Colleagues, Ladies and Gentlemen:

Today gives rise to a major economic thrust in The Bahamas as we gather here to witness the signing of a Heads of Agreement between The Bahamas Government and Mediterranean Shipping Company Limited (MSC), the world’s second largest global shipping company and one of the largest and fastest growing cruise lines headquartered in Geneva.

MSC is also a partner of another conglomerate and major Freeport investor, the Hutchison Group of Companies.

I say a special occasion because it is unusual in small island states to find companies with global reach and with an understanding of the inherent value of strategic partnerships, that will make multiple investments that significantly impact local entrepreneurs, provide spin-off effects in the local economy, as well as provide many jobs and training opportunities.

Mediterranean Shipping Company Limited is such as company and, after a twenty-year relationship with The Bahamas, is making a commitment to generate new investments that intersect with the three pillars of the Bahamian economy - namely that of shipping, tourism and maritime education - and in so doing has not only differentiated MSC from the pack, but has elevated its partnership with the Government in a way that is bound to re-shape economic and human resource development in our country.

Freeport Container Terminal
The Freeport Harbour and Container Terminal, privately owned and operated by Hutchison Port Holdings and the Port Group, is the deepest of all of the harbours along the eastern seaboard of the United States, which gives it a strategic advantage in world trade. MSC, the world’s second largest privately owned container shipping company, with 480 vessels on 200 routes, and second in the industry only to the global shipping giant, Maersk, is the sole supplier to the Freeport Container Terminal.

MSC has committed to a $250 million dollar, Phase V investment that will re-position the Freeport hub to compete with similar hubs in Panama and Jamaica which are undergoing aggressive port expansions in 2016. Contractors for Phase V have been short-listed and one will be selected in the coming weeks.

I recently met with the principals of Mediterranean Shipping Company (MSC) in London to discuss several of their proposed initiatives, including the Phase V Expansion of the Freeport Container Port Terminal in conjunction with its partner, Hutchison Port Holdings and am excited about their plans.

This initiative will serve to double capacity and output by forty per cent, to two million containers per annum, thereby increasing production and employment at Hutchison’s Container Port.

MSC’s cargo services have created 19,500 direct and indirect jobs in Freeport and generated over one billion dollars of revenue to the Government over the period 2001 - 2014.

This new Phase V is welcomed as it is coming at a time when the Government seeks to develop synergistic investments in Grand Bahama, with undertakings such as ship care to service The Bahamas Maritime Registry and a Bulk Logistics Park through which packaging and storage of products could be facilitated for shipping world-wide.

Through these and other initiatives, and working along with Freeport’s major stakeholders, the Government aims to create the desired economic framework and governance structure for the revitalization of Grand Bahama, which would put the nation’s second city on a path to economic sustainability and realization of the vision of its City’s original founder, Wallace Groves, through enactment of the 1955 Hawksbill Creek Agreement.

Given the right tax environment, MSC has said that they may also entertain Phase VI and VII envelopes at an additional cost of US$280 million.

Cruise Port and Cruising
Since its inception three-hundred years ago, the old family-owned company has grown 800%, and has developed a fleet of twelve cruise ships now carrying 1.7 million passengers to 45 countries on its global itineraries. As a major cruise line with 15,000 staff, MSC is now in the enviable position of having insufficient capacity to match demand for its cruise product. This led to the recently ordering of seven (7) new ships capable of carrying 5,300 passengers and 1,600 crew.

The christening this month in the Port of Miami of the first of MSC’s new class of ships signifies a new era in Bahamas cruising for MSC’s fleet as the company completes the acquisition of Sandy Cay, just off Bimini, for development of private island excursions on its exclusive, Bahamas-bound itineraries.

MSC has committed to an investment of up to US$100 million for construction and the self-sustaining operation and environmental management of the Cruise Port and Marine Park at Sandy Cay and plans authentic and engaging Bahamian experiences to compliment the construction of private a cruise destination paradise for its 369,000 annual guests.

