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IDB approves US$50 million to The Bahamas

The Inter-American Development Bank (IDB) announced the approval of a $50 million loan to The Bahamas to support an air transport reform programme, according to CaribbeanPressReleases.com. The modernization requires an overhaul of the existing institutional and regulatory framework. 

Friday, December 16, 2011
Friday, December 16, 2011

Dec. 16/11 – The Inter-American Development Bank (IDB) announced the approval of a US$50 million loan to The Bahamas to support an air transport reform program.

“The Bahamian economy is based on two pillars: tourism and international financial services, both of which are aviation intensive,” said IDB team leader Esteban Diez Roux. “The program will promote the development of safe and efficient air transport in the country following international standards. The air transport is crucial to ensure mobility and transport of goods, services and people in the country, as well as to integrate The Bahamas within the Caribbean region and also internationally.”

Air transport in The Bahamas is provided by 17 international airlines and 5 domestic ones. There are a total of 53 licensed airports in the country. A modern air transport sector needs to provide the greatest connectivity to global markets and invest in its facilities. A comprehensive reform of the existing institutional and regulatory structure will require the implementation of a new legal framework and arrangements for financing and infrastructure management.

Transport reform will introduce a modern civil aviation regulatory regime, create an independent entity to investigate aviation incidents and accidents, and modernize the existing air traffic control infrastructure. Measures will be taken to promote competition and to introduce a booking system to expand local air carrier services, fostering a commercial and entrepreneurial attitude towards ensuring economic and financial sustainability of the sector.

This loan consists of two components: (1) US$47.5 million in budget support on the basis of agreed advances in the reform of the sector, as well as (2) US$2.5 million in technical support which will help implement the reform, assess the Family Islands transport, carry out the airport optimization, and monitor and evaluate Program results.

A fundamental condition for approving special financing of this nature was confirmation of macroeconomic stability and sound management by the Government.

The Ministry of Tourism and Aviation will be in charge of the project. The IDB loan is for a 20-year term, with a five-year grace period, at a variable interest rate based on LIBOR.

This is an excerpt from caribbeanpressreleases.com as it appeared on December 16, 2011. For updates or to read the current version of this post in its entirety, please click here.

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