$80 million loss, says Toppin

Barbadian taxpayers are taking a massive loss on the Four Seasons project, based on figures from the Central Bank of Barbados (CCB), an Opposition spokesman has charged.

Member of Parliament for St Michael North Ronald Toppin told a Barbados Labour Party (BLP) meeting on Sunday the country would be up to $80 million worse off as a result of the
ill-fated project.

He based his conclusion on Government’s guarantee in 2010 of a $120 million loan for the stalled five-star resort and private residences project at Clearwater Bay, Black Rock, St Michael and the announcement last week by CCB Governor Dr DeLisle Worrell that the administration would earn $40 million for the sale of its interests in the property.

“The loan got called so the Government had to pay $120 million that it had guaranteed,” Toppin told party supporters gathered at Lawrence T Gay Primary School.

“If the Government paid out in $120 million as a result of a called guarantee, and is now going to be getting $40 million, what has happened to the other $80 million that the Government put in?”

Construction on the Four Seasons, which had been anticipated to be a stomping ground for the rich and famous from around the world, ground to a halt in 2009 because financing dried up and the sales of the private villas slowed.

After failed attempts by the developers to secure new funding, the then David Thompson-led Government announced in early 2010 it would guarantee the loan from a Caribbean bank.

That same month the Inter-American Development Bank announced it had withdrawn its support, cancelling $160 million in loans it had committed to the hotel component of the venture more than two years earlier.

Minister of Finance Chris Sinckler told Parliament last August he had recently signed an agreement for the sale of the beachfront property and he had expected part of the payment within two weeks.

Toppin on Sunday shredded the Democratic Labour Party (DLP) administration’s tourism strategy, charging it was costing Barbadians millions of dollars without realizing the required returns.

He cited as an example the policy of paying airlines to fly to Barbados, claiming as a result of that policy the administration now owed $5 million to the Brazilian airline Gol, which last August suspended indefinitely its weekly direct service from Sao Paulo without giving reasons.

“The Government believes that the solution [to tourism] is to approach airlines with money, tell you that ‘we’re going to pay you ‘X’ amount of dollars or, we’re going to guarantee you a certain return on every flight you make to Barbados irrespective of who you bring, or how many people you bring’.

“When you hear the Government announcing that such and such an airline will start services, or is increasing, it is as a result of money that this Government is injecting into airlines,” he said of the controversial practice of seat guarantees engaged in by several Caribbean governments to get international airlines to service their countries.

The Opposition spokesman accused the DLP of abandoning the tested strategy of aggressively marketing Barbados and improving its product in order to ensure it was attractive to visitors.

He also charged the administration had paid Delta Air Lines $7 million “to serve primarily the needs of Sandals”, which he contended would soon become “the single largest owner of hotel rooms in this country, for which they will have to pay no taxes or duties of any kind at all for 40 years”.

Toppin also advised Government to stop investing all its energies in tourism, and to recognize that it was important to diversify the economy. (GA)

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