THE eastern seaboard could be the subject of a radical, ambitious regeneration project if the States approves proposals put forward by Long Port Properties. It is planning to spend more than £500m. on a redevelopment in five phases that would stretch from St Sampson’s Marina to the Fish Quay.

It would encompass an integrated sewage- and waste-treatment plant, hundreds of new homes, thousands of parking spaces, improved marina and retail facilities, a five-star hotel, more land for light industry and the relocation of the island’s commercial port operations.

The impact of these plans on Guernsey’s economy would be profound.

The States has predicated the restoration of equilibrium in the public finances on economic growth and the reconstruction of the waterfront will stimulate activity and generate tax revenues.

Taxation of £100m. will accrue from duty on property sales, the sale of the leasehold interest in public land and rental from commercial property. On the assumption that Long Port and its beneficial owner are locally resident and RBSI will be taxed at 10% on its local banking activities, the profits that Long Port and RBSI make on the project will also be taxable.

The redevelopment would lead to more employment and higher salaries that will generate fiscal income and would stimulate economic growth in a variety of ways.

The local construction industry would be an obvious beneficiary if it secured work.

There would be more space for the finance industry to grow and an increase in work for the legal and financial services sectors.

There would be additional land available for light industrial use, which would lower that sector’s costs.

The redevelopment would entail an increase in the population, thereby providing more employees and consumers and therefore tax revenues.

Additional workers would be necessary to carry out the project, but the increase in the housing stock would also enable more people to live and work in the island on a more permanent basis with the necessary licences.

The retail trade would enjoy better parking facilities and further capacity to grow.

Tourism, leisure and hospitality would benefit from people coming to the island to take advantage of the improved marina services, the five-star hotel and conference facilities, the increase in economic activity and the superior infrastructure and amenities.

The States is operating under severe financial constraints and cannot afford to redevelop the area or build the waste- and sewage-treatment plants that the island desperately needs without private-sector involvement.

The plans would provide a £10m. subsidy for these and build them at a significantly lower cost than States projections, as well as financing the redevelopment of the coastline.

The £100m. boost to public sector finances and the incremental tax revenue from the increased economic activity would allow the States to fund other public services such as schools and hospitals.

Private-sector responsibility for the redevelopment will also improve its efficiency and management.

Long Port and RBSI will bear the risks of failure as well as enjoying the profitable rewards of success, so they will have incentives to minimise costs and deliver on time. They have excellent track records and a wealth of resources at their disposal.

This private/public initiative could also provide the blueprint for future partnerships, if successful.

It is a coherent, integrated approach that has been properly considered and will improve our international reputation and actual and potential economic growth.

But of course we must remember that the project is not an all-embracing panacea as it also carries many risks and disadvantages, which will have serious economic and other consequences.

I will consider the other side of the economic argument in next week’s article.