TCI NPSDP - Appendix (Part One)

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APPENDIX 1

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SITE INVENTORY & ANALYSIS REPORT

A.0.0 EXECUTIVE SUMMARY A .1 . 0

INTRODUCTION

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SYNTHESIS OF EXISTING STUDIES/ PLANS/DOCUMENTS

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SUMMARY OF GIS INVENTORY AND A N A LY S I S

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SUMMARY OF ASSESSMENTS

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S U M M A R Y O F I N F O R M AT I O N G A P S

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SUMMARY OF CRITICAL GAPS OF N E E D E D DATA A N D K N O W L E D G E

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SUMMARY OF KEY DEVELOPMENT ISSUES

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M OV I N G F O R WA R D

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CONCLUSION

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APPENDICES

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SOURCE PLANNING DEPARTMENT

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For a copy of the first submission of the Phase 1 Report, Site Inventory and Analysis, please contact the Planning Department due to it’s extensive contents.

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APPENDIX 2

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KEY SECTOR ASSESSMENTS

ECONOMICS

A.2.2 TOURISM A.2.3

C OA S TA L R E S O U R C E S A . 2 . 3 .1 C O N T E X T A.2.3.2 MAPS

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INTRODUCTION & HEADLINE FINDINGS The Economic Assessment herein establishes the structure for data research, analysis and key insights intended to help guide the land use planning efforts associated with the TCI National Development Plan, as well as build a framework for an Economic Development Strategy targeting key industry sectors.

Specific to the economic assessment, the analysis is envisioned to: Identify the TCI’s existing economic base;

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Identify the market potential for future development/redevelopment throughout TCI and demand (by use) during a prospective 20+ year timeframe; and,

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Identify and assess targeted industries upon which TCI can further economic development strategies aimed to broaden industry growth beyond its dominating tourism sector; and,

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Accordingly, the economic assessment serves as a source of information to help not only the planning team, but residents, businesses, community stakeholders, and government officials in making recommendations or decisions on matters relating to land use planning and economic development.

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At the outset, it is important to note two overriding principals that affect the economic assessment herein:

On January 30, 2020, the World Health Organization (WHO) declared the Novel Coronavirus (COVID-19) an outbreak and on March 11, 2020 reclassified it as worldwide pandemic. Since the pandemic was announced, there has been tremendous uncertainty in the global economy and worldwide financial markets. Concerns about the on-going spread of COVID-19 has resulted in the implementation of strict social-distancing and personal quarantine procedures and has severely restricted travel globally and, specifically, into TCI. As a result, the tourism and lodging industry sectors were experiencing the first negative effects due to the substantial decline in social movement and activity, which in turn creates unsettled conditions on other sectors of the economic – including real estate. At this point, the effects of a prolonged outbreak could have a significant (and yet unquantifiable) effect on the broader economy.

Therefore, given the degree of overall uncertainty present in the TCI (and global) economy due to COVID-19, there may be measurable effects on forecasts and projections contained herein and further analysis may be warranted under stable conditions.

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2.) As detailed in following sections, the economic team has compiled and previewed a significant amount of economic and market data published by TCI governmental agencies, as well as from regional and international organizations publishing information applicable to historical, current and prospective economic trends underlying the economic assessment and strategic plan. However, there is a significant amount of information and statisitical data that is still needed in order to effectively evaluate historical economic, demographic, industry and development trends; and, furthermore, provide the critical support need to establish housing, employment and industry forecasts that will effectively guide strategic planning.

The provision of updated information may have a relevant impact on the findings herein; particularly, as it relates to demand by use.

The Economic Assessment herein is broken down into five main sections, including: 1.) Discussion of the Data Set; 2.) Economic/ Demographic Overview; 3.) Industry Sector and Employment Overview; 4.) Development Supply & Demand Forecasting; and, 5.) Industry Case Study/Benchmark Assessment. It outlines the methodology, researchand analysis that serves as the basis for physical planning recommendations and economic development

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strategies. Based upon the documentation provided in the body of this document, headline findings are provided as follows:

Headline Findings (Demand by Use and Development Strategies) Housing - there is an estimated demand for between roughly 8,600 and 13,300 new primary households during

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the next 20+ years. In terms of land utilization, housing will be by far the largest development sector over the next several years. As a result, and considering the desire to preserve land and open space throughout TCI, there should be a concentrated effort to focus more on intensified (multifamily) development. As a matter of fact, demographic forecasts indicate planning for multifamily product will be met with an aging population and a marginally diminishing family base. While single family housing will still be prominent, higher density housing in particular is encouraged in Providenciales and can serve as the anchor for mixed use development. This same policy may apply to other islands such as Grand Turk and North Caicos, which should only help to alleviate the heavy concentration of housing in Providenciales. Moreover, there should also be a focus on increasing homeownership to provide residents a greater vested interest in their community. Lastly, there appears to be a need to expand attainable/affordable housing which can be driven by policy initiatives such as deconcentration of poverty and inclusionary zoning.

Office – There is estimated demand for 250,000++ (moderate) to 450,000++ (upper) square feet of office space

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during the next 20+ horizon. Providenciales provides an opportunity to accommodate at least half of the office demand within more centralized business clusters supporting financial, professional/technical services, and medical uses. Furthermore, new office development can potentially serve as a strong supporting use within mixed use development. Outside of Providenciales, the balance of demand can be positioned around emerging housing and commercial nodes which is likely to be in Grand Turk, or North Caicos with the opportunity to leverage off of the government’s central facilities.

Industrial – Estimates for industrial demand indicate a range of 600,000++ (moderate) to 900,000 square feet (upper) over a 20+ year timeframe. The natural positioning for industrial development is proximity to the port and airport in Providenciales. However, depending upon infrastructure and connectivity planning, some industrial related uses will be needed around commercial activity in Grand Turk, as well as for potential agriculture (ie. hydroponics) in North Caicos.

Retail - Retail demand among resident and visitors is anticipated to increase by approximately 3 00,000

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(moderate) to 400,000 (upper) square feet during the next 20+ years. It is estimated that roughly 40 percent (140,000+ square feet) will be in shopper’s goods (ie. clothing, furniture, electronics), and roughly 30 percent (110,000+ square feet) in convenience goods (grocery, pharmacy). Food service and drinking places comprise roughly 20-25 percent (75,000+ square feet) of demand. The focus of future retail will largely follow housing development, with an opportunity to integrate ground floor retail within mixed use development.

Headline Findings (IIndustry Sector Assessment)) Agriculture: TCI would be well served to its focuses on food security and sustainability and further its evaluation of the agri-tourism sector. On-going exploration of the nascent hydroponics sub-industry is also warranted. This specific industry creates opportunities to enhance agricultural output through either indoor or outdoor production and provides a major contribution to sustainable farming. However, this industry is not without notable challenges around knowledge, costs, power needs, and disease vulnerability. Therefore, from a land use and development planning perspective, there is a need to consider the optimal geographic positioning of not only traditional farming methods, but these emerging sectors as well. Furthermore, improving the domestic TURKS AND CAICOS ISLANDS NATIONAL PHYSICAL SUSTAINABLE DEVELOPMENT PLAN ( DRAFT) 299

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transportation and supply chain infrastructure would give TCI the opportunity to better support linkages to the tourism industry. TCI should continue to build on the Kew Government Farm in North Caicos, which currently serves primarily as a de facto demonstration plot. The National Physical Development Plan can include commercial agricultural land recommendations and best suited for Middle and North Caicos.

Aquaculture: There is a strong indication from a regional perspective that vast potential exists for aquaculture opportunities in TCI. Though largely non-existent now, several next steps present themselves naturally to the aquaculture sector:

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x Consider a National Aquaculture Development Strategy modeled after St. Lucia’s;

x Move forward with more intensive environmental assessments that has already been identified as a needed initiative; and, x Submit proposals for international investment and collaboration in aquaculture.

From a land use and development planning perspective, it is recommended to further explore the opportunity to use the underutilized inland salinas and convert them into aquaculture sites; and, determine suitable offshore locations for mariculture development.

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Cloud/D Data//Tech Centers: The cloud/data/tech industry would require high levels of upfront capital expenditure from the government without a promised return on investment and thus represents a risk, the viability of which should be further examined by the government before undertaken. However, TCIG should be careful to note the broader societal benefits of investing in ICT infrastructure, regardless of whether the industry itself develops.

TCIG might also consider commissioning a National ICT Plan (a regional example would be Trinidad and Tobago’s) and examining potential tax exemptions for foreign investments in the cloud/data/tech sector.

The key land use and development planning considerations include the following: Proximity to a power source/redundancy is important and, therefore, Providenciales provides the strongest opportunity (at least in the near term);

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Consider opportunities to zone for smaller data centers outside of Providenciales based upon the industries success and maturity over the mid- to longer term planning horizon; and,

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With improved connectivity, the potential for a Science Park in South Caicos should be further explored.

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Financial Services: Given viability of further industry development, financial services industry should remain a targeted focus of TCIG. TCIG could consider fintech as a way to jump-start further industry development, perhaps by examining the success that Mauritius has had with investment banking and Anguilla has had with the Captive Insurance industry. Much further progress would appear to come from refinement, rather than revamping, of the overall strategy; as such, TCIG might consider identifying a short series of “policy quick wins” from any prior, unimplemented recommendations. From a land use and development planning perspective and, presuming that targeted initiatives by TCIG continue to focus on the financial and business services sectors, there may be an opportunity to concentrate these sectors within a more defined centralized business district (CBD) in Providenciales with a focus on encouraging mixed use development. Furthermore, this same development concept may work well in Grand Turk by leveraging off of the regulatory/governmental activity already taking place.

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DISCUSSION OF THE DATA SET

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As part of the overall process, the economic team has compiled and previewed a significant amount of economic and market data published by TCI governmental agencies, as well as from regional and international organizations publishing information applicable to historical, current and prospective economic trends underlying the economic assessment and strategic plan. Additionally, the economic team participated in two field visits that included inperson meetings with select TCI governmental departments and private industry representatives in the effort to obtain supplementary information and insight that will be instrumental to the economic component of the National Development Plan. The data resources are cited in this section and a detailed list of references is also included as an Appendix.

Importantly, and to this point, there is a significant amount of information and statisitical data that is still needed in order to effectively evaluate historical economic, demographic, industry and development trends; and, furthermore, provide critical support for establishing housing, employment and industry forecasts that will effectively guide strategic planning. Some of the more notable gaps in information include, but is not limited to:

Additional and Updated Economic/Demographic Data: The vast majority of most recent demographic data is from 2012, including population and households by island. Moreover, there is very limited resident/household data associated with income, expenditures, purchasing power, and/or savings beyond GDP per capita information. This updated and expanded set of data is needed to: o Analyze the relationship between resident/household income and housing costs to effectively plan for future housing demand and, specifically, address affordable/attainable housing needs; o Assess TCI resident/household income to determine demand for certain goods and services that will be needed over time, and understand if household incomes are rising/falling compared to cost of living; o Better define the amount of income/expenditure that is “leaking� out of TCI from non-Belongers.

This not only pertains to the impact on expenditures for goods and services but the impact on fiscal/tax loss as well.

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Additional and Updated Employment Data: For the most part, industry/employment data is provided for

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the period between 2001 and 2005, and 2017. Data between 2005 and 2017 is necessary identify trends and growth opportunities. Furthermore, there is either missing data and/or large inconsistencies in industry sector trends between reporting periods that challenges effectiveness of historical trends and, notably, future industry sector and employment projections. There are other discrepancies including: o Wholesale & Retail Trade is currently combined into a single sector. However, it is most applicable to separate these two categories since they underly two distinct development uses (retail and industrial, respectively). o There is no historical data for the Construction sector (2001 to 2017), which is among the most prominent sectors in TCI. o Finance, Insurance and Real Estate (FIRE) indicate a notable decline between 2005 and 2017. At the same time, Professional, Scientific, and Technical Activities sector is only reported in 2017.

Consistency in these office using sectors, which includes breaking out Information from the Transportation and Storage sector is critical to planning for and forecasting job growth among these higher wage segments, as well as create projections for future office demand.

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Additional Information on Housing and Commercial Development Trends: Establishing development growth projections (by use) is most effective when there is an understanding of the relationship between historical/current supply and demand trends. It will be beneficial to obtain: o Data on housing permits, dwelling units by type (i.e. single family, multifamily, number of bedroom), home sales (prices and volume), land transfers. This is particularly important to TURKS AND CAICOS ISLANDS NATIONAL PHYSICAL SUSTAINABLE DEVELOPMENT PLAN ( DRAFT) 301

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analyzing the primary resident’s housing needs in light of changing demographics and housing affordability.

Data on commercial property (retail, office and industrial) permitting to understand the current level of inventory, physical conditions, occupancy, and general performance (i.e. lease rates) to identify markets that are over/under served; and, how best to plan for future growth based upon industry/employment growth projections.

2.) ECONOMIC/DEMOGRAPHIC C OVERVIEW W

The figure below presents a snapshot of population and households for TCI and its five main islands:

Figure e 1:: Demographicc Snap p Shott – TCII (byy Island)) Sources: Census 2012; ECLAC Pop. Projections 2027; Labour Force Survey Report 2017; TCI Stat. Dept. Pop.

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Based upon 2012 Census data, Providenciales (Provo) is by far the most populated island comprising more than three-quarters of the nation’s population. Grand Turk/Salt Cay represents 15 percent of the population base, with the balance distributed among South, Middle and North Caicos. At 3.1 persons per household, the average household size in Provo increased significantly from a decade earlier and largely attributed to the influx of immigration – discussed further below. The other islands actually experienced declines in average household size.

Based upon 2017 Labour Force Survey data, TCI’s population increased from 31,539 in 2012 to 39,683 in 2017; or, an average annual growth of 4.7 percent. The growth during this five year period slightly outpaces the 4.2 percent average annual population growth rate from 2001 to 2012.

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Figure e 2:: Average e Annuall Growth h off Population n (byy Island)) – 1990 0 to o 2012 2 Sources: Census 2012; ECLAC Pop. Projections 2027; Labour Force Survey Report 2017; TCI Stat. Dept. Pop.

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As illustrated above, Provo experienced measurable stronger population growth than the surrounding islands during the prior decades, its rate of growth too has been steadily declining. The other islands have shown modest growth and/or loss in population base.

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Figure e 3:: Population n Growth h Projectionss – 2012 2 to o 2027 7 Source: Economic Commission for Latin America and the Caribbean (2016)

According to the Economic Commission for Latin America and Caribbean (ECLAC), the population of TCI is projected to grow from 31,439 in 2012 to 47,677 in 2022, an increase of 16,138 This equates to annual increase of 1,614 and an average annual growth rate of 5.1 percent. From 2022 to 2027, population growth is projected to be relatively steady, increasing from 47,677 in 2022 to 55,498 in 2027, an increase of 7,821. This equates to an annual increase of 1,564 at an annual average of increase of 3.28 percent.

