The Chamber Council has reviewed the Environmental Impact Assessment (EIA) that was prepared W.F. Baird & Associates Coastal Engineers Ltd., Smith Warner International Ltd. and the TEM Network Ltd. and released by the Ministry of District Administration, Tourism and Transport on Tuesday, 9th June 2015 during a public meeting held at the Mary Miller Hall in Prospect. President Barry Bodden, Immediate Past President Johann Moxam, Councilor Derrington Miller and CEO Wil Pineau, CCE attended the public meeting on behalf of the Council. Chamber of Commerce Port Authority Representative Gerry Kirkconnell also attended the presentation.
Following the meeting, the Chamber Council decided to seek the views of the wider membership on this important issue. An online survey was developed and distributed via email to the main contacts of all members and a meeting was held with stakeholders in the cruise, stayover, coastal works and civil society to obtain as much information about their views on the EIA as possible.
The online survey was released to the membership on 23rd June. The survey asked each member to confirm whether the organisation works directly with the cruise ship sector so that the results of the questionnaire can be measured into two groups: the businesses that are connected with the cruise sector and those that are outside the sector.
Both groups were invited to select one of four responses:
1. I support the construction of the cruise berthing facility as proposed.
2. I support the construction of the cruise berthing facility but I want to see further studies to make sure we are building in the best location with the best possible design to minimize environmental impact.
3. I do not support the construction of a cruise berthing facility and support maintaining tendering operations and updating and improving shore side facilities.
4. I am undecided at this time.
The survey included a link to the EIA report and was distributed to the main contacts in each of the member businesses in an attempt to prevent multiple responses from any individual member. Three email reminders were distributed and the survey expired on Wednesday, 1st July, two days before the submission deadline for submission of responses to the DOE. All responses were reviewed by the Chamber office and some were evaluated to confirm legitimacy. Responses that were incomplete or could not be verified were deleted.
Survey results
67 member businesses completed the online membership survey 23rd June - 1st July 2015. The industry sector responses reflected the diverse Chamber membership:
23.88% financial services
17.91% multiple sectors (health care, renewable energy etc.)
14.93% services
13.43% tourism
10.45% construction
8.96% retail
1.49% wholesale
1.49% manufacturing
1.49% utilities
The majority of respondents (62.69%) classified themselves as the owner, president, managing director or chief executive officer of their organisations or senior representatives (10.45%) or managers (16.42%).
Only 12 of the 67 respondents (17.91%) classified themselves as being directly involved in the cruise ship industry as a vendor, agent, duty free store or providing services to the industry. 82.09% or 55 respondents stated that their businesses did not have any connections with the cruise ship industry. The majority of the member businesses that were involved in the cruise industry who responded to the survey supported the construction of a cruise berthing facility at the George Town port. Three of the 12 businesses indicated that they would prefer to see maintaining the tendering facilities and updating and improving the shore side facilities.
Comments from these respondents included:
More work needs to be done on the social factor of the EIA: "...if a cruise berthing facility is to be built, George Town, as proposed, is by far the best place to build it. There are mitigation techniques and technologies that can further reduce the environmental concerns. The full identification and mitigation impact analysis of all those techniques and technologies was outside the scope of the EIA as far as I can tell so it would be improper to interpret that the Environmental Statement (ES) already covers all the mitigation that can realistically be applied. The ES is good and to complement the information and environmental risk factors it identified, there are marine engineering experts that we can speak with that have several excellent practical ideas for mitigation. I have already discussed a few of those factors with them. The Government has followed and is following a very sensible path to provide themselves with the relevant information to make a sensible, rational decision on this. The Outline Business Case and preceding document from the Chief Officer for Tourism, and the Request for Proposal for the EIA and the ES together contain good information for two of the key critical success factors ie. economic and environmental. The third factor, social, still needs further development but key data inputs for that could be obtained relatively quickly from statistics readily available within individual companies."
Cayman could be a big loser: "Cayman is the only sizable cruise port in the Caribbean without berthing facilities. Competition amongst ports is getting more significant and Cayman is complacent that the cruise lines will keep coming here. A number of external factors will change the nature of the cruise industry over the next 10 to 20 years and Cayman could be a big loser. I understand the environmental concerns but they can be managed. A lot of area being taken by the piers is trashed coral and this is being ignored by people."
It is not worth the risk: "It is not worth the risk of losing portions of Seven Mile Beach - the number one beach in the world. Many have predicted this would happen."
