Measures And Incentives For Recovery Of Grand Bahama Economy Following Devastation Of Hurricane Matthew

As a result of the devastation wrought on Grand Bahama by Hurricane Matthew, the second largest center of population and economic activity in our country, it has become necessary to quickly assess the situation and take such measures as are necessary to protect and sustain its economy as we seek to relieve human suffering.

While various social and humanitarian programs are being implemented, Government, at the same time in consultation with the private sector is taking the necessary steps to rebuild, repair, reopen and expand the many businesses and public infrastructure which have been severely impacted by the Hurricane.  This is in addition to assistance which is being made available for the restoration of so many homes which have been damaged or destroyed.

In order to bring about early and sustained economic recovery that will benefit the people of Grand Bahama in this current emergency, we must do whatever we can to protect and create businesses and jobs.  The economy of Grand Bahama is built upon the pillars of tourism, shipping and industry.  The tourism and shipping sectors have been severely impacted.  Most of the hotels are closed including Memories and the Grand Lucayan.   Freeport Harbour, the Container Port and the Grand Bahama airport, all majority owned by the Hutchison interests have suffered extensive damage.  As a result of lack of available hotel room inventory, Sunwing which supplies the majority of the airlift has suspended flights indefinitely, pending necessary repairs.  Bahamas Celebration which delivers significant stop over visitors has been diverted to Bimini.

In light of this unfortunate situation I have written to the principals of Hutchison, owners of the Container Port and the three hotels in Lucaya with the largest room inventory in Freeport, appealing to them to effect repairs as soon as possible and in time for the winter season.  I have also pointed out that the repair and reopening of the hotels would put them in a better position to positively influence the possible sale of the properties.  We have also appealed to the President of Sunwing to effect hotel repairs and resume flights as soon as possible.

Due to the foregoing circumstances and in the aftermath of Hurricane Matthew, the lack of basic communications services and the ongoing recovery effort, it is both expedient and necessary to effect amendments to the Grand Bahama (Port Area) Investments Incentives Act 2016, to allow more time for licensees to avail themselves of the opportunity to apply for concessions available under that Act.

Currently under section 15 of the Principal Act applications for concessions must be made within six months from the date on which the Act came into force, and where any licensee fails to make application within the specified time, such exemptions shall cease to apply upon the deadline of the application period.   The Principal Act is deemed to have come into force on 4th May, 2016, and the current deadline for making applications is 4th November, 2016.  An amendment is therefore being proposed to extend the time for making an application under the Act from six months to ten months, and to allow the Minister responsible to extend the time period for the making of an application by Order.

Draft Regulations have been prepared and are in circulation among stakeholders.  The exercise to produce the framework for a One Stop Shop within Freeport is underway.  The One Stop Shop is intended to optimize the process for approving new business in the Port Area by harmonizing the agencies required for investor outreach and business development.  More time is needed for public consultation, before finalizing both the Regulations and the framework for the One Stop Shop, as well as putting in place the necessary administrative machinery and  staff

Under section 14 of the Grand Bahama (Port Area) Investments Incentives Act 2016, the companies listed in the Schedule and their existing affiliates, subsidiaries, and joint venture companies, existing at the time of the commencement of the Act, shall be entitled to the benefit of the concessions set forth in the Act for a period of twenty years subject to fulfilment of their respective obligations under any existing agreement with the Government.

The Hutchison Group has indicated their considered view that the affiliated companies should also be named in the Schedule to the Act.  The opportunity is therefore being taken to make an amendment to list the affiliated companies in the Schedule and to allow the Minister responsible to amend the Schedule to the Act by Order.

As a vital part of the efforts being undertaken by my Government to bring relief and economic recovery to Grand Bahama in the wake of Hurricane Matthew, we are seeking to encourage Hutchison to repair and reopen their hotels, as well as to both restore the damages to the Container Port while at the same time proceeding with the planned expansion to the Container Port.  We shall also encourage and support the efforts of Grand Bahama Port Authority and the licensees in Freeport, both large and small in their recovery efforts to benefit the economy and people of Grand Bahama.

I beg leave to lay on the Table of this Honourable House a copy of this Communication and to introduce The Grand Bahama (Port Area) Investment Incentive (Amendment) Bill 2016.

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