Cruise project takes step forward

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The prospect of a new cruise dock in George Town harbour moved a small step closer this week with PwC selected to produce a business case for the project. 

The firm will also produce the tender documents for an open bidding process to select the company that ultimately builds the pier. Tourism officials accepted on Wednesday that it would be 2014 before a construction contract was finally awarded for the long-awaited project. 

Few dispute the need for new cruise berthing facilities in Grand Cayman and the process of producing a business case is seen by some as a formality, necessary only to comply with the UK’s new ground rules on financing major projects. 

Tourism Minister Moses Kirkconnell announced the selection of Pricewaterhouse Coopers to produce the business case this week, completing a process put in motion by his predecessor Cline Glidden. 

He said the move demonstrated the government’s commitment to openness and transparency.  

Gerry Kirkconnell, managing director of Kirk Freeport that has several businesses downtown, welcomed the news that the pier was a priority for the new government. 

He said: “We need to get more cruise ships back as quickly as possible. The decline in the cruise ship market has definitely hurt businesses.” 

He said traders in George Town were pleased that the outline plan for the project was for a pier only, with “upland development” off the agenda.  

The tourism minister said in his first press conference that the project would be limited to berthing facilities only, calming fears that a cruise operator or construction firm could be 
involved in retail development, in competition with local businesses. 

The project, which has been discussed in varying forms for the past decade, could trigger a wave of new economic activity in the capital. 

Gerry Kirkconnell added that there was significant interest in some of the vacant downtown properties that hinged on the cruise project going ahead.  

He said Kirk Freeport would look to expand its own presence at the Bayshore Mall, if the pier went ahead. 

But he believes businesses are cautious about guarantees over the timing and will wait until construction is well under way before they move on any new development plans. 

“People are probably going to wait, because we have been waiting for so long and hearing for so long that this is going to happen. This has been talked about for more than six years, so people won’t take the risk until they are sure it is actually going to be built.” 

The business case, to be produced by PwC, should be a formality, said Alastair Paterson, who was the project manager on a previous 
proposal for a public private partnership with a Chinese government construction company to build a dock. 

That plan was shelved last year, but Mr. Paterson maintains that much of the groundwork is still relevant. 

He said the case for a pier was obvious and delaying construction only risked further hurting Cayman’s position in the increasingly competitive cruise ship market. 

“I found that most people, regardless of political persuasion, supported the idea of some form of facility as cruise ship tourism is vital to the economy of the country.  

“It is estimated that every passenger generates about US$ 100 into the economy. Increasing passengers to 2 million and above could be an incredible boost for the country and to do that a facility is absolutely essential.” 

He added: “The process laid down at present could take years to complete and by that time the potential exists for further reductions in passenger numbers. The need to go back to square one is a waste of money and energy. The studies have been done. Most know the need. There are few solutions and to process again will lose time and ground.” 

Cruise visitor numbers for the first five months of 2013 are around 60,000 down on the same period last year, which itself saw the second lowest year for cruise visitors since 2001. 

Some of that decline can be attributed to a decision by Carnival to divert some of its ships to Roatan. The company has previously referenced the lack of berthing facilities in Grand Cayman as a concern. 

Mr. Paterson added: “It should also be remembered that cruise ships will be marketing trips now for two or maybe even three years ahead. With no guarantee of upgraded facilities, the ships could conceivably be leaving Cayman off their itinerary for some time to come unless they are given guarantees a facility will be constructed.” 

When he previously spoke out in the Caymanian Compass about concerns that the procurement process could delay the construction project, Mr. Paterson was chastised at a press conference by then tourism minister Cline Glidden, who said the construction contract could be signed by October. 

Stran Bodden, the tourism ministry’s chief officer, appeared to accept this week that would not happen, targeting 2014 as a realistic date for the construction contract. 

He said: “PwC is tasked with producing an outline business case, the full business case and tender documents for the proposed cruise berthing project.”. 

Following the issuance of tender documents and a suitable tender period that will include a timeframe for negotiation, the construction contract is expected to be awarded for the proposed cruise berthing project in 2014, he noted.  

He added that deadlines for each of these steps will be firmed up in the coming weeks.  

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The absence of a proper dock for cruise ships has been blamed for a decline in arrival numbers.
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