Responses from businesses that are not involved in the cruise industry were mixed with the majority favouring maintaining tendering operations and updating and improving shore side facilities (24 responses) or seeking further studies to make sure we are building in the best location with the best possible design to minimize environmental impact (18 responses). There was also support for pressing ahead with the construction of the cruise berthing facility as proposed (10 responses) and three businesses that were undecided.
Some of the 23 comments from respondents included:
A Marine Protected Area should be just that: "Grand Cayman's nearshore marine resources, its beaches, coral reefs and clear waters are vital to its economy and the quality of life of its residents and visitors alike. This plan will destroy coral reefs and put more at risk. It is bad for the environment, Grand Cayman as well as the cruise industry. Sustainable tourism in Grand Cayman must balance well-managed use with environmental protection, for loss of its natural resources will mean a loss of tourism and therefore jobs, economic revenue and the natural beauty that is the island. The current plan to build an extended cruise/port pier will destroy acres of coral reef and put at risk Grand Cayman's invaluable nearshore marine resources, such as Seven Mile Beach. Whereas there has been some moderate success in transplanting individual and mainly branching corals, transplanting and relocating entire coral reefs and their all-important structure is not possible. Loss of coral reefs means loss of habitat, productivity and biological communities along with all economic revenue they bring in through tourism and recreation activity. Just say no to the current plan! A Marine Protected Area should be just that... a marine protected area in which destruction of natural marine resources is not allowed."
Focus more on long stay visitors: "Cayman's focus should be more on long stay tourists. There is great competition and more coming from Cuba and so we need to greatly improve our tourism marketing, product and service to be known as first class - with all of the public working together to make tourists feel like royalty."
Support for lower volume, higher end cruise tourism: "I would only support a lower volume, higher end cruise tourism which may spend more per head and have lower environmental impact. The current level or increased levels are wrong for Cayman in the medium and long term (and right for a few select persons in the near term). The construction work will not be adequately policed to mitigate devastating pollution and disturbance and just as now, when there is an environmental incident during operation, the shore side operators and the cruise operators will not be held to account or choose to implement meaningful remedial action. While the economic power is heavily with the major operators, commitment to enforce stringent, verifiable environmental standards would be beneficial. Perhaps in conjunction with other progressive Caribbean ports of call. Those who want the low end, high volume, high negative impact tourism are welcome as we have other strings to our bow in Cayman."
Too many deleterious side effects: "I believe the bigger ships will still come if we get bigger, faster tenders and create an enhanced processing area for screening re-boarding passengers prior to boarding. I think that any dock proposal that I've seen so far will have too many deleterious side effects to the harbour's reefs and long term clarity. My hope to revitalise our economy by restoring our reef fish population would have a big set-back from this. Stay-over visitors will be repelled as well as Caymanians. If we do a dock, the harbour is the best place for it... but please find a way to invent the best silt retaining mechanism ever utilized on this planet. So far they have all failed to contain well enough to save the George Town reefs from the volume of dredging that is planned. I believe this would not merely be an internationally renowned ecological disaster, but also an economical disaster in the long term. The damage would be permanent. Please say no thank you."
Negatives far outweigh the small positive of a possible 1% increase in cruise visitors over 20 years: "I attended the public meeting to view the presentation and the negatives far outweigh the small positive of a possible 1% increase in cruise visitors over 20 years. We must strive for QUALITY over QUANTITY and not sell ourselves for a few dollars. We have a pristine reef which makes us stand out from other islands. Tourists can snorkel, the glass bottomed boat and submarine takes tourists around and tourists even say they enjoy the tenders as it is different from all the concrete piers of other countries. Why not ask the cruise ship tourists to complete a questionnaire at the dock? Ask if they would prefer George Town to save its reefs instead of building the concrete piers? Don't forget that if it is easier for them to get off then it is easier for them to get back on again and they will do so to eat their free lunch rather than visiting expensive restaurants in George Town. Once we lose our reef, it is gone for good!"
Concerned about the costs and future taxes: "Whilst not directly involved in the cruise hospitality industry, we are concerned as to the potential costs, including environmental rehabilitation/mediation that will have to be met by government, with the potential for yet further costs and taxes being levied. Given the relative contributions of tourism and the financial services industry to the exchequer, it seems likely that the finance costs and risks will be borne not by the businesses directly benefitting, but by others, with a disproportionate burden on the financial service industry - particularly if the project has detrimental impact on the stay-over tourism economy. It would seem to be a moral hazard issue of some scale here - those that potentially benefit are not meeting the entirety of the cost and risk, but sharing the same with the wider business community."
