On Wednesday, Caymanians will be asked a seemingly simple question: Should the Cayman Islands develop cruise-berthing infrastructure?
The reality is far more complex.
A list of more fundamental questions for Cayman starts with the most basic one: How much will it cost?
Reporting in the Compass today suggests post-COVID inflation, supply chains riven with uncertainty amid US president Donald Trump’s tariffs, and the simple passage of time have pushed the optimistic quote of around $200 million in 2019 to north of $300 million.
Anyone with a mortgage will know that the cost of borrowing has also surged. Repaying any bank loans associated with that kind of expenditure could take the project costs close to $700 million before the construction costs and interest are repaid.
Given the protracted timeline from thought to plan to action and the expansive overruns on previous government projects, we expect that could get even higher before any mega ships are moored up in George Town – or wherever else the new infrastructure ends up.
If that’s the case, then we are compelled to ask a more involved question.
Is this the best use of the people’s money?
The list of urgently required infrastructure projects includes remediating and replacing the landfill (ironically, abandoned as too expensive), implementing a public transport system, replenishing the eroded Seven Mile Beach, and upgrading the airport.
An expanded cargo port remains a far-more-pressing national priority than cruise.
All of those projects – to one degree or another – have featured in the manifestos of the three political parties.
At the same time, the rhetoric from many standing for office has been that we must reduce our reliance on work-permit fees and duty from development – two significant income streams for the government.
And all this is against the backdrop of a pre-election economic report that projects Cayman will be running budget deficits by this time next year.
It is very clear that a multi-year infrastructure plan is needed that prioritises capital expenditure based on what the country needs most, not the wishes and whims of the day.
There will be arguments that the cruise lines can pay for the port and be refunded through a per-passenger head tax. That was the formula last time around, and if you squinted hard enough through rose-tinted spectacles, it just about made sense. Up to 2 million passengers per year, paying $6 per head, is a healthy revenue stream over the 25-year cycle of a project like this. But it is a drop in the bucket, given the likely build costs at this point. True, a single pier would be cheaper, but the revenue would decrease, too.
Other islands have entered deals with cruise lines to fund the entire cost of lavish new ports. But they have turned out to be Faustian bargains with the cruise companies dominating revenue generation onshore, as well as on the ships. Former St. Lucia premier Allen Chastanet, flown in to show support for a cruise pier in Cayman, ironically, has been one of the biggest critics of the project in his own country for precisely those reasons.
Some in government and pro-port activists are saying these are all details that will be worked out and that they will somehow find a utopian middle way where Cayman gets the cruise company’s capital dollars with none of the strings attached.
They are essentially pitching the referendum as a relatively meaningless public poll that will simply provide a green light to investigate further – something they are at liberty to do anyway.
The reality is we are not short of information on this issue. It has been discussed, investigated and reported on for 30 years.
Before any government goes to the country to ask if cruise-berthing infrastructure should be developed, it should have a clear idea of what the project would look like, where it will be situated, what it will cost, who will pay and who will benefit.
This is not a yes or no question. In fact, as the Elections Office prepares the ballot papers for Wednesday’s poll, we suggest the addition of a third box for voters to check: ‘Come back when you have a plan.’
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This article omits one very important aspect of this proposed project. Regardless of cost, do the public really want to be flooded with more cruise ship passengers, most of whom, apart from clogging up our roads and what’s left of our beach, spend a fraction of what our stayover visitors do. My sense is that the overall public vote will be against the piers, for this reason.
The truth. And the answer is no… nowhere to put them, not enough for them to do and the traffic would be awful for everyone else.
St. Lucia Cruise Berthing Port is not owned by the Cruise Industry, but the 30 year lease St. Lucia signed, is owned by a China owned firm that directly funds the China military!
Kingston, Jamaica Port $250 million project, signed in 2015 is also own by the same China owned firm with a 30 year lease.
If there was a War between the US & China??? The US Tariff war, it has been suggested that China owned ports will be hit with higher tariffs!
Correct – and the same would happen to us given our current government’s inability to manage budgets. We couldn’t afford this project. That is the hard truth. And would we want it? WE can’t manage the cruise ships we have – traffic becomes a nightmare. Where would the extra people go? Stingray City is only so big. Seven mile beach is disappearing – and, by the way, that is a much cheaper fix. Government needs to sort out the dump, SMB, affordable housing, crime and a host of other issues before it looks at building an expensive berthing facility that we cannot afford.