Tuesday, May 25, 2010

Will Cruise Ships Help Local Economy?

Are Cruise Ships The Answer
Or Has That Opportunity Already Sailed?

Those who wish to spend millions and millions of dollars to attract cruise ships to Nanaimo, should do some serious study before committing the taxpayers to another white elephant.

Ross Klein, an international authority and author of four books on the cruise ship industry sheds some light on the industry as a whole, and in particular how it has affected the BC economy.

One interesting point he makes in an article published in the Vancouver Observer is the number of hours these ships actually spend in port and the fact that 80% of the ships visiting Victoria visit between 6:00 PM and midnight, the last night of the cruise. This makes the economic impact barely a fraction of the impact when a vessel makes a city their 'homeport'.

Most of the ships calling on Vancouver in 2002 were homeported in the city, meaning passengers started and ended their cruise in Vancouver. They used taxis, dined at restaurants, and visited sites pre and/or post cruise. Their economic impact was significant.

When a ship merely stops for 8 hours the economic impact on the port of call is greatly reduced. The ship itself is their hotel, restaurant, and venue for shopping and entertainment. A cruise ship earns more money from passengers spending onboard than it does from ticket sales. In 2007, each cruise passenger's onboard spending accounted for $43 per day in the cruise line's net profit, the figure is significantly higher today.

As ships expand their shopping venues, increasingly sell the same products available in ports, and guarantee they will not be undersold, passengers have less reason to buy souvenirs and other items ashore. They buy t-shirts and post cards, but most local stores report limited sale of other items.

So, before the economic brain trust of the Nanaimo Economic Department develops an elaborate plan to hang our hopes on the cruise ship business, I hope they are able to determine if that is one economic opportunity which has already left the dock.

The read Mr. Klein's full article use this LINK.


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