With 65 percent of The Bahamas' total $500 million in room revenue being generated by just one hotel, the Ministry of Tourism has devised a plan to diversify the tourism sector through government intervention to increase connectivity for international passengers into and out of the Family Islands and the creation of a tourism master plan.
Director General of Tourism David Johnson, in an extensive interview with Guardian Business, said that after 50 years in tourism The Bahamas continues to be too focused on Nassau and Paradise Island, with the result that tourism is not supporting the economic and social development of the country to the degree that it could.
However, he said that the potential from diversification is massive and he explained a plan which he anticipates could begin to yield significant returns for the Family Islands by the fourth quarter of this year.
Charging that now is the time to "charter a new strategic direction" to enhance the contribution of tourism to the economy, Johnson said that two things must occur: The extension of convenient, visible and cost-effective airlift into the Family Islands, and the generation of a "master plan" that will see the touristic development of particular islands guiding which investment proposals are solicited or accepted, rather than proposals driving the development trajectory of particular islands.
"We should not be evaluating proposals in a vacuum. We should know what we want to happen in a particular island and seek out proposals that fit that," said Johnson.
With respect to expanding airlift into the Family Islands, Johnson said that the goal is to increase occupancy at Family Islands resorts from an average of 38 percent, by around 25 percent, to a position where they are operating in a sustainable way. He said that through partnerships between the government and private airlines, it is his belief that through various steps that will be taken this year, this can start to be achieved in 2015.
Airlift as 'infrastructure'
Johnson said that making a genuine change in the progress of economic development in The Bahamas will require "mandating" the provision of key infrastructure that serves the Family Islands - with airlift falling into this category.
"As much as we saw the need for roads in Nassau so people could get to school and to work, this is the same thing. Getting the air network to a competitive level is also going to cost a lot less.
"It revolves around rationalizing the role of Bahamasair as a service provider and the other licensed carriers providing that service.
"From a consumer perspective, if we can enable consumers in New York, London, Atlanta, China or Latin America to search and see these islands and see them in the same way that they can see and search Nassau and Grand Bahama - to find out how soon they can get there and what transport options are available; and book their passage and connect the same day at fares within the same range to come to Nassau and Grand Bahama, I think we will begin in a very, very, real way to diversify our tourism industry. Until then we will not - and 80 percent of our revenue will continue to go into one or two guys' pockets. And God forbid anything happens to them.
"So the government's role is to provide the climate and infrastructure for this to happen."
Johnson argued that emphasis has been placed on providing inter-island flights at times that are convenient for Bahamians, but these are not always convenient for tourists, and this - along with the inability to see domestic flights in international booking systems - has depressed Family Island stopover arrivals.
When visitors go from Nassau to the Family Islands, they more often than not cannot connect both in and out in without staying overnight in Nassau or waiting for extended periods of time at the Lynden Pindling International Airport.
"So you can go at 6.30 a.m. to Abaco, and then the flight in the evening is at best about 5 p.m. You can connect on the return but you might arrive at 7 a.m. in Nassau and not be able to leave until 2 p.m. or 3 p.m.
"We have to encourage growth in the amount of equipment (aircraft) and the ability to deliver more critical mass of services to the islands. We have to say in this first year we will grow tourism to Family Islands by 25 percent. We have to engage and invite those providers to roll the dice for us... they will put in the extra flights and by that I mean some that turn around sometime after 11 a.m. and before 2 p.m.
"We can make smart investment decisions and we will engage the operators on the basis of a proposal where there's an upside to them embracing what we are suggesting. There's a business risk to bring the comfort to a provider, sometimes it becomes the issue of a joint venture, so if we have to invest as an agency to make things happen then we will do that.
"If we have to make an investment I can't think of one where we would get better value for money. If we can start with six strategic Family Island gateways where you can connect the same day, it would make a huge difference.
Re-crafted Bahamasair
In conjunction with increasing the service provided by domestic private airlines, Bahamasair is expected to play a greater role in servicing international routes and driving down fares.
"As a country there's an understated role that Bahamasair as a national flag carrier can play in the economic development of the tourism and the country, and it has much more to do with how it should be able to perform as a low fare, high frill provider of jet service to our major markets.
"We have the ability to influence airfares that are representative of our proximity to the marketplace - today our airfares do not reflect our proximity. That is the role of our re-crafted Bahamasair, and in my view this can be done with less than the current level of subsidy."
Johnson said that Family Island resort partners the Ministry of Tourism has spoken to about the plan "without exception support it, and see the need for it".
"I am confident we will get this plan embraced, can execute it, and will see the benefit of it in the fourth quarter," he said.
Discussions with domestic airlines
With respect to the private domestic airlines that will play a pivotal role in the plan, Johnson said an initial approach was shared.
"We have had meetings on that. They have agreed on the platform (but) there are two paths to it: Path 'A' they were aware of and has complications that we've addressed; path 'B' is the revised approach, I haven't shared that with them, but I will in short order.
"It will require additional equipment and expansion by service providers, but with some philosophical change that must accompany the actions that will follow, which will enable this to happen very quickly.
"But we have to give responsible reasons for those providers to get into expansion mode. They've got to see where that makes business sense, we have to demonstrate that, and we can."
Johnson said The Bahamas' has "only just scratched the surface" of its potential in tourism.
"If we were all stock, The Bahamas' earning potental for investors or owners is so much greater because we've used less than five per cent of our capacity; some of our competitors have used more than 60 percent, so there's not much remaining life there.
"We have almost 200 hotels in The Bahamas, but our energy has been too heavily focused on the capital."

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