As it pertains to households, 2012 is the latest data available with 10,531. In 2001, there were 7,255 households, which translates to an average annual growth rate of 3.4 percent. It is noted that the household growth rate between TURKS AND CAICOS ISLANDS NATIONAL PHYSICAL SUSTAINABLE DEVELOPMENT PLAN ( DRAFT) 303

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2001 and 2012 is significantly lower than population growth for the same period, which is largely attributed to the exponential growth in immigration and an increase in the number of persons per household/dwelling unit; particularly, in most heavily populated Provo and to a lesser extent Grand Turk. The historical growth trends and projections set forth above provide the basis for establishing housing demand that is discussed in following sections.

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Figure e 4:: Demographicc Snapshott byy Age e - 2012 2 (TCI,, Belongers,, & Non--Belong gers)) Source: ECLAC Pop. Projections 2027

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The median age of the population for TCI in 2012 was at 33.1 years, compared to 26.4 years for Belongers and 34.8 years for Non-Belongers. The 15 to 44 age group comprised the largest share of the population at 56 percent for all of TCI, though for non-Belongers its significantly higher at 64 percent. This is indicative of the strong in-migration of workers to support TCI’s industries and, namely, the hospitality related sectors.

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Figure e 5:: Demograp phicc Snapshott – Age e 2012/2027 7 Projectionss (TCI,, Belongers,, & Non--Belongerss Source: ECLAC Pop. Projections 2027

The median age of the population in TCI is projected to increase from 33.1 years in 2012 to 40.0 years in 2027.

During this projection period, the share of population 65+ years in TCI is could increase from 3.5 percent in 2012 to 7.1 percent in 2027. The trends are similar for Belongers and Non-Belongers, with the median age of Belongers increasing from 26.5 years in 2012 to 31.5 years in 2027 and the share of the population 65+ years increasing from 6.4 percent to 10.8 percent over the projection period. For Non-Belongers, the median age of the population is projected to increase from 34.1 years in 2012 to 41.5 years in 2027, with the share of population 65+ years increasing from 1.8 percent to 6.0 percent over the projection period. These aging trends have implications for longer term housing and employment as noted in following sections.

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Figure e 6:: Demographicc Snapshott – E thnicity,, Countryy off Citizenship p Source: CIA World Facebook-TCI Stat. Dept, Pop. Statistics

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The Black population comprises approximately 87 percent of the population in TCI and includes 8 percent white and 4 percent all other ethnic groups. The largest share of the population by country of origin is TCI resident at 39 percent followed by Haiti at 35 percent. Combined these two groups comprise nearly ¾ of the total population.

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Figure e 7:: TCII (and d Island)) Housing g Tenure,, 2012 2 Source: Census 2012

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The figure above displays housing tenure for TCI and the TCI islands. For all of TCI, 56% of occupied housing are renter households and 33% owner-occupied households. The Middle Caicos Island has the highest share of owner-occupied households compared to other islands at 71 percent and the lowest share of renter occupied households at 19 percent.

Among all the islands the Providenciales has the highest share of renter households at 60 percent. In light of this relatively high proportion of renter-to-homeownership, the effort to balance this mix and encourage homeownership is considered to be a key area of focus for development planning; especially, for future housing demand as addressed in sections below.

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In the absence of per capita and/or household data, measuring Gross Domestic Product (GDP) on a per capita basis provides some insight into a country’s standard of living. To an extent, it provides a representation of how much citizen’s benefit from the country’s overall economy. From 2010 to 2018, TCI’s GDP per capita increased from $21,028 to $27,142; or, an average annual increase of 3.2 percent.

Although it is difficult to analyze a straight line comparison of GDP between countries, as complex purchasing parity formulas are required, the following table provides an overview of TCI’s GDP per capita compared to select islands throughout the Caribbean and, notably, the fact that TCI’s GDP per capita growth during the past several years has far outpaced the other.

For reference, the GDP per capita in the US is approximately $62,000.

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Figure e 8:: TCII and d Regionall Countryy GDP P Growth h – 2010 0 to o 2018 8

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3.) INDUSTRY Y SECTOR R AND D EMPLOYMENT T OVERVIEW W The following section address the economic base of TCI, including employment grow and employment by sector.

From June 2015 to June 2016 there were 2,221 new hires and 1,342 job departures in TCI, resulting in an increase of 879 jobs over the reporting period, growing by an annual average of 3.0 percent. Providenciales had a total change of 802 jobs over the reporting period, the highest number of jobs compared to other islands.

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Figure e 9:: TCII Employmentt Change e 2015--June e 2016 6 Source: National Skills Advisory Survey, 2016

This included 2,050 new hires, representing 92 percent of all new hires over the reporting period and 1,248 departures. The average annual growth rate in Providenciales during this time was at 3.1 percent.

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As shown below, the distribution of private employment by sector in TCI shows that Accommodations and Food Services comprise by far the largest share of employment at 35 percent. Wholesale and Retail Trade; Vehicle Repair and Construction are the second largest sectors, both at 10 percent. This is followed by Education and Transportation/Storage each with 6 percent share.

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Figure e 10:: Turkss and d Caicoss Islands--Private e Employmentt byy Sector,, 2017 Source: TCI Labour Force Survey Report

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As set forth above, and illustrated in the following table, there are noteworthy discrepancies in historical employment trend data. For instance, Construction, which is among the most prominent sectors in TCI, has no recorded data between 1983 and 2017. Accordingly, Professional/Scientific has no recorded data prior to 2017; though, the precipitous drop in Financial, Insurance and Real Estate (FIRE) between 2005 and 2017 may indicate that these two sectors were actually separated in the latest employment survey.

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Figure e 11:: Sources: TCI Labour Force Survey Report 2017; Nat’l. Dev. Main Situation Analysis Report 2006–2015; TCI Statistical

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Nonetheless, there are a number of key factors that can be drawn from the existing data and of which become relevant factors for forecasting employment growth and underlying demand for commercial development, including: 9

Accommodation and food services realized its most significant growth during the past decade, increasing an estimated 8.3 percent average annually from 2005 to 2017;

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Agricultural, Forestry and Fishing has remained relatively stable since 2001, it is well below levels of prior decades;

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Wholesale and retail trade/vehicle repair/other commerce also experienced notable growth during this period with 4.7 percent average annual growth; and,

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Administrative and support services as remained relatively unchanged since 2003.

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As important as it is to analyze historical employment trends, observing future job growth by sector is the key to determinant to development forecasting and, specifically, among office and industrial uses. In spite of the inconsistencies with data, the 2017 Labour Force Survey provides projections of TCI’s private employment from 2017 to 2030.

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Figure e 12:: TCII Private e Employmentt Growth h Projectionss byy Secto or (2017 7 to o 2030)) Sources: TCI Labour Force Survey Report 2017; Nat’l. Skills Audit Survey 2016

As its largest industry sector, Hotel and Restaurant Services represents the largest growth in employment with 3,427 new jobs expected between 2017 and 2030; however, its average annual growth (2.8 percent) is relatively modest compared to most other industry sectors. Following closely behind is Construction, which is anticipated to add more than 3,300 jobs at an average annual growth rate of 7.5 percent. At an average annual growth rate of more than 10 percent, the Financial Intermediation sector is forecast to add 1,335 jobs through 2030. Wholesale/Retail and Transport/Storage sectors are expected to grow at a relatively stable 3.5+ percent average per annum and add more than 1,000 jobs each during the next several years.

4.) DEVELOPMENT T DEMAND D ANALYSIS S (BY Y USE))

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The population, household and employment trends and projections outlined above provide the basis for determining demand for development within TCI. For this analysis, the projection timeframe is a roughly 20+ year horizon, allowing for flexibility in the demand projections as a result of several factors including but not limited to: the effect of economic and market uncertainty resulting from the still evolving Covid-19 crisis (and as set forth within previous sections); modifications to the demand analysis as a result of newly obtained economic data beyond what has been provided to date; and, the prospective impact on demand for various commercial uses resulting from any significant inducement (and/or retraction) of TCI’s investment in any given industry sector beyond what is factored at this point of the National Physical Development Plan.

The basis for projecting demand utilizes traditional forecasting models that utilize fundamental metrics of population/household growth for housing demand and employment growth (by applicable sector) for commercial demand.

The analysis below provides a summary of demand by use which includes a highlight of key assumptions and notable limitations to the process.

Residential: Residential demand in this section focuses intently on the primary housing market. Although there is limited data on existing housing conditions and, namely, historical permit activity, pricing, sales volume, and mix of units (by type),

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population and household forecast data does provide adequate support for setting parameters of demand over the next several years.

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Specific to households, as noted in preceding sections, 2012 is the latest data available with a reported 10,531 households.

This marks an average annual growth rate of 3.4 percent over 2001 households of 7,255. The household growth rate between 2001 and 2012 was significantly lower than population growth for the same period, which is largely attributed to the exponential growth in immigration and an increase in the number of persons per household/dwelling unit. If it is assumed that household growth rate ticked upward from 2012 to 2017 like it did for population (or an estimated 3.7 percent), and then slowly moderates over time as it does for population growth forecasts from 2017 to 2027, then current 2020 households are estimated to be 13,470 – as follows: Figure 13: TCI Household Estimates – 2012 to 2020 Source: TCI Labour Force Survey 2017; ELAC Population Projections; Lambert Advisory

Avg. Annual

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TCI Households

Growt Rate

2012

10,531

Base

2013

10,889

3.4%

11,248

3.3%

11,608

3.2%

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11,968

3.1%

2017

12,327

3.0%

2018

12,697

3.0%

2019

13,078

3.0%

2020

13,470

3.0%

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Using 13,470 households as a current baseline and, extending the average annual household growth rate under a moderate (2.5 percent average growth rate) and an upper (3.5 percent average annual growth rate), there is an estimated demand for between roughly 8,600 and 13,300 new primary households during the next 20+ years.

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Figure 14: TCI Household Growth Projections (Moderate and Upper) – 20++ Year Period Source: TCI Labour Force Survey 2017; ELAC Population Projections; Lambert Advisory 30,000 25,000 20,000 15,000

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10,000

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 Moderate

Upper

This level of demand represents a considerable amount of housing inventory within a foreseeable timeframe. Therefore, it is important that the development plan considers not only where this growth can be effectively accommodated, but also lay the groundwork for identifying the type and mix of housing that will be most beneficial to these residents.

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For instance, as outline in preceding sections, and for TCI as a whole, 56 percent of all housing units are rental, 33 percent are homeownership and 9 percent are squatters. While determining an optimal mix of homeownership-to-renter ratio within any given country is debatable, the opportunity to further balance (increase) homeownership is encouraged. Based upon conversations with housing industry representatives, access to homeownership in TCI has become increasingly challenged as non-Belongers and/or foreign buyers with larger amounts of cash places increasing pressure on homeownership accessibility for many Belongers for whom cash is not as readily available. In turn, an increasing number of homes become investment properties that are then rented to Belongers. Furthermore, it is evident from the characteristics of the population growth forecasts outlined above, that TCI should be prepared to provide housing for an aging population as population above 65 is forecast to double over time.

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Lastly, at nearly 10 percent of the total housing inventory, policies to minimize squatter housing are highly recommended.

Naturally, this transcends a need to emphasize prospective program expansions that focus on affordable and/or attainable housing. In this regard, it becomes increasingly important to more clearly understand incomes (by age cohort) and home pricing (by type) to better comprehend the extent of the “gaps” to addressing affordable/attainable housing and the percent of households to which this applies. Notwithstanding, there are some recommended strategy and policy guidance initiatives for TCI to consider in the effort to address affordable/attainable housing. First, is assimilating data beyond what is collected to date and, specifically, related to: 1.) Evaluation of Housing Inventory - which takes into account the generally condition of existing for-sale and rental housing. This will help to determine the type (single family, multifamily), unit mix (number of bedrooms/baths), and condition of available housing and, notably, how the existing inventory correlates with resident households. In particular, this helps to identify the level of substandard housing that currently exists and provides a basis for a clearer understanding of the level of investment and the prospective strategies that may be undertaken to mitigate these conditions; and, 2.) Housing Needs Assessment – which establishes the current and future demand for both market rate and affordable housing. In particular, it is critical to understand the relationship between household income levels and housing pricing to determine the extent to which resident households are housing-cost-burdened. And, at what level these households are burdened by way of housing cost as a percent of total household income.

Beyond the broader assessment of housing supply and demand, policy considerations include: 1.) Deconcentration of Poverty – which is directed from increasing levels of research that indicate a key aspect of every affordable housing program needs to consider deconcentration of poverty in addition to production and adheres to the principles of creating opportunities for lower-income families to locate in neighborhoods that will improve the life prospects of family members;

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and, 2.) Inclusionary Housing - that requires that new housing development include some amount of affordable housing.

Naturally, the ability to promote and support affordable housing requires at least some level of governmental subsistence be it in the form of direct investment in development, subsidy funding to homeowner/renter, and/or other financial incentive that reduces the burden of housing cost on lower/moderate income families. In this regard, and specific to land use planning, a prospective option for TCI is to further explore joint development options (or contribution of land through a public/private partnership) on Crown Land.

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Office: The primary employment sectors associated with office use pertain to financial services, professional business and scientific services, management of companies, real estate, insurance, information, and other associated activities. As it relates to TCI forecast employment, there are two primary office using sectors defined within TCI’s Labour Force statistics: Financial Intermediary and Real Estate/Renting/Business Activities. According to Labour Force projections, the Financial Intermediary sector is projected to more than double during the next 10 years from 793 to 1,861; or an average annual growth of 8.9 percent. At the same time, the Real Estate and Rental sector is expected to increase more than 50 percent during this timeframe and add approximately 140 jobs. Though to a much lesser extent, there are other industry sectors that generate demand for office, in spite of the fact that the majority of job activity is not located in an office. For instance, construction-related jobs are predominately located on a construction site; however, construction companies do have administrative, executive and back office jobs that require office space – and, estimated to be 10 to 20 percent of the sector’s job base. Accordingly, Health and Social services, which is largely associated with hospital space, uses a considerable amount of office space for a myriad of private medical services. Considering this, and based upon Labour Force Survey forecasts, office employment in TCI is projected to add in the range of 1,740 jobs between 2020 and 2030.

However, this includes estimates within the Financial sector that establishes average annual growth of nearly 9 percent; or, nearly 1,100 jobs created during this 10 year period. Though we have not been provided the necessary input to further support or challenge these growth projections, it is quite robust considering the vast historical fluctuations and, furthermore, difficult to ascertain without some correlation to office development during the historical timeframe which is critical to effective land use/development planning.

In light of the challenges to obtaining historical supply and demand indices, as well as some uncertainty as to the basis for the relatively high Financial sector forecast, an analysis has been prepared to establish a baseline framework for private sector office demand during a 20+ year period. This considers estimates of growth by office using sector and summarized in the following table.

Figure 15: TCI Private Sector Office Employment Projections (20++ Years) Sources: TCI Labour Force Survey Report 2017; Nat’l. Skills Audit Survey 2016; Lambert Advisory Share of 2020 2020 Office Office Space Employment Employment Demand 2,823 10% 282 793 100% 793 623 30% 187 2,862 10% 286 225 90% 203 7,326 24% 1,751

D Industry

Construction Financial Health and Social Work Other Services Real Estate and Renting

Projected 2040 Employment 5,716 2,419 1,112 3,544 397 13,189

2040 Projected Office Employment 572 2,419 334 354 357 4,036

^in Office Employment 2020-2040 289 1,626 147 68 155 2,285

Total Office Space Demand Employment, 2020-2040 Total Office Demand Sq. Ft @ Avg. 200 Sq. Ft./Employee (Avg. Annual)

Avg. Annl. % Change 3.6% 5.7% 2.9% 1.1% 2.9% 3.0% 2,285 457,092 22,855

As highlighted above, there is forecast to be nearly 2,300 office using jobs created during the next 20+ year timeframe.

