By NEIL HARTNELL
Tribune Business Editor
A beach park investor yesterday warned that Carnival’s $200 million Grand Bahama cruise port will be “the kiss of death” for himself and other Bahamian entrepreneurs, with the project threatening to suck away 90 per cent of his customer base.
David Wallace, a principal in the all-Bahamian group that has invested more than $1 million to develop the Pirates Cove Water Theme Park, said they and other Freeport-based entrepreneurs will “wither and die” if Carnival shifts exclusively to its own facility.
With Carnival’s vessels likely to bypass Freeport by sailing directly to the cruise line’s private port in east Grand Bahama, Mr Wallace said hundreds of jobs in Freeport - and thousands of dependents - were threatened by potential loss of employment and jobs.
Estimating that 200 taxi drivers, and at least 400-500 employees in businesses ranging from tour operators, excursion providers, straw vendors to Port Lucaya retailers may be impacted, Mr Wallace urged the Christie administration to “rethink and reconsider” the Carnival project at the 11th hour.
“Based on what we’ve been hearing, we’re beginning our fact-finding to find out, one, if they [the Government] have approved this port and, if they have, there should be some consultation with persons on Grand Bahama, in particular those persons greatly affected by this new cruise port,” Mr Wallace told Tribune Business.
“We’re going to begin some dialogue with the Government, the Port Authority and the [Freeport] Harbour Company to understand the economic implications moving this port will have on Grand Bahama.
“Possibly 200 taxi drivers will be affected, and maybe 400 - possibly close to 500 employees - will be affected by this move.”
Besides Pirates Cove and other beach destination and excursion providers, Mr Wallace said the likes of UNEXSO, Port Lucaya Marketplace vendors, jet ski and water sports providers will all suffer a loss of business should Carnival switch its routes from Freeport to east Grand Bahama.
“I’m not sure the Government has given serious thought to the implications of this,” he added of the Carnival project.
“If Carnival was seeking to put a cruise port in an island that does not have a port, fine, but we have a port that’s been around for 50 years, and where many Bahamians have taken their life savings to invest in businesses down by the harbour.”
Mr Wallace told Tribune Business that if the proposed east Grand Bahama port followed the example of Carnival’s Great Turks facility, where it exercised total control, including over the retail offerings and all passenger activities, “it will take Bahamians back to the position of employees, and not entrepreneurs”.
He added: “Persons like myself and others in this group, who have just invested over $1 million in a water park on the beach, will be left to wither and die.
“Four to five groups on the beach, not directly on the harbour, will be impacted directly.”
Mr Wallace said Pirates Cove, and its water park and zip line activities, typically attracted 300 to 500 visitors whenever one of Carnival’s cruise ships was in port at Freeport Harbour for the day.
He added that the cruise line generated “pretty close to about 90 per cent” of his destination’s customer traffic, highlighting the potentially devastating economic consequences that could result from the eastern Grand Bahama cruise port.
“Right now, it will be the kiss of death to Grand Bahama,” Mr Wallace told Tribune Business of the Carnival project.
With the island’s tourism economy already reeling from the Memories and Grand Lucayan closures, and the Vacation Express pull-out that has cost the island 30 per cent of its summer visitor business, he added that the cruise port will be “the final straw that kills Freeport and Grand Bahama from a cruise perspective”.
“We need the Government to seriously review, rethink and reconsider this cruise port proposal,” Mr Wallace said.
Prime Minister Perry Christie has said publicly, both in the House of Assembly and at PLP rallies, that the signing of the cruise port agreement between the Government and Carnival is imminent.
Last Friday, he told his party’s candidates ratification rally that his administration was working out the final details prior to the signing with Carnival, something the Government will likely be eager to conclude ahead of the upcoming general election.
Mr Christie and his have said the agreement with Carnival provides for retail, restaurant and tour/excursion activities at the new cruise port to be owned and operated by Bahamians.
However, with no deal finalised, and its contents yet to be disclosed to the public, it is impossible to determine whether the agreement will be beneficial to Bahamians - both from an employment and entrepreneurial perspective.