Amenities will include shopping, dining, retail and recreational spaces, including an Amphitheatre and a ship-based infirmary among other facilities. MSC is also developing a Marine Reserve at Sandy Cay, offering unique diving experiences for guests of the island, further adding to the Bimini experience.

Future plans call for development a Yacht Club and Spa, private bungalows, massage huts, and wave-action lagoons, as well as a private, mega-yacht marina. Other developments will include offices for a dock master and Bahamas Customs and Immigration. Back of the House facilities will include staff housing, security stations, power, water/waste treatment and maintenance areas.

The resulting net benefit of this new cruise product will be 96,000 incremental passengers in annual cruise calls on the Port of Nassau and 19 new calls, per annum to Sandy Cay in The Bahamas, thereby increasing by three percent The Bahamas’ cruise share of market.

Economic Impact – Historical Performance
Historically, MSC’s cruise activities in The Bahamas have generated US$17 million from direct expenditures in the economy, including employee wages, resulting from the 408 jobs created over its seven year period of operation. These returns are miniscule, however, against the backdrop of some US$800 million dollars in annual, recurring revenues benefitting the country from MSC’s current combined cargo and cruise operations in The Bahamas.

Economic Impact – Sandy Cay
It is anticipated that economic activity from the cruise port at Sandy Cay will bring an additional 465,000 annual cruise passengers to The Bahamas. This is expected to generate US$20 million in salaries for construction services by and create over 600 new construction jobs, with 250 as full-time construction employees, over a two year period.

Beginning in 2018 an additional 361 new permanent jobs will be created, which, together with MSC’s Nassau operations, will generate an additional $13 million in recurrent salaries and taxes in The Bahamas.

The company is set to begin major infrastructural works on Sandy Cay in January 2016, and following completion of environmental studies, mobilization on vertical construction can start as early as May 2016 for rollout of Phase One of the Project by the third quarter of 2017, which will be built and maintained in accordance with the best environmental standards.

Maritime Education and Training
MSC is global but it makes the claim that its services are local and personalized which is good for The Bahamas.  Accordingly, the company has made a commitment to invest in local training and hiring, for two consecutive years, of 120 Bahamian crew members, per annum, to staff its cruise ships.

MSC is also actively working to establish linkages with the College of The Bahamas’ Northern Campus for the creation of an MSC-sponsored, industry-specific education module that will increase the employability of Bahamians in the maritime industry.

There are synergies to be created between MSC’s local investments in maritime infrastructure and training and other similar training establishments such as the L J Mortimer Maritime Academy at Maritime Cay, which currently trains Bahamians to a high standard as seafarers in oil and cargo shipping and crewing on cruise lines. The Academy is eager to do more but can train only as many cadets as can be immediately placed on registered ships after graduation.

These initiatives give young Bahamian cadets the means for work-study at home, the opportunity to see the world and establish life-time relationships as well as receive excellent remuneration while gaining valuable skills and expertise at sea.

Strategic Partnerships
In today’s world much of global trade occurs by ship and with The Bahamas juxtaposed between the lucrative trade passages along the West and East coasts of the USA, the Far East, and Continental Europe, MSC has seen both the present and future benefits of investing in and developing a strategic partnership with The Bahamas Government, not only for the purposes of trade, but in cruising, tourism and maritime education.

Together with The Bahamas Government, MSC has committed to:

• strengthening the country’s major economic sectors of tourism, maritime and shipping;
• building on its capital investments and forging linkages across its business segments to ensure successful, long-term benefits for the company;
• developing new and distinctive Bahamas cruise product at Sandy Cay and creating a new standard of excellence for the cruise visitor experience;

MSC is now is actively working with The Bahamas Government to create a new partnership paradigm that will undergird the bright future that my Government is charting for economic development in The Bahamas.

I commend MSC for its foresight and express my gratitude to the owner of the company for their continuing commitment and confidence in the economy and Government of The Bahamas.

Thank you.