Ingraham on Baha Mar

Thursday 09th, September 2010 / 10:41 Published by

Mr. Speaker,

I rise to Table a Resolution meant to garner the position and sense of the representatives of the people on the proposed Resort development by Baha Mar at Cable Beach, New Providence and to ensure that the Bahamian people are fully informed on the requirements, consequences and benefits which are projected to result for The Bahamas if the development proceeds as now proposed by the principals.

The Baha Mar project is to comprise six hotels with approximately 3,500 rooms and condominiums, an approximately 100,000 square foot casino, 200,000 square feet of convention facilities, a twenty acre beach and pool experience, an 18-hole golf course and a 60,000 square-foot retail village and additional residential products.

The total value of the project is estimated at $2.5 billion. A contract for the amount of $1.918,965,693 billion has been negotiated with the China Construction Company as primary contractors for the project.

The Resolution results from the fact that the foreign labour component intended during the construction of the Resort exceeds levels ever experienced in The Bahamas and is beyond anything ever contemplated by my Government.

In the earliest of times in the development of the tourism sector in our country in the 1950s the law and the Government permitted as much as 25% of the labour force in construction and or operation of a tourism development resort to be foreign. The Hotels Encouragement Act 1954 permitted “for the admission into The Bahamas of key personnel and special workmen both during the construction period and operation of the new hotel, subject to the proviso that at all times seventy-five per centum of the total number of persons employed in the construction or operation of the new hotel shall be natives of The Bahamas if such natives of The Bahamas are available to perform the several and respective services required.”

While that provision remained in the law, following Majority Rule a move toward Bahamianization of the work force brought change.

Beginning in the 1980s the practice evolved where large foreign components were engaged in the construction of hotels, and a smaller number of foreigners were allowed to work in the hotel upon completion.

Honourable Members will recall the substantial foreign work force engaged to construct the Crystal Palace Resort and casino, today the Wyndham Crystal Palace Resort and the US Departure Terminal at the then Nassau International Airport. At those two projects Indian, Brazilian and other foreign nationals far out-numbered Bahamian nationals on the work force.

When my Government first came to office in 1992 we determined not to continue this practice of the former Government. When, in 1993 we agreed terms for the commencement of a Five Phase redevelopment and Expansion of Resort Properties on Paradise Island by Sun International (now Kerzner International) we established that notwithstanding the demonstrable need for the engagement of large numbers of expatriate experts and labour for the timely completion of the project, the ratio of Bahamians to non-Bahamians on the construction site would not exceed 30% foreign to 70% Bahamian, increasing on the required Bahamian component above the 1954 statutory base of 25%.

It is noteworthy that this ratio obtained during Two Phases of construction of the Kerzner International resorts under FNM administrations and was continued when Members Opposite most recently formed the Government during the Third Phase expansion of Kerzner International on Paradise Island. (70% Bahamian : 30% Foreign)

Members Opposite at the same time however, did not require an adherence to this accepted ratio of Bahamian to foreign workers in the construction of the Bimini Bay Resort at North Bimini. As a result foreign workers, principally from Mexico, far exceeded the number of Bahamian nationals engaged on that construction site in the middle of the last decade.

The Bahamas Government now has for consideration the construction of the Baha Mar Resort in Cable Beach. The terms of the funding obtained by the developers of the Resort include a requirement that the overwhelming majority, if not virtually all of the workers to be engaged on the “Core Project”, over the life of the project, be foreign workers – some 8,150 persons.

It is projected that some 1,200 Bahamians will be engaged in the construction of the non-Core project that is, the new West Bay Street, the new Commercial Village and the initial site preparation for the Core Project. More specifically these projects include:

Construction of a new West Bay Street/Corridor including utilities with a value of $75 million

Construction of a new Commercial Village at Cable Beach and related “back of house” on Gladstone Road with a value of $30 million

Construction of free standing buildings including the golf clubhouse and buildings around the beach and pool area and retail village with a value of $20 million

Major earthwork, irrigation and landscaping related to the construction of the new Golf Course with a value of $10 million.

I have been advised that the principals of Baha Mar are in discussion with their Chinese partners and financiers with a view to additionally, engaging Bahamian contractors in a number of “trade packages” related to the Core Project to include general site clearing and preparatory work, masonry, dry wall, ceilings, painting, electrical, mechanical, site security, fencing, beach restoration, remediation, and landscaping having a total estimated value of $40 million.

It is further expected that many of these jobs will carry over to continued employment in the “trade packages” for the Core Project I mentioned. This we are informed is expected to result in the engagement of 3,300 Bahamians at the height of construction of the Core Project.

Honourable Members are aware that the basic justification for permitting the engagement of foreign workers in The Bahamas has been the transfer of technology and of skills. This occurred, very measurably, during each phase of the Kerzner International developments on Paradise Island and is occurring now, at the first phase in the expansion of the Lynden Pindling International Airport.

Based on the numbers, in the case of the Baha Mar Project it is proposed that 71% of the work force will be foreign and 29% Bahamian. This represents a complete reversal of conditions imposed upon Kerzner, for example.

What must be determined is whether this invaluable benefit of skills transfer and improved exposure to new technologies can or will occur in a project where contact between Bahamians and foreign experts is likely to be limited.

I also believe that the Government has an obligation to explain to the Bahamian people other requirements of The Bahamas unrelated to labour issues which arise from this project. Principally this will involve the transfer of Government-owned and Crown Lands to the developers. Because of the conditions precedent set by Baha Mar’s financiers – China Import Export Bank and the China Construction Company – these lands are required to be transferred in advance of the start of construction of the project.

