GEISHA KOW­LESSAR-ALON­ZO

While this coun­try wel­comed the new US$129.83 mil­lion ter­mi­nal at the ANR Robin­son In­ter­na­tion­al Air­port, Crown Point, To­ba­go about a week ago, de­vel­op­men­tal econ­o­mist Dr Mar­lene Attzs says the fa­cil­i­ty should not be seen as just an­oth­er in­fra­struc­ture project - rather it must be a tool for eco­nom­ic trans­for­ma­tion, a cat­a­lyst for growth, job cre­ation and sus­tain­able de­vel­op­ment for the is­land.

In an in­ter­view with the Sun­day Busi­ness Guardian, Attzs not­ed many oth­er Caribbean coun­tries have seen sig­nif­i­cant eco­nom­ic ben­e­fits from their in­vest­ment in im­proved, mod­ernised, ex­pand­ed air­port fa­cil­i­ties. These Caribbean des­ti­na­tions, all heav­i­ly de­pen­dent on tourism, set bench­marks and op­por­tu­ni­ties for learn­ing based on how they have used the air­port ex­pen­di­tures to re­alise tan­gi­ble gains in tourism rev­enues.

For ex­am­ple, she said, the ex­pan­sion of Sang­ster In­ter­na­tion­al Air­port in Mon­tego Bay, Ja­maica re­sult­ed in high­er pas­sen­ger ca­pac­i­ty, in­creased flight fre­quen­cies and a surge in di­rect in­ter­na­tion­al flights. That in­vest­ment, she said, con­tributed to Ja­maica’s record-break­ing 4.1 mil­lion vis­i­tors in 2023, bring­ing in US$4.2 bil­lion in tourism rev­enue.

Fur­ther, Attzs ex­plained a pub­lic-pri­vate part­ner­ship (PPP) mod­el for the Ja­maica air­port ex­pan­sion al­lowed pri­vate in­vestors to fund air­port im­prove­ments while the gov­ern­ment fo­cused on max­imis­ing tourism-re­lat­ed tax rev­enue.

In ad­di­tion, the econ­o­mist not­ed that the ex­pan­sion of Pun­ta Cana In­ter­na­tion­al Air­port in the Do­mini­can Re­pub­lic turned it in­to the busiest air­port in the Caribbean.

“Im­proved fa­cil­i­ties en­cour­aged more air­lines to of­fer di­rect flights, in­creas­ing vis­i­tor num­bers and boost­ing ho­tel oc­cu­pan­cy rates. The gov­ern­ment in­vest­ed in in­fra­struc­ture around the air­port, cre­at­ing new high­ways, re­sorts and busi­ness dis­tricts,” Attzs stat­ed.

She al­so looked at Bar­ba­dos, not­ing that the ex­pan­sion of the Grant­ley Adams In­ter­na­tion­al Air­port was dri­ven by the need to ac­com­mo­date larg­er air­craft and in­creased long-haul flights from Eu­rope. Those new air­port fa­cil­i­ties al­lowed for bet­ter pas­sen­ger ex­pe­ri­ence, con­tribut­ing to high­er vis­i­tor sat­is­fac­tion and re­peat vis­i­tor ar­rivals

Turn­ing back to To­ba­go, Attzs ad­vised a sim­i­lar ap­proach, not­ing that ex­pand­ing air ca­pac­i­ty to at­tract more di­rect in­ter­na­tion­al flights could in­crease vis­i­tor ar­rivals, raise for­eign ex­change earn­ings and stim­u­late lo­cal busi­ness growth.

“A suc­cess­ful air­port ex­pan­sion can in­crease tourism’s con­tri­bu­tion to GDP if aligned with na­tion­al de­vel­op­ment goals. Air­port de­vel­op­ment can dri­ve tourism growth, at­tract for­eign in­vest­ment and cre­ate jobs, but on­ly if man­aged strate­gi­cal­ly and sus­tain­ably,” Attzs said.

Cost-ben­e­fit analy­sis

What should a cost-ben­e­fit analy­sis (CBA) for the new To­ba­go air­port look like?

Attzs ex­plained this should as­sess eco­nom­ic, so­cial and en­vi­ron­men­tal fac­tors to pro­vide a well-round­ed eval­u­a­tion of its fea­si­bil­i­ty and long-term im­pact.

Re­gard­ing eco­nom­ic con­sid­er­a­tions, she said this should in­clude both costs and ben­e­fits to the gov­ern­ment, busi­ness­es and trav­ellers.

