Cruise line offers berthing deal

12 May 2016

As published in the Caymanian Compass Monday 4 February, 2013 http://www.compasscayman.com/caycompass/2013/02/04/Cruise-line-offers-berthing-deal/

A cruise line has submitted a written proposal to the Cayman Islands government to develop cruise berthing facilities in George Town.

Minister of Tourism and Development Cline Glidden told reporters Thursday that the government had received a “preliminary proposal from one of the lines” since his meeting with the cruise line industry in Florida last month. He did not specify which cruise line had approached the government with the offer.

Other cruise lines have also expressed an interest in developing berthing piers in the local harbour, he said at Cabinet’s weekly media briefing on Thursday, 31 January.

Accepting an offer from a cruise line to build the berthing dock presents a challenge to government, he admitted, as it did not follow the traditional procurement process of a competitive tender. However, the offer from the cruise line represents a “whole different scenario”, said Mr. Glidden, that may be considered more akin to a licensing process.

He described a situation in which a cruise line company approaches the government for permission to build a pier to enable it to bring passengers on island. “Then the question gets further complicated,” he said. “Is that procurement or is it just a licence to allow them to build a pier?” Mr. Glidden asked.

He said the United Kingdom government supported plans to create berthing facilities for cruise ships in the British Overseas Territory “as long as it follows best practice procurement process”.

The UK’s Foreign and Commonwealth Office late last year ordered then-Premier McKeeva Bush and the Cayman Islands government to halt a deal with China Harbour Engineering Company to build berthing facilities in Grand Cayman because it had not undergone the correct procurement process, such as a public tender or been accepted by the Central Tenders Committee. Under existing law, all public sector projects valued at more than $250,000 must be evaluated and approved by the Central Tenders Committee.

Mr. Glidden said the Cayman Islands government is consulting with Nigel Hearndon, a financial consultant appointed by the British to liaise with the government on procurement issues, on whether this offer, or others that may be received, would be acceptable to the UK government. 

The proposed development of a cruise dock has seen many iterations over the years. None have come to fruition.

The major up-side of partnering with a cruise line in building new berthing facilities would be that the company could guarantee a certain number of visitors to Grand Cayman for an agreed upon number of years, said Mr. Glidden – something developers could not guarantee. “No one else can guarantee what the line can guarantee,” he said.

Time is also of the essence, the minister admitted, as cruise lines prepare their itineraries two to three years in advance. “It is critically important for us to ensure that we do our best to try to get an arrangement made that will allow us not to lose the 2015 season,” Minister Glidden told reporters. 

If a cruise line company – or multiple cruise line companies – were to get the go-ahead to build a dock, the ownership and operation of the facility would remain with the Cayman Islands government, the tourism minister said.

Preferential berthing

The cruise line that has made the offer to build the dock has asked for a preferential berthing arrangement, Mr. Glidden said. This means that during a set period of time, if the cruise line has ships in port, it has preference to use the berth it has built. 

“If we’re talking about two berths, the request has only been made for preference on one of those berths,” he said. 

Asking for such a preferential arrangement confirms the cruise company’s commitment to bring passengers to Cayman for that agreed period of time, which was “a good problem to have”, Mr. Glidden said.

With no berthing facilities in place at the moment in Grand Cayman, cruise ship passengers are transported to shore on board tender boats while the cruise ships anchor in the harbour.
 

James Bovell

James Bovell

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