At an average 200 square feet per office worker this translates into more than 450,000 square feet of office space demanded during the projection period. Importantly, though, there are several variables associated with this level of

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demand and whether or not it effectively signifies demand for new office space. First, it is presumed that some level of existing office inventory is quite old and generally beyond its useful life. As such, some of the forecast demand will simply replace existing properties in need of repositioning. Second, recent events associated with COVID-19 have created an increasing level of uncertainty with regard to office use signaled by a stronger shift to telework (or remote work). At the same time, there are also indications that the space needed per office worker may increase due to prospective social distancing guidelines and/or workspace distancing. Lastly, and as set forth in following sections (Targeted Industry Assessment), TCI is reportedly placing intensified focus on expanding the financial and business services sector through measured strategic initiatives. Even though it’s difficult to ascertain its potential success at this time, the analysis considers that at least some level of success will be gained in this effort and drive demand for new, quality office product.

Based upon the factors set forth above, the recommendation for office development as part of the National Physical Development Plan consider a moderate plan for 250,000+ square feet of space and an upper-range of 450,000+. To a large extent, the success of office development considers access, visibility, and proximity to the resident workforce.

Additionally, critical mass often plays a role in successful office development in much the same way as it clusters within a central business district (CBD) where there is interaction between varying services such as finance, law, professional/technical and/or other services. For this, focusing at least half of the office demand within Providenciales is a recommended strategy for land use planning. Moreover, there should be an opportunity to integrate office use within potential mixed use development and, notably, among professional services and medical office uses. The balance of space is likely to be positioned around emerging housing and commercial nodes which is expected to be in Grand Turk, or North Caicos where development can leverage off of the government’s central facilities.

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Industrial:

The main employment sectors that pertain to industrial development are manufacturing, transportation, warehousing, and wholesale trade. For TCI forecast employment, there are two primary industrial using sectors in accordance with the Labour Survey: Transportation/Storage, and Wholesale Trade. However, as part of TCI’s forecast grouping, Retail Trade is combined with Wholesale Trade and, technically, these two sectors should not be combined – and therefore removed from the analysis. In the absence of any detailed information underlying the Retail component, the sector’s employment base is discounted 50 to 60 percent. As a result, Transportation/Storage is forecast to add approximately 725 new jobs from 2020 to 2030 (or, a 3.6 percent average annual increase), while Wholesale Trade is expected to add nearly 445 new jobs during that period (3.1 percent average annual growth).

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Similar to that of office, the analysis herein is challenged by the lack of reliable historical demand and supply trends. As a result, an analysis has been prepared to establish a baseline framework for private sector industrial demand during a 20+ year period. This considers estimates of growth by office using sector and summarized in the following table.

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Figure 16: TCI Industrial Employment and Demand Projections (20++ Years) Sources: TCI Labour Force Survey Report 2017; Nat’l. Skills Audit Survey 2016; Lambert Advisory

Transportation, Storage Retail, Wholesale Trade Totals

Share of Industrial Space Demand

1,873 2,491 4,364

90% 40% 61%

Projected Employment 2020 Industrial Industrial Space Employment Demand Sectors 2040 1,686 996 2,682

2040 Projected Industrial Space Employment

Total Industrial Employment Added 2020-2040 Projection

3,212 2,891 1,205 4,055 1,622 626 7,267 4,513 1,831 Total Industrial Space Demand Employment, 2020-2040 Total Industrial Demand Sq. Ft @ Avg. 750 Sq. Ft./Employee

FT

Industry

2020 Average Employment Industrial Demand Sectors

Avg. Annl. % Change

2.7% 2.5% 2.6% 1,831 1,373,235

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As illustrated above, there is forecast to be roughly 1,800 industrial related jobs created during the next 20+ year timeframe.

At an average 750 square feet per worker this translates into approximately 1.3 million square feet of industrial space demanded during the projection period; however, even though the demand is based upon employment forecast that appear to be more modest than what is projected by TCI data, this level of demand is considered to be quite excessive for the broader market. Nonetheless, as with office, there are key variables associated with this level of demand and whether or not it effectively signifies demand for new industrial space, including: a.) some level of existing industrial inventory is quite old and generally beyond its useful life and, as such, some of the forecast demand will simply replace existing properties in need of repositioning; b.) recent events associated with COVID-19 have created an increasing level of uncertainty with regard to industrial use by way of a push to enhance sustainability with respect to select areas of enhanced transportation, manufacturing, health care, and food security which rely to varying degrees on industrial-type facilities; and, on that note, c.) as indicated Targeted Industry Assessment, there is an emphasis to expand disparate employment sectors including technology/data centers and agricultural (including food security and agri-tourism) that would potentially require industrial facilities not only for direct business operations, but expanded trade opportunities.

Considering this, the recommendation for industrial development as part of the National Physical Development Plan is a moderate range of 600,000+ square feet of space and an upper-range of 900,000 square feet over a 20+ year timeframe.

A natural positioning for industrial development is proximity to port(s) and airport(s); or, Providenciales. However, depending upon infrastructure and connectivity planning, some industrial related uses (ie. agricultural/hydroponics) will be utilized for direct business operations and, therefore, positioned in areas such as North Caicos.

Retail: Traditional retail demand forecasting is based upon the analysis of a Trade Area, which is generally drawn based

D

upon distance, drive-time, proximate competition and physical boundaries. The Trade Area represents the area from which business will draw residents (patrons) on a regular basis for convenience goods stores such as groceries and drug stores, shopper’s goods, including clothing stores, furniture, electronics and other general merchandise stores, and food and beverage establishments. Additionally, these models account for expenditure inflow potential from demand outside of the Trade Area, as well as outflow (or leakage) from demand within the trade area. However, the retail forecast models also rely upon a significant amount of data including but not limited to per capita income, consumer expenditure data among a myriad of goods and services, as well as retail sales by type of goods and services. In the US, this data is readily available from resources such as the US Census of Retail Trade and Department of Commerce (Consumer Expenditure Survey).

Furthermore, the Trade Area analysis focuses intently on sales/expenditure activity among primary residents, with ancillary retail from visitors accounted for separately – and discussed further below.

As it relates to TCI, there is not enough available data to utilize traditional forecast models that use in-depth sales and expenditure data by type of goods. Instead, the analysis herein utilizes basic metrics of per capita demand per square

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foot (by generally type of goods) using benchmark analysis from inhouse data among US communities varying in size and with differing economic/demographic characteristics.

A summary of our analysis of retail demand among primary residents by type of good during the next 20+ years is provided in the following table.

Figure 17: TCI Retail Demand Projections from Residents (20++ Years) Source: TCI Labour Force Survey Report 2017; Lambert Advisory Retail Demand Estimated Retail Estimated Retail Per SF/PP Demand (20 Yrs) Demand (20 Yrs) 2.0 86,118 172,236 5.0 215,295 386,265 4.0 172,236 309,012 1.0 43,059 77,253 12 516,708 944,766

FT

Food Services & Drinking Places Shoppers Goods Convenience Goods Non-Retail Space Total

2020 Pop 43,059 43,059 43,059 43,059

2040 Pop 77,253 77,253 77,253 77,253

Net New Demand 86,118 170,970 136,776 34,194 428,058

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As shown above, there is an estimated demand from roughly 425,000 square feet of retail during the next 20+ year period, which is predominately driven by population growth estimates. However, there are two notable factors impact the retail sector within TCI: first, and as set forth in preceding sections, nearly 60 percent of TCI’s population is categorized as nonBelonger. It is understood that a relevant amount of wages earned by non-Belongers are repatriated to their country of origin; however, absent available statistical data it is difficult to determine the extent of this “leakage” in expenditure.

Nonetheless, information from sources such as the UN indicate roughly 15 to 20 percent of foreign wages are sent back to the country of origin and need to be discounted from the projections set forth above; and, second, is the eventual emergence of online shopping which has already had profound effects in the US market. While we clearly understand that this segment of shopping is currently marginal within TCI, it needs to be considered over the mid- to long-term planning horizon.

In addition to demand from the resident base, visitors contribute significantly to the retail sector. For this analysis, the primary focus is overnight non-cruise related visitors as it is assumed that a significant amount of retail generated from cruise passenger will be captured within the upland component of the cruise terminal.

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The basis for retail demand from overnight visitors considers visitor forecasts and daily visitor expenditure characteristics set forth in the Tourism section of this report. In this regard, one particular observation is that the average daily expenditure per visitor (per day) seems quite low; especially, as it relates to entertainment/recreation ($13) and shopping ($5) which is in part attributed to the limited scale of product for these activities. Therefore, for this analysis, we’ve increased these visitor expenditures assuming that product will expand over time and the result is projected demand for approximately 25,000 to 30,000 square feet over the next 20++ year period.

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Figure 18: TCI Retail Demand Projections from Overnight Visitors (20++ Years)

Dining (Meals) Entertainment & Rec. Shopping Other

2020 Visitors 469,000 469,000 469,000 469,000

E stimated Retail Estimated Retail 2040 Visitors Expenditure/PP Expend (2020) Expend (2030) 604,800 $41 $19,229,000 $24,796,800 604,800 $20 $9,380,000 $12,096,000 604,800 $10.0 $4,690,000 $6,048,000 604,800 $10.0 $4,690,000 $6,048,000 $37,989,000 $48,988,800

Avg. Sales/ Sq.Ft. $475 $425 $375 $350

Estimated Retail Estimated Retail Demand(2020) Demand (2030) 40,482 52,204 22,071 28,461 12,507 16,128 13,400 17,280 8 8,459 114,073

Net New Demand 11,722 6,391 3,621 3,880 25,614

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Therefore, in aggregate, retail demand among resident (and to a lesser extent visitors) is anticipated to increase by approximately 300,000 to 400,000 square feet during the next 20+ years. It is estimated that roughly 40 percent (140,000+ square feet) will be in shopper’s goods (ie. clothing, furniture, electronics), and roughly 30 percent (110,000+ square feet) in convenience goods (grocery, pharmacy). Food service and drinking places comprise roughly 25 percent (75,000+ square feet) of demand. The focus of future retail will largely follow housing development, with an opportunity to integrate ground floor retail within mixed use development.

5.) INDUSTRY CASE STUDY/BENCHMARK ASSESSMENT

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Introduction

The “Industry Assessment” section of this report reviews several sectors of interest to the Turks and Caicos Islands— namely, the agriculture, aquaculture, cloud/data/tech, and financial services—that will help guide the economic component of the TCI National Physical Development Plan. It synthesizes information on these sectors from both regional and benchmark case study standpoints to provide high-level assessments of the industries as prospective “target industries” for the Turks and Caicos Islands. Findings may serve as a comparative basis for subsequent economic strategies and physical planning recommendations. Each industry subsection below concludes with takeaways pertinent to the broadening of TCI’s industry sector base.

OBJECTIVES x

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x x

Identify regional (Caribbean) industry trends to help TCI focus on economic areas that have been prosperous for its neighbors.

Identify case study initiatives and policies that may be helpful to TCI. Identify where TCI stands with regard to each industry in terms of previous efforts, policies in place, and any previous or current challenges and obstructions impeding success in the given industry.

Note major, high-level points of comparison across which TCI could learn from the “best practices” of benchmark nations, highlighting major opportunities and potential challenges in doing so.

Translate research and findings to land use and development planning.

Provide insight into next steps for TCI target industry strategy.

x x x

PROCESS

As mentioned previously, the economic team has compiled and previewed a significant amount of economic and market data published by TCI governmental agencies, as well as from regional and international organizations publishing information applicable to historical, current and prospective economic trends underlying the economic assessment and strategic plan. Additionally, the economic team participated in two field visits that included in-person meetings with select TCI governmental departments and private industry representatives in the effort to obtain supplementary information and insight that will be instrumental to the economic component of the National Physical Development Plan.

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For the Industry Assessment, the economic team added to this a wide-ranging literature review, gathering and parsing available information on the prospective target industries as pertains to the Turks and Caicos Islands and the Caribbean region more broadly. The team selected as benchmark case studies several nations which had developed a track record of strong and sustainable performance; the team then proceeded with desk research and further literature review of the key components of each benchmark case study’s sectoral development—competitive advantages, policy initiatives, or any other important efforts made in the sector. For the data/tech industry, the team also conducted an expert interview to better understand the more intensive structural factors underlying the potential establishment of a data/tech “hub.”

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Upon concluding its research, the economic team synthesized all information into sets of key benchmark case study and regional findings. Cross-referencing these key findings with the current industry status in TCI made for a “TCI Tie-In,” which summarizes the TCI-benchmark case study comparison, assesses the viability of further sectoral development in TCI, highlights promising opportunities for TCI to emulate successes of the benchmark case studies, and spots potential future challenges.

Lastly, for each industry, the team distills its findings into a few next steps or key takeaways, looking particularly to the implications of its research on land use and physical planning considerations.

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Note that, for the purposes of a National Physical Development Plan, the Industry Assessment compiled information primarily through high-level literature review and refrains from delving into the minutiae of intensive policy-drafting and industry analysis. Rather, it provides an understanding of opportunities looking forward, including what they mean for land use planning, giving way for TCI initiatives to move forward with specific policies.

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INDUSTRIES S AGRICULTURE E Introduction n

Discussion n

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After strong production from the 1700s through the 1980s, domestic agricultural production currently constitutes less than 1% of TCI’s GDP and fewer than 100 full- and part-time farmers. Accordingly, Labour Force survey data indicates that the entire Agricultural, Hunting, Forestry and Fishing employment sector decreased from above 600 jobs in the early 1980s to slightly more than 200 jobs in 2017. However, TCI labor forecast indicate the addition of more than 600 jobs in this aggregated sector between 2020 and 2030; though, it is unclear as to what the basis is for this exponential growth.

Nevertheless, suitable agricultural land exists on TCI, and opportunities to improve food security and create production linkages with TCI’s strong tourism industry render the agricultural industry worth studying further.

Regional agricultural profiles indicate a burgeoning industry projected to grow several percentage points faster than the global average. The region is expected to see the greatest growth in agricultural land use worldwide through 2028.

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Fig. 1: Regional production trends (left); Regional trade balances (right)

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Fig. 2: Change in agricultural land use, 2016–2018 to 2028

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Despite these promising figures, however, it is worth noting that the projections do not disaggregate the Caribbean from Latin America. However, according to data published by the Food and Agricultural Organization of the United Nations 1 from a regional perspective the value of agricultural production has increased 1.5% over past 40 years, though the pace of growth was notably higher during the past 15+ years (2.5%) – and the lion’s share of which is attributed to production in Haiti. Even with the modest growth, production on a per capita basis was generally flat during this time.