Key costs should in­clude:

* Cap­i­tal ex­pens­es such as land ac­qui­si­tion, con­struc­tion and in­fra­struc­ture de­vel­op­ment; and

* Op­er­a­tional costs in­clud­ing main­te­nance, se­cu­ri­ty, staffing and util­i­ty ex­pens­es.

On the rev­enue side, fac­tors to con­sid­er in­clude:

* Di­rect air­port rev­enue from air­line fees, land­ing fees and rental in­come from re­tail spaces.

* Tourism-dri­ven rev­enue such as in­creased ho­tel oc­cu­pan­cy (and re­lat­ed gov­ern­ment tax­es), as well as growth in lo­cal busi­ness­es like taxis, re­tail stores, and food and bev­er­age es­tab­lish­ments.

So­cial, en­vi­ron­men­tal con­sid­er­a­tions

These Attzs em­pha­sised should al­so be in­clud­ed in the cost-ben­e­fit analy­sis of To­ba­go’s ter­mi­nal ex­pan­sion so that a bal­ance is struck be­tween growth and sus­tain­abil­i­ty.

She not­ed that de­spite the eco­nom­ic ben­e­fits, air­port ex­pan­sion projects in the Caribbean have faced en­vi­ron­men­tal and so­cial chal­lenges, which To­ba­go should care­ful­ly man­age.

Attzs ad­vised that some key con­sid­er­a­tions should be that a mod­ernised air­port can re­sult in high­er car­bon emis­sions, noise pol­lu­tion and ecosys­tem dis­rup­tion. She not­ed var­i­ous Caribbean na­tions have tack­led these is­sues through green air­port ini­tia­tives:

(1) St Lu­cia’s Hewanor­ra In­ter­na­tion­al Air­port ex­pan­sion: St Lu­cia, heav­i­ly de­pen­dent on eco-tourism, en­sured that its air­port ex­pan­sion met sus­tain­abil­i­ty stan­dards. The new de­sign in­cor­po­rat­ed so­lar en­er­gy, rain­wa­ter har­vest­ing, and car­bon off­set pro­grammes to mit­i­gate en­vi­ron­men­tal im­pact;

(2) Bar­ba­dos’ green air­port strat­e­gy: Recog­nis­ing the risk of coastal ero­sion and habi­tat de­struc­tion, Bar­ba­dos in­clud­ed cli­mate re­silience mea­sures in its air­port ex­pan­sion plans. The Bar­ba­dos gov­ern­ment im­posed strict en­vi­ron­men­tal reg­u­la­tions, re­quir­ing air­lines and air­port op­er­a­tors to re­duce emis­sions and man­age waste re­spon­si­bly.

“For To­ba­go, it is cru­cial that air­port ex­pan­sion aligns with its eco-tourism brand. Sus­tain­able fea­tures such as so­lar-pow­ered ter­mi­nals, wa­ter con­ser­va­tion sys­tems, and low-emis­sion ground trans­port can en­sure that tourism growth does not come at the cost of en­vi­ron­men­tal degra­da­tion,” Attzs added.

Fur­ther, she said, the air­port ex­pan­sion al­so should fac­tor the im­pact on the com­mu­ni­ty to en­sure ben­e­fits ac­crue to the lo­cal com­mu­ni­ty, cit­ing that one of the biggest con­cerns with air­port ex­pan­sion projects is en­sur­ing that lo­cal com­mu­ni­ties ben­e­fit from in­creased tourism ac­tiv­i­ty.

Tool for com­mu­ni­ty de­vel­op­ment

Not­ing some ex­am­ples of Caribbean coun­tries that have used air­port ex­pan­sions as a tool for com­mu­ni­ty de­vel­op­ment, Attzs said these in­clude:

(1) Ja­maica’s in­clu­sive tourism mod­el - The ex­pan­sion of Mon­tego Bay’s air­port was paired with train­ing pro­grammes for lo­cals, en­sur­ing that tourism jobs were ac­ces­si­ble to Ja­maicans. The gov­ern­ment pro­mot­ed small busi­ness par­tic­i­pa­tion, en­cour­ag­ing lo­cal ven­dors to set up shops in air­port ter­mi­nals;

(2) Do­mini­can Re­pub­lic’s lo­cal in­te­gra­tion - The ex­pan­sion of San­to Domin­go’s Las Améri­c­as Air­port in­volved col­lab­o­ra­tion with lo­cal taxi dri­vers, tour op­er­a­tors, and restau­rants. Small and medi­um en­ter­pris­es (SMEs) ben­e­fit­ted from in­creased tourism flows, cre­at­ing a mul­ti­pli­er ef­fect in the econ­o­my.

