WEDNESDAY, JUNE 29, 2016
business@tribunemedia.net
NAD eyes fee rise after $15.1m loss By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
Mulling eight cent per passenger increase
THE Nassau Airport Development Company (NAD) is currently mulling another fee increase, as it predicts a “few more years” of losses following $15.1 million in ‘red ink’ incurred during its 2015 financial year. Vernice Walkine, NAD’s president and chief executive, in e-mailed responses to Tribune Business questions, revealed that the Lynden Pindling International Airport (LPIA) operator is assessing whether to raise aeronautical fees. “NAD is currently considering an aeronautical fee increase, which will translate into an $0.08 increase in fees per passenger,” Ms Walkine said.
LPIA operator: Losses to continue for ‘a few years’ But maintains ‘BBB-’ credit rating VERNICE WALKINE “NAD is currently in the midrange for airport fees compared to its competitors in the Caribbean region.” The latter comment is designed to reassure the aviation industry, plus the travelling public and NAD’s retail/restaurant tenants, that the LPIA
operator is not in danger of ‘pricing itself’ out of the market - something that could have serious consequences for the Bahamian tourism industry. However, NAD’s freedom to raise fees and charges “as necessary”, and without Government or political interference, is vital
Price control proposal like ‘Gestapo tactics’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Bahamas Chamber of Commerce (BCCEC) warned yesterday that any Government move to force businesses to reduce prices in line with import duty cuts would be akin to “economic dictatorship” and “Gestapo tactics”. Edison Sumner, the BCCEC’s chief executive, told Tribune Business that the proposals being floated by the Price Control Commission would, if passed, place the Government in charge of running private sector businesses. Reiterating that proper competition and market forces, rather than Government regulation, was the best defence against price gouging and unscrupulous merchants, Mr Sumner said numerous factors - other than taxes and import duties - helped determine consumer prices. And, with the private sector now responsible for administering and collecting Value-Added Tax (VAT), the Chamber chief executive said a “quid pro quo” between See PG B2
Forcing lower prices akin to ‘economic dictatorship’ Chamber rails against tie to lower import duties Competition, market forces better control method
EDISON SUMNER
Union to ‘do what it has to do’ over Hilton meltdown By NATARIO McKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net
THE hotel union’s president yesterday said that if working conditions at the British Colonial Hilton do not improve soon it will “do what it has to do”, amid an air conditioning breakdown that has persisted for more than a week. Meanwhile, Robert Farquharson, the director of labour, told Tribune Business that he will send a team to the property to assess the situation, after this newspaper was alerted to staff complaints about the unbearably humid conditions they are being forced to endure. Tribune Business sources said a number of the British Colonial Hilton’s 300 staff did not report for work yesterday in protest at the conditions. However, Nicole Martin, president of the Bahamas Hotel Catering and Allied Workers Union (BHCAWU), was unable to confirm or deny whether this occurred. And attempts to reach British Colonial Hilton general manager, Rui Domingues, were unsuccessful up to press time yesterday. A malfunctioning air conditioning system at the historic downtown Nassau property has forced it to compensate guests by providing them with accommodations at other Nassau hotels. China Construction America (CCA), the Pointe developer and Baha Mar’s main contractor, acquired
Workplace health and safety ‘paramount’ Wants A/C malfunction sorted ‘real quickly’ Dept of Labour to conduct workplace inspection the resort in late 2014. “We were made aware of the issue some time last week when it got really bad,” Ms Martin told Tribune See PG B2
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to its ability to service the debt financing (chiefly bonds) that it took on to fund LPIA’s $409.5 million redevelopment. The airport operator thus has the ability to increase revenue streams whenever needed to ensure it meets its debt servicing requirements, and keeps both local and international bondholders happy. NAD’s annual report for the year to end-June 2015, obtained by Tribune Business, shows that the airport operator suffered a $15.101 million net loss, a slight 7.6 per cent reduction from the previous year’s $16.341 million. Ms Walkine blamed 2015’s net loss on NAD’s debt servicing costs, which remained relatively flat year-over-year at $41.813 million. This was the key factor in wiping out the See PG B4
$6.6bn debt ‘well beyond’ the need for stabilisation By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Bahamas is “well beyond” the point where it merely needs to “stabilise” its $6.6 billion national debt, a former Chamber chairman said yesterday, as he warned that the economy was showing “no desire for growth”. Robert Myers, now a principal with newlyformed civil society group, the Organisation for Responsible Governance (ORG), said Bahamians would likely only realise the consequences of successive governments’ fiscal profligacy “when they slam into the wall”. Suggesting that too many were ignoring “the writing on the wall”, Mr Myers said the Bahamas now stood “on the edge of fiscal doom”, with little to no capacity to respond to a major economic shock. He was responding after See PG B5
Bahamas showing ‘no desire for growth’ Ex-Chamber chair fears ‘wall slam’ for public Concern over ‘wipe out’ from major shock
ROBERT MYERS
MSC warns over Customs change shipment delays Bahamian firms may see imports delayed up to week Cargo shipper sets strict new manifest rules Urges clients to work with it to avoid 25% charge By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE world’s second largest cargo shipper has warned Bahamian companies that their imports will be delayed “until the next sailing” if manifests are not made for compliance with Bahamas Customs’ new requirements. Mediterranean Shipping Company (MSC), in a June 24, 2016, letter to its Bahamian private sector customers, expressed particular concern about the 25 per cent “processing fee” that will be levied if last-minute changes are made to cargo manifests. MSC, which is one of the two main cargo shippers serving Nassau, together with Tropical Shipping, called on its Bahamian clients to work with it to avoid the implementation of such fees. Yet the letter, which has been obtained by Tribune Business, warns that companies unable to supply MSC with a complete cargo manifest by its desired time may see their containers removed from the vessel and left until the next sailing. This, potentially, could result in a threeday delay to cargo being shipped out of Port Everglades to Nassau, and possibly a week’s delay to freight coming out of Jacksonville. “Effective July 1, 2016, the Bahamas Customs will implement a new regulation regarding C-10 (local Manifest Correction) requirements,” MSC’s letter warned its customers. “We should work together and accurately co-ordinate our actions on this subject, as each amendment to the manifest filed with Customs will generate a penalty of 25 per cent of the cargo value.” MSC added that should such a ‘processing fee’ be levied, it would be applied to the “wrongdoer’s account” - implying that it would pass the extra charge on to the ‘consignee’, or ultimate owner of the imported goods, rather than pay it itself. “In order to comply with such, and protect our customer interests by avoiding any applicable fine, we must review our procedures and enforce strict deadlines,” MSC warned, setting out the new timelines its See PG B5