While there may be several factors that contributed to the modest growth, we understand trade costs and a lowering capacity to meet modern food safety standards has played a part. Additionally, one interesting trend was the relatively large decline in “traditional” products (sugar, bananas) and increase in processed food. Instead, the growing demand by these sectors in the region is mainly fulfilled by imports. The region’s agricultural sector is also constrained by large and increasing pressures on natural resources and a high vulnerability to climate change. Despite the recent regional trends in agriculture, there was one distinct area of focus common among the regional outlook: Agri-food for the Tourism sector.

For the Turks and Caicos Islands, and as noted above, agricultural employment has declined been in decline, which is stark contrast to the sector’s forecast during the next decade. The fact is total production remains minimal as a percentage of economic output and more than 90% of food consumed in TCI is imported from the US, Haiti, and the Dominican Republic.

It is our understanding from discussion with government representatives the challenges include unaffordable machinery costs, the need to protect land for agriculture, and the lack of agricultural educational programs on the islands. At the same time, it’s been observed that the TCI Government has taken several positive steps to revive the industry, including, but not limited, to: x

1

Plans drafted in the 2007 National Socio-economic Development Framework.

Study of the State of Agriculture in the Caribbean

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x x x x

Establishment of Kew Government Farm in North Caicos, which contemplates creation of “demonstration” plots and training.

2018 Agriculture Policy speaking to incentives, concessions, machinery, work permits, imports, and applying for land.

Establishment of an Extension Sub-Department within Department of Agriculture for transferring knowledge.

2017 Farmer Survey to understand state of agriculture in TCI and how the industry can be improved.

Findings and Recommendations

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In light of these strategic efforts, there is little in the way of measuring progress and/or dissemination of information that delineates the opportunities and challenges associated with the these initiatives including the program implementation in Kew. The lack of industry growth in TCI does not track with regional averages, raising several questions: should industry expectations be tempered? Is a different strategy needed? The opportunity for modest sectoral growth exists, as indicated by suitable land in North and Middle Caicos (around 30% of land on North Caicos is suitable for crop production) as well as consensuses on improving food security and sourcing the tourism industry locally. However, structural constraints such as rainfall and land area limit TCI’s ability to meet regional averages and, furthermore, a more comprehensive understanding of environmental conditions is required to promote broadened agricultural opportunities.

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Moving forward, we believe TCI would be well served to its focuses on food security and sustainability and further its evaluation of the agri-tourism sector. Further exploration of the nascent hydroponics sub-industry is also warranted. This specific industry creates opportunities to enhance agricultural output through either indoor or outdoor production and provides a major contribution to sustainable farming. However, this industry is not without notable challenges around: its demand for knowledge and understanding of crop nutrition; generally high implementation costs; vulnerability to power failures; and, higher-levels of susceptibility to water-borne diseases.

From a broader policy and strategic growth standpoint, the Department of Agriculture should continue to explore and develop its partnership with regional and international agricultural organizations. The department could also plan to conduct a future internal monitoring and evaluation report to gauge the successes of, and make modifications to, the 2018 Agriculture Policy and its implementation.

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From a land use and development planning perspective, there is a need to consider the optimal geographic positioning of not only traditional farming methods, but emerging sectors such as hydroponics. Furthermore, improving the domestic transportation and supply chain infrastructure would give TCI the opportunity to better support linkages to the tourism industry. TCI should continue to build on the Kew Government Farm in North Caicos, which currently serves primarily as a de facto demonstration plot. The National Physical Development Plan can include commercial agricultural land recommendations—best suited for Middle and North Caicos.

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AQUACULTURE Introduction The aquaculture industry existed in modest form in the Turks and Caicos Islands in the past, and the industry has a notable history in the region. In recent years, the industry has exploded globally; moreover, TCI would appear to possess several of the necessary structural conditions for the development of the industry.

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Discussion In the Caribbean region, aquaculture is losing ground as the industry grows rapidly in other parts of the world.

Table 1: Volumes and values of aquaculture Country/Region

Aquaculture values Million US$ 2015

2006– 2008

2009– 2011

2012– 2014

% total 2012– 2014

2006– 2008

2009– 2011

2012– 2014

% total 2012– 2014

41.8

36.2

31.6

1.2

87.7

68.7

45.7

0.3

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Caribbean

Aquaculture volumes metric tonnes

However, experts suggest that massive industry potential still exists in the region, both in available supply and projected demand. Studies have found huge potential for aquaculture in the region, with even conservative estimates citing over 34 million metric tons of seafood per year—a yield much larger than the region’s current seafood production. Additionally, aquaculture provides an employment boon to the region—especially to women, who presently dominate the processing aspects of aquaculture and figure prominently in income generation and poverty reduction.

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St. Lucia was identified as a benchmark case study because its average annual growth greatly outpaces the region (24.3% average annual industry growth) and it is roughly comparable to TCI as another small Caribbean island nation. Key findings from the St. Lucian benchmark case study include: x

x

High levels of government involvement and industry planning, including the Caribbean region’s most comprehensive and integrated National Development Plan for the Aquaculture Industry—noted by experts as an effective model for the region.

International investment (foreign direct investment and collaborations with supranational organizations) to kick-start the sector. Notably, St. Lucia has partnered with and received assistance from the Taiwanese government and the UN Food and Agriculture Organization.

Despite plans from the 2007 National Socio-economic Development Framework to study the financial and technical feasibility of aquaculture (DECR, Invest TCI), the aquaculture industry is virtually nonexistent in the Turks and Caicos Islands today (though the industry did maintain some modest activity in previous decades, particularly in conch mariculture).

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Fig. 3: Aquaculture production (metric tons) – Turks and Caicos Islands 400 360 350 300 250 200

2015

2009

0

2013

0.2 0

2011

0

2007

4

2005

30 25

2003

4 10

2001

5

1999

1

1997

1989

1987

0

2

1995

50

1993

100

1991

100

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150

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Tying the regional and benchmark case study analyses to TCI’s current aquaculture status, the industry does present a potential threat in that there is no already-proven historical record of regional nor TCI growth in recent years. The regional industry climate in particular is rather lukewarm; however, studies pointing to the massive regional potential may indicate some prospective viability for TCI.

To take advantage of this potential, TCI would have to overcome its current strategic gaps. In particular, TCI could somewhat straightforwardly translate several of the key findings from the St. Lucian benchmark, including a National Aquaculture Development Strategy, perhaps with a greater focus on conch and offshore mariculture (given prior TCI conchfarming activity). Importantly, this would include the need to further evaluate environmental conditions underlying the aquaculture industry, which we understand is an initiative TCI has acknowledged is needed.

Findingss and d Recommendationss

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In light of the above, several next steps present themselves naturally to the aquaculture sector: x x x

Consider a National Aquaculture Development Strategy modeled after St. Lucia’s; Move forward with more intensive environmental assessments that has already been identified as a needed initiative; and, Submit proposals for international investment and collaboration in aquaculture;

From a land use and development planning perspective, it is recommended that further exploration to address the opportunity to use the underutilized inland salinas and convert them into aquaculture sites; and, determine suitable offshore locations for mariculture development.

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CLOUD/DATA/TECH Introduction Cloud and data centers, and the tech sector more broadly, present an exciting non-traditional industry opportunity to the Turks and Caicos Islands, especially as geography becomes less of a constraining factor in the modern world. Prior to examining benchmark case studies, it is useful to note the main structural conditions necessary to build data centers: x

Location - According to data center site location experts, 2 there are generally six criterium for the location factor:

x

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availability, cost and redundancy of power; low/moderate risk of adverse weather or natural disasters; high-quality construction at reasonable cost; existing telecommunications infrastructure; cooling technology/equipment; and, quality of life.

Capital Expenditure – for tech/data is quite extensive. The facilities themselves need to be well built and equipped with redundancy. Beyond that, the interior buildout and equipment (racks, servers, wiring) is quite costly.

x

Land area - dependent on capacity, land area need not be a crippling factor, with more than 50% of data centers globally being less than 50,000 square feet.

x

Power - data centers consume an inordinate amount of power, estimated to be 10-50 times the power of an office building with the same floor space. Accordingly, access and control of a power source creates competitive advantages and one factor that TCI can leverage upon with its local authority.

Telecommunications Infrastructure – largely refers to the fiber network with two key resources including: “dark” (or owned) fiber; and, “lit” (or shared) fiber. A key differential is control and capacity; naturally, the optimal structure is dark fiber which is generally far more costly. Nonetheless, some fiber infrastructure implementation is already underway in Providenciales and Grand Turk (Digicel).

x

Labor - the amount of labor required to operate data centers is fairly intensive and generally comprising: facility management; technical support and security. The technical component requires specified and experienced skill sets. Accordingly, some level of staffing among technical and security personnel is often required 24/7.

R A

x

Discussion

Singapore and Vietnam were selected as benchmark case studies. Singapore, which was named the best data center market and the most cloud ready country in the Asia-Pacific region, presents a few key findings: A strong tech and fiber infrastructure;

x

The government itself a buyer of cloud/data capacity from the centers; and,

x

Not dissimilar to TCI, land scarcity on a relatively small island nation has not been a tremendously limiting factor.

D

x

In Vietnam, which has risen to become a key player in the industry, many cite workforce education as a critical success factor.

The expert consensus with regard to both nations, however, is that an FDI- and tech-friendly tax environment has played an absolutely critical role in attracting sectoral investment and development.

2

Data Centers, Choosing and Optimal Location (Mike Carter & Robert Hines)

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There is little to no cloud/data/tech industry to speak of in TCI currently. Some promising ICT infrastructure has been put in place, including some fiber optic and coaxial on Providenciales and Grand Turk; infrastructure is divergent by island, however, with no broadband whatsoever on the Family Islands. The 2007 National Socio-economic Development Framework featured several ICT-related plans, including a proposed Science Park in South Caicos and a National Science, Technology, and Innovation Policy. From what we understand, follow-through thus far has been mixed.

Findings and Recommendations

FT

There are large gaps between TCI and the benchmark case studies; however, TCI’s already existing building blocks—its fiber infrastructure and its ICT in Education policies, for example—indicate an opportunity to build momentum in the industry. The threat of potentially investing in ICT infrastructure only to still not attract cloud/data center corporations and/or venture capital cannot be discounted. Notably, though, the industry is unique in that investment in ICT infrastructure could potentially have positive social and economic ripple effects extending far beyond the cloud/data/tech industry itself.

At the outset, there are several site location factors that determine the viability of data centers. Among those identified herein, notable challenges include vulnerability to natural disasters, the high cost associated with building the facility, and the modest level of existing telecommunication infrastructure. On the other hand, the access to power/redundancy (to an extent) and quality of life portend well for the island.

R A

The cloud/data/tech industry would require high levels of upfront capital expenditure from the government without a promised return on investment and thus represents a risk, the viability of which should be further examined by the government before undertaken. However, TCIG should be careful to note the broader societal benefits of investing in ICT infrastructure, regardless of whether the industry itself develops. TCIG might also consider commissioning a National ICT Plan (a regional example would be Trinidad and Tobago’s) and examining potential tax exemptions for foreign investments in the cloud/data/tech sector.

The key land use and development planning considerations include the following: Proximity to a power source/redundancy is important and, therefore, Providenciales provides the strongest opportunity (at least in the near term);

x

Over the longer-term, there could be opportunities to zone for smaller data centers outside of Providenciales based upon the industries success and maturity;

x

Providenciales and Grand Turk contain the greatest concentration of ICT skill sets, although a shift away from these centers can be facilitated with improved transit/connectivity; and,

D

x

x

The potential for a Science Park in South Caicos should be further explored, with likely implementation over the mid- to long-term horizon.

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FINANCIAL L SERVICES S Introduction n

FT

Of all prospective target industries, TCI is perhaps most familiar with financial services. Through this benchmark case study assessment, however, the economic team looks at the status of the industry in TCI, confirms that no high-level strategic trends have been overlooked, and outlines some considerations in determining whether and how much to further target industry development.

D

R A

Table 2: British offshore finance centers’ economic profiles

Discussion n

Anguilla, Mauritius, and the Cayman Islands were selected as benchmark case studies—Anguilla because of its relatively comparable size to TCI and because of the comparable size of its industry as a percent of GDP/employment, Mauritius as a success story from another region, and the Cayman Islands as the traditional bellwether of Offshore Financial Centers.

No single factor proved critical across all three benchmark case studies, but several themes emerged: x

Embracing tech including cryptocurrency in Anguilla and fintech more broadly in Mauritius;

x

Proactive policymaking including a governmental task force for financial services competitiveness in Anguilla; and,

326 TURKS AND CAICOS ISLANDS NATIONAL PHYSICAL SUSTAINABLE DEVELOPMENT PLAN ( DRAFT)

x

decades-long collaborative policymaking process aimed specifically at becoming an offshore financial center (OFC) in the Cayman Islands.

Other factors were unique to the benchmark case study, including:

Mauritius – has recently emerged as a magnet for foreign direct investment supported by a political stability, low taxes, strong legal framework, and sound fiscal policy. It has shifted from what has been perceived to be a tax haven to a major investment conduit to many areas throughout Africa.

FT

Anguilla – following implementation of its Financial Services Commission Act in 2003, international finance and business has grown exponentially. Specifically, it has emerged as a major player within the Captive Insurance sector, which has helped lay the foundation for expanded financial, legal and technical service jobs.

In TCI, the financial services industry rebounded surprisingly well from the 2008 financial crisis, as well as from the 2017 hurricanes. The industry continues to grow but is still underdeveloped compared to goals set by TCIG, Invest TCI, and others. Many promising, industry-forward policies have been passed, but room still exists for further legislative updates and for new legislation, including a modern Tax Administration Procedures Act and updated Banking and Insurance Ordinances. From a labor standpoint, there are some Belonger-focused programs, including a job training program, but progress remains unclear.

R A

TCI exhibits strong engagement with international organizations to ensure compliance, build its reputation, and better develop its policy framework. Moreover, TCI continues to engage with experts for further industry development, including through a recent KPMG report. These initiatives seemingly factored into prospective job growth as highlighted in preceding sections.

It is clear that TCI is furthest along the path to a robust financial services industry in comparison to all of the other targeted industry assessments. Tying TCI to the benchmark case studies, it also appears that many of the key case study findings, including proactive policymaking and government-led marketing, either already exist or have been identified for future development. The questions which then arise include: Why hasn’t the industry developed further yet?

Are there additional structural obstacles?

Is the OFC market saturated?

Is there a “reputation barrier” that is too high for TCI to overcome?

D

x x x x

Nevertheless, given the established foundations and the strength of the industry, further development of the financial services industry remains extremely viable.

Findings and Recom mmendations Given viability of further industry development, financial services industry should remain a targeted focus of TCIG. TCIG could consider fintech as a way to jump-start further industry development, perhaps by examining Mauritian and Anguilla for insight into applicable initiatives.

Much further progress would appear to come from refinement, rather than revamping, of the overall strategy; as such, TCIG might consider identifying a short series of “policy quick wins” from any prior, unimplemented recommendations within the 2007 National Socio-economic Development Framework, the recent KPMG report, or any previous IMF reports on TCI’s financial services industry.

