July 28, 2024
While much of our local discussions center on the political events in the United States, a
specter is devastating our tourism economy; Mega-ships plying the central and northern
seas of The Bahamas.
The numbers clearly show that as cruise passenger numbers rise and we giddily
celebrate record-breaking arrivals, our stopovers fall. The simple fact is that our
stopover visitors are rapidly being converted to cruise passengers, with devasting
implications for our economy.
Using data presented at the Ministry of Tourism’s July 5th press conference, for every
6% conversion—representing a loss of 100,000 stopovers—our economy loses ~$250
million or a quarter of a billion in visitor spending.
The evidence for this “great conversion” is incontrovertible.
✓ In 2023, while nine other countries in the region, led by Turks & Caicos, grew their
stopovers by up to 36% over 2019, our previous best year, stopovers in The Bahamas
grew by 0%. ALL of the Bahamas’ increase in our record-breaking year for visitor
arrivals were cruise passengers.
✓ As of April 2024, The Bahamas is in last place in our region concerning stopover
visitor growth. In fact, for the first four months, stopovers to The Bahamas are behind
stopovers for last year. These comparisons have been taken
from tourismanalytics.com because the Ministry has since shut down access to current
stopover visitor numbers on tourismtoday.com.
✓ In December of 2023, while the Ministry was celebrating its record-breaking year for
visitor arrivals, the Minister of Finance was forced to reduce the economic growth
forecast from 5.5% set in July to 1.1% in December. If, like Turks & Caicos, all of the
Bahamas’ 33% increase in visitors were stopovers, visitor spending would have
increased by $6.2 billion! Unfortunately, they were all cruise passengers, so the
spending increase was only $168 million, a $6 billion difference! The gulf between
stopover spending and cruise passenger spending is staggering.
✓ The Ministry of Finance was clearly concerned about this lack of correlation between
total visitor arrivals and economic growth because the Prime Minister, in his December
keynote at the BHTA AGM, in the presence of the senior staff at Tourism, said that he is
far less interested in visitor numbers and far more interested in economic prosperity. Up
to July 5th, 2024, that fell on deaf ears as Tourism staff continued celebrating total
visitor arrivals, deliberately masking the elephant in the room.
✓ According to the Cruise Lines Industry Association (CLIA), Florida is the largest
source of cruise passengers for The Bahamas. Since its peak year of 2006 for
stopovers, Florida has seen the most significant drop in stopover visitors out of all of the
United States by far—clear evidence of stopover conversion.
✓ Finally, at the Seatrade conference in March of this year, a very senior cruise
executive said that his objective is not to compete with other cruise lines but to convert
land-based visitors to cruise passengers! Clearly, they are succeeding
Those in denial do not wish to acknowledge that the growth of cruise visitors and the fall
off of stopovers are interrelated. They do not wish to recognize that the biggest threat to
our tourism economy is the continued conversion of stopovers to cruise passengers.
Doing so would force them to acknowledge that they have been celebrating economic
suicide.
Instead, they attribute the lack of growth of stopovers to the loss of hotel rooms
between 2019 and today, even though, unlike the cruise lines, our current hotel rooms
are far from 100% occupancy.
They are at pains to explain why The Bahamas is losing hotel rooms while Jamaica, the
Dominican Republic, and other countries have thousands of hotel rooms under
construction, and the cruise lines have more than 50 new mega-ships under
construction for delivery by the end of 2028.
Could it be that other destinations are growing their much more economically valuable
land-based tourism while The Bahamas continues to celebrate lower-spending cruise
visitors?
Could it be that investors are betting their capital on businesses that are growing, not on
those that are faltering?
The truth is that amenity-laden mega-ships of today are far different from ships of
bygone ages. Each one has more sleeping rooms than Baha Mar, more restaurants,
more bars and more entertainment. They have multiple pools, meeting rooms, water
slides, neighborhoods, multiple suites, and more ocean-view rooms. The Bahamas has
happily added the one thing they had missing: private beaches and the magnificent
ocean waters of our private islands. Such amenities can be provided at prices far lower
than a land-based vacation in The Bahamas with comparable amenities. And with
operating costs for utilities and labor far lower than those for land-based hotels, the
profitability of cruise companies has skyrocketed since the end of the pandemic.
Both land-based and cruise-based tourism can coexist profitably in The Bahamas.
However, the current and devasting problem for the Bahamian economy cannot be
solved by those in denial.
We once took pride in being regarded as the tourism leaders in our region. We
understand that Tourism delivers “roughly 60% of our GDP” —most of that,
approximately 87%, is delivered by stopover visitors. For the sake of the Bahamian
economy, there is no better time than now to show that leadership again.
Michael C. Pintard
Leader, Free National Movement