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(This article originally appeared in the Daily Business Journal)

MIAMI-Baha Mar Resorts of Nassau said Wednesday that it has signed facility and investor agreements with the Export-Import Bank of China and China State Construction and Engineering Corp. to develop the multi-billion dollar Baha Mar Resort on Nassau’s Cable Beach.

The agreements, signed Tuesday in Miami, include $2.5 billion in financing by the Export-Import Bank, construction deals with China State Construction and Engineering Corp., the project’s general contractor; and an investor agreement between Baha Mar and China State Construction, which will assume a minority equity interest in the property.

The resort’s first phase is to include 3,000 hotel rooms, a 100,000-square-foot casino, 200,000 square feet of meeting space and a 35,000-square-foot retail section.

Backers say the deal will stimulate the economy of The Bahamas and its likely to help cement the growing regional influence of China’s banking and construction sectors.

“Financing for mega hotel and resort developments of this size, scale and scope are extremely rare, particularly in today’s economic environment,” Sarkis Izmirlian, Baha Mar Resorts’ chairman and chief executive, said in a prepared statement.

TOURISM DOWNTURNIzmirlian said the deal represents “a primary stimulus” for The Bahamas, which has been hard-hit by the recession. That includes its tourism sector, which directly or indirectly employs half the nation’s workforce and generates about 60 percent of its $7.6 billion gross domestic product.

In 2008, 4.6 million tourists visited The Bahamas, 85 percent from the U.S. That was a 4.5 percent year-over-year decrease from 2007, according to U.S. State Department figures.

The Baha Mar hotel project’s future was called into question whencasino operator Harrah’s pulled out of the deal in March 2008. In March 2009, however, the Ex-Im Bank of China agreed to finance the stalled project.

The Bahamas is focusing on construction and other infrastructure projects in order to boost the economy and create jobs while courting foreign investors, sending investment missions to the Far East, Europe, Latin America, India, and Canada.

“The government continues to pay particular attention to China to encourage tourism and investment,” the State Department noted in a December 2009 analysis of the Bahamian economy. “The Chinese are funding the construction of a new $30 million sports stadium in New Providence and are providing more than $100 million in road construction projects.”

Guy Trusty, president of Lodging & Hospitality Realty in Coral Gables, said the resort complex likely represents more competition for hotels in The Bahamas than South Florida. He said the projected late-2013 completion date is well-timed because “it’s the safe bet the market will be doing better both here and there by that time.”

The Chinese partners indicated in a news release that they expect the project will help to establish their presence in the North American and Caribbean markets, while showcasing their construction and development capabilities. China’s four-largest state-owned commercial banks hold assets in the trillions.

China’s Big Four banks marked a coming out party of sorts in the region in November when for the first time all sent representatives to the Latin American Federation of Banks [Felaban] conference in Miami. They even held their own panel discussion, the most visible presence the Chinese banks have ever had in the annual event’s 43 years.

The 1,000-acre Baha Mar project is set to break ground later this year, with the construction start date subject to approvals by the governments of The Bahamas and China.

The developers predict that Baha Mar will create over 8,000 new jobs for Bahamian workers across all sectors of the hospitality industry. In addition, Baha Mar Resorts said it is committed to hire “as many qualified Bahamians as possible” to work on the project during its construction phase.

Backers predict Baha Mar will generate 2.3 million annual visitor room nights; inject $1.1 billion in spending and direct taxes into the Bahamian economy in the first year of operation and generate an additional $740 million, or a 10 percent increase, to the current gross domestic product of The Bahamas.

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