The Abaco Chamber of Commerce hosted their third quarterly Mix and Mingle in Elbow Cay on October 26, 2017 at Sea Spray Resort. The guest speakers for the evening were the Honourable Dionisio D’Aguilar – Minister of Tourism and Aviation; and Randy Butler – Sky Bahamas CEO.
Min. D’Aguilar preceded the meeting with a visit to the Elbow Cay Lighthouse and heard from Elbow Reef Lighthouse Society regarding investments that must be made to continue maintaining the famous lighthouse as one of the premier tourist destination in Abaco.
Chamber of Commerce members and local businesspersons enjoyed a fun soiree at Sea Spray – sampling complimentary wine, beer and hors d’oeuvres – before the introduction and presentations from speakers.
Mr. Butler spoke about his experience in the aviation industry – both public and private. He talked about businesses being good corporate citizens but lamented that regardless of charitable spending businesses still are taxed the same. He said this provides less incentive to companies to invest in the community.
Mr. Butler shared some interesting information regarding aviation in The Bahamas. He said that, contrary to what many might think, the Domestic Terminal subsidizes the operations of the International Terminal in Nassau. He noted onerous fees and taxes have stymied the industry and legitimate carriers are undercut but “hackers” – flights operating in an informal, unregulated market.
Mr. Butler also praised BahamasAir as having some of the most dedicated, hardworking staff in the industry, but that “unfortunate politics” have long kept them from achieving their potential.
Min. D’Aguilar spoke about the airline industry as a whole in The Bahamas and the Bahamian government’s challenges and approach.
Among several anecdotes he noted how he discovered one family island airport only had a $500 a month maintenance budget which was clearly not enough. He coupled this with admitting that, for a long time, The Bahamas has not maintained its assets – costing much more in the long run.
Bahamian airports are categorized by three tiers. Both Abaco’s airports are considered Tier I. Leonard Thompson International in Marsh Harbour has the second most traffic in the country and air arrivals to Abaco have increased ~5% every year for the past five years with one exception in 2014.
He noted that at 6500 feet the Marsh Harbour runway is too short to accommodate anything much larger than small regional jets but it has an impressive terminal. Treasure Cay, on the other hand he noted, has a runway that can accommodate much larger aircraft but its terminal is not suited for high traffic. The challenge of government, he said, was finding the money to correct either one while balancing the needs of the 28 other airports in the country on top of other budgetary needs and restrictions.
Min. D’Aguilar said the way forward to alleviate strain on the Treasury was Public-Private Partnerships to manage and run airports. He noted the government is “mindful” about who it is choosing to do business with.
The Minister noted that a lot of the budget for Aviation currently goes towards paying salaries. BahamasAir, for example, spent ~$100 million dollars in recent years to purchase five new planes bringing the fleet total up to eight – however BahamasAir has 869 employees. He said it put government in a difficult position between cost-cutting and putting Bahamians out of work.
Min. D’Aguilar spoke about how the United States manages Bahamian airspace and collects the fees from airlines for itself. The Bahamas hopes to negotiate in the coming months to control its own airspace, collect the fees and pay the USA to manage the airspace from those fees – resulting in a net gain for The Bahamas. This, the Minister said, is his number one goal and he meets with the International Civil Aviation Organization later this year.
Speaking as the Minister of Tourism, D’Aguilar also said he met with representatives of AirBnB, an online marketplace for rental homes and short term leases, that has been disrupting the traditional hotel business in The Bahamas. AirBnB said they would not collect VAT, due to accounting issues revolving around valuing homes that are rented, but would collect a simpler shared economy tax on behalf of the government and remit it to the Bahamian Treasury.
D’Aguilar also said he wants to cut back on burdensome regulations on the second home market. He wants to instead allow the free-market more room to regulate itself via property reviews. He said the current checklist of regulations, and noted government inefficiencies, is too large a barrier to entry to the market.
The audience had a question and answer session followed by a raffle drawing. Patrons had placed business cards in a raffle earlier in the evening.
The Abaco Chamber of Commerce has made a concerted effort this year to reach out to the business community throughout “all of Abaco” including far north, south and the Cays.
The event was sponsored by Aliv, Sea Spray Resort & Marina, Albury’s Ferry and Abaco Print Shop.