By DENISE MAYCOCK
Tribune Staff Reporter
dmaycock@tribunemedia.net
PRIME Minister Philip Davis declared last night that the present way of governing Freeport will come to an end, branding the 71-year-old Hawksbill Creek Agreement colonial and telling the Grand Bahama Port Authority the change is not up for negotiation.
Speaking at a shipyard in Freeport as his government published a Green Paper on the island's future, Mr Davis said powers the private company holds in the Port Area, including over who may do business, what may be built and how land is planned, belong in public hands.
"The present way of governing Freeport will come to an end," he said. "This is my starting point. It is non-negotiable."
He said whether the change happens was settled, but that Grand Bahamians would help shape how it happens through a six-month public consultation beginning November 1.
"I come to the table with a menu," Mr Davis said. He said he was prepared to discuss the pace of reform and to listen to anyone who put the interests of the people first.
"But I am no longer prepared to negotiate as to whether Grand Bahama deserves a different future," he said. "That is off the menu!"
He said a private veto over the island's future and public power without safeguards against private conflicts were also off the table, and that there was no place for those who wanted to wait until 2054 for change.
The Hawksbill Creek Agreement was signed on August 4, 1955, between the colonial government and the GBPA, a private company, for a term of 99 years. Under it, the company was leased about 50,000 acres of Crown land around Hawksbill Creek and built the harbour and city of Freeport in return for generous concessions and a large share of the powers of government over the area.
Today, the GBPA issues business licences and building permits and manages zoning and land use inside the Port Area. Everywhere else in the country, those functions rest with central and local government.
Mr Davis said the agreement was made before Bahamian women could vote, 12 years before majority rule and 18 years before independence.
"Let us call it what it is. It is colonial in origin. It is colonial in character. It is unacceptable, and it has out-lived its time," he said.
"What does Independence mean, if it stops at the boundaries of the Port Area? Whose island is this?"
He asked whether residents of New Providence, Exuma, Eleuthera, Abaco or Cat Island would accept a private company deciding who could open a shop, and noted that he had defended The Bahamas' sovereignty before the United Nations General Assembly last month.
"If I am prepared to defend our sovereignty against foreign interests, I am certainly prepared to fight for our sovereignty at home," he said.
He framed the speech around a child born in Freeport last night, who would be 28 when the agreement expires. On the present path, he said, she would spend her childhood, school years and the start of her working life under an arrangement written for a colony 70 years before she was born.
Mr Davis said his case concerned the structure, not the people who run the company. He said that when a private company holds public powers, it can face competing duties, using the examples of a seawall in need of repair, a young entrepreneur wanting to compete with an established business, and a family needing a permit after a storm.
"No board of directors should be asked to weigh its shareholders' interests against a city," he said.
"A company may own land. But authority over people belongs to the people, through the government they elect. Ownership is a private right. But authority is a public trust."
He drew on his own upbringing, describing his father, a firefighter, as his hero and saying a fire service answers every alarm, at the big house and the small one, on equal terms.
The Green Paper, titled "Grand Bahama: A Framework for Stability and Growth", says the government considers the agreement an antiquated, colonial, pre-independence mechanism that has outlived its usefulness and created an economic imbalance on the island, pointing out that its tax exemptions have only ever applied inside the Port Area.
It sets out three connected reforms.
The first is a government-led Grand Bahama Development Council to coordinate and monitor an island-wide development strategy, bringing together government, local government, the GBPA, licensees, labour, business, communities and young people. The government intends to establish it on an administrative basis from July 2027. The paper says the council would not grant licences or permissions, direct regulators or commit public spending.
The second is a review of the Hawksbill Creek Agreement directed by the Attorney General, which Mr Davis said would lead to the agreement being amended. He said it would not be "yet another review" that keeps the status quo.
He said the agreement could not be removed "with a stroke of a pen" because it is made up of contractual and statutory arrangements, supplemental agreements and concessions. The Green Paper says the Port Area rests on the 1955 agreement, at least six later Acts of Parliament, supplemental agreements and orders, which the government calls a convoluted framework.
The review would go through each function, including licensing, planning, building control, environmental protection, utilities, customs and immigration arrangements, roads and drainage, to determine who should hold the legal power, who does the work, who pays and what standard of service the public can expect.
The third is a Grand Bahama Development Act to put a modern legal framework in place for the whole island. Mr Davis said it was intended to be more than a replacement for the agreement.
The Act would include concessions for investment across Grand Bahama and the surrounding cays, with possible enhanced concessions outside the Port Area to bring growth to East and West Grand Bahama sooner. Rates, duration and conditions will be decided after consultation and fiscal analysis. Mr Davis said the concessions must benefit Bahamian employment, training, local suppliers and enterprise, and that the government would measure and publicly report those benefits.
The Green Paper asks 25 questions. The largest group asks, function by function, which public body should be responsible and how residents and businesses can get a decision or a remedy. The government has promised to publish an account of who does what today by January 31, 2027.
The paper also says the government will ask the Bahamas National Statistical Institute to produce separate figures for the Port Area and the rest of the island, because no official data currently shows how the decline and recovery have been shared between them.
The Green Paper points to a long decline. Stopover visitors peaked at 587,250 in 1995 and fell to 101,077 last year, about 83 percent lower. The population fell nine percent between 2010 and 2022, to 46,740, and 4,306 of the island's 22,127 homes were vacant at the last census. Grand Bahama's economic output was $1.8bn in 2024, up 13.4 percent on the year before but still 7.5 percent below 2021.
