As The Bahamas wrestles with implementing a value-added tax (VAT) with ratings and lending agencies looking on, Royal Bank of Canada (RBC) Caribbean’s December Caribbean Economic Report points to a crucial consideration — the already relatively high expense of a vacation in the region.
One&Only Ocean Club boasts room rates up to $2,000, and Atlantis, Paradise Island’s Cove luxury offering has room rates from $109 up to $800, so The Bahamas runs the gamut in terms of offerings at different price points.
Concerns have been raised by some in the industry about the impact of VAT on the cost of tourism in The Bahamas, but the Bahamas Hotel and Tourism Association (BHTA) recently disclosed that the transition to a VAT environment had been accomplished without significant challenge.
In the report obtained by Guardian Business, RBC Caribbean’s Marla Dukharan pointed out that a week at a Caribbean beach is the most expensive in the world.
Dukharan cited a recently published IMF (International Monetary Fund) working paper entitled “Revisiting tourism flows to the Caribbean: What is driving arrivals?” which stressed that while tourism is the dominant sector in the region, tourist arrival growth has stalled and global market share is being eroded. Caribbean market share has fallen to 2 percent in 2013 from 2.5 percent in 2000.
While Belize, the Dominican Republic and Jamaica have seen their share of regional tourism increase since 2007, the rest of the region has seen declines, the report noted.
Dukharan explained that the “week at the beach index” measures the average room rate of three-star hotels from one common source, the taxi fare between the hotel and airport, three meals per day, two liters of water, one beer and one cup of coffee. By this metric, the nominal cost of an “average” beach holiday in the Caribbean is higher than in other parts of the world.
While the Ministry of Tourism touts steadily improving tourism figures, leading figures in the tourism industry continue to drive home the point that tourism in The Bahamas must be a value for money proposition.
The Nassau Guardian
Published: January 9, 2015