Cruise Tourism Economics: Unlocking Belize's Potential

Cruise tourism is a rapidly growing sector of the tourism industry, and Belize is no exception to this trend. The country markets itself as an ecotourism destination, emphasising its natural and cultural attractions. While cruise tourism can bring economic benefits, there are also negative impacts, such as overcrowding and pollution, which can damage the environment and local economies. In Belize, cruise tourism has led to a significant increase in the number of tourists, putting pressure on local infrastructure and the environment. The economic impact of cruise tourism in Belize is felt in various sectors, including tourism, business investment, and infrastructure development. The cruise industry generates a significant amount of revenue and contributes to job creation in the country. However, there are concerns about the distribution of economic benefits and the potential for leakage of earnings. Overall, the economic impact of cruise tourism in Belize is complex, with both positive and negative effects.

How cruise tourism impacts local businesses

Belize's economy is largely driven by tourism, which is the country's top foreign exchange earner. The industry directly contributed to 13.4% of total employment, accounting for 21,000 jobs in 2017. The total contribution by the Travel & Tourism industry, including jobs indirectly supported by the industry, accounted for 37.3% of total employment (59,000 jobs) in 2017.

The cruise tourism sector is one of the fastest-growing segments of the tourism industry. In Belize, the number of cruise passengers grew significantly from 14,183 passengers in 1998 to 705,219 in 2009. However, cruise ship arrivals have reduced by 3.1% from 1,208,137 visitors in 2018 to 1,170,558 in 2019. This can be attributed to the reduction in cruise calls, with 21 fewer calls than in 2018, 12 of which were cancellations.

The economic impact of cruise tourism on the host economy is generally positive, but there are also some negative aspects. Cruise lines exercise a high degree of control over onshore excursions by making agreements with local providers to sell tours and activities to passengers. When passengers buy such excursions, the cruise ship usually keeps 50% or more of the price, which has negative implications for the profitability of local tourism businesses.

In Belize, there has been a decrease in the number of visitors who opt to go on tours, resulting in a noticeable decline in the visiting of the top 10 tourist sites and a decline in engagement in the top 10 activities frequented by cruise ship passengers. This decline may be due to the rise in visitors to Harvest Caye in the south, which saw an increase of 2.8% in visitors in 2019.

Despite the reductions in cruise ship arrivals and tours, the total number of tourists visiting Belize has been on an upward trend, and the hospitality industry has taken notice. From 2018 to 2019, the total number of rooms available in the country increased from 8,435 to 8,853, with 70 new hotels added, making a total of 953.

In summary, while cruise tourism has had some negative impacts on local businesses in Belize, the overall contribution of the industry to the economy and employment has been significant. The recent decrease in cruise ship arrivals and tours may be a cause for concern for local businesses, but the upward trend in total tourism arrivals indicates that the hospitality industry is adapting to meet the changing demands of visitors.

The environmental impact of cruise tourism

The cruise industry is a large part of Belize's tourism sector, which is largely marketed on the basis of its natural and cultural attractions. As such, it is portrayed as an ecotourism destination. Ecotourism is defined by the International Ecotourism Society (TIES) as "responsible travel to natural areas that conserves the environment and improves the well-being of local people".

The cruise industry has a significant impact on the environment, and in Belize, there are concerns over the effects of cruise tourism on the country's natural resources. The cruise line industry is responsible for a large volume of waste, pollutants, and destruction of marine life compared to other maritime sectors. The industry carries thousands of people in a single voyage, and these passengers generate sewage, grey water, oily bilge water, solid and hazardous waste.

The discharge of ballast water, dredging, sewage disposal, physical damage to marine habitats, use of antifouling paints, noise emissions, and disposal of waste materials are some of the activities that impact the marine environment. The construction of port infrastructure for larger ships has also led to the destruction of coral reefs and mangroves in Belize.

The International Maritime Organization (IMO) is the world's most influential organization for preventing and controlling marine pollution. IMO guidelines such as the International Convention for the Prevention of Pollution from Ships (MARPOL) and its annexes provide requirements for ships, including cruise vessels, to prevent pollution. MARPOL includes six annexes that address different forms of pollution from vessels: Annex I (oil and oily water), Annex II (noxious liquid substances), Annex III (harmful substances), Annex IV (sewage), Annex V (garbage), and Annex VI (air pollution).

