By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

The Government is targeting a near-28 per cent increase in cruise passenger spending yields to generate an extra $90 million in annual tourism revenue, a Cabinet Minister said yesterday.

Dionisio D’Aguilar, minster of tourism, who was the keynote speaker at the Abaco Business Outlook conference, also vowed to “get tough” with cruise lines and “change the way we do business” to ensure their passengers spend more in the Bahamas with local firms.

He added that 70 per cent of the Bahamas’ six million-plus annual visitors are cruise passengers, and said: “The cruise ship visitor spends an average of $70, while the stopover visitors spend an average of $1,500.

“In the short-term we are aiming to induce our cruise ship visitors to spend $20 more within our destination. The average spend right now is about $70 per person, and we want to get it to $90. This near-28 per cent increase in cruise spend will net $90 million in additional revenue. In tandem with increasing cruise visitor spend, we are working to get as many cruise visitors as we can to become return stopover visitors.”

Mr D’Aguilar said the Ministry of Tourism will seek to act as a “buffer”, and negotiate with the cruise lines on behalf of Bahamian entrepreneurs to ensure they capture more business from the cruise ships.

“Previous governments have given these cruise ships these islands, and they take the tourists to these islands and that’s not really helping Bahamians because, for instance, they are bringing food off the ship,” the Minister said.

“You may be able to sell some art or craft, but they tell their passengers not to bring any money with them and, as a result, we are not feeling anything economically. We incentivise them based on the number of passengers that they bring.”

Mr D’Aguilar added: “We need to look at what is the economic impact, and base the incentive on that and not the number. If passengers come to Nassau and never get off the boat, we still have to incentivise them.

“We need to be able to partner and see how we can get visitors to spend more. We owe these cruise ship companies tens of millions of dollars. That’s the deal we struck and we’re just so scared. Get ready when I get tough with them and they threaten to pull their ships. We have to get tough with them in order to change the way they see us and do business with us.

“We have something they need, which is those islands,” the Minister continued. “If you want to go to those islands you have to come to Nassau, Freeport or whatever the major population centres are and get visitors to spend. They have made substantial investments on those islands and that is something we have to leverage.”

Mr D’Aguilar’s comments hit on a strategy that many in the tour operator/excursion provider industry have advocated for years, namely using the cruise lines’ Bahamian private islands as a method to extract more favourable terms for locals and their businesses.

Under the US Jones Act, foreign-flagged vessels such as the cruise ships have to first call at a foreign port before they can return home to the US. This made the Bahamas a natural stop on the three, four and even five-night cruises, but Cuba’s opening up has whittled away this advantage and strategy./

And this is not the first time Mr D’Aguilar has threatened to ‘get tough’ with the cruise lines. He did similar in slamming as “reprehensible” the threat by a major cruise line to terminate Bahamian tour operators’ contracts if they direct-sell to passengers without its permission.

His pledge came after Tribune Business obtained a copy of Norwegian Cruise Line’s (NCL) August 30 warning letter demanding that Bahamian shore excursion providers “discontinue this practice immediately”.

Promising to confront the cruise lines on the issue, Mr D’Aguilar said he “completely agrees” that NCL’s letter amounts to ‘restraint of trade’ and anti-competitive practices that have left Bahamian companies earning mere “crumbs” for years.

The Minister yesterday noted that destinations such as Aruba and St Marten were generating cruise passenger spend in the range of $180-$190 per person.

“They somehow have it in their head that they get better deals in those places, so maybe I have to speak to the Minister of Finance about removing duty on clothes and electronics, which seem to be a heavy buy for them when they get to the southern Caribbean,” Mr D’Aguilar said.

On other issues, the Minister said the Government was “in kind of a dilemma” over its fiscal position “because we use government to create employment”.

He added: “There is a desire to make that change. The problem is the political will. This government understands that we have slipped considerably in the ease of doing business. It’s a frustrating barrier; a whole lot of government is into job preservation and job growth.”