By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

Bahamas Junkanoo Carnival’s chairman yesterday stood by his projection that the inaugural festival increased Bahamian gross domestic product (GDP) more than $50 million, with the event having a direct economic impact of $19 million.

Paul Major, the Bahamas National Festival Commission’s chief, said: “The GDP impact that I said will be over $50 million, I stand by that number, but I don’t want to talk to that yet because we have  Deloitte and Touche doing an economic/GDP impact study which will be ready in a few weeks.

“I stand by that number because whatever is spent directly there is some multi-plier effect that translates that into a GDP impact. It’s somewhere between 3 and 7 per cent as a multiplier effect.

“Whatever the foreign input is is multiplied by as much as seven times, and  for things that are local, input could be anywhere from one to four and that’s all about money being recycled in the economy.”

A Commission report dsaid Junkanoo Carnival generated $19 million in direct economic activity - $13.5 million on New Providence and $5.5 million in Grand Bahama.

Total government (taxpayer) subsidies amounted to $12.9 million, 86 per cent of which was spent with Bahamian companies. Mr Major said the inaugural event had provided a solid foundation for the Festival’s future, and the net cost to Government will be less going forward.

He added that participating companies having already been advised they would not receive the same level of subsidy as seen in 2014.

“The net cost to the Government will be less to the extent  that we have no doubt now that we have got the firepower to be able to go to major international sponsors to be able to raise a lot more money,” said Mr Major.

The Commission’s report said the Government earned $1.5million in direct revenue, and $6.6 million in tax revenue.

“The Commission had estimated about $5 million but we fell short because we got all tangled up with this main act, and we just weren’t able to attract the level of international sponsorship we know we will get next year because now we know we can generate the crowd,” said Mr Major.

He added that the inaugural event had provided a major stimulus for 880 small and medium-sized businessees. The Commission’s report indicated that $9.9 million was spent with 580 vendors in Nassau; $1.2 million with 310  vendors on Grand Bahama; and $1.7 million with international vendors.

Mr Major said the Commission had devised a formula to pay vendors at the Carnival Cultural Village. “We have devised a formula by which we would like to compensate some of them for their losses via a refund of maybe the fee they paid and some contribution toward loss of product.  They haven’t been reimbursed as yet. It is being considered,” said Mr Major who could not give a timeline for the payout but noted that it may total some $40,000.

Estimates provided by the Royal Bahamas Police Force (RBPF) listed total spectator support at 115,000 people for the festival events. More than $800,000 was directly spent on Bahamian musicians, according to the Commission’s report, with some 1,169 entertainers engaged.

Cost overruns amounted to $3.8 million. This, Mr Major explained, was due to several factors such as the hosting of the Grand Bahama kick-off weekend, which was not initially part of the  planned festivities; the construction of the Cultural Village as well as art pavilions and subsidies for Road Fever Bands due to sluggish costume sales.

“We couldn’t sell on-line because we didn’t have enough to sell international without having a main act, and sales were sluggish even in the local community, but once we got our marketing campaign going and we started to subsidise the costumes, meaning that the cost per unit dropped, people starting turning up in droves,” said Mr Major.