The Canadian Centre for Policy Alternatives has released a new report on cruise ships and their environmental and economic impact on coastal communities. The news release is reproduced below. The full report can be found at www.policyalternatives.ca
Cruise ship industry not a panacea for port citiesPosted by wetcoast at September 26, 2003 02:27 PMStudy says industry growth will slow, governments should be realistic about economic expectations
(Vancouver) A new report from the Canadian Centre for Policy Alternatives says port cities need to take a sober and realistic look at their expectations of what the cruise ship industry can deliver in economic benefits. The study finds that a likely slowdown in industry growth combined with ongoing investments in new cruise terminals and facilities is a recipe for overcapacity and “race-to-the-bottom” style competition between port cities.
Ross Klein, author of “Charting a Course: The Cruise Industry, the Government of Canada and Purposeful Development,” says that in their rush to embrace the cruise industry, Canadian ports have underestimated the costs of development and overestimated income. “Ports are investing millions in anticipation of a continuing boom in the growth of the cruise industry — an expectation that isn’t realistic, given depressed prices for cruises, fewer contracts for new ships in 2005 and beyond, and the dependence of the industry on American cabotage laws.”
Klein says this expansion has been accompanied by port cities marketing themselves to the cruise industry in an effort to capture part of the market. “With so many cities vying for business from the cruise industry, not to mention ports in the US, conditions are ripe for one port to be played off against another. There are more suppliers than demand for ports — one city’s gain is another’s loss.”
Klein points out that the Port of Vancouver has made significant investments in its berth facilities, yet cruise ship calls have decreased significantly in 2003. At the same time, cruise passenger numbers for BC are up overall. “Conditions are ripe for a competitive bidding war in the Pacific Northwest,” says Klein. Victoria has embarked on a redevelopment project that will cost between $5 and $10 million. Prince Rupert is spending $9 million on a new cruise terminal, and Nanaimo is considering dredging and modifying one of its berths.
Klein says these investments are based on what tend to be unrealistic estimates of the benefits of cruise tourism, such as the commonly-cited $100 per passenger in onshore spending. “The cruise industry leaves a relatively small economic footprint,” says Klein. “Governments need to take a realistic approach to developing the industry that acknowledges the real costs, risks and benefits of cruise tourism. Policy makers must look critically at the information provided by cruise industry promoters and make decisions that are in the interest of the local community and the province.”
The report also examines Canada’s voluntary approach to the regulation of cruise ship discharges into costal waters.
Klein makes the following recommendations: Canadian cities and ports need to work together to avoid being pitted against one another; Canadian cities should consider a reasonable head tax on cruise passengers to fund related expenses; a national, independent study that assesses the economic and social benefits and costs of cruise tourism is needed; Transport Canada’s plan for voluntary guidelines to deal with environmental issues related to cruise ships should be cancelled; and, the federal government should immediately legislate sound environmental regulations.