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From a land use and development planning perspective and, presuming that targeted initiatives by TCIG continue to focus on the financial and business services sectors, there may be an opportunity to have these sectors anchor a centralized business district (CBD) in Providenciales and a cluster of mixed use development. Furthermore, leveraging off of the regulatory activity taking place on Grand Turk, this same concept can be employed there and help to shift the concentration of commercial activity from Providenciales.

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A2.2- APPENDIX | KEY SECTOR ASSESSMENTS | TOURISM

TOURISM TABLE OF CONTENTS

Connectivity and Transportation

FT

Tourism Enablers Competitiveness Analysis (TECA)

Airports - Connectivity and Infrastructure Roads - Connectivity and Infrastructure Ferry (Nautical Transportation) Marinas

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Tourism Infrastructure

Cultural, Entertainment and Recreational Offering

Human Resource

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Marketing and Promotion

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TOURISM ENABLERS COMPETITIVENESS ANALYSIS (TECA)

A country cannot compete in the global tourism market without proper infrastructure for travelers to access and move comfortably within the destination. Airports, ports, roads, ferries and marinas are essential infrastructure for mobility and connectivity. Increased air connections facilitate travel capabilities. Increased transportation networks and mobility, including roads and nautical navigation, promote homogeneous and cohesive economic development. Due to its nature and geographical characteristics, TCI territory has connectivity challenges.

As a result, development has not been cohesive and homogenous.

FT

The World Economic Forum (WEF) uses tourism enablers to measure travel and tourism competitiveness of destinations together with industry and data partners. The Travel and Tourism Competitiveness Index (TTCI) aims to measure factors and policies that contribute to tourism development in different countries. It includes external factors related to disruptive events, accelerating trends, regional demand shifts, economic downturn, natural disasters, terrorism, political instability, aging population, digitalization & inflation, which are considered change drivers.

CONNECTIVITY AND TRANSPORTATION

The enablers are composed of several internal building blocks that a destination requires to drive inbound tourism growth and compete and excel in tourism. These enablers are used to measure and determine tourism competitiveness and readiness. Enablers include some crucial factors such as:

Before the Covid-19 pandemic hit, the aviation industry was anticipating high passenger volume and aircraft fleet growth over the next decade. Now the industry is facing a new reality where capacities are reduced, and passenger demand is down for the foreseeable future. There is no certainty of when and how fast the industry will recover.

The industry’s financial strength has been dramatically impacted. Operating revenues have dropped by more than 80 percent in the three quarters ending June 30, 2020. As the Covid-19 pandemic brought national and international air travel to a nearly complete standstill the industry landscape has changed.

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• Connectivity and Transportation Infrastructure: Air, roads and nautical • Tourism infrastructure: Lodging accommodations • Recreational, cultural & natural resources (ei: landmarks, attractions, gastronomy, artisan shops) • Human resources • Marketing efforts

Airports - Connectivity and Infrastructure

For the purpose of the enabler’s competitiveness assessment, inbound market characteristics as well as other competing destination attributes have been considered. The objective is to determine the following:

D

• Do current conditions of infrastructure meet existing and future market trends?

• Which modifications are needed to ensure competitiveness?

• What is the competitiveness of tourism related products as it relates to inbound market characteristics and other competing destinations?

• What are the other opportunities to enhance efficiency and increase competitiveness?

For evaluation purposes, the current state of the infrastructure and how it grades against the infrastructure in competing destinations with similar market characteristics is the starting point. Trends - including those resulting from Covid-19 - are considered. And finally, recommendations and priority needs are listed.

Destinations are currently challenged with lower passenger demand while trying to maintain airlift conditions. Airports, on the other hand, are forced to make improvements to accommodate demand shifts and implement safety regulations resulting from the pandemic. Airports will face difficulties in keeping costs down with continued declining revenues. However, generating passenger confidence is essential for the recovery of destinations, so safety regulations need to be in place. Airports are forced to make improvements that may allow the destination to recover faster to pre-pandemic levels, which are expected only after a couple of years.

TCI is not exempt from these challenges and must act fast to ensure passenger confidence is maintained while supporting the existing airlines to continue operating.

The analysis below summarizes the current situation considering competing destination conditions, market segment characteristics and current trends related to the Covid-19 pandemic.

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Table 1: Airports Connectivity and Infrastructure

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Roads – Connectivity and Infrastructure decision has been taken as to which is the most feasible solution. Delaying a decision does not solve the problem of connectivity and is not a solution. Making a decision is the most effective way to address the challenge if the destination wants to promote cohesive tourism development and welfare among all.

There is an outdoor aspect unique to Provo that is very enjoyable. This is an opportunity to enhance it. Generally, TCI is flat. The use of alternative non-motorized modes of transportation such as bicycles is a growing trend.

Dedicated bike lanes to promote cycling for tourists and locals as well as tourist trolley shuttles, such as on Grace Bay Road, have proved to be very beneficial in other

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One of the major challenges facing the destinations is the lack of connectivity among the islands. As a result, there are substantial differences in the tourism development stage among the different regions, hindering cohesive development. Increased transportation networks and mobility that allows the movements of people and goods and services in a fast and effective manner will bring along homogeneous, cohesive and inclusive economic development. Functioning infrastructure that allows visitors and local people to access the country and move comfortably within it is a key element.

leading beach destinations.

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In the past, many initiatives have been discussed, including vehicular solutions such as the Spine Link Road or an efficient water-based ferry system. Until now no

Table 2: Roads Connectivity and Infrastructure

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Ferry (Nautical Transportation)

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Generally, TCI is characterized by either exposed ocean waters or shallow bank waters that are challenging for nautical transportation. The existing ferry facilities as it relates to connectivity, quality of the vessels and absence of ferry terminal infrastructure is a concern particularly when compared to other competing destinations such as Belize and Bahamas. An important aspect to consider is that the vast shallow waters may have potential to serve as transit options for water taxi and water tour services.

Designated areas may be assigned as water taxi and tour pick up and drop off locations around high-traffic areas with adequate landing piers. Additional information is available though the Coastal Resources section.

Table 3: Ferry Connectivity and Infrastructure

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Below are a few examples of the quality of ferry services and vessels in The Bahamas, a competing destination with similar nautical conditions.

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Pictures from Bahamasferries.com

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Marinas Cayman Islands has been successful in attracting yachters through special events, such as the annual Cayman Cookout Festival.

Provo has potential for growth and affinity for this market segment. Overall TCI´s transient boaters demand can be enhanced. Sister islands like Middle & North Caicos, could benefit from being promoted as visitation anchorages for lower draft recreational boats. In particular Mudjlin Harbour, with its extraordinary beauty, could benefit from

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In general, the Caribbean is considered one of the best yacht destinations in the world, comparable only to the Mediterranean and Baltic Sea. There is an opportunity to promote tourism growth in the affluent market of boating and yachting in Provo. This would require some infrastructure improvements to existing facilities, broadening of some water channels and use of some water bodies. The utilization of some parts of extensive Salinas, particularly those experiencing degradation and which does not add value to the destination may be considered.

Considering TCI´s strong affinity with the upscale market and quality of waters, Provo is limited with marinas. Aside from Blue Haven Marina, which is already a stop for transient boaters, and Turtle Cove, which is restricted to small vessels, there are no other facilities. Turtle Cove does provide a laid-back vibe; however, it has lost most of its glory and it’s in urgent need of regeneration. Strengthening the “Marina Village” concept in Blue Haven Marina and broadening and improving the access channel could

benchmarking with Colombier Bay in St. Barths.

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generate significant demand within this segment.

Table 4: Marinas Conditions and Priority Needs

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TOURISM INFRASTRUCTURE

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conditions.

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Tourism infrastructure in the analysis’s includes lodging accommodations such as hotels and condo hotels as well as villas and vacation rentals. The majority of hotel rooms are located in Providenciales, capturing 94% of the total supply with a concentration in the upper-tier segment.

Grand Turks follows with 64 (2%) of the total supply mainly concentrated in the economy scale tier. The additional 1404 condo hotel cays are all located in Providenciales.

The following is an assessment of current competitiveness

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Table 5: Hotel

Table 6: Condo Hotel

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Table 7: Villas

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Table 8: Vacation Rental

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Traditional hotels and branded hotels have been critical elements for the success of other competing destinations, and it is very unlikely that this phenomenon will change.

Should vacation rental supply continue to grow at this pace, coupled with muted demand for hotels, it could exercise a negative pressure on occupancy levels. Currently for every hotel room (including hotels and condo-hotel) there are 1.5 vacation rentals (including registered villas and active vacation rental). TCI lodging supply needs to be balanced.

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The number of available rooms is a constant moving target. A significant portion of transient housing is actually condominium, villas or vacation rental, a product which goes back and forth between being rented by short term visitors and for longer term housing. This is exacerbated due to the shortage of a wide range of permanent quality housing product on Providenciales.

Pursuing sustainability and tourism development as the road to economic recovery will require a healthy balance in lodging supply and a clear differentiation between what constitutes tourism development and what constitutes real estate development. This is clearly a policy issue. The need to determine the road between competing to attract tourism or promoting real estate development or striking a balance between both is critical for the long-term success of the destination. In any instance, to attract investment it is necessary to qualify tourist offer.

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To mitigate the impact of the constant fluctuations in available hotel rooms, TCI policies should encourage a healthy balance and control growth on vacation rentals with limitations for occupancy lasting longer than 60 days.

This will create a stabilized permanent pool of hotel supply always available to the tourist market consistent with market demand. Likewise, it will mitigate the impact on the housing sector of constant fluctuations in housing stock to accommodate tourists during peak periods, which turn into unoccupied housing units during shoulder and slower times of year.

Most recently Barbados launched a 12-month remote work-stay incentive to attract visitors. As remote working becomes the new normal, Barbados is hoping to introduce a “12-month Barbados Welcome Stamp”, which will allow visitors from oversees to stay for an entire year and work remotely. Recognizing the difficulty of short-term travel, with Covid-19 restrictions and mandated quarantines, the destination is hoping that a yearlong stay could help jumpstart the island´s economy. This is an excellent benchmark that could easily be applied in TCI with a substantial favorable impact. The long-term rental pool could easily be absorbed more rapidly in favor of releasing some much-

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CULTURAL, ENTERTAINMENT AND RECREATIONAL OFFERING

component) as presented in the following charts.

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Table 9: Gastronomy

Our analysis defines enablers as gastronomy, landmarks, attractions and artisans’ shops (as part of tourism retail

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Entertainment, attractions and recreational offering are the magnets that attract visitors to the destination. They are essential enablers for tourism competitiveness as well.

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Table 10: Artisan Shops

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HUMAN RESOURCES Human resources (as it relates to population and skills) are a unique transversal asset. In general TCI has a population with good skills and education and a strong orientation to quality service. The biggest challenge is the low population.

TCI has 12 tourists per person vs. Latin American and the Caribbean’s 1.2 tourists per person, and a worldwide 3.3 tourists per person. This is a reason for concern due to the risks associated with not being able to serve tourist demands because of the short supply of workforce. It becomes critical to reinforce the prestige of tourism jobs, create critical mass adapted to market needs and promote equal opportunities.

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The enablers above are qualifying assets that contribute to generating a sense of place. Sense of place is essential for a destination to succeed and excel in tourism. People travel to experience a destination - to sense it, to taste it, and to feel a part of it. Architecture, landmarks, attractions, gastronomy, local craftsmanship, galleries and connecting with the destination´s history and its people are the most effective instruments to generate a sense of place.

The rapid growth of Provo´s tourism industry is challenged by a shortage of willing and skilled workers. It is very unlikely the destination is capable of expanding into other industries in order to diversify its tourism dependency unless a strategy is put in place to attract foreign workers.

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There as some very good examples on how leading destinations have brough both residents and locals together to generate a sense of place. One of them is Ubud, Bali, which is the artistic capital of Indonesia and one of the most recognized tourism destinations in the world.

Many years ago, artists and designers moved to Ubud, Bali seeking some quietness. Locals and residents started working together in a unique eco-system where cultures merged together. As a result, Ubud became the center of artistic pursuits with many success stories- the boom of the Bali fashion industry today being one of them. It’s roots in the Balinese culture, heritage and craftsmanship combined with the knowledge and experience of resident artists sharing international concepts of style, quality and design

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has led to the success.

In line with Barbados’ 12-month remote -work stay program, TCI could offer an extra incentive. Promote skilled workers to run their businesses from Provo or to open new ones with special strong incentives in sister islands. The sister islands could benefit from artists, designers, architects and persons with different skillsets to come and establish business. Transfer of knowledge and experience between visitors and locals would promote social cohesion. The program could serve to attract and support investment that generates wealth and qualified employment.

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MARKETING AND PROMOTION Effective marketing is an essential tool for a destination’s success. Now more than ever many destinations are forced to reinvent themselves and strengthen their ability to respond to the challenges of retaining customers, gaining confidence and attracting new customers. This entails the following resources:

Migrating from a traditionally marketing and promotion focus, to the formation of a Destination Marketing Organization is trend and an excellent option to consider.

Consistent with our findings, TCI has excelled in tourism in many aspects and, more importantly, Provo, as the major hub of tourism, is consolidated enough to take the reign.

This will allow for the much-needed cohesive tourism development in the remainder of the country. Public and private efforts and resources to the use of the destination´s main industry, all under one goal.

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• Robust marketing resources • Fast and efficient organization with an adequate governance structure with the integration of different private and public stakeholders operating under a common goal: providing input, guidance, decisionmaking and resources.

• Marketing intelligence to define strategy and real time statistics for policy decision making.

• Collecting relevant sector data on a timely basis.

USD 357 million of the country´s GDP in 2019. It is critical to examine ways on how public and private sector can come together to protect the industry.

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As compared to similar destinations the budget allocated to the Tourist board is extremely poor. The budget is not consistent with the revenues directly generated by the industry, such as accommodation tax and other associated fees and taxes (ei: airport and air travel taxes and stamp duty on land transaction). These revenues alone represent 26 percent of the total revenue by economic classification for financial year 2020/2021. With the remaining of the resources detailed in the paragraph above absent as well, it will difficult if not almost impossible to ensure an effective marketing effort that allows the destination to recover from the most catastrophic event in the industry´s history. A concerted effort will be needed to retain the destinations positioning.

There are many good examples. One of them is The Barbados Tourism Marketing Inc. (BTMI) whose functions are to promote, assist and facilitate the efficient development of tourism; to design and implement suitable marketing strategies for the effective promotion of the tourism industry; to make provision for adequate and suitable air and sea passenger transport services to and from Barbados; to encourage the establishment of amenities and facilities necessary for the proper enjoyment of Barbados as a tourist destination; to carry out market intelligence in order to inform the needs of the tourism industry. A clear example is the innovative approach that it has taken in launching the 12-month remote work stay incentive program to attract visitors during the pandemic.

While it’s too soon to measure its effectiveness, this approach has surely positioned Barbados in the top of mind and resounded worldwide. There is no doubt that it will contribute to the destinations competitiveness’s in providing innovative solutions during crisis.

