Last updated: 01:38 PM ET, Fri October 02 2015

Cayman Islands Green Lights $150 Million Cruise Port Development

Destination & Tourism | Brian Major | October 02, 2015

Cayman Islands Green Lights $150 Million Cruise Port Development

PHOTO: The Cayman Islands’ $150 million cruise ship pier plan will proceed despite expected damage to dive sites in George Town harbor, said officials. (Photo courtesy of Thinkstock)

The Cayman Islands will move forward with plans to build a $150 million cruise ship pier and passenger terminal, the country’s premier said Wednesday. The controversial plan calls for the construction of a pier and terminal in the harbor of George Town, the country’s capital.

Cruise industry giant Carnival Corp. is likely to play a key role in the new development, company officials confirmed Friday.

Speaking at a local chamber of commerce gathering at the Ritz Carlton, Grand Cayman, Alden McLaughlin said that after considering the environmental and economic implications, the Cayman government will allow the project to “proceed to the next stage,” according to a report on the government-run Cayman News Service website.

“The decision to be made is not whether we want to build cruise berthing, it is whether we want to remain in the cruise business in any significant way,” said McLaughlin in a Cayman Compass report. “The decision is whether many hundreds of people and families who today rely on jobs created as a result of cruise tourism have those jobs next year and in the years to come.”

Although it hosted 1.6 million cruise vacationers in 2014, the fifth-highest total among destinations tracked by the Caribbean Tourism Organization (CTO), the Cayman Islands does not operate a modern cruise pier. Cruise visitors must rely on small shuttle vessels to carry them to and from ships anchored offshore.

The long-planned project has evolved in recent months into a battle pitting cruise-reliant tourism stakeholders against environmental activists and dive-oriented tour operators. Supporters argue the facility is critical to the country’s economic future. Opponents claim the environmental impact of dredging in George Town harbor will be too severe.

Opposition intensified following this summer’s release of an environmental impact assessment (EIA) that found dredging would “have significant negative impacts on the marine ecology within George Town harbor, in particular the coral reefs and associated habitat surrounding the project site.”

Yet the same report also confirmed what tourism stakeholders have long argued: the Cayman Islands' share of cruise ship calls is declining because the territory lacks a modern cruise ship pier and terminal.

The EIA also reports tourism accounts for 24 percent of the Cayman Islands’ gross domestic product and provides “significant employment and entrepreneurial opportunities for residents.” 

The Cayman Islands has sought for nearly a decade to develop a modern cruise ship terminal, and in recent years seemed to inch closer under the current effort, led by the government under the administration of Moses Kirkconnell, the Cayman Islands’ deputy premier and tourism and transport minister.

McLaughlin said Wednesday that while the harbor dredging would harshly impact coral and dive sites in George Town harbor, it would not impact the Seven Mile Beach resort district, a key factor in the government’s approval of the project despite the “damage to reef structures in the immediate vicinity of the harbor” dredging will create.

He said the project would safeguard the island’s cruise ship business, which has been in development for 40 years, and include an enlargement of the cargo port, which would “protect existing jobs” and create new ones. He added that the current tendering of ships off shore would in itself severely damage coral reefs in George Town harbor.

McLaughlin’s announcement came in advance of the release of a final business report from project consultant PwC and was met with “stunned silence” according to the Cayman New Service report. He said the next step was to consult with the U.K.’s Foreign and Commonwealth Office and the cruise lines to create a funding model for the multi-million dollar project.

Officials at Carnival Corp. said Friday the company is poised to play a role in the port. “There is a benefit to our guests — and to the community — through the undertaking any type of activity that modernizes our port of call and enhances the attractiveness of the destination for our guests onboard the ship,” said Roger Frizzell, Carnival Corp.’s chief communications officer.

“We remain open, as always, to playing a role in these types of activities as a partner in the community.” 

The cruise company’s vessels account for about 60 percent of cruise ship calls to the Cayman Islands, according to the Cayman Compass report. Carnival has partnered with several Caribbean destinations to finance and support port development in recent years.

McLaughlin said the project’s financing model would ensure the cruise line partner would guarantee passenger volumes over the financing period.

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