FCCA president warns PM: GPH deal will jeopardize cruise business

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A letter from the president of the Florida Caribbean Cruise Association (FCCA) dated 19 February 2019 has warned Prime Minister Gaston Browne and Tourism Minister Charles “Max” Fernandez that the Global Ports Holdings agreement will adversely affect Antigua and Barbuda’s cruise tourism business.
In the letter, FCCA president Michele Paige informed the government that the deal with Global Ports, named “the Company” in the letter, will price numerous cruise lines out of Antigua and Barbuda as a destination.
“On behalf of the FCCA Member Lines, we … praise the initiative to secure new pier works that will accommodate larger ships and product enhancements to improve passenger experience that will put Antigua and Barbuda in a strong position to lift with the cruise industry’s rising tide… however, as structured, the agreement for the works would likely severely lower that ceiling and jeopardize current levels by pricing out numerous cruise lines,” Paige wrote.
She stated that, under the deal, the Variable Concession Fee and Cruise Passenger Charge alone would be more than the port charges currently offered by most Caribbean countries.
“The Variable Concession Fee and Cruise Passenger Charge alone—being awarded directly to the Government—are more than all port charges in most Caribbean ports, and that excludes the Port Charges going to the Company, which will also likely increase, including a Security Fee to be implemented in 2020,” she said.
Paige said that while the government’s aim is to ensure long-term economic stability, the implications arising from the deal will cause cruise lines to re-evaluate their itinerary planning decisions.
“Though we certainly endorse the Government’s aim to secure its long-term economic future, consider the implications that these exorbitant increases could have. Even in the short-term, the costs in 2019 and 2020 would greatly impact cruise lines because those costs would cause many lines to reevaluate their itinerary planning decisions moving forward,” she said, adding, “Many of the cruise calls within that window have already been confirmed and sold at the past prices, which would likely lead to a loss for those cruise lines.”
She added that she hoped the government regarded their partnership with the respect as the FCCA does, and did not realize the implications of the increases.
“Cruise tourism’s true positive impact in destinations comes by our guests experiencing and spending money in the destination – and if passenger spending on the island were to perform at the 2018 BREA study overall average, that would have added $18.5 million in direct expenditures.”
Paige, in the letter, questioned the reasons for the agreement to focus on duty-free shopping, instead of looking for new opportunities to develop the cruise product.
“There are opportunities to increase that spending with a project like this, especially as guests’ interest in engaging experiences continue to grow, but it is surprising that the agreement appears fixed on items like duty-free shopping—which has lost favor with consumer sentiment—and awards tax exemptions and other profit allowances for the retail and rent components, along with numerous other exemptions and incentives for the Company even at the possible detriment of cruise tourism,” she said.

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