Carnival has been searching for its own Bahamas cruise port/private island for some time, as it seeks to match rival cruise lines who already possess such facilities.
This desire appears to match the Christie administration’s recent cruise port drive, the Government having already sealed a similar deal with Mediterranean Shipping Company (MSC) to turn Ocean Cay into its own private facility.
The Government appears to be trying to strengthen the Bahamas’ competitive position with the cruise ship industry, given the potential threat posed by Cuba’s opening to US tourists.
Carnival, Royal Caribbean and Norwegian Cruise Lines (NCL) have all unveiled itineraries that involve cruises to, and overnight stays in, Havana, with the latter having dropped Nassau and Freeport as stops as a result on 25 cruises during the 2017 second half.
The Government likely believes that these private island deals will help tie the cruise lines to the Bahamas in the wake of Cuba’s opening, giving them a reason to keep on coming to this nation.
However, John Rolle, the Central Bank governor, recently said cruise passenger volumes were not the best measurement of the industry’s economic impact on the Bahamas. And there is a growing suspicion that the economic benefits from private cruise ports/islands are tilted towards the cruise lines, rather than the Bahamas.
Mr Wallace told Tribune Business that with the Carnival port located an hour to one-and-a-half hour’s drive from Freeport, there would be little to no incentive for passengers to visit the city as they will have to spend three hours out of an eight-hour stay in port on the road.
As a result, he said taxi drivers would no longer receive the $7 per head charged to take cruise passengers from Freeport Harbour to activities in the city. Should they take just 10 passengers on a round-trip, Mr Wallace said this amounted to $140 per day in fares for the drivers.
He called on Obie Wilchcombe, minister of tourism, and Dr Michael Darville, minister of Grand Bahama, along with all Grand Bahama MPs to intervene “on behalf of the thousands of persons affected by this move.
“I call on the Prime Minister to do the honourable thing, and come to Grand Bahama to meet with the persons greatly affected by this cruise port, them and their families,” Mr Wallace said. “Have everyone affected to a meeting with the Prime Minister. Let him hear from 800 people and the straw operators.”
Mr Wallace said other tour and excursion providers shared his concerns, but were likely afraid to speak out because they all held existing contracts with Carnival, whereas he did not.
He added that the Grand Bahama Chamber of Commerce was receptive to the sector’s concerns, though, and a meeting will be held this Thursday to determine how best to engage the Government and Grand Bahama Port Authority (GBPA) over the Carnival project.
Mr Wallace also called on Carnival to “do what is right for Grand Bahama”, arguing that it had “a moral obligation” to look out for the interests of Bahamians and local entrepreneurs given the benefits provided by the island to cruise lines over multiple decades.
Alluding to an economic model that favoured the cruise lines, he added: “Many vendors are struggling to keep their doors open because of the percentage they [the cruise lines] seek to take out of tours.”
Mr Wallace also recalled how Grand Bahama was “near death” in Hurricane Matthew’s aftermath, when the cruise lines stopped called on Freeport for a month, and how many providers re-opened at great personal expense.
“The Port Authority was calling everybody with a business on the beach to try and get them up and running, so passengers could visit a place of normalcy,” Mr Wallace said.
“Many persons stretched their financial capacity and re-opened without insurance money, as they had yet to get settlements, to get the cruise ships back here. When the ships returned for the first time, it was like Christmas for the taxi drivers and others.”
Pirates Cove employs 30 persons. Apart from Mr Wallace, its investors include Ivan Cartwright, Wendal Grant II, Philip Galanis, Clarence Wallace, Theresa Grant-Missick and Vincent Vanderpool-Wallace, all of whom are partners in Arawak Adventure and Commercial Tours Ltd.
The Government is likely to be deeply reluctant to reconsider the Carnival project at this late stage, though, given that it went to great lengths to obtain Hutchison Whampoa’s consent to waiving Freeport Harbour Company’s port ‘exclusivity’ on Grand Bahama.