It also notes signs of recovery. Unemployment fell from 12.8 percent at the start of 2025 to 8.7 percent by the end of the year, and the value of construction permits more than doubled in 2024.
"Behind each of those numbers is a kitchen table where a family decided to leave," Mr Davis said.
The paper acknowledges this is not the first review. In 2015, a committee chaired by Dr Marcus Bethel recommended extending the GBPA's expiring tax concessions for 20 years. Its conditions included a right of appeal against GBPA licensing decisions and a single approvals process with a 21-day limit for referrals to central government. Those concessions were later extended until 2036.
It also notes sharp disagreement over Freeport's cost to the public purse. Accounts compiled for the government by Pannell Kerr Foster in 2016 found a shortfall of $150m to $160m a year between 2011 and 2013. A review of those accounts commissioned by the GBPA from KPMG concluded the government had a small surplus in 2013 and 2014. The Green Paper says the estimates differ widely and rest on different methods.
Mr Davis said the change would be made lawfully, through Parliament, and that nothing would be done retrospectively. Licensees' lawful rights would be identified, recorded and respected, he said, and they would have a full say in how any change is made.
He told the GBPA, its shareholders and its staff that "there is a seat for you at this table", and said the company could have a strong and profitable future as a landowner, developer, investor and partner. He said many Port Authority staff were Grand Bahamians whose skills would be needed in the transition.
"I respect the families who own the Port Authority. I respect its staff and its licensees. My argument concerns a structure," he said.
He also paid tribute to the families who came to the island in the 1950s and 1960s and built a city out of pine forest.
But he acknowledged that some would be troubled by his remarks. "If anyone is offended that this government has acted in the best interest of the Bahamian people, I am sorry that you are offended. But on this, we will have to agree to disagree," he said.
Addressing investors from the United States, China, the United Kingdom and elsewhere, he said The Bahamas welcomed every partner who invests under Bahamian law and that certainty was the strongest incentive any country could offer.
The consultation runs until April 30, 2027, with public meetings in Freeport, East Grand Bahama and West Grand Bahama, along with sector sessions and written submissions through the website gbframework.com. The government plans to publish a summary of views in February, a White Paper on July 1, 2027, and draft legislation by December 31, 2027, with passage targeted for the first quarter of 2028 so the new framework can be funded in the 2028/2029 budget.
A Cabinet subcommittee chaired by a senior minister designated by Mr Davis will oversee the reform, supported by a secretariat that will run the consultation.
The Green Paper says it is informed by the arbitration award of February 27 in the dispute between the government and the GBPA. It notes that seven of the GBPA's eight counterclaims failed, and says the award materially constrains the argument that the agreement gives the company a permanent private regulatory franchise beyond the reach of national law and government oversight. It also acknowledges that the award did not repeal the agreement, transfer any functions to the government or establish that the GBPA owes any debt.
The tribunal dismissed the government's claim that the GBPA owed $357m in reimbursements for administrative costs. It found the government in breach of the agreement over its failure to approve environmental bye-laws proposed by the GBPA, and directed that damages be assessed. According to the Green Paper, the tribunal also found that applying the Electricity Acts of 2015 and 2024 inside the Port Area did not breach the agreement.
The GBPA has disputed the government's reading of the ruling, telling licensees in March that it did not fundamentally alter the status quo in Freeport.
Mr Davis acknowledged the tension last night. "There have been hard words on every side, some of them mine," he said. "I do not go looking for fights, but neither have I ever been afraid of one."
He said the government had already begun to bring balance back to Grand Bahama, pointing to its acquisition of the Grand Bahama Power Company in May. Since June, he said, more than 17,000 households and more than 1,500 small and medium-sized businesses have seen lower bills, with residential bills down by at least 35 percent.
He also outlined the government's three main projects for the island: the airport, the harbour and the Grand Lucayan.
A new international terminal is being designed with provision for United States Customs pre-clearance. Its floor will stand 23.5 feet above sea level, compared with 10.5 feet for the old terminal, which Hurricane Dorian's surge filled to the roofline in 2019. Concept design is due to be finished at the end of this month, with construction to begin before April 2027 and completion targeted for early 2029. Thirteen airfield safety and repair packages worth about $8.6m are under way or being contracted.
MSC has been approved to invest $400m in a cruise terminal at Freeport Harbour. Its programme includes upgrades at the Old Harbour, a new terminal at Billy Cay and a beach club at Lucaya. At full build-out the harbour could berth up to six of the largest cruise ships afloat, which will require expanding the harbour entrance, a matter MSC is discussing with the landowners. MSC expects more than 600 direct jobs and a payroll of more than $14m a year. On its own planning assumptions, the programme could bring up to 20,000 visitors a day spending more than $300m a year onshore. Public consultation on Billy Cay and the other works takes place on November 2.
Demolition has begun at the Grand Lucayan, most of which has been closed since Hurricane Matthew in 2016 and which the government bought in 2018. Concord Wilshire is redeveloping the resort, and MSC will open its beach club on 20 acres of the site in November 2028. Concord Wilshire also plans a second cruise resort with a Bahamian operator, a hotel and casino resort, a mega yacht marina and a championship golf course.
Mr Davis said the Freeport Health Campus was about 30 percent complete in September, with the first phase on target to open in 2027.