Foreign Investment in the Bahamas
The Bahamian government restricts foreign investment in a number of sectors.
According to the U.S. Department of Commerce,
“Reserved businesses include: wholesale and retail operations; commission agencies engaged in the import/export trade; real estate and domestic property management agencies; domestic newspaper and magazine publication; domestic advertising and public relations firms; nightclubs and some restaurants (except specialty, gourmet and ethnic restaurants and restaurants operating in a hotel, resort complex or tourist attraction); security services; domestic distribution and building supplies; construction companies (except for special structures for which international expertise is required); personal cosmetics/beauty establishments, shallow water scalefish; crustacean, mollusk and sponge fishing operations; auto and appliance service operations, and public transportation.”
All outward capital transfers and inward transfers by non-residents require exchange control approval and that foreign direct investment must be approved by the central bank. “Capital investment into the Bahamas remains subject to exchange controls,” reports the U.S. Department of Commerce, “but as a practical matter these controls have not been known to inhibit repatriation of approved investment capital.”
Foreigners purchasing real estate for commercial purposes or purchasing more than five acres must obtain a permit from the Investments Board.
In 2002, net private foreign direct investment rose to $316.7 million from $164.7 million in 2001. Net direct capital inflows rose to an estimated $144 million from $62.9 million in 2001, and net loan funding on foreign investments increased to an estimated $116.7 million from $63.6 million in 2001.
Foreign demand for Bahamas real estate is constantly on the rise, though it took a dip somewhat over the past two years (2004-2005) during the hurricanes.
Major foreign investments in The Bahamas include:
- Atlantis, a hotel, resort, and casino complex on Paradise Island near Nassau owned by the South African firm Sun Hotels International;
- The Container Port facility, airport and three beachfront hotels acquired in 1997 by Hong Kong-based Hutchison Whampoa;
- Our Lucaya Resort, a subsidiary of Hutchison Whampoa Group and Centex Rooney;
- Lucayan Marina Village developed recently by European investors;
- Nassau Marriott Crystal Palace Resort, casino, and convention center, and the Nassau Beach Hotel, owned by the Ruffin Group of the United States and operated by Marriott;
- Superclub Breezes Resort, owned by a Jamaican company;
- Sandals Royal Bahamian Resort, owned by a Jamaican company;
- The Sheraton Grand Hotel on Paradise Island, owned by the U.S.-based Wedge Group;
- The British Colonial (Hilton) Hotel and the Clarion Resort owned by RHK Capital, Inc. of Canada;
- Club Med Resorts on Paradise Island and San Salvador owned by a European group;
- Comfort Suites on Paradise Island owned by a U.S. company;
- Island Outpost Resort at Compass Point, Nassau, Pink Sands Resort, Harbour Island, and Kamalamae Resort, Andros owned by a Jamaican company;
- Cable Bahamas, Ltd., established by a Canadian group;
- Sandyport Development Co. Ltd., a housing subdivision owned by a British company;
- Roberts Isle, a housing subdivision owned by a U.S. company;
- Treasure Trove, a housing subdivision, owned by a U.S. company;
- Commonwealth Brewery Ltd (Heineken), a Dutch-Bahamian company;
- Bacardi Company Ltd., a Bermuda-based company;
- Freeport Power, an affiliate of Mirant, based in Atlanta;
- The Caribbean Marine Research Center, operated by The Perry Institute for Marine Science, an American firm;
- Polymers International, Ltd., which produces styrofoam pellets at a plant in Freeport, owned by a holding company in The Cayman Islands.
- Morton Bahamas Ltd. (Salt), owned by a U.S. company;
- Gorda Cay, renamed Castaway Cay, purchased and developed by Disney Corp. for its cruise ship operations;
- Half Moon Cay, owned by U.S. company Holland America Cruise Lines;
- Bahama Star, a large citrus farm on Abaco Island owned by a U.S. company;
- A tropical fish farm operated on Walker’s Cay by Aqualife, Ltd., a U.S. company;
- Princess Cay, a cruise ship landing facility near Eleuthera Island, owned by Landquest, a U.S. company;
- Four Seasons Resort Development on Exuma, owned by a U.S. Company;
- Freeport Ship Care Facility, owned by the Lloyd Werft Ship Repair Company of Germany;
- AES American Oil Company, which owns Ocean Cay a mining facility to produce liquefied natural gas (upon government approval).
The largest investors are American, Canadian, Hong-Kong Chinese, and South African in origin.