We decided to share this article with readers of BAHAMAS CHRONICLE, which has a huge following among the Bahamian diaspora across the United States, Canada and the United Kingdom as well as in The Bahamas and the wider Caribbean. The Nassau Tribune published this article by Neil Hartnell on Friday, February 14, 2025.
By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
Freeport must go back to its Hawksbill Creek Agreement roots and banish the red tape and regulatory “handcuffs” if it is to compete with multi-billion free trade zone rivals, a GBPA director asserted yesterday.
Rupert Hayward, also a member of the Grand Bahama Port Authority’s two family owners, told the island’s Business Outlook that the original intent of Freeport’s founding treaty must be revived after being “diluted” and “watered down” by policy “guardrails” such as Immigration policy.
Pointing to competition that has long surpassed Freeport’s output and economic impact, he cited Dubai’s Jafza special economic zone as an example “of what we are missing out on” with its $169bn in annual trade value in 2023 generated by playing host to 10,700 companies from 100 countries.
And, closer to home, Mr Hayward noted the $130m in trade value generated every year by Cayman Enterprise City, which enjoys 100 percent exemptions on corporate, income, VAT and capital gains taxes plus import duties, and is where businesses can become operational within four to six days aided by renewable five-year work permits and residency visas for staff that are issued within five working days of application.
“That’s the competition, ladies and gentlemen, and that’s what we’re up against,” the GBPA director warned. “Under the strict application of the Hawksbill Creek Agreement, as it was envisaged in 1955, Freeport would offer a very similar suite of incentives. As we all know, though, the reality today is very different.
“Despite many of the unique benefits that Freeport has to offer, we have fallen behind in this race precisely because the provisions of the Hawksbill Creek Agreement have been watered down and diluted…. Today, there’s approximately $14bn in real terms invested in Freeport since its inception in 1955. The reality is it could, and should, be closer to $100bn.
“But, sadly, the gradual watering down of the regulatory regime, excessive red tape, and guardrails on Immigration have undermined the Hawksbill Creek Agreement, which by its very existence created the Magic City.” To reverse course and revive Freeport, Mr Hayward argued that “we don’t need to reinvent the wheel” but, rather, go back to the original roots, vision and intent of the city’s founding treaty.
Later, fielding questions from attendees, he argued that getting Freeport’s economic model correct would have “a snowball effect” where increased investment, employment and economic activity will raise living standards, improve the quality of life and generate more revenues for the GBPA to maintain the city and upgrade its infrastructure.
Asked whether it is the GBPA or the Government who is responsible for the deterioration of key infrastructure in the Port area, Mr Hayward replied: “I think it’s a collective effort. We can all do better. I’m not standing here to say the Port Authority is perfect. In fact, I’ve said in a number of speeches that we need to create a… world class organisation.
“We do have constraints, and those constraints can be resolved by us working closely with the Government. I am sure the Government would say there are things we need to do better but we know there are building blocks for sustainable, sustained growth in Grand Bahama and those building blocks are what I mentioned today.
“Getting our regulatory framework right, improving the ease of doing business, improving the processes that allow foreign direct investment to come here so that more money then trickles down. The Port Authority has some more revenue it can reinvest back into the city, we all have jobs, everyone can look after their yards and the roads look better,” Mr Hayward added.
“It’s a snowball effect but it comes from the building blocks which are streamlined processes, creating a competitive ease of doing business environment. From that everything else flows.” Earlier, in his formal Grand Bahama Business Outlook address, Mr Hayward had urged this nation to break from from “a Nassau-centric mindset” that is holding back development of other islands.
Noting that Freeport faces regional competition from the likes of Panama and Jamaica’s special economic zones (SEZs), he added: “What would it take for Freeport to compete with even one SEZ in Dubai? What would it take to at least scale the $3bn in investments that we have slated for Grand Bahama to reach $30bn or $40bn every year?
“What would it take for Freeport to regain its rightful place as one of the leading SEZs in the world? A place that generates so much business that Bahamian unemployment is functionally eradicated. A regional beacon of excellence in sustainability, in good governance with a diversified economy in multiple sectors, which means that we Bahamians don’t need to go abroad to fulfill our dreams, but can do so at home.”
Mr Hayward continued: “The key lies in a mindset shift from a scarcity mindset to an abundance mindset. From a mindset of handcuffing or constraining business to an ease of doing business mentality. In my mind, it’s not about redistributing what we have. It’s about recognising that the pie can be infinitely bigger so everyone can share in a bigger opportunity.
“Freeport must offer more to prospective investors than Cayman Enterprise City, or Panama Pacifico and Colon, or the new free trade zone in Kingston and the other Jamaican SEZs…. Deeper collaboration with the Government is needed to revise outdated policies and regulation, fast-track permits and reduce bureaucracy.
Today, as a lived experience, I can tell you a big project can take up to a decade to become a reality thanks to red tape. but a single hurricane can destroy it in an instant. We have to be honest about how our current state of affairs came about. Hurricanes and global economic shocks have exposed the fragility of Freeport’s economic model, which has strayed from the original tenets of the Hawksbill Creek Agreement.
“But all the necessary provisions are still contained within that agreement, but constrained by national legislation. If they can be reinstated, we can significantly boost the competitive landscape from what we have today…. The future we all want is within our grasp. We must work together to ensure that it doesn’t slip through our fingers.”
Mr Hayward added that the Grand Bahama Shipyard will “be like a city within a city” when its $660m investment in two dry docks is completed and fully operational by year-end 2026, re-establishing it as “the premier commercial and cruise ship repair operation worldwide”.
And he confirmed that Billy Cay will be redeveloped into a new cruise port and amusement park by a combination of the Freeport Harbour Company, Mediterranean Shipping Company (MSC) and Royal Caribbean. “Combined with Freeport’s existing cruise port redevelopment, Freeport will see a total increase of roughly 30,000 additional visitors every single day, almost doubling the current population,” Mr Hayward said, “and that’s on top of the incredible investment into Celebration Key by Carnival Cruise lines further east.”
However, he conceded: “At the same time, we must acknowledge that in Freeport we are used to hearing big numbers, seeing false dawns, and experiencing unfulfilled promises. The truth is that, today, only some of us are feeling the impact of these projects – many of us are not.”