As you are aware, the Cable Beach Hotel, now the Sheraton was transferred to Baha Mar in 2005.

The Crystal Palace Resort and Casino, now the Wyndham Crystal palace, was acquired on leased land by Baha Mar in 2005. That hotel, like the Nassau Beach Hotel, is constructed on leased Crown Land.

Approval for the Baha Mar Project requires the transfer of the following publicly-owned land:

Wyndham Hotel & Casino Land 13.450 acres

Nassau Beach Land 7.546 acres

Hobby Horse Hall parcel 70.964 acres

Fidelity Bank .866 acre

Cecil Wallace-Whitfield Centre 2.259 acres

Cable Beach Police Station 1.377 acres

Old West Bay Street 11.228 acres

New Corridor #7 1.610 acres
Plus an additional parcel of
.783 acre

Gladstone Road back of House 50.00 acres

Prospect Ridge Parcel 2.365 acres

Water and Sewerage Corporation 99.782 acres
Parcel

BEC Parcel 2.570 acres

BEC Substation .165 acres

264.965 acres

It is the position of my Government that these lands will only be transferred for the expressed purpose of facilitating the development and that should the development not proceed the land must return to the Government.

Mr. Speaker,

I should also advise that a number of unresolved matters between Baha Mar and Scotia Bank relating to outstanding loans attached to the Baha Mar Project are being negotiated even now. It is expected that all outstanding matters will be resolved within the next two week period. Hence, it is proposed that we reserve our debate of the matter until these matters have been completed.

It would appear that the Wednesday 22nd or Thursday 23rd September may be an appropriate time for the debate.

Mr. Speaker,

To be very explicit, so that the noise in the print and broadcast media to the effect that somebody is holding up this project can be put to rest – Baha Mar cannot do the deal with the Chinese bank until it satisfies the Scotia Bank loan.

They are in discussions with Scotia Bank. The next meetings take place next week in Toronto. But there will be no deal unless Scotia’s loan is satisfied.

Secondly, there will be no deal unless the Government of The Bahamas and the Chinese Government exchange letters saying “we approve in The Bahamas”, and we get from the Chinese Government at the same time in the next hand, “we approve here [China].”

They will go ‘hand go, hand come’ – at the same time and the same place.

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4 Comments on “Ingraham on Baha Mar

  • Bahamians have to be out of their minds to go for this Baha Mat deal! This is not an inter-governmental transaction where the Chinese Government is lending lending money to the Bahamian Government; the Chinese are lending their money to a foreign private investor. If this was anyone of us, we would need to come up with our own collateral to qualify for a loan. The Izmirlians are proposing on using land that they don’t even own as collateral for a $2.6 billion loan. How crazy is that? We Bahamian must give up thousands of acres of prime Cable Beach real estate for this joke of a tranaction to go ahead just so we can get some construction jobs in the short-term and provide long-term competition to Atlantis. If Baha Mar were knocking down their own buildings and rebuilding on their own land in phases it might be acceptable. Better still if they were buying the land they need from the Government and private owners. But they want us to give up all of these existing buildings and other land plus the Cable Beach portion of West Bay Street while they build 6 hotels all at once in a down market. Dream on! Baha Mar would need to rebuild the Cable Beach Police Station, the Sir Cecil Wallace Whitfield Building, Fidelity Bank, the Cable Beach Straw Market plus reposition the West Bay Street roadway first before I would agree to anything that they are proposing. Suppose they knock all these buildings down plus dig up West Bay Street and never finish the job? Where does that leave us who live on this Island and have to go east to get to work? Imagine the dislocation while all this construction is going on? What are we supposed to do? How are we supposed to go west to Westward Villas and beyond while they are bulldozing and building? Take Prospect Ridge or JFK Drive/the Airport Road to get where we are going? Imagine the delays? If you leave home at 7:00 or 7:30 AM to get to work, you will be leaving at 6:00 AM when Baha Mar starts construction. And for how long? Imagine a year or more of this kind of discombobulation? Take the blinders off Bahamians and look at this thing realistically.

    Reply
  • My Questions are very Simple:

    Will the Bahamas still be available to the Bahamians ten years from now , have we discussed what kind of leadership roles we will have in the running and operating of these new projects ,Are the people of the Bahamas expected to give up their Birth Rights for only 1800 permanent Jobs ?

    I am always thankful to see the Bahamas prosper , but like the Bible says my people perish for the lack of Knowledge. I am a Bahamian and i am proud of that fact. The Bahamian people have always stood for Progress, Education and Independence, are we going to be slaves at the end of the Day ?

    As for you Mr Nigel Gray of Williamstown Exuma I hope you brush up on your Chinese.

    Reply
  • Nigel Gray Williamstown Exuma

    Yo listen up! Take the money and shut it! Only 1200 construction jobs and 1800 permanent jobs you say…..Be thankful we have such an opportunity to create jobs and add considerable potential future wealth to our beautiful country. Stop the sip sip and suck teet crap. BE THANKFUL! Thank you Mother China for smiling on our small country. It is idiots like you who have been chasing all of the investment away from these islands. Greedy unions broke America and greedy unions will keep our islands poor and without work!

    Tell the Chinese that when they finish in Nassau come on down to Exuma and help us develop our Island. We will welcome China and its people with open arms.

    I am Nigel Gray and I stand by what I say! Suck teet to that! Perry & Brave stand up and tell em what I say!

    Reply
  • I hate this deal, the Chinese are set for a win-win, while we only get 1,200 construction jobs and 1,800 permanent jobs and all the land given up for this? This deal needs to be recalled!

    Reply

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