Region urged to get better deal from cruise tourism
ST JOHN’S, Antigua (CMC) —managing director of a Caribbean-based hospitality consultancy is urging regional countries to come together to form the Organisation of Tourism Economy Countries (OTEC) as a means of negotiating as a cartel from a position of greater strength with the cruise lines.
Robert MacLellan, who is also a former vice-president of an explorer cruise line, said in a newspaper commentary published here that Caribbean countries should learn a lesson from the Organisation of Petroleum Exporting Countries (OPEC) that 60 years ago came together in a bid to get a fair price for oil, their main source of national revenue.
“As a result of their joint stronger bargaining power, oil prices have risen relatively steadily from US$1.63 per barrel in 1960 to an average of around US$77 during the last 10 years,” he wrote.
MacLellan said that the weak negotiating position of individual Caribbean governments versus the massive cruise line corporations — relative to port taxes — poses similarities to OPEC’s situation, “and the same potential ‘rebalancing’ strategy should now be pursued in the Caribbean”.
He argued that if governments across the whole region, including Central America, come together and form OTEC, “they can negotiate as a cartel from a position of greater strength with the cruise lines.
“Currently, when individual countries try to increase port taxes they are threatened with being dropped from cruise itineraries and can be picked off one by one by the powerful cruise lines.”
He said from a better bargaining position, state or national governments with single-destination cruise itineraries — Alaska, Bermuda, and Hawaii — have already negotiated higher cruise port revenues than those in the average Caribbean country.
“Cruise ships stay two nights in Bermuda and pay at least US$50 per passenger. For mainland United States and Canada cruise itineraries, an average of 33 per cent of the cruise ticket price goes to port taxes, compared to an average 14 per cent for a Caribbean itinerary. By negotiating, governments in the greater Caribbean region can achieve similar results to these destinations with higher port taxes.”
MacLellan said that a recent statement from the Antigua and Barbuda Government had summarised the history and current situation of regional cruise taxes. He said in 1993 Caribbean Community countries initially agreed to impose a minimum US$10 port head tax for cruise passengers, but this was never implemented because of internal disagreements.