Cruise tourism in jeopardy

| 27/04/2011

(CNS): The decision by the premier not to extend the deal with developers GLF over the construction of the cruise berthing facilities in George Town is putting the industry in further jeopardy, according to the former tourism minister and those working in the industry. With no agreement in place now with any team, the possibility of another developer being ready to go in six weeks, as GLF construction had said it could, is “nonsensical”, Charles Clifford told CNS. Having had the experience of negotiations with a potential developer, he said the process takes time. He said he believes that there is something behind the move that the people of the Cayman Islands are so far not privy to.

Clifford said that the decision by McKeeva Bush to end the agreement with the latest cruise berth developers GLF means that government is essentially starting over. Pointing out the complexities in the process, Clifford said it was madness to expect that any other developer could move ahead more quickly.

“It simply can’t be done in less than six weeks so I don’t know what he is hoping to achieve,” the former minister said about the premier. “Obviously there is something going on here that we are not yet privy to and I fear there will be a number of irregularities.”

He said that, given the process and the things that would need to be done if a new developer was to come on board now, there is no way the project could move forward in such a short time frame without rules being broken.

It would not be possible, Clifford explained, for a new development team to simply pick up where GLF have left off as they would have to cost out the designs themselves and ensure they were confident that they could reproduce the project, and that alone would take several months, the previous tourism minister said. He noted that it was likely a new team would also have different ideas and a different approach, which would obviously add more time.

Clifford warned that the tourism industry was facing a summer of reduced cruise passenger arrivals as the lines changed their itenaries to accommodate the new mega ships in the region, which will not be coming to Cayman without piers.

“The industry faces a 25% decline for this summer in passenger arrivals,” he added, warning that this delay would mean there is certainly to be no relief for the industry in the summer 2012 and it’s now unlikely the facilities will be even ready for the summer of 2013.

With the mounting troubles already among operators fighting for cruise business and bottom lines being hit in George Town stores, the impact of a decline in passengers this summer will be hard.

Although none of the official associations contacted by CNS have responded to our questions about the premier’s decision, a number of local business owners have revealed their genuine concerns. Tour operators and taxi drivers as well as business owners connected to retail and restaurantshave expressed their fears that the cruise facilities may never be developed as the project continues to be bogged down in what many believe to be political priorities instead of business ones.

Clifford also warned that the decision by the premier to pull out of the deal with GLF may cause delays not just because of the need to find new partners but because of possible legal troubles.

Although the framework agreement had come to an end, if GLF had fulfilled the requirements of that deal they would have a genuine expectation to either extend it or move to the master agreement as per the request made by CEO, Francesco Senis in his letter to the premier. Given the current situation and the amount of money spent by the firm so far on the project, which is understood to be in excess of $1million, the firm may seek an injunction to prevent the government from moving ahead with any other developer until any claim they make is addressed.

If government is drawn into another difficult civil courtroom battle, not only will that place the cruise tourism business in real jeopardy, it could also hit the public purse hard.

In a press statement released on Tuesday evening Clifford points to possible solutions, provided there are no legal problems, now government appears to be back at square one.

He tells government to formally invite the cruise lines back to the table and ensure their participation. With new negotiations and a demonstration of some stability with the project, he said, government may be able to convince the two main cruise lines, Carnival and Royal Caribbean, to prop up arrival numbers via increased port calls from their various sub-brands, which still operate smaller ships on the western Caribbean itinerary.

“Because cruise lines plan and begin to book their itineraries 18-24 months in advance of a cruise, the UDP Government must act now if we are to have a chance of saving our 2012 cruise tourism winter season,” he added. 

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Comments (41)

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  1. Anonymous says:

    What is happening about the dump?  My company are willing to work with Dart or anyone else to sort this problem out, reduce consumption of high sulfide diesel and cut electricity prices… nothing seems to be happening, this is a dangerous situation for the island, its inhabitants, ecology and tourism…  You would think it would be a priority.

  2. Anonymous says:

    Now is the time for those honest UDP members to stand up and help remove MAC & Ju Ju. Form a coalition government with PPM and Mr Miller, then get on with the business of trying to save Cayman

  3. JJ says:

    One day Chuckie is against Bush engaging in projects that could hurt the environment – The next day now, it appears he flip-flops, complaining about him terminating a deal to pursue a massive project! He and his followers should make up his mind – PROGRESS or AGAINST PROGRESS

    • Anonymous says:

      Actually, this is not one of the projects Mr. Clifford ever opposed, as he himself tried to get a port development project off the ground during his own tenure. It is something he worked hard on before, and he had engaged the cruise lines as well as a developer at the time, to move it forward. However that development plan did not materialize as his Govt. lost the election. He might be against other massive developments for environmental or other reasons, but he definitely was not against the port development.

