A Local Investors’ Conference was held today to sensitize potential investors on how the proposed Public-Private Partnership (PPPs) for the Grantley Adams International Airport (GAIA) would work.
Representatives from corporate Barbados, institutional investors, and stakeholders, received a rare glimpse into the operations of the GAIA and its potential for future investment returns during the event at the Lloyd Erskine Sandiford Centre today.
Governments traditionally use PPPs as a means of funding public infrastructure projects in transportation, energy, water and sanitation, schools and healthcare facilities, through contractual engagements with private entities for their mutual benefit.
Minister of Tourism and International Transport, Kerrie Symmonds, led off the Local Investors’ Conference. He outlined the context of the partnership, which would see a transfer of the daily operations of the airport from the GAIA Inc. to a private operator through a long-term contractual agreement.
The Minister emphasized that it was important to find a suitable experienced, qualified private partner for the airport facility and stated this conference was a means by which potential investors in Barbados could be acquainted with the process.
Minister Symmonds indicated that the private operator, which would be chosen through a competitive tendering process, would ultimately be responsible for expanding and improving operations at the airport to assist with driving increases in revenue and further enhancing quality of service.
He stressed that the entire process must be done in the “most transparent and committed way possible” and assured potential investors that Government was devoted to doing so.
“I say committed because I am also aware there are a number of times when governments have retreated even after they have made public commitments about processes of this nature. …There is no question this is going to happen and we have to make it happen simply because the government is not in a position any longer to meet the increasing demands for the expansion and continuing development of the airport,” he said, adding that government believed the PPP was the best way forward.
Attendees at the half-day session also benefited from a presentation by Acting Chief Executive Officer of GAIA Inc., Terry Layne, who gave background on the airport and its operations, as well as the opportunities in the context of the future redevelopment of GAIA under a PPP arrangement.
Michelle Ottey, Senior Investment Officer with the International Finance Corporation (IFC), the private sector arm of the World Bank Group that is advising GAIA Inc. on the PPP, also spoke to the proposed structure of the partnership, opportunities for local investors and expected timelines on the process.
Ms. Ottey highlighted several features that could make the airport an attractive investment prospect, including that it was a well-maintained and modern facility that had undergone substantial expansion and redevelopment and offered “significant potential for non-aeronautical revenue and operational efficiency improvements”.
Adding that “robust growth” was projected for the Barbados economy, the IFC Executive indicated that over the life of the PPP, passenger traffic was forecast to almost double from 2.2 million to 4 million by 2050.
Mr. Symmonds noted that approximately two weeks ago, Barbados launched a global request for proposals for the development and expansion of GAIA at the Global Airport Development Conference held in Dublin, Ireland.
At that event, the Minister and Mr. Layne presented to international investors on ‘The development, operation and expansion of the Grantley Adams International Airport Inc. Barbados under a Concession‘. The Local Investors’ Conference is the second activity of the PPP Roadshow for the proposed new operating structure.
The final decision by GAIA Inc. and Government on which operator will be awarded the contract will be based on the outcome of the evaluation of bids received, against the pre-established criteria set, and is expected to be made in 2020 with operations being fully handed over in early 2021.