Concerned about job losses: "If they can build a facility without destroying the reef we can support it. The floating dock seemed to be a good idea but I haven't heard much about it recently. If they put up the concrete parking lot in town and move those reefs, hundreds of boat, dive etc. industry will be out of a job."
An economic impact assessment is needed: "What are the true costs of this project? Is there an independent feasibility study? Is there an Economic Impact Assessment? Why were other venues not considered? There is not enough objective independent information to make a final decision. The George Town cruise berthing proposal should not be a top 5 priority for Cayman Islands Government as the costs and potential environmental risks are too high. They should focus on Airport redevelopment, fixing George Town dump, completing the John Gray High School and addressing the high costs of living & doing business in the country."
Evaluate all potential locations: "EIA should have been comprehensive to include evaluating all potential locations and best method to minimize environmental impact."
Risks outweigh the rewards: "Folks come to Cayman to experience our clear waters, dive sites and quiet/calm way of life. It is my understanding that the proposed dock will destroy 5 of those dive sites, cloud the waters for ever more and over crowd our streets, making it a very unattractive place to be, all for 20 million dollars over 20 years - oh really a whole million a year. Who would this undertaking really benefit? Would there really be more jobs on offer outside security positions. Stay-over tourists already avoid down town on cruise ship days and complain loudly about how beaches are overrun by cruisers - have a couple of mega ships stop by and we may not need an expansion to the airport."
Airport redevelopment should be top priority: "The Government should prioritize the redevelopment of the airport including the construction of jet bridges to better service stay over visitors rather than spending money on the cruise industry."
Additional information
To further assist in the development of this response to the EIA, the Council held discussions with various representatives from businesses that deal directly with the cruise ship industry as well as other stakeholders in the business community and civil society and have reviewed other reports and economic and statistical data.
According to the EIA, tourism represents 24% of the Gross Domestic Product and provides significant employment and business opportunities. Approximately 85% of these visitors arrive by sea, predominantly by cruise ship. This is an important economic segment of the Cayman Islands' economy and generates millions of dollars each year in Government and private sector revenue and provides hundreds of jobs to Caymanians and legal residents. Business investment in real estate development to cater to the needs of this industry along the George Town harbour front has resulted in a well-developed duty free and consumer goods marketplace with many of the world's leading jewellery, crystal, watch and leather and consumer goods brands and local crafts represented. Tour buses, taxi and watersports operators, restaurants and retail outlets rely on the cruise industry for their livelihoods with hundreds of persons benefitting.
In addition to reviewing the findings of the EIA, the results of the online Chamber survey and participating in discussions with key stakeholders, the Council has also considered and debated the following factors:
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Cruise lines want a berthing facility. They have made it clear to the Cayman Islands Government over a number of years that this is important for their continued support of the Cayman Islands as cruise tourism destination.
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There is a threat that Cayman's cruise sector will decline thereby negatively impacting many businesses and jobs, if the above cruise lines don't believe our solution (berthing facility or some other alternative) is suitable. It is not clear whether this threat is quantifiable but it seems to be material. The Council has received indications from industry representatives that if cruise berthing is not introduced then the cruise lines will reduce the number of ships that call which will result in a significant decrease in number of visitors and a reduction in jobs and loses to businesses that serve the cruise ship market.
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The current version of a berthing facility being considered will have a significant negative environmental impact on the George Town harbour area based on the EIA study but this is being disputed by some who say that the total area impacted will be much less than reported by the consultants. This needs to be clarified by requesting a measured area of the actual live living coral that will be required to be relocated from the 15 acres of coral reef as stated in the EIA report. People familiar with the area confirm that the red shaded zone in the report comprises areas of flat hard pan relatively barren area and sand seabed areas with both types of seabed conditions exceeding the area of live coral within the 15 acres.
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Cruise ship passengers may have a lower economic impact than stayover tourists (in terms of average spend) but it has to be borne in mind that cruise ship passengers also indirectly contribute to the volume of stayover visitors. The former economic impact is quantifiable via previous studies but has not been quantified. Many stakeholders in the local cruise industry state that many visitors who arrive by air say they have decided to return to Cayman following a cruise visit.
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There are alternatives (at least one-the floating concept) to the type of berthing facility currently being considered that have far less environmental impact but there does not seem to be a consensus on the feasibility of this solution. The EIA also examined other reports that were conducted and reviewed the feasibility of alternate locations around the island to position a cruise berthing facility but concluded that the George Town harbour is the preferred location.