      • Anonymous says:

        A good example of the hypocrisy of the UDP, is Boat Ramp at Coe Wood Beach, Bodden Town.  The UDP critisied the PPM when they made the effort to get the ramp started in 2009 and today which governement has gone ahead with the same idea?  The UDP, who are only seeking political mileage.  I don't think BT voters are that stupid next time around.

  4. Anonymous says:

    I don’t believe the Genesis class of cruise ship that everyone is preparing for will take hold. The 110,000DWT Carnival Cruise Ships are relatively new and everyone considers the words from Chuck to be gospel.

    Where are these super cruise ships of which there are only 2 of them. How many are on the drawing board to be built? None that I know of.

    Cayman needs to position itself as a unique high end destination and the tender system fits better than a huge pier out off 7 mile beach.

    What has the down turn done to the industry?

    Almost everyone was against Chuck’s port plan if you attended the meeting at the Family life center.

  5. Anonymous says:

    Has anyone considered that having a birthing station could be bad for local businesses?  If these tourists had an easy way to get back on the ship instead of waiting for tenders, how many of them would return to the ship for free lunch or take advantage of all the free amenities (pools, slides, tennis courts, golf, rock climbing etc.) after they go on their pre-booked excursions.  I think a lot, and the net effect will be less people hanging out in town buying lunch or walking around shopping.  Just a thought!

    • Who's Your Daddy says:

      I think a “birthing” station would be awesome. We could all crowd around and take bets as to the sex of the child and what its name might be.

      Heck, it might even improve our tourism.

    • Anonymous says:

      having been on over a dozen cruises i can assure you it won’t hurt business. there have been a number of timeswhere i have gotten back aboard the ship only to remember i needed to buy a gift for someone back home and been able to quickly run off the ship and get it and get back with time to spare. had it been in cayman, where it is truly a pain to get off and on the ship, i never would have had the chance. also many of these amenities are closed when a ship is in port. there are no shops open, the casinos are closed, the pools are sometimes closed. many of the people who go on cruises use it as an opportunity to see many different cultures on one trip and are more likely to want to try local cuisine than get back on board the ship and eat the typical bar food that is served in the buffets and restaurants of the ship when in port. having been on many caribbean cruises i can assure you that there is no more popular stop than cayman, the ship empties, and those who do stay onboard do so because of the difficulty getting off and on. we cannot be left behind by jamaica and mexico, countries with docks, as the newer bigger ships will continue to just sail past us to these places with docks. that is much more harmful to local businesses than losing a few sales to a few people who aren’t adventurous enough to try local food or are too cheap to experience the wonders of our island.

      • Anonymous says:

        Right on the money, totally agree. As noted in an earlier post, people come here first and foremost to shop and see the sights, not to eat in the local restaurants, but most visitors do want to sample the local food too. I know that’s what I do whenever I travel, I want to immerse myself in the new culture, sample its foods, buy souvenirs, etc. and most tourists will tell you the same thing. The great harm to the economy, is not people going back on the ships to eat, but rather people not visiting our shores at all because the cruise lines decided to bypass Cayman for places that offer more convenience in disembarking from the ship. The overall experience offered to the visitor is what counts – the easier it is made for them to come onshore and stay longer, is the more they will enjoy their experience, and be more motivated to return as stayover guests. Isn’t that what we all want?

    • Son of Thunder says:

      “Dat wat ya get”!!! Don’t say that we weren’t warned.
      We threw him out in 2005, why on GOD’s earth did we put him back in 2009? Don’t we ever learn? The most worrying part of it is that he is worse now than he ever was. Has that man gone mad? Not only is cruise tourism in jeopardy, but Cayman is in jeopardy. I hope it is not too late to save our beloved Cayman, but “Dat wat ya get”!

    • Concerned Caymanian says:

      You are quite right.  If you go to Nassau on a cruise, most passengers return to the ship for meals etc., and there are not as many nice restaurants in the downtown area as we have here.

