U.S. cruise lines say return to Cuba would take time
Wed Mar 17, 2010 3:38pm EDT
MIAMI (Reuters) – U.S. cruise companies are eager to add Cuba to their
itineraries; but even if U.S. policy allowed that, Cuba's ports would
need years of rebuilding to accommodate the ships, industry officials
said on Wednesday.
"Our business has grown so much that these ports in Cuba that were
(established) in the time of the Spanish conquistadors, that size of
ports, they're going to need a lot of infrastructure improvement," John
Tercek, vice president of commercial development for Miami-based Royal
Caribbean Cruises Ltd, said at an industry conference in Miami.
The world's three largest cruise companies — Carnival Corp & Plc, Royal
Caribbean and Norwegian Cruise Line, which is owned by U.S. private
equity firms Apollo Management LP and TPG Capital LP and by Genting Hong
Kong Ltd — are all headquartered in Miami.
They are prohibited by the United States from doing business with nearby
communist Cuba, under a policy aimed at depriving Cuba of U.S. dollars
until it adopts democracy.
The Caribbean region is the top destination for cruise lines because of
its year-round mild weather and its proximity to North America, which is
the source of more than 70 percent of all cruise passengers globally.
The cruise industry in turn pumped $2.27 billion into the economies of
29 Caribbean destinations last year, according to the Florida-Caribbean
When industry officials gather each year at the Cruise Shipping Miami
conference, the conversation inevitably turns to when U.S.-Cuba
relations might thaw enough for U.S.-operated ships to call on Cuban ports.
"The moment Cuba comes into the market, I think it's another star," said
St. Lucia Tourism Minister Allen Chastanet.
Because Cuba would be a novelty to most American passengers, it could
draw traffic away from other Caribbean ports, industry officials said.
But they said it would be likely that the attention focused on a newly
opened Cuba would generate more interest in the Caribbean overall,
creating a bigger tourism pie for all to share.
"When Cuba opens up, it's going to be great for everybody," Royal
Caribbean's Tercek said. "We'll all find interesting ways to grow with it."
But no one expects overnight changes.
"The general assumption — that if the U.S. administration dropped their
restrictions, there's going to be a mass exodus of all the ships to Cuba
— is clearly not going to happen," said Colin Murphy, vice president
for destination and strategic development for Norwegian Cruise Line.
"No one knows what the government of Cuba will do. So if there's a
change in policy from the U.S. administration, it doesn't mean we're
necessarily going to be welcomed with open arms there."
If U.S.-Cuba relations thawed, the first U.S. cruise ships to call on
Cuba would likely be the smaller ones, cruise officials said. It could
take four or five years to refit Cuba's ports to accommodate the
150,000-plus-ton megaships that now ply the Caribbean waters and carry
thousands of passengers, they said.
"Nothing's going to happen super-quick," Murphy said. "The ports are
(Editing by Gerald E. McCormick)"