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If the Government decides not to proceed with the cruise berthing project what will the socio-economic impact be for the other sectors of the economy that may see a significant reduction in demand such as the taxis, tour and watersports operators and other businesses that depend on the growth of the cruise sector? Can the Government appease the cruise lines to continue to confirm calls by improving the tendering services and installing security systems on shore and allowing them to open their casinos and stores while in port? Is this an acceptable fallback position?
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Do the environmental risks with the project represent a greater impact to the overall economy and could it jeopardise the tourism product which may result in a decline in stayover visitors and investments along West Bay Road? The EIA states that the Seven Mile Beach stretch is a closed system for sand movement but there are others in our community that question this view. What will the consequences be to the overnight tourism product and investment if the impact is found to be significant?
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The long term economic benefits of constructing a cruise berthing facility at the George Town port is significant and will firmly establish Grand Cayman as a cruise location of choice on the western Caribbean itinerary. It will provide the cruise lines with a direct incentive to commit to regular calls particularly for the Oasis class vessels. New jobs will be created. Infrastructure improvements will be made to accommodate the growth. Investment in real estate in George Town as part of the revitalization efforts will improve traffic flows and facilities.
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Should the Cayman Islands be focusing on quality versus quantity to manage the tourism product? Should the focus be directed to improving infrastructure facilities for overnight visitors (airport redevelopment and including jet walkways in the redesign)? This position is supported in various tourism development plans that have been adopted by the Government over the years.
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The existing cargo port facilities has been ignored during this discussion on cruise berthing. With the increasing population, there is a need for expansion to keep pace with the growth of the economy. Based on our discussion with key stakeholders, Cayman has one of the most under developed port facilities in the Caribbean next to Anguilla and Monserrat. The shipping lines have no alternative than to operate two smaller low draft vessels each week by each company which increases operating costs for the cargo services. The cargo port is also restricted to night time operations. The proposed cruise berthing facility has addressed the needs of the cargo port by creating a cargo port facility that can accommodate three vessels working simultaneously on any single night through any day of the week. This would eliminate shipping delays and port congestion which has occurred for quite a number of years and would allow the shipping companies to service Cayman with larger vessels to handle the country's economic growth and reduce operating costs at the same time.
Summary position
The cruise ship industry and the cargo port are important economic drivers and contribute positively and substantially to economic development, attract millions of dollars in foreign exchange and provide necessary government revenue, jobs and private sector investment. The Chamber Council supports the further development of the cruise sector and improvements to the cargo port as essential infrastructure initiatives.
The results of two separate online surveys in October 2014 (included in the EIA report) and June 2015 indicate that the majority of the membership who took the time to respond to these surveys support cruise berthing but want to be assured that any environmental damage caused by dredging can be reduced and mitigated and all efforts will be taken to relocate the living coral that will be impacted by this project. Based on this feedback, we recommend that Baird is asked to confirm the breakdown of actual live coral reefs versus the associated marine habitat and the nature of that habitat (hard pan, squab bottom/sand etc.).
The EIA also omits the measured area of live coral to be relocated but it provides a cost of this relocation of coral but no details or breakdown for how this calculation was arrived at from an estimated area of live coral to be relocated. This is not even discussed in the EIA report. We would recommend that the area of live coral that will be affected is measured and confirmed so that a true cost for the mitigation can be properly assessed rather than estimated.
Once these assessments are completed, mitigation strategies should be confirmed and costed so that the Government is given an accurate cost. We believe that before deciding to invest millions of dollars in cruise berthing facilities and cargo dock improvements, the Government must be satisfied that the environmental risks are clearly understood and all efforts taken to mitigate the damages.
The Chamber Council believes that the development of the Environmental Statement and EIA are steps in the right direction and have instigated a national debate on the development of this industry sector. We believe the debate should continue so that the Government can determine the course for the Cayman Islands tourism product and to develop a national tourism strategy for cruise and stayover visitors.
Cayman's environment is critical to our long term success. Our coral reefs, clear aquamarine waters, fish life and white sandy beaches are the primary reasons why our visitors come here. We must do more to protect our natural environment to prevent further destruction. But we must also ensure that the Cayman Islands is competitively positioned to attract cruise visitors and improve our cargo port to keep pace with the Islands' growing economy. The DOE will also need to determine how this project relates to the National Conservation Law that was recently passed.
This statement was submitted to the DOE in response to the EIA on 3rd July 2015. It purpose is to provide the DOE and Government with some useful feedback and recommendations that can be utilised to reach some level of consensus on this critical infrastructure project.