      • Anonymous says:

        You both have excellent points. However, when you consider the time lost waiting for the tenders to ferry people to and fro, the lines etc., it means less shopping time and sightseeing time for visitors. The primary reason they come on land is not to eat in the local restaurants, but rather to shop for souvenirs and duty free jewellery or go on guided tours to take in the local beautiful sights or enjoy the beach, Stingray City, etc. It is those experiences that motivate them to return as stayover guests, not the food in the restaurants, although that is nice too.

  6. Anonymous says:

    You can’t run a downtown retail business on just six months of cruise passengers (especially when you have to buy a one-year work permit!).  And to the first commenter, downtown retailers would love to hire more Caymanians, but they would rather work in a bank versus working in a retail store.  Stores are going to start to close for the summer months and the downtown tourist product for those that do come will be poor.  This in turn will hit the cruise blogs and decrease calls in season.  Further, a downtown with shut doors will encourage crime, reduce rents, and drive businesses away.  By the time Caymanians actually get their heads out of the sand, other islands will have gladly scooped up the tourists, the businesses, and yes, even the ex-pats.  Dart is rich, but he is not going to be able to save the country from its own arrogance.

  7. chad says:

    wow! you people condemn the Premier in saying that he is selling out the island – too much projects, first to Dart, then GLF… Now he has cancelled all deals with GLF and you’re complaining that its going to hurt our economy if he doesn’t pursue the project

  8. Anonymous says:

    Rubbish.  Cayman has always been a first class destination for the cruise lines and their passengers.  Sure, it may be easier for a ship to tie up but honestly, they have been coming here and hovering for ever.  The system is fine and it gives the passenger a wonderfulperspective of our island.  I currently live in states and have met many new people over the years who have all cruised (usually spring break type visits) and they have all said that Grand Cayman was their favorite stop, and a few have been back as overnight visitors since.

    I also went on a cruise that stopped in Belize some years ago and they don’t have a cruise berth…I wonder if the cruise lines are  threatening to no longer stop there if they don’t build berthing facilities?

    As usual, there is no transparency to these plans. 

    • Anonymous says:

      yep…. tenders arethe way forward….zzzzz…

    • Anonymous says:

      You miss the whole point. Things have changed. Cayman can no longer rest on its laurels thinking people will come here no matter what. The cruise lines are redeploying to other destinations that have already prepared themselves with proper berthing facilities, so that means less ships coming here and the smaller ships that do still come here are going to come less frequently as some of these are also being redeployed. Look at the numbers projected to visit Cayman in the next couple of years. The point is the loss of revenue to the local business and govt., which in turn creates further downturn in the economy which can ill afford it at this time.

  9. Message for Mark Scotland says:

    Can someone please inform Mark I am coming for his seat next election sincehe is not trying to do anything with it besides be Mckeevas yes man! Jon Jon I told you watch your company!

  10. Anonymous says:

     Is this port really going to help, there are no guarantees the ships will come back. Have they left due to no berthing facilities or have they actually left as they wanted to go to new destinations to keep their guests happy to come back to cruise every year. In order to do this they need to keep their destination  lists fresh and interesting.

    We have all heard how bad people think it would be to tourism to take away Stingray City Sandbar … but what about the fact that two ship wrecks and a reef in town will no longer be visitable. How many tourists daily visit Cheeseburger Reef or the wreck of the Cali. How easily will diving or snorkeling be at the world Famous Eden Rock Devils grotto? Maybe even further round will get affected by all the bow thrusters and prop wash kicking up the sand from the ships.

    How much annual revenue to the tourim industry will be lost by loosing all these tours in the Hog Sty, how many visitors will want to come here when these tours are no longer available??

  11. Anonymous says:

    More likely that the cruise ship operators have already taken the decision to start planning alternatives to Cayman because of routing/fuel cost issues and the prospect of Cuba opening up.

    Despite what Chuckie says Grand Cayman is clearly in the process of joining a long list of former cruise ship destinations and the sooner people get their heads round this and start making alternative plans the better.

    Bottom line is that cruise ships companies don’t give spit about what happens to any of their destinations if they pull out and all the negotiations in the world won’t change that.

     

    • Anonymous says:

      Actually, this is exactly why negotiations were underway to get the cruise lines to the table, to get a guarantee from them on a minimum number of arrivals per annum, to protect against this very same thing you mentioned. There was progress being achieved in this respect, before it was abruptly terminated a couple weeks ago.

      • Anonymous says:

        As the earlier comment says – cruise ship ‘guarantees’ aren’t worth spit.

