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Editorial & Column


Countdown To Shutdown


July 17, 2003
Copyright © 2003 CARIBBEAN BUSINESS. All Rights Reserved.

Hate to say "we told you so," but we did.

"Economic bombshell" was the headline on our front-page story Oct. 3, 2002. In it we tallied the devastating economic impact of already sharply declining U.S. military procurement spending in Puerto Rico and the closure of military installations all over the island: a loss to Puerto Rico of at least $1 billion a year.

Some of the bases had just closed, like the Navy’s communications base in Sabana Seca, others were in the process of downsizing, like Fort Buchanan following the departure of the U.S. Army South, and as to yet another, we were the first to anticipate that it would soon be closed, Naval Station Roosevelt Roads (NSRR).

In the accompanying editorial, we wrote: "If indeed the U.S. Navy is forced to abandon the use of its Inner Range target facilities on Vieques (which still hadn’t happened), the future of Roosevelt Roads is up in the air, regardless of what U.S. Navy public affairs spokespeople are forced to say for the record. You don’t have to be a military scientist to know that. Some very powerful senators and congresspeople are already very annoyed with Puerto Rico’s actions regarding Vieques."

Some people might have thought we were exaggerating. Now those senators and congresspeople are about to hang a "For Sale" sign on the main gates of the NSRR.

And you know what? It’s not out of spite against Puerto Rico as some local politicians are suggesting. It simply doesn’t make any economic sense for the Navy to keep spending $300 million a year on an installation it no longer needs. Even to keep it open with a minimal use would cost the Navy $70 million a year, or $5.8 million a month!

As things stand now in Congress, it is all but certain the base will close early in 2004. As explained in detail in our front-page story this week, the economic impact to Puerto Rico will be devastating, particularly for the nine municipalities of the eastern part of the island.

The Calderon administration and its resident commissioner didn’t even know a bill had been presented in Congress to close the NSRR before the next regular round of base closures by Congress in 2005. They learned of it when it was reported in local daily newspaper El Vocero.

How such a significant development in Washington could have taken the Calderon administration by surprise is simply beyond comprehension. But the fact is that they don’t have an immediate action plan to face their toughest economic challenge yet.

Now, the administration has vowed to fight to keep the NSRR open. Pleeese! Don’t insult the intelligence of the people of Puerto Rico. Don’t keep them crying over spilled milk. Roosevelt Roads is as good as gone. The question now is what are we going to do about it.

What indeed are we going to do with 8,600 acres (almost 9,000 cuerdas) of prime real estate with enormous economic development potential? Well, first we have to get them.

Right there is a challenging task for our resident commissioner to dedicate himself to in body and soul for the next few weeks and months. Will he be able to do it?

Regardless of the good intentions of their mayors, the municipalities of Ceiba and Naguabo—the NSRR spans both towns—don’t have the financial resources and wherewithal to develop something like this. No more than the mayor of Culebra had about 33 years ago when the Navy ceased operations there or the mayor of Aguadilla 30 years ago when it got part of the almost 4,000 acres of the former Ramey Air Force base.

Ceiba’s mayor, among others, says he would like to see Roosevelt Roads used for tourism development. That’s of course easier said than done. There’re lots of properties suitable for tourism all over Puerto Rico. That’s not a problem. The problem is in finding and attracting tourism-related hotel and resort companies willing to invest here. And you would need quite a few hotels and tourism amenities to fill 8,600 acres! Local businessman and developer Arturo Diaz, for example, worked more than 20 years to convince two hotel chains to set up in Coco Beach’s 1,000 acres and he still has 700 acres left.

The new Convention Center in Isla Grande still doesn’t have an anchor hotel interested. The Condado Beach Trio is yet to get off the ground and is mostly going to be turned into expensive condo / hotel apartments. After years of operation and despite having one of the nicest beaches on the island, the Cerromar shut down. The island’s west coast, with hundreds of beautiful acres available, is still struggling to develop its tourism product. Palmas del Mar, already greatly developed as a destination resort with all the necessary amenities including golf, tennis, beach and restaurants, yet with plenty of additional land for development, is still scrambling to close a deal for a company to buy and run its existing hotel and trying to find another company willing to build a major new hotel.

Tourism is an industry with great potential in Puerto Rico, but it is still way underdeveloped. Besides, the government of Ceiba is not the one to take over the potential development of 8,600 acres of land. If it were to, we would end up with another Culebra or Ramey, with existing housing on the base going to pay for political patronage or parcels going any which way to developers of condo / hotels and great, expensive weekend homes for locals.

Let’s recognize Roosevelt Roads’ economic potential for what it is. More than 60 years ago it was picked by the Navy because it has the best and biggest natural harbors in Puerto Rico, which, together with its vast, already developed land area, airport, and other infrastructure, makes it the most suitable location for a truly visionary, world-class transshipment port.

A transshipment port that, when fully developed, will make Ceiba, Naguabo, and the other towns in eastern Puerto Rico the fastest growing and most prosperous municipalities on the island.

A transshipment port with truly historic economic potential that in time will make the economic disaster that is about to hit Puerto Rico early next year seem a distant nightmare.

This Caribbean Business article appears courtesy of Casiano Communications.
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