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Cruise Berthing MOU Signed

The Hon. Premier, W. McKeeva Bush, OBE, JP.

The longer we delay in addressing this issue, not only will we remain at a competitive disadvantage, but we will also stand to weaken the second pillar of our economy, which has supported us for decades.

—The Hon. Premier, W. McKeeva Bush, OBE, JP.

Statement from

The Hon. Premier, W. McKeeva Bush, OBE, JP,

Minister of Finance, Tourism & Development

Re Cruise-Berthing Facility - Signing of Memorandum of Understanding

Press Briefing 10 a.m. Thursday 14th April, 2010,

Opening and overview

Good Morning and thank you all for attending;

In November of last year I announced that Cabinet had approved the selection of Dart Enterprises Construction Company (DECCO Ltd) as the Country's development partner that would finance, design and build the much needed cruise-berthing facility in George Town. At that time, I also advised that the Port Authority was developing a non-binding memorandum of understanding with DECCO Ltd. and the Florida-Caribbean Cruise Association; and that the MOU document was to be presented to Cabinet for further consideration and approval.

I am pleased this morning to announce to the nation that Cabinet has now approved the MOU between the Cayman Islands Government, the Port Authority and DECCO, and following this briefing, the agreement will be signed by all parties involved.

The decision to partner with DECCO for the development of this most important project is based on a number of reasons, and took into account their proposed financing arrangements, project timelines, ability to start relatively quickly and the fact that DECCO is a local business of high standing in the Cayman Islands, with a proven track record.

Assessment & Agreed Approach

The United Democratic Party Government is committed to using this type of joint Public/Private sector model to fund capital projects which will greatly benefit this Country. Given the economic conditions globally and our current dire financial situation, we are faced with the stark reality that we are simply unable to raise the required financing for this critical project.

In this situation, the most logical solution - and the one which we adopted - is to invite and accept private sector participation for projects such as this one; which have the ability to generate self-sustaining revenues, without requiring additional cash injections from Central Government.

Three-Phased Approach:

In order to get to where we are today, a three -phased approach was agreed to:

Phase 1:

  • Specified the physical development scope of the project and agreed the broad parameters for the project
  • Identified a process for undertaking this type of capital project and invited private sector participation
  • Once proposals were received a shortlist of 4 was developed.
  • The Cayman Islands Government and Port Authority then recommended a development partner and signed a Non-Binding Memorandum of Understanding.

  • Preliminary works, including an Environmental Impact Assessment was initiated

Phase 2

Cabinet's approval to enter into a non-binding MOU will facilitate Phase 2 of the process and enable negotiations with cruise lines to take place.

This commitment will also allow for determination, and if possible, agreement on a sustainable business model within the CIG/PA specified parameters.

Phase 3

Finally, Phase Three will be the binding agreement between the Government, Port Authority, Developer and Cruise Lines, with the Port having technical and operational oversight as necessary.

I would like to point out that while the cruise berthing project will be developed by DECCO and paid for by fees charged to the Cruise Lines that use the facility, the Government and Port Authority are committed to protecting the existing revenue flows to the Port Authority. Consequently, measures are in place to ensure that the Port Authority will retain full, effective ownership and control of the Port's land, piers and operations.

The Need for Cruise Berthing Facilities

The need for cruise berthing facilities as part of the overall development of the Cayman Islands tourism infrastructure has been understood by the Government for some seven years now. The previous Government also recognized this need and embarked upon a joint private-public sector initiative approach to commence the project. My Government in 2004 had gotten agreement for the Cruise Lines to build the berthing facilities but then came Ivan and we lost the election. The previous Government reinitiated the process and signed an MOU with a potential developer, (Atlantic Star Ltd.,) this MOU expired before any meaningful preliminary works were undertaken.

This Government however is committed to completing the much needed enhancements to the Port, and by enhancements I specifically mean the construction of two cruise ship berthing finger piers - of which at least one will be able to accommodate the Oasis Class ship. As I have stated many times previously, these ships will not place destinations on their itineraries that don't have berthing facilities, and the Cayman Islands is the only significant destination in the region without one. Most of our Western Caribbean competitors such Honduras, Roatan, Montego Bay and Ocho Rios already have walk-on cruise facilities. The longer we delay in addressing this issue, not only will we remain at a competitive disadvantage, but we will also stand to weaken the second pillar of our economy, which has supported us for decades.

The cruise berthing facility will be designed to greatly enhance the visitor experience. By eliminating the inconvenience of tenders, passengers will be more inclined to disembark from the ships and come on land to purchase a variety of goods and services. For this reason, and others which I mentioned earlier, the cruise berthing facility is of tremendous significance.

Not only will it deliver a superior experience for visitors who arrive by sea; but it also represents tangible evidence of this Government's unwavering commitment to facilitating the long-term interests and sustainable growth of our cruise tourism product.

Thank you.