        If the company accounts say Cayman isn’t viable they will go somewhere else – this isn’t about some cozy relationship between CIG and the cruise lines based on trust or some mythical understanding it’s about money and we all know the old saysabout that.

        You don’t believe me? Talk to any one of the local companies that does business directly with the cruise industry and ask how their profit margins have been squeezed down in the past few years. Some say they now make next to nothing from pre-booked cruise shippers while the cruise companies take 400-500% profit on their services for just making the bookings.  

        • Anonymous says:

          You may have a point there. But that is why it is also necessary to agree on penalty fees so that when the numbers guaranteed do not come, there is still some sort of revenue to Govt.

          • Anonymous says:

            And trying that will obsolutely guarantee that no more cruise ships ever visit Cayman. LOL!!!!!!!!!!!!!!! 

  12. Anonymous says:

    It is far better that the emphasis be put back on stay-over tourism which is where the longterm benefits really are.
    Cruise tourism is better if the mass market such as we have now is avoided.

    • Anonymous says:

      Great point, but it is not prudent to emphasize one over the other i.e. stayover guests versus cruise visitors and vice versa. Why should one be at the expense of the other? Don’t forget that when the recession kicked in and the stayover arrivals dropped as less people could afford to travel, it was the cruise ships that helped to keep the economy from going into a complete nosedive. Don’t forget also the incredible drop in stayover numbers right after the 9/11 terrorist attacks, when people were afraid to travel. In other words, diversify the tourism product, don’t put all eggs in one basket. Keep both cruise and stayover tourism strong, so that if one goes down, you have another segment to fall back on. When you try to give the cruise visitors a firstclass experience including an easier way of getting onshore to enjoy what we have to offer, they will be more motivated to return as stayover guests. Jamaica has strong cruise ship arrivals, strong stayover arrivals, sport tourism, eco-tourism, culture tourism (where locals put up visitors in their own homes so they truly enjoy the jamaican experience). None is treated as more important than the other. Now that is diversifying, something that we can all learn from.

  13. The Watchers says:

    The truly amazing thing is that Caymanians voted this guy in, and more than once! I liked Cayman, and it is a shame to see it spiralling in like this. That said, Caymanians are free to do with their jurisdiction as they choose – that’s how democracy works. As a non-citizen, I only got to vote with my dollars while I was there, all of which packed up and left with me. Mac has that effect on people you know. Watching the final phases of Cayman’s demise is interesting watching, though I regret the destruction.

    Can any Caymanians tell me why you voted Mac back in again? I understand that Kurt didn’t get the job done, but surely there are other leaders in your population who have the backbone to give this a try. No?

    • Anonymous says:

      The best of Cayman do not run for politics…they can make it on merit and don’t require political positions for clandestine negotiations or ministry coffers to succeed.

  14. Anonymous says:

    Now what exactly does the Premier know about building cruise berthing facilities?.. running a taxi – Yes!… making it look like you are buying votes from your fellow West Bayer’s… Sure!.. but building a cruise terminal??? Anybody else who doesn’t consider themselves an expert in a field, hires the experts to do a detailed feasibility and impact study and takes the findings back to the parties involved and makes a joint decision on whether to move forward or not. Appears that there have must be more here than the general public are currently aware of but does this surprise anyone? There was previously an agreement with Atlantic Star, then DECCO (Dart), now the GLF deal goes belly up! Seems like a one man show with a hidden agenda costing the tax payers of this tiny island millions of dollars

  15. Anonymous says:

    Could not agree more with the person who posted above. It is about time we started paying more attention to stay over tourism and also get back to a few good ships (let Carnival leave!) who actually spend money.

  16. Anonymous says:

    Could this be a tactic to drive more downtown businesses to ruin so that the big opportunistic predator (DART) can swoop in and obtain the water frontage for little or nothing? Then, after the smaller businesses are gone and there are only the two or three big boys on the block, THEN the berthing facilities WILL go thru with smooth sailing…. touting 1000’s of jobopportunities for Caymanians (i.e. actual positions to be filled), but less than 10% actually filled by Caymanians (be it status holders or born here), all the while Caymanian unemployment sky-rockets – compounded each year with more and more school leavers who can’t obtain even a summer job at the LOW wage of $2.50 per hour because Government is promoting Work Permits over Caymanian job placements.

    • Anonymous says:

      When I look in the shops downtown I don’t see a lot of Caymanians working in them anyway – so what’s the problem?

