By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
A senior hotelier yesterday said The Bahamas “still has some headroom for tourism growth” post-COVID amid forecasts its annual expansion rate will merely match the Caribbean average for the next decade.
Robert Sands, the Bahamas Hotel and Tourism Association’s (BHTA) president, told Tribune Business that this nation’s key economic driver has not yet “maximised our capacity in terms of occupancy and stopover visitors” despite producing the second-sharpest rebound in the Western Hemisphere from the pandemic.
A World Travel and Tourism Council (WTTC) report, seen by this newspaper, disclosed that The Bahamas was only behind St Lucia in the strength of its COVID rebound in 2021 when compared to the rest of the hemisphere. “The fastest rates of recovery were witnessed in St Lucia, The Bahamas and Colombia; the sector in these countries rallied by 92.6 percent, 88.9 percent, and 83.8 percent respectively,” the report said.
And a separate WTTC study, focused on the Caribbean specifically, confirmed that the Bahamian tourism industry’s relatively rapid recovery from COVID came after it was one of the nations hit hardest by the lockdowns, travel restrictions and border closures in 2020.
“Within the Caribbean, some of the worst affected countries were The Bahamas – which witnessed a 70.1 percent fall in the contribution of travel and tourism [to economic output] – and the British Virgin Islands, which saw a drop of 68.8 percent. Such declines demonstrate the importance of international inbound travel to these economies,” the second document added.
“Given the significance of the sector to the regional economy, contraction of travel and tourism transmitted to the overall economy. In 2020, with a GDP shrinkage rate of 8.9 percent, the Caribbean experienced the fastest decline of all regions worldwide. Meanwhile, travel and tourism employment declined by 25.8 percent in 2020, amounting to a loss of 708,000 jobs.”
Acknowledging that The Bahamas and other Caribbean countries have yet to fully recapture 2019’s pre-COVID business volumes despite their rapid recoveries, the WTTC report added that this nation’s rebound benefited from having the least pandemic-related restrictions in the region - despite all the criticism levied at the former Minnis administration.
“According to the Oxford COVID-19 government response tracker, The Bahamas had the least stringent restriction on international travel in 2021, mandating quarantine on arrivals or a travel ban for only 50 out of 365 days. As a result, the country enjoyed an 88.9 percent growth in travel and tourism GDP, the second highest in the region,” the WTTC study added.
“St Lucia and the Dominican Republic also eased all travel restrictions for vaccinated travellers before the peak winter months of December to April, and reaped the benefits in the form of a strong rebound in and tourism GDP. On the other hand, throughout 2021, international travellers to Barbados and Dominica were either banned from entering or required to quarantine upon arrival.”
Many Bahamians who will recall living through COVID-19 lockdowns and restrictions may dispute the Oxford assessment, though. And the WTTC report noted that The Bahamas’ average annual tourism growth rate over the next ten years through to 2032 is projected to lag behind many in the region, coming in around 6 percent just ahead of the world and Caribbean average. The latter is 5.5 percent, but both Anguilla and St Kitts and Nevis are forecast to be in double digits.
Mr Sands yesterday forecast that The Bahamas is primed for “a bumper year” in tourism in 2023, with business volumes forecast to exceed pre-COVID levels from 2019 which was the country’s best year on record. He added that the WTTC’s projected compound annual growth rate (CAGR) for The Bahamas over the next decade showed this nation still enjoys sufficient room to grow.
Asserting that the WTTC’s findings reaffirm Bahamian tourism’s resilience, the BHTA president said: “We are going to come fairly close to our best year in history, which is 2019, this year. This is right after going through not only the pandemic, but Hurricane Dorian.
“It does speak to the resilience of tourism in The Bahamas but, more importantly, it does speak to the strength of The Bahamas’ brand, which I think has been confirmed by the unique brands in the destination - Atlantis, Baha Mar, Sandals, the Ocean Club - and top resorts in the Family Islands.
“Also the cruise industry, the private boating industry, the private aviation industry.... all these things collectively have helped to shore up this whole issue of the post-COVID rebound and the collective overall strength of The Bahamas’ tourism brand.”
The WTTC studies show The Bahamas has become even more dependent on tourism post-COVID. The sector’s relative contribution to economic output and gross domestic product (GDP) has increased from seventh in the Caribbean ion 2019, pre-COVID, to fourth in the region in 2021. The Bahamas, as of last year, was the world’s sixth most reliant country on tourism as opposed to the tenth spot it held in 2019.
“The reality is we still have some growing room to do, so I’m very optimistic 2023 will be a bumper year for tourism in The Bahamas,” Mr Sands told Tribune Business. “What I’m saying is we have not maximised our capacity this year in terms of our potential for occupancies and stopover visitors, and also cruise passengers.
“We still have some headroom for growth, and that is going to manifest itself in extra growth for 2023. The sleeping giant is the Airbnb market, where we’re not at this point in time able to quantify the number of persons participating in that sector. I think it’s fair to say almost 66 cents in every dollar is generated from tourism.”
The WTTC study, though, showed that The Bahamas sits alongside Puerto Rico in having the greatest proportion of tourism earnings leak outside the country via the industry’s supply chain. “The Caribbean travel and tourism sector suffered from economic leakage of around 27.5 percent in 2019, significantly higher than the world average of 6.4 percent,” the WTTC study said.
“As a result, the domestic supply chain only made up 72.5 percent of the total supply chain compared with 93.6 percent for the world. This means that 27.5 percent of the supply chain revenues generated through tourism in the Caribbean leave the economy, thereby not benefiting the local population.”
In The Bahamas, it has long been estimated that between 80-85 cents of every tourism dollar earned leaks outside the country. The WTTC report placed it at between 35-40 percent.