The operating profits achieved by Nassau hotels are 59 per cent and 74 per cent lower than their counterparts in the Caribbean and the US, a report on the tourism industry’s competitiveness revealed yesterday, with high labour and unity costs, pilferage, and low productivity key factors in making The Bahamas a high cost destination that is becoming increasingly uncompetitive.
The report, compiled by Ralph Massey for the Tourism Taskforce on Trade Liberalisation, found that although the average room rate of $131 per night for the Nassau hotel was comparable with the $129 and $115 rates for its caribbean and US competitors, “the shocker is the bottom line”.
Gross operating profits, which do not include payments for interest, taxation, depreciation and amortsiation, were 9 per cent for the Nassau hotel, 22 per cent for the Caribbean and 35 per cent for the US.
The Taskforce report said: “This means that the Nassau hotel was, at best, in a ‘breakeven’ position on net profits.
The Tourism taskforce report, which was presented to the Bahamas Chamber of Commerce yesterday, is part of a wider drive to produce a five-year National Economic Development Plan that will establish a framework for how this nation will cope with the effects of trade liberalisation regardless of whether it joins agreements such as the Free Trade Area of the Americas (FTAA) and the Caribbean Single Market and Economy (CSME).
Source: The Tribune