    • Lambs To The Slaughter says:

      It’s funny you say this, (or not) because this is exactly what has been going in the Carolinas and other tourism spots on the coast. Government is manipulated by the predators to create a huge drop in real estate values with oppressive or inefficient legislation, dragging feet, conservation mandates, environmental reasons, unreasonable taxes, (un)natural disasters etc and then when all the legitimate businesspeople and landowners have given up, the predators swoop in for the kill for cents on the dollar. It’s called Vulture Capitalism. To the middle class Caymanians that own a little piece of your islands. Hang on and don’t sell out. Talking about opportunism, I was at the cinema the other week and Dart seems to be getting away with $4.00 for a bottle of water and $5.25 for a SMALL popcorn, for heaven’s sake! More fool us for buying it. How the hell do you justify that, Mr. Dart? The answer is simple. Because he can. Well I’m going to boycott your establishments and your products from now on. I resent being shafted and although I’m only one person, I’m not playing your game any more.

      • Anonymous says:

         When one Googles " Kenneth Dart, Vulture Capitalism" there’s some fascinating reading.

        • Anonymous says:

          Agreed – a fascinating read indeed. In this case, it does not seem Dart played a role in recent developments, but hey, anything is possible, nothing surprises one anymore. There seems to be more intrigue on this tiny island than most other places in the world. In any event, let us not blame Dart for doing what he does best i.e. venture capitalism, or vulture capitalism as some describe it. If we all did our jobs equally well and we all looked out for this country’s best interests in the long run, we would all be better off. Put the blame where it properly lies, namely, those who roll out the welcome mat to capitalists at the risk of their own local business-owners who do not have the resources to compete and who might have no choice but to sell out or face bankruptcy.

    • Just the Facts says:

      Rather than some long-drawn-out conspiracy theory designed to trample down Caymanians and rob them of their property, it’s more likely that the root of the problem is financing, and that we’ll see some kind of joint deal involving the Chinese as financiers and GLF as constructors. This avoids re-doing designs or re-inventing the wheel. The Government knows we need the cruise piers, and wants to see them built as soon as possible. The latest move was probably designed to force GLF’s hand. After all, if they have the cash, they should be able to prove it. Just guessing, but it avoids conspiracy theories.

       

       

       

      • Anonymous says:

        Perhaps, but most people might agree that seems a little farfetched, considering the abruptness at which the termination took place – it does not bode well for future negotiations if previous good faith negotiations are unceremoniously terminated. Since the news reports indicate that the developer would be able to mobilize within 6 weeks and had financing proposals on the table but needed a contract with Govt in order to move forward, it does not seem likely that financing was the issue.

      • Anonymous says:

        Until the full truth is revealed (if that time ever comes), what you suggest might just be speculation too. How does anyone know for sure that proof of funding was not provided to the Govt or Port reps? According to CNS news, the developer gave an update on the funding proposals and progress of negotiations with the cruise lines and requested a meeting. Perhaps they intended to provide all the documents at the meeting and fully unveil their development plan, or perhaps they submitted it later. The point is, the general public does not know – as the negotiations are supposed to be confidential. So, it is just all speculation.

  17. Anonymous says:

    The most glaring irregularity with this whole expanded Port scheme was the deletion of any credible environmental impact assessment.  So, in as far as the plan is stopped, that’s a good thing.  My preference has always been to avoid the new Genesis-class cruise ships, and focus on the smaller higher-end boutique liners – something that should have been done years ago.  We have to decide whether it is more important to draw (presumed) headcount for gov’t coffers or genuinely qualified shoppers for our local merchants. We cannot have both.

     

     

    • Anonymous says:

      Firstly, as far as the EIA goes, this was undertaken by the first proposed developer, Decco who promised to make it available to Govt for a fee, and that is still the plan as far as the public is aware – there has been no indication in the news that this requirement was deleted. Secondly, Mr. Clifford advised that most of the smaller lines are owned as sub-brands by Carnival and Royal Caribbean and have already been deployed to other itineraries – it will be a matter of convincing the cruise lines to re-deploy them here in time for the 2012 summer – not an easy feat – and other independently owned liners are not sufficient to sustain the cruise tourism industry or bring sufficient revenue to Cayman. Given the further delays to the proposed berthing facility and the seeming inability to make up our minds decisively to stick with the development plan despite the progress achieved to-date, why should the cruise lines show any interest in continually coming here?