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Tourism and transport sector employ 13,000 persons annually (directly or indirectly) and contributed more than

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COASTAL RESOURCES TABLE OF CONTENTS

Introduction Coastal Resources Maritime Network Policy and Guidance Methodology

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Coastal Characterization Marine Features Coastline Types Additional Shoreline Categorization Factors

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Coastal Conditions and Hazards Prevailing Coastal Conditions Hazards Hurricanes Tsunamis Climate Change and Sea Level Rise (SLR) Shoreline Risk Maritime Network and Island Connectivity Status of Commercial Ports and Traffic Ferry Traffic Recreational / Pleasure Craft Routes Island Inventories

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Management Policy and Guidance Coastal Development Fisheries

Key Preliminary Findings and Recommendations Coastal Development and Management Fisheries Resources Maritime Network Island Connectivity (Waterborn) Intracoastal Waterway

A 2.3.2 - MAPS Development in the Coastal Zone Mapping Mapping Process Mapping Results Shoreline Characterization and Risk Analysis & Rating Development Potential Evaluation Notes

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INTRODUCTION

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The Turks and Caicos archipelago consists of approximately 40 different islands and cays located in the tropical latitudes of the western North Atlantic Ocean.

They are separated into two major island groups; the Turks Islands and the Caicos Islands. The islands are part of the larger Bahamian (or Lucayan) Archipelago and rest on deep limestone platforms, forming wide shallow bank systems.

These systems are bisected and surrounded by the much deeper waters of the Turks Islands Passage, Caicos Passage, North Atlantic Ocean, and Caribbean Sea. Island landforms, submerged marine features, and intertidal zones connecting the two exhibit a variety of geologic formations which result in the physical and ecological diversity, outstanding natural beauty, and coastal culture of TCI.

Key coastal resource types include: ● Physical  Landform coastlines (e.g. ironshore, sandy beaches, estuaries, tidal areas)  Submerged marine features (e.g. reef, hardbottom, deep ocean walls)  Waters (e.g. navigational waterways)  Mineral resources (e.g. sand)  Hazard protection (e.g. dune protection against storm erosion; fringe reef against ocean waves) • Ecological  Habitat (e.g. reef, seagrass, estuaries)  Fisheries, seafood, and other critical species (e.g. conch, lobster, sea turtles)  Ecological functions (e.g. water quality, nurseries) • Economic  Exports (e.g. conch and lobster)  Tourism (e.g. coastal resorts, natural beauty)  Maritime industry (e.g. seaports, shipping, ferries) • Social  Coastal culture (e.g. natural beauty, way of life)  Local food source (e.g. fisheries and seafood)  Recreation (e.g. beaches, swimming)

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This report summarizes a study and findings related to key coastal resources of TCI, categorization and mapping of TCI shorelines and coastal hazards, evaluation of TCI’s maritime network and island connectivity, and organization of key legislative and regulative policy governing coastal and fisheries resource management. Information from this report will serve as a foundation to advance recommendations for the National Physical Development Plan related to mapping of coastal development potential, maritime infrastructure and island connectivity opportunities, and policy guidance to effectively manage coastal resources for a resilient TCI future.

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Coastal Resources The coastal zone of the Turks and Caicos Islands primarily includes the steeply sloping subsea bottom or vertical walls that rise from deep oceanic waters, shallow banks, tidal areas, and immediate coastlines of the islands. While physical development will generally only occur in one of these areas (coastlines), all coastal geological forms support critical resources. Coastal resources consist of natural resources of the coastal zone and include physical features, processes, places, habitats, species, or objects that have physical, ecological, economic, or social value.

The value of these coastal resources is well understood and appreciated, even if specific dollar amounts and functions can be difficult to determine. This is because coastal resources provide such diverse and complex roles, often permeating numerous sectors or issues.

The coastal environment is also in a constant state of change due to dynamic natural forces such as tides, winds, waves, and storms. Anthropogenic forces such as development, shoreline armoring, resource extraction (e.g. fishing or mining), pollution, and similar action impact the physical and ecological processes that shape the coastal zone. Responses by the coastal environment to these pressures can vary, which emphasizes how important proper planning and management are.

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Maritime Network A key aspect of the TCI’s coastal environment is what is commonly referred to as the maritime network. The maritime network includes the infrastructure, industry, and operations surrounding seaports and marine access, shipping and transportation, waterways, routing, and international and inter-island connectivity.

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Key aspects of the maritime network include: ● Infrastructure  Seaports  Marinas  Community docks and landings ● Vessels  Industrial cargo, tankers, and barges  Ferries  Fishing  Private and pleasure craft ● Routing  Maintained and natural waterways  Inshore and offshore routes ● Operation  Commercial interests and private companies  Government roles  Capacity, efficiency, reliability, and cost A strong maritime network is critical to the connectivity of archipelagic states and neighboring island communities. Its primary purpose is to link the island chain for commerce, tourism and to enhance livability. Viability of the network is measured by frequency, reliability, cost, capacity, speed and comfort. This study will evaluate the existing network as well as explore opportunities for creation and/or enhancement.

In recent decades, a policy of Integrated Coastal Zone Management (ICZM) has become the ideal scenario for management. According to the United Nations Food and Agricultural Organization, Fisheries Technical 327, “Integrated Management of Coastal Zones”: ICZM provides the opportunity to allow policy orientation and development of management strategies to address the issue of resource use conflicts and to control the impacts of human intervention on the environment. It provides institutional and legal framework, focuses on environmental planning and management, coordinates various concerned agencies to work together towards a common objective.

Sectoral planning and management is still essential but should operate within the general framework of ICZM. Maintaining species habitats, natural resource base and management of development processes are part of ICZM programme.

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Benefits include: ● Facilitating sustainable economic growth based on natural resources ● Conserving natural habitats and species ● Controlling pollution and the alteration of shorelands and beachfronts ● Controlling watershed activities that adversely affect coastal zones ● Controlling excavation, mining and other alteration of coral reefs, water basins, and sea floors ● Rehabilitating degraded resources ● Providing a mechanism and tools for rational resource allocation

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Policy and Guidance Ultimately, legislative and regulative policies and initiatives that are attainable, impactful, measurable, and enforceable will direct TCI in the resilient management, planning, and development of the coastal resources, fisheries management and maritime networks. Management programs require clear and defensible guidance documentation, procedures, and timeframes. Uncertainty or ambiguity in official policy can encourage irresponsible coastal development projects or discourage development altogether.

TCI has an existing legislative and regulative process in place that can be used as a foundation to integrate ICZM type policy into the NPDP framework.

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METHODOLOGY The coastal resources summary, shoreline categorization and relevant contributions to the NPDP were conducted and developed using the following methods: ● Research and Review of Available Information

Analysis Based on the available information, field reconnaissance, and technical expertise, key topics were analyzed, including:  Shoreline Categorizations  Coastal Hazards and Resilience  Coastal Development Potential for various types of physical development.  Maritime Network details of ports, ferries, and overall island connectivity.  Policy Framework governing coastal resources, specifically coastal development and fisheries.

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This included internet research, historic relevant project data, proprietary database information mining, documents provided by TCI, as well as inperson interviews with select TCI officials. A data gap analysis also detailed critical missing information to the TCI Government.  Data gap overview · EIA TOR standards · Proposed or adopted revisions/ amendments to Physical Planning Ordinance or Development Manual · Fisheries Management Plan and/or guidance documentation · Coastal studies (e.g., sea level rise, storm surge, coastal vulnerability, etc.)

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Data was input into a GIS framework to map shoreline categorization, coastal hazard risk level, and coastal development potential for shorelines of each study island within TCI.

Coastal topography for all islands in the study

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Mapping

Bathymetric mapping Beach profiles collected by/for DECR Port capacities, drafts, vessel types, frequencies, etc.

Field Reconnaissance

Recommendations Recommendations related to coastal development, policy and management of coastal resources and fisheries, and maritime infrastructure and island connectivity will be developed and integrated into the NPDP.

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Observations and photographic documentation were taken of existing coastal conditions via ground-truth visits and low altitude flyovers of TCI.

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COASTAL CHARACTERIZATION

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Marine Features The shorelines of the Turks and Caicos Islands exhibit several identifiable marine features as a result of unique geological formations and activity, biological response, and changes to historical metocean conditions (waves and water levels). Originally a part of the North American Continent, the Turks and Caicos Bank detached over 200 million years ago and split into the Caicos Plateau (or Platform) and the Turks Plateau. The sub-aerial islands and lagoons existing today were shaped and formed through millions of years of limestone accumulation, growth in ancient coral reef systems, sea level rise, and erosive activity. The Plateaus are surrounded by steep undersea cliffs of approximately 3,000 meters in depth.

The largest islands of the Caicos Plateau are positioned inside the northern rim (West Caicos, Providenciales, Pine Cay, North Caicos, Middle Caicos, East Caicos, and South Caicos). A majority of the northern rim consists of nearshore reefal ridges and mixed sandy/hard-bottom flats; these natural barriers create a natural offshore wave breaker and provide significant protection from hurricane swells and waves. These reef systems consist of both barrier reefs and fringe reef. The Turks Plateau, an area approximately 1/10th the size of the Caicos Plateau, also presents a pronounced fringe reef system which protects the north and eastern shorelines of Grand Turk from Atlantic Ocean swell. However, gaps in the reef system can promote transmission and diffraction of wave energy, affecting nearshore processes and shoreline composition.

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Figure 1: Nearshore shelf transitioning to fringing reef and rocky mounds, eastern shore of South Caicos

Figure 2: Waves break at the edge of a wide shelf, Northwest Grand Turk

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The Caicos Islands are separated by channels, natural cuts, and shallow tidal inlets where water can exchange between the sea and the expansive interior lagoon.

Water depths in the interior lagoon vary in depth with an average reported depth of approximately 6.0 meters.

The inward-facing shorelines of the islands overlook the interior lagoon, nearshore tidal flats, and shoals. With the exception of Providenciales, a majority of the island shorelines facing the lagoon consist of wetlands and inaccessible intertidal zones.

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The features of the coastlines inside the reef vary in type and character: ● natural sandy beaches protected by the fringe reef system or advantageous geographic orientation, ● vegetated and sloping beaches and dune systems, ● rocky limestone ironshore and coastal karst in forms ranging from low-lying headlands to highland cliffs ● beaches of mixed sand, rock fragments, and ironshore. ● sandy, silty, and vegetated estuaries and tidal inlets.

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Figure 3: Tidal inlets and vegetated shorelines, North to Middle Caicos

Figure 4: Tidal inlets and mix sandy and vegetated shorelines, North Caicos

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The ямБgure below shows the coastal features discussed for Caicos Islands and Plateau.

Figure 5: Marine Features of Caicos Plateau (Kaczmarek 2008; Wanless and Dravis 1989)

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Coastline Types The different types of coastlines can be grouped into five categories including: 1. Cliff and ironshore 2. Mixed sandy and rocky shoreline 3. Sandy beach with dune 4. Vegetated shoreline 5. Low sandy beaches

Sandy beaches with dune systems include predominantly sand beaches with a raised vegetated dune system inset from the swash zone. Dune systems help to provide stabilization to shorelines and additional protection for onshore development. These beaches may be considered preferred for recreational activities and accessibility, depending on the wave climate and offshore conditions.

Beaches of this type may have a narrow to medium width with medium to steep slopes.

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Cliffs and ironshore consist of limestone formations ranging in elevation, from low-lying bands with low upland elevation to highland cliffs. These forms are typically more prominent in exposed or energetic waters. These sections of shoreline have the lowest vulnerability to erosion, flooding, or instability caused by waves and currents. The terrain and energetic swell conditions may restrict direct access to the water.

Mixed sandy and rocky shorelines consist of a wide range of grain sizes including medium to coarse grain size sands, gravels, coral fragments, and rocks. Such beaches may indicate erosional trends as waves and currents drive finer sands from the area, exposing coarser grained sands and limestone/coral fragments beneath. Typically consist of a full range in slopes from mild to steep. These types of beaches may be limited for recreational beaches or suitable for all beach-oriented tourism and activities.

Figure 7: Ironshore Cliff, southeast South Caicos

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Figure 6: Ironshore Coast, Bottle Creek, North Caicos

Figure 8: Sandy/Rocky Shoreline, southeast South Caicos

Figure 9: Sandy/Rocky Shoreline, southwest Grand Turk

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Figure 11: Sandy Beach and Dune, north central Providenciales

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Figure 10: Sandy Beach and Dune, northeast Grand Turk

Figure 13: Vegetated shoreline, northwest Middle Caicos

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Figure 12: Vegetated shoreline, South Caicos Interior

Figure 14: Low Sandy Beach, north Grand Turk

Figure 15: Low Sandy ArtiďŹ cial Beach, South Caicos

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Additional Shoreline Categorization Factors In addition to Coastline Types, shorelines may be further categorized based on additional factors including planform, nearshore water depths, sheltering from/exposure to wave energy, stability, and topography. These categories are presented in Table 1.

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Vegetated shorelines typically include mangrove shorelines, wetland areas, vegetated estuaries and inlets.

Surface sediments generally consist of material ranging from silty sediments to fine-grain sands on mild slopes or intertidal flats; however, in some locations, vegetated shorelines may also include vegetation intermixed with low-lying bands of exposed ironshore. Generally, these shorelines are not considered to be easily accessed.

These shorelines are advantageous to promote healthy ecosystems and coastal stability, where mangroves often reinforce the soils through their root system while providing some dissipation of nearshore wave energy.

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Low sandy beaches are considered to be wide, gentle sloping or flat beaches in sheltered waters and typically associated with low-lying upland terrain. Sands may consist of grain sizes ranging from fine to medium (associated with minimal wave activity and shallow nearshore conditions). Such beaches may likely be accretional or stable, but they may also be subject to inundation at higher tides (whether high spring tides or extreme water levels).

Table 12: Shoreline Categorization

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COASTAL CONDITIONS AND HAZARDS The coastal resources which make the Turks and Caicos such a unique and desirable destination for visitors and residents also inherently carry exposure to certain coastal conditions and hazards. These conditions and risks should be understood and studied to 1) protect the coastal resources and 2) address development sustainability.

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Prevailing Coastal Conditions The Turks and Caicos are exposed to the prevailing east-southeasterly trade winds. The region is primarily affected by waves from the NE to SE directions due to the trade wind inuence (see Figure 16). However, waves can approach from any and all directions due to Atlantic Ocean swell generated several miles away. Swell from more northerly directions, capable of refracting (bending to be directed onshore) and breaking on western facing shorelines is relatively common, especially during winter months. Additionally, winter weather often brings cold fronts with both winds, swell, and locally generated windwaves out of the more northerly and westerly directions.

Many of the islands’ shorelines are surrounded by shallow banks and/or fringing barrier reefs which offer natural sheltering from large open ocean waves. As there are varying degrees of sheltering, wave exposure varies along the coasts depending on the widths of these banks, proximity to deep water, the presence of fringe reefs, seagrasses, etc. Due to the large prevalence of these types of natural protections, the majority of the islands experience mostly calm prevailing wave conditions and are not exposed to the larger open ocean waves. However, coastlines more closely located to deep water, and/or lacking these protective features are more exposed to larger waves and ocean swell. Storm waves (tropical and seasonal) can approach from any direction contributing to risk at unprotected shorelines

Figure 16: (Left) Windrose of Grand Turk Airport Windspeeds and (Right) Offshore Wave Rose [~20 miles north of TCI].

