The Caribbean is continuing to suffer heavily from the downturn in the global tourist industry. Of the 21countries reporting 2009 figures, only three experienced an increase in tourist arrivals. These were: Cuba,with arrivals growth of 2.0% year-on-year; Jamaica, with 0.2% growth; and Saba, with 1.4% growth.
Even such growth rates are well below those traditionally enjoyed by the region of 8-10%. Moreover,some countries reported major drops in tourist arrivals. The worst affected were Anguilla (-21.4%), theBritish Virgin Islands (-25.1%), St Maarten (-16.1%) and the Bahamas (-15.3%).
The Caribbean is suffering particularly heavily from the downturn because it has historically been one ofthe more expensive tourist destinations and therefore is marketed more towards high-end and luxurytravellers. With incomes suffering globally, tourists appear to be choosing cheaper and closer holidaydestinations at the expense of the Caribbean. Also, much of the Caribbean’s tourism has beenconcentrated in the cruise industry, which is suffering in line with other luxury travel options. With Q209arrivals appearing to continue the downward trend, we remain negative on prospects for Caribbeanarrivals in 2009, especially given the start of the hurricane season in August.
Focus On The Dominican Republic
The Dominican Republic is suffering less than many other Caribbean countries from the touristslowdown. In the first four months of 2009 arrivals fell by 4.8% year-on-year (y-o-y), making it the fifthbest performing country in the region.
The country is weathering the downturn better than some of its neighbours for several reasons. For one, itpossesses a highly developed tourist infrastructure, with substantial developments along the beachfrontand a good balance between charter holiday and high-end resorts. Its long coastline gives it an abundanceof locations, while the capital, Santo Domingo, provides a good base for travellers wishing to exploremore of the country. Unlike some other Caribbean destinations, the Dominican Republic benefits from avaried landscape, with tourists able to explore the beaches and the mountainous interior. These factorsshould help it to mitigate the effects of the 2009 downturn and position it for a recovery into 2010.
Eastern Caribbean Ferry Service Opens
With regional incomes suffering during the economic downturn, regional flights are beginning to appeartoo expensive. To counter this, countries in the Eastern Caribbean are to open a new ferry service inOctober 2009. Grenada-based company BEDY Ocean Line will launch operations serving Barbados, StLucia, Trinidad, Grenada and St Vincent. One ferry will be based in St Vincent and serve St Lucia andBarbados, while the other will be based in Grenada and serve Trinidad and Barbados.
With prices ranging between US$120 and US$140, the ferry service offers a cheap alternative to flights inthe region and should be popular with locals and tourists. Currently, the only Caribbean ferries operatingare between Florida and the Bahamas, and between Puerto Rico and the US and British Virgin Islands.The launch of the ferry service will be negative for regional airline Liat, which is already struggling tomaintain revenue in an environment of declining passenger demand and an ongoing pay dispute withworkers.
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