China to finance $2.6B Bahamian resort

NASSAU, (Reuters) – China has agreed to let two  state-owned agencies finance a stalled $2.6 billion Bahamian  resort project that the developer said would provide the  biggest job stimulus The Bahamas has ever seen.

Bahamian Prime Minister Hubert Ingraham said in a statement  on Tuesday that Beijing had given approval for the agencies to  enter into a joint venture with privately held Baha Mar Resorts  Ltd for redevelopment of the Cable Beach resort in Nassau.

Chinese Ambassador Dingxian Hu is to meet with Ingraham on  Aug. 18 to formalize the agreement.

Tourism and financial services drive the economy in the  Bahamas, an Atlantic island chain that stretches from just off  eastern Florida to near southeast Cuba and has a population of  310,000 people.

The future of the Baha Mar project was called into question  after casino operator Harrah’s Entertainment Inc pulled out of  the deal in March 2008.

The China Export-Import Bank will provide $2.5 billion in  financing, and the other agency, China State Construction, will  take a small equity stake in the development and act as main  contractor for the 1,000-acre project.

Baha Mar’s chairman and chief executive, Sarkis Izmirlian,  said China’s approval was critical for the resort project that  is expected to create 11,000 jobs and add $1 billion in new  spending to the Bahamian economy in the first year after  completion.

As soon as the Bahamian government gives its formal  approval, Baha Mar will award almost $60 million in  construction contracts for infrastructure work to prepare the  resort site, he said.

“We strongly believe that the creation of this world class  resort will significantly benefit the Bahamas and all  Bahamians,” Izmirlian said in a statement.

“Ultimately, our  project will result in the creation of 11,000 Bahamian jobs,  including 6,000 to 7,000 new permanent positions. This will be  the most substantial single job stimulus opportunity the  Bahamas has ever experienced.” The construction phase is expected to last about four years  and employ 4,000 Bahamians. The company said that once the  resort is fully operating, approximately 98 percent of the  staff will be Bahamians.

The company expects millions of vacationers and business  travelers a year will visit the resort, which is to include six  hotels with 3,500 rooms and condos, the largest casino in the  Caribbean, the largest convention center in the Bahamas and an  18-hole golf course and retail village.