Fur­ther, Attzs rec­om­mend­ed that the To­ba­go’s air­port ex­pan­sion should in­clude a lo­cal busi­ness par­tic­i­pa­tion plan, en­sur­ing that lo­cal ho­tels, restau­rants, and tour op­er­a­tors ben­e­fit from in­creased vis­i­tor ar­rivals; em­ploy­ment op­por­tu­ni­ties are pri­ori­tised for To­bag­o­ni­ans, re­duc­ing eco­nom­ic in­equal­i­ty and in­fra­struc­ture im­prove­ments (roads etc) al­so serve the lo­cal pop­u­la­tion.

Ad­di­tion­al­ly, she said a mod­ernised, larg­er air­port ter­mi­nal in To­ba­go would like­ly in­crease flight traf­fic, sup­port­ing Gov­ern­ment’s tourism ex­pan­sion goals. How­ev­er, Attzs cau­tioned this could al­so re­sult in neg­a­tive en­vi­ron­men­tal im­pacts, par­tic­u­lar­ly in terms of:

· Noise pol­lu­tion, af­fect­ing res­i­dents and busi­ness­es in close prox­im­i­ty to the air­port.

· Air qual­i­ty con­cerns from in­creased air­craft emis­sions.

A rel­e­vant case study, Attzs said, is the Heathrow Air­port ex­pan­sion in Eng­land, where noise pol­lu­tion be­came a ma­jor is­sue, par­tic­u­lar­ly dur­ing the de­vel­op­ment of Ter­mi­nal 5 (T5) and dis­cus­sions around a third run­way.

She al­so stat­ed that near­by com­mu­ni­ties, such as Houn­slow, were sig­nif­i­cant­ly af­fect­ed by in­creased air­craft noise, lead­ing to sig­nif­i­cant pub­lic out­cry.

Fi­nal­ly, Attzs em­pha­sised a thor­ough CBA should weigh these eco­nom­ic op­por­tu­ni­ties against the en­vi­ron­men­tal and so­cial trade-offs, en­sur­ing that a new To­ba­go air­port de­liv­ers sus­tain­able ben­e­fits while ad­dress­ing po­ten­tial neg­a­tive ex­ter­nal­i­ties for lo­cal com­mu­ni­ties.

BOX

At the of­fi­cial open­ing of the new fa­cil­i­ty on Sat­ur­day, then Fi­nance Min­is­ter Colm Im­bert shared that on a cost per-square-me­tre ba­sis, the new To­ba­go ter­mi­nal was de­liv­ered at ap­prox­i­mate­ly US$6,000 per m², sig­nif­i­cant­ly be­low the Caribbean re­gion­al av­er­age of rough­ly US$11,200 per m² and the glob­al av­er­age of ap­prox­i­mate­ly US$13,800 per m².

“In oth­er words, we have built more for less. The sto­ry is sim­i­lar when we look at the cost per pas­sen­ger: our project’s cost works out to rough­ly US$53 per an­nu­al pas­sen­ger ca­pac­i­ty, where­as com­pa­ra­ble air­port projects av­er­age about US$177 per pas­sen­ger,” he said.

Im­bert added the fa­cil­i­ty was de­signed to be eco-friend­ly and en­er­gy ef­fi­cient.

It in­cor­po­rates fea­tures, such as so­lar pan­els, en­er­gy-sav­ing LED light­ing, and high­ef­fi­cien­cy cli­mate con­trol sys­tems, to re­duce en­er­gy use.

Wa­ter con­ser­va­tion mea­sures, in­clud­ing rain­wa­ter col­lec­tion and low-flow plumb­ing, have al­so been im­ple­ment­ed to re­duce wa­ter wastage.

Sus­tain­able build­ing ma­te­ri­als and strict waste man­age­ment were al­so ap­plied to min­imise the en­vi­ron­men­tal im­pacts.

Na­tion­al In­fra­struc­ture De­vel­op­ment Com­pa­ny (Nid­co) chair­man Her­bert George who al­so spoke at the open­ing cer­e­mo­ny, said the project, man­aged by Nid­co, be­gan on Ju­ly 18, 2020 and was ex­pect­ed to be com­plet­ed in Ju­ly 2022, at an orig­i­nal con­tract sum of US$128, 663, 741.

The fi­nal con­tract sum, he said, will be de­ter­mined fol­low­ing the out­come of the eval­u­a­tion of claims sub­mit­ted by the con­trac­tor, Chi­na Rail­way Con­struc­tion Caribbean Com­pa­ny Ltd.