Cruise Passenger Spending Grows 850 Percent

Thursday, 27 February 2014 00:00 News Editor
Print

Cruise arrivals to The Bahamas have grown by 76 percent between 2000 and 2012, according to data recently released, with overall revenue generated from cruise arrivals ballooning by over 850 percent to just under $400 million per annum over the same period.

This revenue boost came about despite the fact that per passenger expenditure fell by 16 percent during the 2000 to 2012 period.

The new data highlights the extent to which cruise tourism is coming to dominate Bahamian tourism. Last year, cruise passengers made up 79 percent of total arrivals to The Bahamas, up from the 59 percent they represented in 2008. Cruise visitor numbers have grown by 228 percent from 2008 to 2013 alone.

Despite the growth in the overall contribution by cruise passengers to the economy, this latest data comes on the heels of recent comments by Bahamas Hotel and Tourism Association (BHTA) President Stuart Bowe that he is concerned about the fall off in stop over arrivals relative to cruise passengers, given the lower average spend and “multiplier effect” of the latter type of visitor compared with those who stay in The Bahamas overnight.

His comments echoed points expressed recently by academic Dr. Andrew Spencer, program director and head of the centre for tourism management at the University of the West Indies (Bahamas), when he told the Bahamas Business Outlook in January that The Bahamas ought to “band together” with other Caribbean countries if it is to achieve more economic impact from the cruise industry.

Spencer said: “I think there are some challenges. From a regional perspective we have not been able to band together to make a statement to the cruise lines. That’s a big problem. Cruises will threaten they won’t make a stop at this port if you don’t do this and you don’t do that, and if one country decides they will not allow that to happen, they’ll simply say ‘We’ll skip you and we’ll still have a Caribbean cruise because the other guy is willing to accept this’. I think we have not been able to sit in a stable position at the negotiating table and that has been our problem.”

In data compiled by the BHTA in its February member update, the association found that cruise arrivals grew from 1,480,461 in 2008, to 4,318,455 in 2011, and up to 4,870,048 in 2013.

In a report recently shared at the same time by the BHTA with its members, which was prepared for the Inter-American Development Bank, it was noted that of five countries studied – Antigua, Bahamas, Barbados, Jamaica and St Lucia – all but one experienced at least modest growth in cruise passengers over the 2000 to 2012 period.

The report titled, “The Conditions and Performance of the Tourist Industry in the Caribbean”, attributed the better performance of The Bahamas and Jamaica to their proximity to the USA originating ports for cruises, such as Miami and Fort Lauderdale.

It added that cruise companies have also invested in port infrastructure assets closer to Miami, including Jamaican and Belize, and have even purchased islands, including in The Bahamas at Castaway Cay, Coco Cay, Great Stirrup Cay and Half Moon Cay.

“They are therefore committed to the use of these islands in preference to islands in the Southern Caribbean, where they have no tangible assets,” said the report.

The report notes however that cruise passengers have a lower average per passenger expenditure of less than $100.

“A high level cruise official has observed that some Caribbean countries are not doing enough to create and offer new products, attractions, events and activities for passengers,” it added, in a statement which repeats challenges noted by Minister of Tourism Obie Wilchcombe that contribute to low cruise passenger spending.

In The Bahamas, the data on average passenger expenditure shows that cruise passenger spending fell from $77.90 in 2001 to $64.80 in 2012, despite peaking in 2009 at $83.93.

Other Caribbean countries, such as Antigua and Barbuda, also experienced a decline.

However, while average passenger spending fell, overall expenditure by cruise passengers entering The Bahamas rose from U.S. $40.6 million to $393.8 million in 2012, in light of the much greater overall passenger numbers.

Total employment in The Bahamas deemed to be related to cruise tourism was said to have risen from 5,600 in 2001 to 8,668 in 2012.

In the 2013 BHTA Industry Performance and 2014 Outlook Survey report issued earlier this month to BHTA members by the association, BHTA President Stuart Bowe said: “More needs to be done to increase visitor stopover numbers. Stopover visitor expenditure is valued at 20 times more than the cruise guest. The multiplier effect of stopover visitor expenditure is crucial to all stakeholders in our economy.”

Alison Lowe
The Nassau Guardian
Published: February 27, 2014