Chinese-Financed Bahama Resort Project Breaks Ground#
Bahamian Deputy Prime Minister Brent Symonette speaks during the Baha Mar groundbreaking ceremony in Nassau, Bahamas. (Photo: Tim Aylen)
Yesterday, a ceremony was held in the Bahamas marking the beginning of construction on a $3.4 billion resort project, $2.6 billion of which will be China-funded. The Baha Mar project was conceived by the Bahamas-based billionaire investors the Izmirlian family, along with their financing and construction partners, the China Export-Import Bank and China State Construction. The Baha Mar project, a resort, gaming, and entertainment complex, is slated to open in late 2014.
China's ambassador to the Bahamas, Hu Dingxian, believed that this was "another milestone" in the development of the bilateral relationship, and said that "more and more Chinese investors will be coming to the Bahamas to seek investment and co-operation." At the ceremony, Hu Dingxian described overseas investments by Chinese companies as having increased by 26 percent year-over-year in 2010, with $59 billion on a total of 3,125 projects.
The Wall Street Journalreports that the Bahamas project is the largest property to be built and partly owned by a Chinese company outside of China. Considering the China Export-Import Bank is a state-owned bank that specializes in helping Chinese companies invest overseas, and with Beijing encouraging Chinese companies to invest abroad and reduce its reliance on the U.S. dollar, the Bahamas project seems only a part of a larger push into overseas markets.
While China is providing much-needed and hard-to-find financing, these partnerships are not without their difficulties, namely in the bureaucratic red-tape that surrounds the mostly state-owned Chinese operations. Additionally, the U.S. has expressed concerns about the financial impact these Chinese investments might have on the Bahamian economy and the possibility of the Bahamas being indebted to China in the future -- as released in a December 2009 diplomatic cable from the American Embassy in Nassau, the Bahamas, obtained and published by whistle-blowing site, Wikileaks. Ambassador Hu Dingxian addressed these concerns by pledging that Chinese investment would "not come at a cost" to the Bahamas, emphasizing partnership and mutual benefits in this "win-win situation" for all parties involved.
The announcement of China's involvement in the Baha Mar resort follows news last month of China's investments in Zimbabwean hotels, as well as the announcement previously of China Tong Jian Investment Co. Ltd's $230 million investment to start a construction company and build a luxury hotel in Mozambique, Africa. Chinese developers have also signed construction deals further afield in places like Cuba, where they hope for increased visits in coming years from Chinese travelers. With tourism being a major factor of the economies of many Caribbean and African countries, these hotel construction partnerships could help these destinations make inroads with the fast-growing Chinese outbound tourist market.