The Cayman Islands Tourism Association has suggested the government divest itself of non-performing, heavily-subsidised attractions such as Boatswain’s Beach and Pedro St. James.
We could argue that government should have never entered into the tourism attraction business in the first place, but that is beside the point right now. The fact is that it did and Boatswain’s Beach/Turtle Farm and Pedro St. James are losing way too much money for the Cayman Islands to sustain even in good times, let alone during a financial crisis.
Finding buyers for attractions that are losing money might be easier said than done. In order to find a buyer, the government will almost assuredly have to sell the properties for much less than it has put into them. But unloading the burden of the subsidies being given the two attractions still makes sense in the long run, particularly since there is no logical reason to believe the situation will ever change substantially.
Part of the problem, which is inherent in almost any government-run project anywhere, is the fact that government does not have to make a profit to keep an entity in operation. It can avoid making the tough decisions that private sector business owners and managers make on a regular basis. It can continue operating on a flawed business model simply because the taxpayers will bail them out.
Whether either of the two attractions as they are could ever draw the number of visitors envisioned, even with private sector ownership, is debatable. In fact, new ownership might have different ideas entirely on how to make the properties profitable.
In the end, however, it’s best to let someone with whom the financial bottom line dictates the decision-making process take on the risks of ownership.