount of planning and that planning needs to ensure that those customers and the needs of those customers as well as for their employees and unions and the community at large is going to be satisfied.”

Mr Wright has over 30 years of experience in advising on infrastructural projects throughout the Caribbean and has done work with the Bahamas Electricity Corporation, now Bahamas Power & Light (BPL) and its loan portfolio where the power company had a yen foreign currency loan that needed to be restructured.

When Nassau airport was redeveloped SIG had put forward proposals that the project be a public-private partnership, but this was not taken up by the government.

“Our idea was to at least reduce the interest rate to the government portion, but we did not get a good reception to do that because the other investors were looking for a return,” he said.

“So our experience is in knowing the direction of the market, currently. The structure of the tourism, aviation market has changed dramatically.

“So while most airport capital plans that were put in place prior to COVID-19 they will need to be modified. You can’t have the same forecast. It’s not the same expectations. It’s not going to be the same protocols... the same customer. There’s been somewhat of a shift for more demand on the fixed base operator for general aviation versus commercial.”

He also raised concerns on whether or not the larger commercial airlines have gotten their bailout money “resolved” in the US and whether or not some of them will return to the international market. Something that he feels must be factored into the decision in securing financing for these airport infrastructural upgrades.