The cruise industry has taken steps to improve its environmental performance and adopt more sustainable practices. Some initiatives include research and innovation, corporate social responsibility, awareness-raising and environmental education, and the use of green technologies. For example, green technologies such as solar panels, exhaust scrubber systems, and energy-efficient appliances are being incorporated into new and retrofitted ships.

Cruise lines such as Carnival, Disney, and Royal Caribbean have implemented waste management and recycling practices, used shore power, and collaborated with nonprofit organizations to monitor ocean health and climate change. Royal Caribbean's Oasis of the Seas, which accommodates 5400 passengers, is powered by liquefied natural gas-fueled engines that reduce nitrogen oxide emissions and CO2.

Overall, the cruise industry in Belize has a significant environmental impact, and efforts are being made to adopt more sustainable practices to mitigate these effects.

The economic impact of cruise tourism on local employment

Belize's economy is heavily reliant on tourism, with the industry contributing 41.3% of the country's GDP in 2017. Tourism is the country's primary source of foreign exchange, and the cruise industry is a significant part of this.

The cruise industry's contribution to Belize's economy is twofold: it creates jobs for Belizeans and generates revenue through passenger spending.

Employment

In 2017, the travel and tourism industry, which includes jobs indirectly supported by the industry, accounted for 37.3% of total employment in Belize, or 59,000 jobs. The cruise industry directly contributed to 13.4% of total employment, accounting for 21,000 jobs.

Passenger Spending

Cruise passengers spend money on tours, food and beverages, ground transportation, entertainment, and shopping. A study of passenger spending patterns in the Port of Piraeus, Greece, found that on average, passengers spent €105 per person. Extrapolating this to the 1,170,558 cruise passengers who visited Belize in 2019, we can estimate that these passengers spent a total of approximately €122.8 million.

However, it is worth noting that cruise lines have a high degree of control over onshore excursions and often keep a significant portion of the revenue generated from these activities, which can negatively impact the profitability of local tourism businesses.

The cruise industry has a significant impact on local employment in Belize, creating thousands of jobs and contributing to the country's economy through passenger spending. However, the control that cruise lines exert over onshore activities and their retention of a large portion of the revenue from these activities may reduce the benefits for local businesses.

The economic contribution of cruise tourism to the GDP

The cruise industry's contribution to GDP is also evident in its ability to generate employment. In Barcelona and its surroundings, the sector creates approximately 9,000 jobs, with only 60% belonging to the tourism industry. This showcases the diverse range of opportunities that cruise tourism offers to local communities.

Additionally, cruise passengers tend to spend more per day than the average non-cruise tourist. In Barcelona, for instance, cruise passengers spend 230 euros per day, compared to the 70 euros spent by non-cruise tourists. This higher expenditure contributes significantly to the local economy, benefiting businesses such as hotels, restaurants, shops, and tourist attractions.

The economic impact of cruise tourism extends beyond the immediate region as well. The income generated from the cruise sector can lead to better standards of living for local people, particularly in the form of micro, small, and medium enterprises (MSMEs) in local communities. This positive impact on local economies is crucial for fostering sustainable development and improving the quality of growth in the region.

Overall, the economic contribution of cruise tourism to the GDP is substantial, offering financial gains not only to the tourism sector but also to various other industries. The high expenditure of cruise passengers and the diverse job opportunities created by the industry further highlight the significance of cruise tourism to local and national economies.

The impact of cruise tourism on local infrastructure

The cruise industry has a significant impact on local infrastructure in Belize. As one of the fastest-growing sectors in the tourism industry, it plays a crucial role in the country's economy, particularly in the coastal areas.

The influx of cruise tourists has led to the development of new infrastructure to accommodate the increasing number of visitors. This includes the expansion of ports, the construction of hotels and other tourist facilities, and the improvement of transportation networks. The development of cruise tourism has also contributed to the growth of local businesses and the creation of new jobs, with approximately 9,000 jobs generated in Barcelona and its surroundings, only 60% of which are in the tourism sector.

However, the rapid growth of cruise tourism in Belize has also raised concerns about overcrowding and its impact on local infrastructure. Studies have shown that residents are not always supportive of further cruise tourism development due to concerns about overcrowding and pollution, which are seen as ecological threats to the natural environment, such as the marine ecosystem.

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