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Cuba: Immediate Threat To 20% Of Bahamas’ Visitors

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Cuba’s opening will immediately threaten more than 20 per cent of the Bahamas’ stopover visitor market, it has been revealed, amid calls for a ‘tourism trade agreement’ with the US to mitigate the impact of its ‘diplomatic reset’ with Havana.

The implications for the Bahamas’ number one industry, and other Caribbean nations, are discussed at length by a newly-released Caribbean Hotel and Tourism Association (CHTA) paper, which describes Cuba’s opening as “the biggest and most disruptive pebble to be dropped into the Caribbean pool in 50 years”.

The CHTA paper, in particular, warns that Cuba’s proximity to the US will act as an immediate draw for Florida’s ‘impulse’ traveller market, which currently gravitates to the Bahamas for short-term stopover vacations.

“As it relates to the state of Florida as a source market, Cuba’s location will draw the attention of those travellers who have traditionally travelled spontaneously and impulsively to the Bahamas, a country which has relied on Florida for generating over 20 per cent of its arrivals for some time,” the CHTA paper warned.

“A not insignificant proportion of those arrivals from Florida to the Bahamas also results from surreptitious travel by US citizens to Cuba, and the airlines benefiting from those transactions will likely lose out.”

The Bahamas Hotel and Tourism Association (BHTA) has already shown itself to be alive to the implications of the thaw in US-Cuba relations, and the eventual full opening of the latter’s tourism market to American visitors - a base that accounts traditionally for 80-85 per cent of this nation’s total stopover visitors.

It earlier this year formed a ‘Cuba Commission’, with members including BHTA president, Stuart Bowe; British Colonial Hilton general manager, Rui Domingues; Nassau Airport Development Company (NAD) chief, Vernice Walkine; and KPMG accountant, Charlene Lewis-Small.

The Commission’s aim, according to BHTA Board meeting minutes, is: “With Cuba coming on line, the BHTA would like to create a committee that would examine the potential impact Cuba would have on the Bahamas as it pertains to our tourism economy, and also the opportunities to improve areas of our product and service that need enhancing in order to ensure competitiveness.”

The CHTA paper, meanwhile, warned that the value of Cuba’s proximity to the US for stopover visitors “cannot be overstated”.

It added: “Countries such as the US Virgin Islands, Puerto Rico, Belize, the Bahamas and the Cayman Islands, and to a lesser extent destinations such as Cancun and Jamaica, have been beneficiaries of spontaneous and impulse vacation decisions, a growth area aided by online vacation offers and instant booking technology applications.

“According to the global marketing communications firm, MMGY, consumer research undertaken earlier this year shows that 20 per cent of all vacations were last-minute vacations.

“Soon the very large and varied destination of Cuba will be added to the list of options in the consideration set for last-minute and impulse vacations by US travellers, particularly those in the north-east, mid-west and south.”

The US north-east, alongside Florida, is the Bahamas’ other key stopover visitor market. And not even the cruise ship sector will be immune from the Cuba effect.

“The likelihood that cruise lines will drop some existing ports to accommodate Cuba port visits is real, and the proximity of Cuba to the US mainland can allow for Cuba to be easily added to a schedule that can impact itineraries to near markets such as the Bahamas, the Cayman Islands, and Jamaica,” the CHTA paper warned.

All segments of the Bahamian tourism base will thus be under instant, sustained pressure once Cuba fully opens up to US tourists.

“The CHTA expects that those islands and countries nearest to Cuba will feel the greatest ripple effects, and believes it would be wise for them to begin planning ways to mitigate those effects now,” the CHTA added.

The Bahamas, via the BHTA, has already adopted such an approach, and the CHTA suggested that time was still on this destination’s side.

A full opening of Cuba to US tourists is still likely to be some way off. That is because Congressional approval, always a difficult ask, is required to completely lift the US trade embargo. And then there are the outstanding multi-billion dollar reparations claims by US companies for assets seized by the Castro regime that have to be addressed.

“The Caribbean, the most tourism dependent region in the world, could use a good shaking up,” the CHTA paper said. “For decades, with few exceptions, it has relied on its natural advantages of sun, sand, sea, welcoming populations and, more than anything else, its relative proximity to the United States, the largest economy on earth, for much of its success.

“For decades, many Caribbean governments appear to have grudgingly accepted the employment and foreign exchange benefits delivered by their tourism economies but have not provided the kind of attention and support to tourism that could further reduce the crushingly high and debilitating levels of unemployment and national debt which often plague their countries.

“Relatively little effort has been spent on turning the most tourism dependent region in the world into the most tourism competent. The coming Cuban disruption just might be the tonic that the countries need, individually and collectively, to build the kind of strategic approaches to tourism development that will yield sustainable results for its citizens.”

Emphasising that Cuba’s opening was as much an opportunity as a challenge for the Bahamas and other Caribbean nations, the CHTA said much would depend on whether the region could grow its tourism arrivals market as opposed to splitting it with the Communist nation.

As a result, it is calling for a Caribbean Basin Tourism Initiative (CBTI) to be agreed between the region and the US as a means of stimulating trade, investment and economic growth via the industry.

It would be modelled after the existing Caribbean Basin Initiative (CBI), the one-way trade preferences regime designed to boost commodities exports from the region into the US.

Frank Comito, the CHTA’s chief executive and director-general, said in a statement: “Taking advantage of the opportunities which are presented will require leadership and engagement by all stakeholders, and in our view the United States must return to the stewardship role it played in the region’s economic development several decades ago.

“The normalisation of US-Cuba relations can be the catalyst for advancing a new Caribbean tourism and economic development agenda.”