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Table 13: Turks and Caicos Tide Levels

tidal range occurs during neap tides, and spring tides can bring lower low tides and higher high tides, but these are only minor variations and still typically within about a 3 foot tidal swing. Tidal datums are presented in Table 2 below.

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The tide range for the Turks and Caicos is relatively small, with typically only about a 2 to 3 foot difference between high tide and low tide. Seasonal and monthly variations in the tides bring some changes to this range. The smallest

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years, the Turks and Caicos have had 18 named storms (at tropical storm strength or higher) pass within 75 miles (shown in Figure 17B). Six (6) of these storms were “major hurricanes” (Category 3 or higher). Tropical storms and hurricanes most commonly approach the Turks and Caicos Islands from the east and southeast, however, the possibility of approach from other directions cannot be ruled out. Storms that do not make direct landfall and those passing considerably offshore can still affect the islands’ shorelines and pose hazards to the Turks and Caicos coastal development.

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Hazards Hurricanes Tropical cyclone systems (tropical storms and hurricanes) are the primary cause of extreme water levels (storm surge), wind, and wave conditions which can cause significant episodic beach erosion, and often serve as design conditions for habitable structures and critical infrastructure along the coast. Figure 17A shows the Saffir-Simpson scale for hurricane category windspeeds.

Hurricane season for the Atlantic Basin is during the months of June through November. Over the past 50

Figure 17. (A) Saffir-Simpson Hurricane Category Wind Scale (NOAA). (B) NOAA Tropical Storm and Hurricane Tracks 75 miles of Turks and Caicos (1970-2019)

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During extreme weather conditions such as tropical storms and hurricanes, the islands are subject to strong winds and wave which can approach from any direction. Elevated water levels are experienced due to storm surge from passing tropical cyclones (tropical storms and hurricanes) and cold fronts.

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“Storm Surge: Storm surge describes an abnormal rise of water generated by a storm above predicted astronomical tides. Surge risk varies depending on the strength and structure of a given hurricane as well as geography and tidal cycles along the coast it impacts. However, it is useful to note that any low-pressure system off shore with associated high winds can cause a coastal flooding event depending on duration and direction of winds.” (Impacts of Climate Change on Extreme Events in the Coastal and Marine Environments of Caribbean Small Island Developing States (SIDS); Stephenson and Jones, 2017.)

A significant proportion of the country is low elevation land. These low-lying areas, even if sheltered from open ocean waves, can be especially vulnerable to coastal flood inundation during extreme storms. Additionally, under surge conditions the amount of wave protection provided by the natural features surrounding many of the shorelines can diminish. For example, although the extensive shallow bank characteristic of many of the southern shorelines of the Caicos Islands sees virtually no waves under normal conditions; during a large storm, elevated water levels can potentially allow for larger waves to impact these shorelines. Similarly, fringe reefs can become submerged/ overtopped under storm conditions and provide less wave protection leading to coastal erosion.

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The amount of surge from any particular hurricane or other extreme events will vary from coastline to coastline depending on the storm, the timing of the tides, and due to the island and underwater shelf geometry of the Turks and Caicos. In general, storm surges in the Turks and Caicos are relatively small due to the steep shelf surrounding the islands which significantly limits the amount of surge that can build up. No reliable storm surge studies have been conducted on a countrywide scale for the Turks and Caicos, however, storm surge information was developed from modeling conducted by the Global Risk Assessment (GAR, 2015), and extracted from the nearest representative location for the Turks and Caicos, on Great Inagua Island.

Table 3 presents storm surge estimates for various return period extreme storms.

Tsunamis Although rare in the Caribbean, the potential for tsunamis to impact the Turks and Caicos does exist. The primary cause of tsunamis are underwater earthquakes, and the Turks and Caicos proximity to Puerto Rico and Hispaniola trenches make the country susceptible to this type of coastal hazard. Similar to storm surge, tsunamis put areas with lower topography at severe risk of damage. These events bring can bring overwhelming coastal inundation capable of flooding areas significantly far inland.

Return Period (Years)

Surge (feet, MSL)

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Table 14: Return Period Storm Surge Estimate

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lost in Historic Cockburn Town under a 2 m SLR scenario, with all (100%) of the beach area in Grand Turk Cruise Centre and Grand Turk West Shore under a 3 m SLR scenario.”

“The IPCC (IPCC, 2007b) also notes that small islands are particularly vulnerable to the effects of climate change, including sea-level rise and extreme events. Deterioration in coastal conditions is expected to affect fisheries and tourism, with sea-level rise being “expected to exacerbate inundation, storm surge, erosion and other coastal hazards, threatening vital infrastructure, settlements and facilities that support the livelihood of island communities” (IPCC, 2007b, p. 15).” (CARIBSAVE, 2012).

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Climate Change and Sea Level Rise (SLR) Major impacts of climate change facing the Turks and Caicos Islands are sea level rise (SLR), increased temperatures (including sea water temperatures), and increases in the frequency and intensity of extreme weather events (floods, droughts, hurricanes), all of which “combine to pose a serious threat to the Caribbean’s sustainable development agenda”. Coral reefs are susceptible to damage from seemingly minor increases in sea temperatures, and 65% of all marine species in the Caribbean are dependent on coral reefs. In addition to widespread impacts to fisheries and ecology, coral reef damage impacts would extend to tourism sectors as these are vital attractions for divers and snorkelers.

“Most importantly, coral reefs afford significant protection to vulnerable coastal resources and protection”. (Draft Climate Change Policy of the Turks and Caicos Islands, 2011).

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The coastal hazards the Turks and Caicos Islands are already facing will become greater threats due to rising seas and an increase in the frequency and severity of extreme storms. The mean sea level in the Caribbean has risen over the past year 100 years and the rate of this rise is expected to increase due to climate change.

“Caribbean countries are projected to experience SLR at rates between 18 to 59 centimeters by 2100”, (Draft Climate Change Policy of the Turks and Caicos Islands, 2011).

Shoreline Risk Erosion can pose a significant risk for shoreline development in the Turks and Caicos. Long-term erosion to a sandy beach can occur due to prolonged wave activity. Beaches more exposed to waves will often see seasonal sand patterns which coincide with seasonal wave activity where beaches become wider during calmer summer conditions, and narrower during times of larger wave activity, typically in the winter. Less exposed/more protected sandy beaches that experience very little wave activity (typically due to the presence of a shallow bank and/or fringe reefs) tend to have much more stability and will generally maintain a healthy, wide beach year-round.

Extreme weather events (tropical storms, hurricanes, large winter storms) can remove large amounts of sand from a beach over a very short period of time causing damage and hazardous conditions for beachfront developments and beach assets. Both short-term and long-term erosion can cause substantial damage to upland infrastructure and can leave upland areas more vulnerable to damage from waves and surge.

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SLR is anticipated to bring increased risk to coastal development due to accelerated erosion as well as the potential for more damaging events during extreme weather events due to elevated water levels. High water events contributing to erosive conditions and the potential for coastal flooding and upland damage will occur more frequently as mean sea level increases. Over time, rising seas may cause the loss of entire beaches and other coastal resources.

The CARIBSAVE Climate Change Risk Atlas (CCCRA) “Climate Change Risk Profile for The Turks and Caicos Islands” in 2012 examined the potential impacts of SLR scenarios of 0.5m, 1.0m, 2.0m, and 3.0m in the analysis of Grand Turk. The 2012 CARIBSAVE study estimated that “a 0.5 m SLR will result in the loss of more than half of the beach area in Grand Turk West Shore (53%) and Historic Cockburn Town (65%). All (100%) of the beach area will be

The risk and severity of potential impacts from erosion, surge, waves, coastal inundation are of course specific to each location. In addition to wave exposure/wave protection, shoreline risk also depends on the landforms and coastline topography that make up or surround the shoreline. Ironshore or rock shorelines have little or no risk of erosion, and shorelines with higher topography will potentially have less risk to surge, wave hazards, and coastal flooding than low-lying areas. Beaches of mixed sand and rocks generally erode less than a sandy beach,

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shoreline characteristics often with vast mangrove forests fronting the upland. These are prevalent along the southern shorelines of the Caicos Islands due to the extensive shallow bank. These types of shorelines are lowlying, and at risk of recession during extreme storms, but provide a valuable buffer to inland areas and infrastructure.

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but may be exposed to larger waves more often.

Protective oceanfront dune systems with supporting vegetation can provide protection to upland areas along sandy beaches. Many shorelines of the Turks and Caicos that are substantially protected from ocean wave conditions also feature low-lying wetland and/or estuarine

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MARITIME NETWORK AND ISLAND CONNECTIVITY

There are three active port facilities in the TCI. Port access for heavy commercial vessels (handymax bulk cargo and tankers) is restricted to Providenciales (South Dock Road Terminal), South Caicos (Conch Ground), and the terminal at Grand Turk. As shown in Figure 18, commercial traffic routes are primarily limited to deep-water access outside of the Plateau and reef system, except where en route to/from the terminal on Providenciales.

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The maritime network in the TCI includes commercial ports, recreational marinas, boat landings, ferry services and the interconnected waterways used by each. The archipelago is sited approximately 620 miles from Miami, 100 miles from Hispaniola and 30 miles from the Bahamas. Water to the east, north and west are deep open ocean. The islands wrap around the shallow waters of Caicos Bank to the south. The open ocean conditions and shallow bank affect the maritime network navigation in two distinct ways: exposed but deep vs. protected but shallow.

Status of Commercial Ports and Traffic

Figure 18: Cargo Ship Traffic Routes, TCI (Source: MarineTraffic.com)

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There are current plans in place to develop the port on South Caicos. The port at South Caicos receives 40,000 lb of cargo per week. The poor condition of the existing port and hurdles in permitting port improvements are limiting factors to increasing traffic to serve island development.

North Caicos has a semi-active port facility at Bellfield Landing (located near Sandy Point Landing on the west side of the island). The plan is for Bellfield Landing to become the commercial port for North Caicos. There are plans for channel dredging to activate commercial traffic to this location. Due to current depth restrictions, smaller commercial traffic may be restricted to access at Sandy Point just north of the Landing.

Grand Turk is home to the only container port in the TCI, receiving 20 containers per week at its deep-water terminal. Facilities are in good condition, and there are no present identified plans for additional upgrades. Adjacent to the Port terminal is the Grand Turk Cruise Center for receiving Cruise Ships.

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Providenciales has one existing port facility (180’ pier with 11’ depth). Commercial port activity on Providenciales is expected to triple over the next 20 years, and there is a phased development strategy in place to accommodate up to three vessels at the port.

Figure 19: Grand Turk South Dock Port

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Ferry Traffic:

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Ferries provide service routes as per Table 15 and Figure 20.

Table 15: Ferry Routes (www.caribya.com)

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Figure 20: Existing Domestic Ferry and Air Routes (www.visittci.com)

Figure 21: TCI Ferry at Walkin Marina / Heaving Down Marina, east Providenciales Ferry service is critical to promoting inter-island connectivity and to support development goals. Growth in development will require: ● Reduced travel times and increased frequency of transport

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Variety of ferry types including high speed, shallow draft ferries through the interior Caicos Bank (potentially via “hoverboats” or similar) Direct routes and landings (i.e. Middle Caicos, North Caicos, Salt Cay) Upgraded onshore facilities and infrastructure.

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Recreational / Pleasure Craft Routes: Recreational boating traffic is primarily conďŹ ned to the routes shown in Figure 22 through Figure 24, noting that these maps only show vessels equipped with AIS transponders and do not show small craft.

Figure 22: Pleasure Traffic Routes, TCI (Source: MarineTraffic.com)

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Figure 23: Pleasure Traffic Routes, Providenciales (Source: MarineTraffic.com)

Figure 24: Pleasure Traffic Routes, South Caicos/Grand Turk/Salt Cay (Source: MarineTraffic.com)

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Figure 25: Southside Marina, Providenciales

Figure 26: Caicos Marina and Shipyard, Providenciales

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Figure 27: Blue Haven Marina, Providenciales

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Figure 28: Small boat harbour at South Caicos (Seaview Marina)

Figure 29: Small boat harbour and port at South Caicos

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DEVELOPMENT IN THE COASTAL ZONE

“Shoreline” Resorts  Ideally provides indirect access to sandy or mixed beaches  May be located at high elevations or above ironshore cliffs while preserving scenic ocean views  Potential themes may include eco-resorts, yoga resorts, health and wellness retreats, spas.

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Marina Facilities and Resorts  Requires sufficiently deep water access for boaters, including navigable access through gaps in offshore reef  Requires safe and sheltered harbors from storms and waves (either natural basins or excavation into low-lying areas or inland salinas)  Strategically positioned for short / easy access to offshore resources (diving spots, fishing holes, surf breaks, cruising areas, sheltered routes to other island destinations)

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In addition to shoreline categories and coastal risk factors, the potential for waterfront development is primarily driven by the availability of coastal resources and the demand by different user types for access to those resources. Prime developable coastal property is limited, and thus it is important to select development types strategically to meet the needs of the users and provide economic benefits for the nation.

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The following waterfront development types have been considered in this study:

Beach Resorts  Requires direct access to sandy beaches  Requires good (or manageable) shoreline stability with beach quality suitable for recreational activities  Preferably sheltered and tranquil conditions for swimming, snorkeling, and watersports  Targeted towards families and groups.

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Figure 30: Grace Bay and Beach Resorts, Providenciales

Figure 31: Blue Haven Beach Resort and Marina, Providenciales

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Ports and Ferry Terminals  Same criteria as per Marina Facilities and Resorts  Requires onshore infrastructure for logistics, storage, and connections for intra-island transport.

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Available developable upland area for support facilities, F&B, retail, and accommodation (hotel and/or residential), etc.

Residential Development  Consisting of private villas and luxury condos  Does not require direct or indirect access to water.  “Resi-Resorts” subcategory · Where conditions are superb for both luxury residential real estate and beach resorts, combination resort facilities may be a strong opportunity.

Parks and Public Areas  May be intermixed with Residential development  Ideally located in areas with either close proximity to existing gathering places (residences, businesses, F&B, etc.) or areas of natural beauty. Should not be located in remote or hard to reach locations.  Does not require direct or indirect access to water.

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Figure 32: Navigable passage to North Creek, north Grand Turk

Figure 33: Blue Haven Marina, Providenciales

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MANAGEMENT POLICY AND GUIDANCE

* Other guidance or policy documents may exist but have not been made available for review within this report.

Numerous research, planning level, and “vision” documents have been produced throughout the years to provide guidance to TCI on a variety of related topics. While an exhaustive collation and detailing of all documents is not the intent of this report, readily available information has been reviewed in general terms as it relates to coastal resources, specifically coastal development and fisheries.

