The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas leads the Caribbean and Central America in extracting an annual $655m economic boost from the cruise industry despite consistently ranking in the bottom 40 percent on key visitor satisfaction metrics.

The Florida-Caribbean Cruise Association (FCCA), releasing the first post-COVID study of the sector’s economic impact on the region, ranked this nation as number one for total passenger spending and local employment with 13,846 Bahamian jobs and a combined $250.16m annual wage bill said to be reliant on the industry.

Direct spending by the cruise lines themselves in The Bahamas was also said to be the highest out of all 33 countries surveyed at $160.2m annually, with the majority of this sum devoted to the payment of port fees, taxes and surveys. However, beyond the region-leading figures and headline numbers, other data revealed by the FCCA-commissioned study revealed a combination of weakness and untapped potential for this nation.

In particular, the report by Business Research and Economic Advisors (BREA) disclosed that the statistics show almost 20 percent or one in five cruise visitors never left the ship when docked in The Bahamas. And, when it came to cruise ship crew, some 70 percent also remained on board for the duration of their visit.

Both ‘stay-on-board’ categories represent spending sources that never benefit Bahamian businesses. Cruise vessel employees, in particular, may elect to remain on the ship because the frequency with which their vessels call on Nassau may lead them to believe they have seen everything there is to experience in the destination.

However, of more concern to The Bahamas is the report’s revelation that per capita cruise passenger and crew spending in this nation have both declined in the six years since the last FCCA survey was conducted pre-COVID in 2018. Passenger expenditure per person fell by 8 percent, or more than $11, from an average $131.95 in 2018 to $120.93 for the 12 months to end-April 2024.

Crew spending per person, meanwhile, dropped by 21 percent over the six-year period from $54.90 in 2018 to just $43.26 this year. Yet total cruise passenger spending in The Bahamas was shown to have increased by more than $150m during that period, jumping from $322.57 per annum in 2018 to $473.32m this year, and representing an increase of 47 percent.

The increase in total spending, while per capita passenger yields and returns fell, was driven entirely by higher visitor arrivals to further affirm that cruise tourism is the ‘volume’ segment of The Bahamas’ tourism market. Total crew spending in The Bahamas, though, declined by 27 percent over the same six-year period from $28.94m per annum to $21.24m - a drop of some $7.7m.

And, despite leading the Caribbean and Central America on total cruise industry spending impact, the FCCA-commissioned study showed The Bahamas ranked consistently in the region’s bottom 14, either 20th or lower, on guest satisfaction metrics or what would likely be termed key performance indicators for the 33 countries surveyed.

For example, The Bahamas was rated 28th out of 33 for average length of visitor hours ashore, with passengers spending some 4.2 hours off the ship - more than our hour less than regional leader, Aruba. This nation also finished in 23rd spot when cruise passengers were asked “how satisfied” they were with their visit to the country, again finishing more than one full point behind top-ranked Key West.

When it came to meeting visitor expectations, The Bahamas finished in 22nd spot, although it fared somewhat better when cruise passengers were asked “how likely” they were to return for a resort or land-based vacation as it finished 13th out of the 33 destination.

Yet The Bahamas, according to the BREA report, fell to 20th and 22nd spot, respectively, when passengers were asked to state their satisfaction with the “shoreside welcome” and tour they had purchased. The Bahamas also ranked 25th for tour value for money; 24th for the variety of activities to participate in when in-destination; and 23rd for visitor satisfaction with museums and historical sites.

The Bahamas also enjoyed a similar rating, 23rd, for the prices and costs that cruise passengers encountered. The rankings support previous calls by both Chester Cooper, deputy prime minister and minister of tourism, investments and aviation, and Michael Maura, Nassau Cruise Port’s chief executive, for Bahamian entrepreneurs to develop fresh, innovative activities and excursions for visitors to do.

The FCCA-commissioned study, though, also signals the level of influence that the cruise lines have over their customers’ in-destination activities. For example, although just 47 percent of disembarking cruise passengers in The Bahamas purchase a tour or excursion, some three-quarters or 75 percent of these are booked and paid for via the cruise lines. Just 4 percent book directly with the local provider, with travel agents accounting for the 21 percent balance.

“Based on data collected from the Ministry of Tourism, 4.808m cruise passengers arrived aboard cruise ships during the 2023-2024 cruise year,” the FCCA report said of the 12 months to end-April 2024. “Of these, an estimated 3,913,970 passengers (81 percent) disembarked and visited The Bahamas.

“Utilising additional data provided by the Bahamas Ministry of Tourism and visiting cruise lines, 1.615m crew were aboard the cruise ships and an estimated 30 percent, or 490,995 crew, disembarked and visited the destination. Passenger arrivals are up about 60 percent from the last study in 2017-18.

“These passenger and crew visits, along with additional expenditures by the cruise lines, generated a total of $654.8m in cruise tourism expenditures in The Bahamas during the 2023-2024 cruise year.... The Bahamas led all destinations with $655m, followed by Cozumel with $483 million. The US Virgin Islands ($258m), Dominican Republic ($251m) and St. Maarten ($238m) round out the top five destinations.”

The study added that the $473.3m total spend in The Bahamas for that 12-month period accounted for 15 percent of all expenditure by cruise passengers over that 12-month period across all 33 regional destinations. As for crew, it found: “With the highest number of onshore crew visits (491,000), The Bahamas had the second highest total expenditure among the 33 participating destinations, $21.2m.

“Crew spent an average of $43.26 during their onshore visit in The Bahamas. Crew expenditures in The Bahamas were concentrated on food and beverages, followed by clothing and personal products. These three categories accounted for 76 percent of total crew spending in The Bahamas.”

As for the cruise industry’s direct impact on Bahamian job creation, the FCCA report added: “The Bahamas had the second highest level of direct jobs supported by the cruise industry.

“The Bahamas’ $655m in direct expenditures supported an estimated 7,400 direct jobs paying $134m in direct wage income during the 2023-2024 cruise year. One direct job was supported for every $88,000 in direct cruise tourism expenditures. The $134m in wages represents approximately 20 percent of the direct spending.”

And in total impact: “The Bahamas had the highest level of total jobs supported by the cruise industry. The Bahamas’ $655m in direct expenditures supported an estimated 13,846 total jobs paying $250m in direct wage income during the 2023-2024 cruise year. As a total, one job was supported for every $47,000 of direct cruise tourism expenditures in The Bahamas.”