7 News Belize

The “Fantastic Four” Delivers “The Carnival Compromise”
posted (January 10, 2011)
On Friday in Miami - Prime Minister Dean Barrow and a team of senior tourism officials met with executives of Carnival and Royal Caribbean Cruise Lines.

Their mission? To arrive at some arrangement that would stop the cruise lines - at least temporarily - from implementing a new policy that would put 11 independent tender operators, their 50 boats and their 165 employees out of work - and save the 25 million dollar investment they have made.

The team returned over the weekend and they today held a press conference to disclose the promise terms of what we've dubbed the Carnival Compromise:…

Hon. Dean Barrow, Prime Minister
"What was agreed with Carnival is that there will be a transition period during which the status quo, the current arrangements will be maintained and from that point of view I believe we can justifiably claim that the mission was successful. The problem is though that while a stay of execution so to speak was obtained, the length of the stay has not yet been determined. Basically government or the team said to Carnival, 'We want the transition period to be a long as possible.' Carnival's response was, 'We want it to be as short as possible.' We said we are thinking in terms of a year. Carnival said, 'We are thinking in terms of weeks.' In any event there is simply not enough of the large scale tenders in Belize country to service at that level all of the cruise lines. There really is no choice but to wait until the additional tenders can be procured. My notes reflect that this was accepted by Carnival except that they made the point that if it took too long to put the new arrangements in place they reserve the right to reduce the number of calls to Belize. What is very important in this mix is that Carnival agreed with us that the new mandate would be fulfilled by a new company a new Belizean company that would be made up of all the current tender operators that wish to participate. Bottom line, suffice it to say that Carnival has agreed that it will treat with this new Belizean entity and that it will seek to enter into a contract with that new Belizean entity. All the tender owners/ operators who are here this morning, who are in that meeting have agreed that they will come together form this new Belizean entity that will contract with Carnival, and the way we see it, all of the cruise lines doing business in this country. It is Carnival's position that it is happy to enter into the negotiations with the new Belizean company or the new soon to be formed Belizean company and that it is happy to conclude an exclusive deal with that company. Carnival is so important because it is already the biggest player in the cruise sector in this country and it is talking about increasing the volume of business that it does in this country. So coming to this understanding with them, agreeing on a way forward has been absolutely critical."

As the prime minister explained, the principal beneficiaries of the arrangement are those 11 small tender operators who - according to Carnival - should have been out of work from last week.

Now they are the cruise lines' point of contact, looking to make a collective investment - and no longer subject to the whims of a middleman. The new group - as we understand it - will be run by a board of directors and government has agreed to have the DFC assist them with financing, and assured them that they will be granted all concessions to get their enterprise going.

Stanley Longworth Sr. is the interim head and he discussed the practical dimensions of the new way forward.

Stanley Longsworth Sr., Head of Tenderers' Group
"We feel that it is exactly what we have set out to achieve because basically our objective is that the tender business remains in the hands of Belizeans."

Jules Vasquez
"Now there are practical realities, a large amount of capital has to be accessed, I don't know if this size of vessel can be made locally. Have you all looked at those issues?"

Stanley Longsworth Sr., Head of Tenderers' Group
"Absolutely, even though this thing has burst out of nowhere, we are aware that boats can be built in Belize, in fact we do have one particular boat that was built in Belize. As far as the requirements for additional boats are concerned, if it cannot produce locally in time then we look at the export market."

Jules Vasquez
"In terms of time do you all know how soon you all will be able to make or access these vessels on the international market?"

Stanley Longsworth Sr., Head of Tenderers' Group
"We are of the opinion that a local boat produced in Belize will take 3-4 months. The international market...we have to search for the source because Carnival has requested that these boats be of a minimum of 150 passengers and currently the boats that are mass produced are about 120-140 passengers."

Jules Vasquez
"I know it's at the preliminary stage but initially do you know how much one vessel like this will cost and you have in mind how many you all will need to create?"

Stanley Longsworth Sr., Head of Tenderers' Group
"We are looking at about 1 million Belize per vessel and we will need a minimum of 5 additional vessels to get it going."

And while the way ahead has been mapped up with surprising speed and effectiveness, there's still a dispute about who knew what and when. Carnival claims it told the local shipping agent Eurocaribe about the change in August, which Eurocaribe says it was so told on January third.

But that's in the past now. Presently, representatives of the Florida Caribbean Cruise Association are in Belize. The Prime Minister was scheduled to meet with Norwegian cruise line today to ask them also to participate with the new tenders association.

According to tourism board statistics, cruise lines spent 15.5 million dollars on tendering services in Belize in 2010.

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