The $3.5 billion Baha Mar luxury resort in The Bahamas, long a dream of the Swiss-Bahamian Izmirlian family, was nearly a victim of the Great Recession when investors started pulling out in 2008. Then China came calling.
Thanks to a $2.4 billion loan from China’s export-import bank, 4,000 imported workers and $150 million in equity for a new developer, the project was salvaged. For the Chinese, Baha Mar was a potential showpiece, a calling card as it set out to expand into the Americas with megaresorts and massive construction projects, including a planned $50 billion waterway in Nicaragua to rival the Panama Canal.
Now, repeated delays in the opening of Baha Mar have cast a pall over China’s Caribbean plans and forced the resort to miss the peak winter travel season. Disputes between the builder, China Construction America Inc., and the Izmirlians have devolved into a public sparring match in The Bahamas, where officials are counting on the resort to lift an $8.4 billion economy that grew just 1 percent last year.
“From the inception of this project, there has been this concern that the developer was taking on too much at one time and should have used a phased approach,” said K. Peter Turnquest, a member of parliament and chairman of SkyBahamas Airlines Ltd. “What people are wondering is if this developer now, considering the delays, will be able to bring this project to fruition in a reasonable amount of time.”
According to the China Global Investment Tracker, compiled by AEI and the Heritage Foundation, Chinese companies have invested at least $8.2 billion in the Caribbean and Central America in the last decade. Recent agreements, not all of which are included in the database, include $36 million for a port in Antigua, financing for a biopesticide plant in Cuba and the planned canal in Nicaragua.
Read more at Bloomberg Business.