Mr Comito, who held the same post with the BHTA, added: “CHTA presents to the region’s public and private sector leaders, the US International Trade Commission and, by extension, to the US government, a single recommendation: The creation of a Caribbean Basin Tourism Initiative (CBTI). This would recognise tourism services as a way in which to support both Cuba and the region’s development.”

Comments

asiseeit 4 years, 9 months ago

The U.S. is not stupid, they could see the play China was making in the region and have put a halt to it. The Bahamas is just a minor player that will get squeezed and squeezed hard, you think they (U.S,- China) give a crap if The Bahamas suffers? Baha-Mar bet on the wrong country to back it (China) and we (Bahamians) are gonna pay. Cuba is going to eat our lunch and the U.S. is going to make sure of it. You think the U.S. would just let China in it's backyard without a fight?

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Economist 4 years, 9 months ago

We have known that Cuba would open up sooner or later. Some of us have voiced our concern for the last 20 years or so.

We need to market to those who won't want to holiday with a bunch of Americans. It will be interesting how many Europeans and Canadians will not want to go there. The DR has already started to market for them so we are behind the competition.

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Well_mudda_take_sic 4 years, 9 months ago

Economist, you really have it all wrong. English & French Canadians, together with the Spaniards from Spain, simply can't get enough of Cuba when it comes to spending their vacation money. The American tourists who will soon will be flooding into Cuba will not dampen the great love affair with everything Cuban that the Canadians and Spaniards have been enjoying for many decades now.

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Economist 4 years, 9 months ago

I know that they can't get enough of Cuba at the moment but some of my Canadian friends tell me that they think that many Canadians and Europeans won't want to there with a crush of Americans.

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jt 4 years, 9 months ago

I agree with "well mudda", I've been to Cuba 3 times and Canadians and Europeans go there in droves for a tourist dollar that stretches far in a grateful, spectacular and welcoming country. Cuba has beaches, diving, mountains, waterfalls, nightlife...subpar dining but culture in spades. Far from the expensive vacation packages and surly, ungrateful staff that is the norm for many tourists here...plus our native petty theft, charming. Same for the D.R., Punta Cana is booming while we just sit here churning out hundreds and hundreds of illiterate high school "graduates"...what could possibly go wrong?

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banker 4 years, 9 months ago

I spoke to a Canadian colleague who holidays there, and they love Cuba. Because the Americans blocked off Cuba, they needed a hard currency or convertible currency such as Canadian dollars to pay for exports. So the tourist experience was wonderful. A Canadian colleague told me that he threw his change on the bedside table of the hotel, and the maid had cleaned the coins and stacked them on the table. There is no teifin there because the government needs the tourism, anyone caught teifin from the tourists is immediately dealt with by the authorities, sometimes with a bullet if the amount is big.

Cuba has everything, from exotic food, to bass fishing, bird hunting, hiking and ecology tours. We simply can't compete, either on price, gastronomy, cigars, culture, experience or features.

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SP 4 years, 9 months ago

Biggest & Most Disruptive Impediment To Bahamas Tourism In 50 Years Are PLP & FNM

Tourism failure can be laid squarely at the feet of asinine dumb-ass stupidity of the PLP and FNM.

Notwithstanding Bahamas prime proximity, after 40 solid years of jackass PLP and FNM management, Bahamas has digressed from the number one regional tourism destination position to number 6 and steadily falling.

Jackass does as jackass is. They are both well proven to be the epitome of all that dumb stupid jackass's could possibly ever be!

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GrassRoot 4 years, 9 months ago

well there is an opportunity for the Bahamas in that as well. I remember the German CONDOR went from Frankfurt to Cuba onto Nassau a couple of times a week. maybe it would be a good idea for our tourism people to get the large carriers on board (KLM, Air France, Condor/Lufthansa, AirBerlin, Turkish) to extend their flights to Cuba on to Nassau. There is lots the Bahamas has to offer that Cuba doesn't. And when you talk to Europeans on a rainy November evening about the Bahamas, they would come in a heartbeat. Not only is Bahamas expensive the access to the Bahamas is expensive already due to BA's monopoly from and to Europe.

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asiseeit 4 years, 9 months ago

Pray tell what the Bahamas has that Cuba does NOT? Crime? Murder? Petty Theft? Rude People? Corrupt Officials? Ignorance? Garbage everywhere? Tell me because I know they have the same beaches, sealife, and sun we have plus some much more such as mountains and rivers. So what is it we have that they do not? Cuba is going to take our tourist dollar and there is NOTHING Bahamians will or can do about it! The last time anything drastic changed/happened in our tourist industry The Bahamas was still a colony!

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Abaconian 4 years, 9 months ago

We really need to start diversifying our economy. Tourism is great and has built the economy of this country, but it has some major flaws. For one - its flaky. It can leave just as quickly as it came. You don't need to look far to see how many places have been developed to cater for cheap cruiseship and package-deal type tourists only for them to move on to somewhere else a few years later: somewhere cheaper, less crowded and more novel (aka Cuba). When that happens the country in question is devastated because they've over invested and over speculated in a flaky industry. It's extremely worrying for us...... But meanwhile our government doesn't seem to get it. They neglect things like education and small Bahamian-owned businesses and instead devote all the attention to the mega resorts, and cruise ship ports - the kind of developments which only make Bahamians more economically dependent on tourism, and do little to foster the kind of entrepreneurial spirit that we so desperately need in this country.

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Sickened 4 years, 9 months ago

I would have to add that the drug trade is what built our economy. Without that HUGE injection of cash in the 80's (thanks PLP) our economy would not have grown as quickly as it did just on tourism dollars. And because of all that easy money our government, nor our people, put much effort into our tourism product.

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