Tourism Industry Update

Coming out of high season (Jan–Apr) the tourism industry in the Cayman Islands has held its ground compared to other destinations and despite the lack of focus nationally by Government representatives on industry related issues and developments. The stresses within the financial sector have weighed heavily on the leadership causing tourism issues and priorities to take a back seat.
 
It is CITA’s hope that with the newly formed Ministerial Council and Tourism Advisory Council, on which CITA has four representatives, there will be more forward movement. As an association, CITA continues to represent its members through lobbying efforts, marketing support and general promotions and initiatives that contribute to the betterment of tourism.
 
Resilience takes precedence. Businesses have been forced to scale back, cut costs, lower rates and generally work harder for every transaction. These circumstances have also been plagued by the Cayman Islands Governments financial strain that has resulted in an increased cost of doing business.
 
What is the breaking point? Things are slowly coming to a head and there is tremendous concern over what happens next–and how long we can withstand the pressure. There will likely be some businesses that can’t survive. As time goes on there is frustration within the private sector and the industry issues become critical. From a sustainability standpoint, CITA is concerned that businesses will not be able to reinvest in their product. Although people are starting to travel (or in some cases never stopped)–they are demanding more for less.
 
The air arrival statistics show a 5 per cent increase in arrivals year to date over 2009 (Jan–May). The interesting factor is that tourism accommodations tax revenue, which represents 10 per cent of total room revenue, is only up 3 per cent over this time in 2009 meaning that room rates have decreased significantly. Although the revenues are improving from 2009 figures comparing to pre-recession figures in 2008 the year to date is down approximately 12 per cent.
 
The prospects of the berthing facility development has industry partners holding their breath in hopes that this revitalises the experience and produces positive results in arrival numbers in years to come. Year to date cruise arrivals are up 3.2 per cent, but in the short term there continues to be lack of confidence that Cayman can withstand its competitive edge without berthing at this time.
 
One new initiative that will bring a splash to the industry is the newest Kittiwake shipwreck attraction for scuba diving and snorkelers. This project was executed through a private/public partnership between CITA and the Cayman Islands Government. Not only does it create an appealing site for returning divers to come visit but it also provides an exciting underwater artificial reef. This activity which will provide an alternative to Stingray City for both cruise and stayover visitors and alleviate some environmental impact on the site. For more information about this project visit kittiwakecayman.com.
 
With talk of the US dipping into a depression, post recession, Cayman needs to continue to strive to maintain its competitiveness through new initiatives and product development. The ultimate goal, as stated by CITA, being to increase air arrivals to 400,000 and 1.75 million cruise arrivals by 2014. This being sustainable based on the existing room stock and infrastructure.
 
For more information,
contact Trina Christian, Executive  Director on 949-8522 or trinachristian@cita.ky.

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