The financial collapse of the Bahamas’ Baha Mar super-resort before it ever opened has cost the Caribbean island nation an estimated US5 million in unpaid tax revenue and 1 million in lost wages.
The losses are calculated over an 18-month period dating back to the $3.5 billion property’s failure to make its December 2014 opening. They are contained in a new report from the government cited by daily newspaper The Tribune.
Impacts include 2,000-3,000 direct jobs that never materialized and 800,000 international visitors who never came, with each visitor expected to spend $576 per day, according to the report.
Baha Mar was expected to create more than 9,000 jobs in all, the report says.
Other impacts include “reputational damage for the Bahamas” and “lost marketing spent on promoting the destination”.
Baha Mar foundered on disagreements between its founder and developer, entrepreneur Sarkis Izmirlian, and the project’s Chinese backers. Export-Import Bank of China (EXIM) is the resort’s secured creditor. China Construction America Bahamas is the general contractor.
The falling-out led Izmirlian to pursue a financial reorganization in the United States under the protection of federal bankruptcy law. The Bahamian government, however, opposed this as an affront to sovereignty and instead petitioned the Bahamas Supreme Court for a liquidation. The court placed the property into receivership last October at the request of EXIM.
The release of the report prompted the opposition Free National Movement party to blast the administration of Prime Minister Perry Christie, claiming it sided with the project’s Chinese entities, effectively dooming its ability to recover and open.
Senator and former Attorney General Carl Bethel, an FNM leader, said, “The government decided that it would intervene for its own reasons and in doing so they basically came to favor one side over the other and that’s why we are where we are.”
He said the FNM will push for a commission of inquiry if it wins the next election.
Christie recently said he believes EXIM will present a possible buyer for the resort and that a resolution is “imminent.” But Christie has a history of saying that a resolution is imminent.
It seems apparent that nothing will be resolved until the next bankruptcy hearing on September 30 when a full liquidation could be ordered.