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Coastal Development The available existing legislative and regulative framework documentation that governs physical development specifically related to coastal development includes the following (TCI Law from Revised 2018 documents): ● TCI Law – Chapter 09.02 Physical Planning Ordinance ● TCI Law – Chapter 09.08 Crown Land Ordinance ● TCI Law – Chapter 09.09 Minerals (Exploration and Exploitation) Ordinance ● TCI Law – Chapter 10.01 National Parks Ordinance ● TCI Law – Chapter 10.06 Coast Protection Ordinance ● TCI Law – Chapter 10.11 Marine Pollution Ordinance ● TCI Development Manual – Department of Planning (2014) ● TCI Building Code – Department of Planning (2014) ● TCI National Physical Development Plan (1987)

As it relates to legislative and regulative framework documentation that governs fisheries, the final TCI NPDP document will address: ● Major Deficiencies in Existing Policy Framework ● Planning Level Recommendations for Policy Updates ● Recommendations on Overarching Goals, Challenges, and Strategies for Policy Framework for Fisheries

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Fisheries The available existing legislative and regulative framework documentation that governs issues related to fisheries and critical marine species includes: ● TCI Law – 10.08 Fisheries Protection Ordinance ● TCI Law – 10.08 Fisheries Protection (Amendment) Regulations 2018 ● TCI Law – 10.09 Fishery Limits Ordinance

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KEY PRELIMINARY FINDINGS AND RECOMMENDATIONS Based on the preliminary analyses, several findings and recommendations have emerged as key issues related to coastal resources that will be evaluated and pursued in detail for inclusion in the final NPDP document.

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Not all types of coastal shorelines in TCI can support all types of coastal development. Final mapping exhibits and GIS framework data will be included in the NPDP that indicates a range of potential coastal development types and rankings along shorelines of each study island.

The management of the coastal zone, whether developed or preserved, must account for specific coastal hazards that exist now, as well as future hazards due to climate change and sea level rise that will significantly impact TCI. The planning, design, construction, and operations of any development in the coastal zone must incorporate resiliency, specifically against coastal hazards and climate change.

Sand mining should be evaluated to provide a source of beach compatible sand for shoreline restoration projects.

The official policy framework that governs coastal resources and development in the coastal zone, must be clear, effective, efficient, and enforceable.

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Coastal Development and Management ● TCI shorelines are a valuable coastal resource for numerous reasons. They provide physical settings for coastal development, water and public access, attraction for tourism, recreation, coastal hazard protection, outstanding natural beauty, and an assortment of environmental habitats, species, and processes. ● There is a finite amount of physical coastline in the TCI archipelago. Further, limited amounts of varying shoreline types are present on each island, if at all, with varying degrees of existing development. As such, coastal properties and shorelines represent a finite resource that must be responsibly and holistically managed. This management must occur on a national scale as well as island and smaller zonal shoreline scales. Emphasis should be put on conservation, management, and preservation. Table 6 presents an inventory of shoreline types for each primary study islands. Total shoreline length of the primary study islands is approximately 244 miles and estimated total shoreline length of all islands and cays within the nation of TCI is over 500 miles.

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Table 16: Shoreline Type Inventory of Primary Study Islands

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capacity, introduce competition, improve reliability and efficiency, and lower costs. Uncertainty and high costs related to existing cargo and shipping movement discourages development.

The ability to provide goods and equipment is critical to quality of life. Also, development on islands without seaport facilities or facilities with low capacity or poor infrastructure will necessarily be severely limited.

Due to island buildout, population density, and tourism demand, Providenciales is and should continue to be the primary port in the TCI. The envisioned improvement plan for Provo’s port should remain a priority.

Improvements are required at North Caicos and South Caicos. Facilities should be evaluated at Middle Caicos and Salt Cay. Minimal attributes should include:  Functional water depth including entrance waterways and berths should support all existing and envisioned vessel drafts plus 3-4 ft of overdredge for advance maintenance and ship flexibility.  Minimal infrastructure to support RoRo and container vessels.  Properly sized and designed seawalls, bollards, fendering, ramps and piers  Hurricane tie down equipment  Secure storage facilities appropriate for the site/island  Perimeter fencing and security

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Fisheries Resources ● The fisheries, seafood, and critical marine species resources of TCI are vital to various sectors including tourism, local food production, exports, and cultural heritage. ● Existing fisheries and seafood industries should have centralized commercial processing facilities for export as well as local points of sale. ● Management of fisheries and seafood industries should strive for responsible harvesting while seeking ways to expand species numbers to provide reliable sources for resilient local food production/ consumption, including meeting expectations and demand of tourism industry. ● Aquaculture opportunities should be explored for the variety of existing key species as well as new industry species. Salt flats should be investigated as potential resources. ● Process for re-evaluating efficacy of existing regulations ● Identifying Carrying Capacity (e.g., cruise ship landings, ecotourism) ● Funding for conservation programs ● Cumulative effects of development on Water Quality ● Emerging issues (Coral degradation, Fish Attractor Devices, increases in Sargassum, status of violation of marine resource protection ordinances) ● Central Repository for Marine-related information

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Maritime Network ● The system of seaports must support the typical operational needs of the islands but also incorporate resilience in their capacity and operations to serve future capacity requirements and short-term needs of large-scale projects. Individual development or infrastructure projects should not be required to construct waterfront facilities that only serve the needs of a single project. This increases costs, discourages development, and does not provide wider benefits to the islands and their inhabitants.

Development on islands without seaport facilities or facilities with low capacity or poor infrastructure will necessarily be severely limited. ● The commercial maritime industry, including cargo vessels, shipping and construction barges, similar operations, and the entities that own and operate them must be expanded to increase

Island Connectivity In the highly segmented archipelago of TCI, reliable, efficient, and cost-effective connectivity of goods and people is a necessity. A reliable water-based system is critically important in linking the island chain. In the near term, creating a practical and achievable system of island connectivity should be a critical goal. While some ferry services currently exist, their frequency is limited and their reliability is suspect. Further, not all major islands are served.

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Creation of an intracoastal waterway to connect North Caicos, Middle Caicos, South Caicos, Grand Turk and Salt Cay to Providenciales should be studied in detail.

Generally, a system could be developed that would include vessels capable of open ocean travel (to/from South Caicos to Grand Turk and Salt Cay) as well as those with shallow water draft to utilize the Caicos Bank (to/from Provo, North Caicos, Middle Caicos and South Caicos). A study should consider:

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Linkages, capacities, schedules and final routes should support belongers and tourists The ferry system must perform to a reliable schedule with sailing times and frequency designed to over serve initial demand Vessel quality/comfort and size must meet a defined minimum standard High speed catamarans are a likely candidate for a functional ferry system Landing site infrastructure and connectivity to parking/taxi access/drop-offs High initial infrastructure costs could require a public/ private partnership

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Other coastal and island nations have successfully implemented ferry operations of similar scale and nature to that which would be required for TCI. The following table provides operational ferry routes in other countries as a reference to the range of travel distances, routes, and times expected for a comprehensive TCI ferry system.

Table 17: Operational Ferry Routes in other countries

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MAPPING Mapping Process The objective of the mapping process is to display distinct segments of the shoreline perimeters according to the following parameters: Shoreline category types Coastal vulnerability and risk Type and degree of development potential per shoreline segment.

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Ranking of development potential according to shoreline segment and each development type, as follows:* [0] Poor, development not recommended [1] Low potential, not preferred [2] Some potential, low preference [3] Moderate potential, opportunity exists [4] Good opportunity, development recommended [5] Exceptional opportunity, highly recommended

This exercise was completed for Providenciales, North Caicos, Middle Caicos, South Caicos, Grand Turk.

The process for developing the maps is described below.

Mapping Results

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Shoreline Characterization and Risk Analysis & Rating The results of the shoreline categorization and coastal risk / vulnerability index are presented in perimeter defined maps for Providenciales, North Caicos, Middle Caicos, South Caicos, Grand Turk and Salt Cay in the following Figures.

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Preliminary categorization of shoreline type and coastal vulnerability index factors using aerial photography and available datasets.

Ground-truthing including site visits to areas of indeterminate category, representative sites well distributed along the island perimeter, and particular locations of interest.

• Documentation including GPS coordinates, digital photographs, drone footage, and aerial reconnaissance by charter plane.

Coordinated review of all collected images and datasets for confirmation of shoreline type and coastal vulnerability index factors. Vulnerability index factors included three primary categories which were averaged together: a. Bathymetric exposure (ranging from wide shallow bank [score of 1] to open ocean / deep [score of 5]) b. Nearshore wave dissipation (ranging from the presence of barrier islands [1] and fringe reefs [2] to open sea [5]) c. Flood potential (ranging from high ground [1] to low ground [2]) Based on the updated maps and ATM’s experience, identification of development potential according to each type for total island perimeter Segmentation of shoreline into zones according to the identified development potential type (Beach Resort, Shoreline Resort, Marina Resort/Facility, etc.)

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Development Potential

Development potential can be described as the ability of a coastal shoreline to theoretically support a particular type or types of development. Considerations such as shoreline type, coastal risk, upland geography, location on island, topography, existing development, proximity to key island sites (e.g. town centers), and similar factors were used to evaluate potential coastal development types and rankings.

Key items for select development types and maps are identified below: • Marina Facilities and Resorts Primary considerations for marina facilities include access to deeper navigable waters and safe harbor protection from waves. These offerings, especially on Providenciales, can sometimes be found at planned residential developments that may or may not have been completed, and as, such are included in the marina development potential results. Additionally, upland geography just inland of a coastline can lend itself to marina development, with

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some alteration to the natural environment. Salinas, shallow ponds, and other low-lying inland areas along the coastlines are all examples of potential opportunities for theoretical inner harbor marina development. The relative safety of inner harbors (both vessel and infrastructure) is illustrated at Turtle Cove today. These particular development potential opportunities are mapped as dashed lines on the maps to indicate potential cut channels for interior marina basin access.

• Ports and Ferry Terminals Existing ports and ferry landings were mapped with the marina facilities development potential results as, together, these operations create TCI’s commercial maritime network.

Potential locations for future facilities are also mapped based on deep water access, routing, island location, and similar needs.

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• Parks and Public Areas These development types should be considered in all locations as the natural coastal resources belong to the people of TCI. Specifically, a concerted effort should be made to provide easily accessible shoreline and beach access to the general public. Consideration should be given to requiring such access be considered or incorporated when private developments are planned and constructed. Note that beach access points were not identified due to the scale of this investigation. It is recommended that improvements be made particularly

on Providenciales including parking, signage, solid waste collection, shade structures and in some cases bathrooms.

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Simply because a shoreline can theoretically support a particular type or types of development, does not necessarily exclude the possibility of others, or of complete preservation or restoration of the natural environment. The results of the coastal development potential are ultimately intended to be used as a practical reference in combination with other layers of data to guide planning and decision making on a case by case basis.

The results of the coastal development potential analysis are presented in perimeter defined maps for Providenciales, North Caicos, Middle Caicos, South Caicos, Grand Turk, and Salt Cay in the following pages.

*Note: where high ironshore cliffs were identified, these sites were assigned the lowest coastal vulnerability score possible. This score is independent of nearshore

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bathymetry and conditional on the assumption that all development be sited at high elevation and not on the lower lying shorelines (if present).

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PROVIDENCIALES

Figure 34: Shoreline Categorization Map, Providenciales

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PROVIDENCIALES

Figure 35: Coastal Risk / Vulnerability Index Map, Providenciales

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NORTH CAICOS

Figure 36: Shoreline Categorization Map, North Caicos

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NORTH CAICOS

Figure 37: Coastal Risk / Vulnerability Index Map, North Caicos

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MIDDLE CAICOS

Figure 38: Shoreline Categorization Map, Middle Caicos

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MIDDLE CAICOS

Figure 39: Coastal Risk / Vulnerability Index Map, Middle Caicos

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SOUTH CAICOS

Figure 40: Shoreline Categorization Map, South Caicos

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SOUTH CAICOS

Figure 41: Coastal Risk / Vulnerability Index Map, South Caicos

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GRAND TURK

Figure 42: Shoreline Categorization Map, Grand Turk

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GRAND TURK

Figure 43: Coastal Risk / Vulnerability Index Map, Grand Turk

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SALT CAY

Figure 44: Shoreline Categorization Map, Salt Cay

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SALT CAY

Figure 45: Coastal Risk / Vulnerability Index Map, Salt Cay

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PROVIDENCIALES

Figure 46: Marinas Development Potential Map, Providenciales

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Figure 47: Beach Resort Development Potential Map, Providenciales

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Figure 48: Parks & Public Areas Development Potential Map, Providenciales

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Figure 49: Residential Development Potential Map, Providenciales

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Figure 50: Resort & Residential Combination Development Potential Map, Providenciales

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Figure 51: Shoreline Resorts Development Potential Map, Providenciales

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NORTH CAICOS

Figure 52: Marinas Development Potential Map, North Caicos

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Figure 53: Beach Resort Development Potential Map, North Caicos

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NORTH CAICOS

Figure 54: Parks & Public Areas Development Potential Map, North Caicos

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NORTH CAICOS

Figure 55: Residential Development Potential Map, North Caicos

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NORTH CAICOS

Figure 56: Resort & Residential Combination Development Potential Map, North Caicos

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NORTH CAICOS

Figure 57: Shoreline Resorts Development Potential Map, North Caicos

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MIDDLE CAICOS

Figure 58: Marinas Development Potential Map, Middle Caicos

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MIDDLE CAICOS

Figure 59: Beach Resort Development Potential Map, Middle Caicos

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MIDDLE CAICOS

Figure 60: Parks & Public Areas Development Potential Map, Middle Caicos

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Figure 61: Residential Development Potential Map, Middle Caicos

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MIDDLE CAICOS

Figure 62: Resort & Residential Combination Development Potential Map, Middle Caicos

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MIDDLE CAICOS

Figure 63: Shoreline Resorts Development Potential Map, Middle Caicos

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SOUTH CAICOS

Figure 64: Marinas Development Potential Map, South Caicos

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SOUTH CAICOS

Figure 65: Beach Resort Development Potential Map, South Caicos

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SOUTH CAICOS

Figure 66: Parks & Public Areas Development Potential Map, South Caicos

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SOUTH CAICOS

Figure 67: Residential Development Potential Map, South Caicos

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SOUTH CAICOS

Figure 68: Resort & Residential Combination Development Potential Map, South Caicos

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SOUTH CAICOS

Figure 69: Shoreline Resorts Development Potential Map, South Caicos

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GRAND TURK

Figure 70: Marinas Development Potential Map, Grand Turk

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GRAND TURK

Figure 71: Beach Resort Development Potential Map, Grand Turk

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GRAND TURK

Figure 72: Parks & Public Areas Development Potential Map, Grand Turk

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GRAND TURK

Figure 73: Residential Development Potential Map, Grand Turk

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GRAND TURK

Figure 74: Resort & Residential Combination Development Potential Map, Grand Turk

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GRAND TURK

Figure 75: Shoreline Resorts Development Potential Map, Grand Turk

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SALT CAY

Figure 76: Marinas Development Potential Map, Salt Cay

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SALT CAY

Figure 77: Beach Resort Development Potential Map, Salt Cay

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SALT CAY

Figure 78: Parks & Public Areas Development Potential Map, Salt Cay

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Figure 79: Residential Development Potential Map, Salt Cay

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SALT CAY

Figure 80: Resort & Residential Combination Development Potential Map, Salt Cay

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SALT CAY

Figure 81: Shoreline Resorts Development Potential Map, Salt Cay

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