Interview with Charles Fernandez, Minister of Tourism, Civil Aviation, Transportation and Investment, Antigua and Barbuda

27 Feb Interview with Charles Fernandez, Minister of Tourism, Civil Aviation, Transportation and Investment, Antigua and Barbuda

Antigua and Barbuda’s economy was hit hard by the pandemic. However, intelligent spending and fiscal strategies have seen the GDP rebound, with a rise of 4.8% in 2021 and 6.5% in 2022. What factors have led to the recovery of the economy, and what measures are the government now taking to diversify the economy and mitigate future challenges?

Presently, we have legislation that allows for investment. The Caribbean as a whole has seen a lot of interest in terms of investment, bearing in mind the war in Europe. In addition, the Caribbean is still seen as one of the safest places in the world. In Antigua, we are located in a central location in terms of where we are and the position of the island chain. We are right in the middle between North America and Guyana, South America, and so on; that makes us key. In addition, we have the most modern airport. The government is now putting in place to complete the cruise port, which will be the most modern in the Caribbean that will be an incentive for the cruise ships to come here.

As well as that, we will have an LNG plant that will mean we will be able to fuel the cruise ships from 2025. In a few years, cruise ships are going to have to convert to LNG because of climate change and emissions reduction. Antigua will be one of the few ports as it stands now, the only one, but probably one of the few ports that will be able to allow for LNG refueling. So, that is another step the government is making in terms of the cruise side of it.

There are incentives for new development in terms of tourism. We have a major development taking place in Barbuda called the Peace, Love and Happiness (PLH) project, that comprises about $3 billion of investment. We have the De Niro and Packer project that is going to start later this year that is half around $500 million. We have another group interested over that has already put down some money to start which is going to be about $80 million.

In Antigua, we have a project called Moon Gate. We have Sandals in Antigua that is starting to refurbish this year, which involves $120 million. We have the Halcyon that the Royalton Chic is going to brand and will be an additional 200 rooms or so. We also have Hammock Cove which will another 150 villas, while Jolly Beach and Nikki Beach will soon be developed too.

As you can see, there is a tremendous amount of interest in terms of investment, mainly in the hotel sector, because for us that is the biggest money earner. We do not have enough land for farming or agriculture in a very serious way although it is important. The only other area that the government could look to get into would be fishing because Antigua has the largest ocean footprint of all the islands in the Caribbean. Unfortunately, we are not up to that level yet. It would need a fair amount of investment and that has not been completed yet.

Tourism is Antigua and Barbuda’s biggest breadwinner, with the sector contributing around 61% of the economy. According to the Antigua and Barbuda Tourism Authority, tourism recovered 88% of its 2019 business in 2022. What are some of the major projects, initiatives, or special plans for road, maritime and cruise, and civil aviation?

As you know, 2019 was the best year Antigua had tourism wise as we welcomed over a million aviation, cruise and yacht passengers combined. which are the three pillars of our tourism product. In 2022, we targeted air arrivals of 75% of 2019’s total, but actually achieved 88%. The cruise industry has rebounded well, albeit only to around half of where we were in 2019.

The cruise sector had a really tough period and took a longer time to restart because of all that happened with the ships. In addition, many of the cruise lines accumulated heavy debts and had to restart slowly. The good news is that in 2024, the prediction for cruises is looking at about 70-75% of pre-pandemic levels. The yachting sector did well during the pandemic as many yachties came and stayed here, which was an unusual event.

So, those are the three areas. In terms of airlift, we are hoping to match pre-pandemic levels, but certainly, we are on a trajectory. We are way above where we were in 2021 in all three parts of our tourism product.

How significant is cruise tourism for Antigua and Barbuda’s tourism sector, and what potential does the country have in being a homeporting hub for the region?

Homeporting is a new aspect to cruise and we can do this because of the investment under the partnership the government has with Global Ports Holding (GPH). We have a new berth that is very long and deep. We have dredged the channel to turn it into a basin, and we are now finishing the channel, which means that in another few months, we will be ready to accept the Oasis class, which is the biggest. Our aim is to accept one million passengers. We have had as many as 800,000 cruise passengers annually, but our aim is to reach a million per year by 2024 or 2025. This project is a very important piece of that mosaic.

Increasing transport connections remains a key factor in attracting foreign visitors and trade to the islands, particularly air connections. What is the government doing to develop its transport sector to allow for more connections and enhance trade capabilities?

It is important for any country or any airport that touts itself as a hub to have a regional carrier. That is where LIAT comes in, and that is why the government is seeking to revamp LIAT and is now seeking investment for its operation as LIAT is an important piece in our tourism puzzle.

It is all about creating the whole aspect of Antigua becoming a hub. So, that was the whole idea between upgrading our cruise sector to the most modern one in the region because we wanted to ensure that the cruise ships, in additional to adding the LNG terminal would have a reason to come to Antigua. We did the same thing with the cargo port. The cargo port received a $100 million investment and is now the region’s most modern.

As green investment increases, opportunities in lowering carbon emissions and upping renewables in energy mixes are becoming more attractive. How is Antigua and Barbuda helping to reduce carbon emissions in its tourism and transport sectors, and what new opportunities are we seeing for green investment in the country?

Barbuda should be fully green within another two years. It will be the only island in the Caribbean that will run on 100% green energy. In addition, we are considering the whole aspect of the transportation sector. The plan is for incentives for taxi operators to go into electric buses or electric vehicles. We are working with the Ministry of the Environment and hope it will be completed by 2025.

You are three hours from Miami and four hours from New York. Speaking about reputation and Antigua and Barbuda’s current relationship with the US, what is your competitive advantage for businesses, investors, and tourists from the US? How significant is the US market in building up the country’s key focus sectors – such as tourism and transport?

Antigua has a very good legal system and extremely close ties with the US. Although we were British there is more travel to and from the US than the UK because of the lower cost. In addition, the tourism sector is easier to equate with the US because of the proximity.

We have some tourism investment opportunities lined up. Antigua has not yet peaked in terms of properties available for tourism investments. Because we are so close, if they have an investment here, they do not have to live in Antigua, as they are only three hours away. They could come in on a weekend and look over their property as many Americans have done. In addition, there are many Americans from the US who have invested in Antigua and acquired citizenship over time.

Antigua has the lowest record of serious crime in the region, and that is very important for everything, more so for tourism. Again, added to that the whole aspect of the incentive-based system we have for investment, there are opportunities; we are seeing several interests from the US into Antigua and Barbuda.