Executive sinks hopes of eco-friendly floating pier solution
One of Carnival’s top executives has dismissed a floating pier concept for Grand Cayman as “pie in the sky” and urged government to move ahead with a long-term solution by building two permanent cruise piers in George Town harbor.
The world’s largest cruise line is interested in partnering with government on the dock project and will likely respond to the request for qualifications which goes out this year, according to Giora Israel, senior vice president of Carnival’s global port and destination development.
Mr. Israel said the long-term future of Cayman as a cruise port depended on the development of proper berthing facilities. Carnival was interested in helping to make it happen, he said, but he warned the “economics have to work.”
He urged government not to get distracted by ideas like the environmentally friendly floating dock being pioneered in Norway and get a real pier built before it was too late.
Executives at the Scandanavian company SeaWalk had expressed interest in bringing the technology to Grand Cayman as an alternative to the extensive dredging of the harbor that would be required for a permanent pier. They said the floating pier could be used in similar or more severe weather conditions as tender boats.
But without the backing of Carnival, which is responsible for more than 60 percent of the cruise traffic into Grand Cayman, the idea is effectively dead in the water. Mr. Israel said he believed weather conditions would make the floating pier impractical for Cayman or any Caribbean destination and suggested it could only be used in fjords or lakes where relatively calm conditions could be guaranteed. He estimates it would be unusable 150 days a year in Grand Cayman.
He said he had personally been involved in discussions over a pier for Grand Cayman since 1998 and was keen to see it happen “sooner or later.” Whether Carnival decides to get involved will come down to the economics, but shore-side shopping is not a deal breaker for the company. “We don’t in any way or shape need retail, it just has to be a viable pier project,” said Mr. Israel.
Government’s favored approach, outlined in a business case produced by PwC, is for a cruise line to finance the building of two piers at a cost of between US$100 million and US$200 million in return for the right to collect port fees from other cruise lines and a share of the per-passenger head tax currently charged by government.
Mr. Israel accepts that the attractiveness of the project could come down to the size of the head tax and how much government wanted to retain. But he said Grand Cayman, with its combination of taxes and berthing fees, is currently the most expensive destination in the region, and anything that makes it more costly to the cruise lines would be problematic.
“If the costs are too high, it is not going to fly. What is being asked is for us to invest or to provide a guarantee. Why would we invest if the fees are so high or guarantee money to a port when I can go to others that are much cheaper?” he asked.
He said Cayman needs the piers if it is to remain viable as a cruise destination and no one should be fooled by a bump in bookings for the next two years, which he said is connected to economic conditions in Europe and political and social unrest in the eastern Mediterranean.
“The credit to the Caribbean in terms of cruise numbers for the next two years is really more of a debit to the Mediterranean,” he said. “There are powers that are bigger than one country has the capacity to impact.
“The question of whether or not piers should be built? We are way beyond that. Anyone who questions that has to question their understanding of this business.
“Whether you want cruise ships or cruise passengers in your country or not is a different matter. That’s a perfectly legitimate question and a legitimate decision for the government to make. But if you want to be viable as a cruise destination, then a pier is critical.”
He said Carnival has built piers in Grand Turk, in Mahogany Bay, Roatan, and is building one in the Dominican Republic, while their “friendly competitors” have built ports across the region.
“Each pier that can take two ships is sucking in 1.5 million passengers per year. There is a glut of berths now in the Caribbean and more coming,” he said. “We like Grand Cayman as a destination, but if we have two ports to select, one with a pier and one without, I will tell you which way we will go.”