Our port: Should we ‘rent’ or ‘buy’?

The role of tender boat revenues: If the proposed cruise berthing facility is not built, the owners of the existing tender boats will continue to gain fees of US$5.25 per passenger. Based on the current 1.9 million passengers per year, this means the tender boats will receive an estimated US$249 million over the next 25 years.

When the port facility is built and financed under the proposed arrangements, this US$5.25, which currently goes towards private businesses, will now go to the port developers to help finance the project, as well as to maintain the port facility over the 25-year period.

Financing the port in this manner is similar to a family choosing to buy a house today by using a bank mortgage instead of continuing to pay rent for housing. The recent public meetings show that the developer Verdant Isle is assuming all of the financial risks relating to the project. The Cayman Islands government is not borrowing the funds to finance the project, Verdant is the borrower.

However, if the port is not built, the US$249 million will simply go into the pockets of the tender boat operators and the country will have nothing to show for it after 25 years. Having all these funds go towards transportation costs is like paying rent for 25 years and not owning the house afterwards.

On the other hand, if the port is built, the public gets an asset valued at over $450 million at the end of the 25-year period.

Make no mistake. With almost US$250 million to lose, the tender boats are not independent bystanders in this debate on the new cruise berthing facility. So, when you read that the owners of the tender boat operations are saying “We will be out of business”, this is what that means. And when the tender boat owners say “We donated to save reefs, not the tender business”, please look at that quote, think about this US$250 million dollars in revenues that they stand to lose, and think again.

Kenneth G Davis

1 COMMENT

  1. Short answer to this is the obvious fact that noone would ever be able to get a mortgage application approved with a heavily qualified and four years out of date draft property survey.

    And that is exactly what CIG and VIPP are trying to do. Persuade the country to approve a project on the basis of unreliable, incomplete, heavily qualified and massively out of date “experts” reports that aren’t worth the paper they’re written on.

    They are also deliberately ignoring and/or excluding from the conversation our own and much better qualified experts, the DoE and CCMI.

    So, in the absence of up to date and reliable reports, the only sensible thing we can do is to keep renting and avoid the risk of repossession.

    Therefore we must all vote No. to the port.