Minister for Tourism and Civil Aviation

"Analysis of the Tourism Sector"

Delivered at a Press Conference at the Government Information Service

February 1, 2001

Several weeks ago I had occasion, as Minister responsible for Tourism and Civil Aviation, to caution would-be tourism critics of the dangers inherent in adopting positions and forming opinions predicated on false and/or inconclusive information.

A case in point was the half-year performance of the tourism sector and the fact that certain markets had recorded, up to that point, slight declines. I cautioned then that the true picture of our performance would have been better gleaned through the final year statistics, when all variables would have been taken into consideration.

I am now in possession of the authentic performance figures for the calendar year 2000 as well as a situation analysis of where we are, vis-à-vis our stated goals as a new Government in 1997 and as a ministry, under new leadership, from March of 2000.

The facts are that the tourism sector continues to outperform all others as the main impetus for economic growth and social development. Visitor arrivals for 2000 amounted to a record 726, 454…an increase of 16.5 per cent over comparative figures for 1999. I should point out here that increases were recorded in both cruise and stay over arrivals.

This performance is better appreciated when viewed against the backdrop of 2000 having been an election year in the United States of America, with its own peculiar characteristics, an Olympic Year and a period of continuous fluctuations and dynamic changes in the international money market.

Additionally, it must also be recalled that for a substantial period of the year, a sizeable portion, some 33 per cent, of our hotel plant was out of commission due to the damage caused by Hurricane Lenny and planned renovations to various properties.

But, as I have said repeatedly, my concept of tourism and its impact on the St. Lucian economy provides for a much wider interpretation and analysis of how the sector performed in relation to its impact on the lives of our people.

Statistics from the National Insurance Scheme show a gradual and consistent increase in the number of persons employed in the restaurant and hotel sector.

Indeed, not withstanding the aforementioned variables, registered direct employment improved by just under 1,000 in the period under review.

In simple terms, 848 new persons were registered as new, permanent employees in the hotel and restaurant sector, and as we know in St. Lucia, this is a fraction of all those who actually found work, but have not been registered formally with the NIS.

In construction, where much tourism related activity is going on, we have seen a jump in the figures of some 1,600 new registered workers, and again that figure is anticipated to be higher as there is a sizeable portion of construction workers not registered with the NIS.

Therefore, from a job creating point of view, tourism continues to play its part in creating and providing meaningful and quality employment for our people.

Relative to direct revenue in-flows, earnings from tourism grew by 3% to EC$747million. However, direct expenditure grew even faster by 6%. Here again we have not taken comfort in blank figures. Further analysis show that 50% of that increase in revenue went directly into the pockets of our local people.

In 1998 the Ministry of Tourism established the Heritage Tourism Programme to encourage and nurture greater local involvement and enhance the value added benefits to ordinary St. Lucians.

Traditionally, the point has been made that the bulk of our tourism earnings remain or are repatriated overseas and that our people have not benefited substantially.

We have in recent months sought to counteract this by facilitating the establishment of scores of locally owned businesses across the island, catering to all aspects of tourism activity.

The community-based Heritage Tourism Programme has within a rather short period provided $300 000 in soft loans to 15 specific initiatives.

Technical and financial support too was given to the development and operation of numerous community managed tourism attractions and small and medium size grants of up to $25 000 to a range of ancillary projects, including site development and beautification.

Additionally, several small entrepreneurs have been assisted with feasibility studies, designs and work plans. All these ventures have netted significant sums for the operators themselves and the programme has benefited to the tune of half a million dollars collected from the Heritage Tours Sales Desk within its first few months of operation.

The point must be made therefore that not only is St. Lucia continuing to grow as a tourism destination, with overall arrivals and revenues increasing, but our people are now benefiting more substantially than ever before, in terms of jobs and earnings, from this vital industry.

The point has been made repeatedly that for St. Lucia to remain competitive, it has to consistently modernize, upgrade and refocus its tourism offering.

In recent months, the Ministry of Tourism, spearheaded in the main by efforts of the St. Lucia Tourist Board, has sought to ready itself for the challenges that lie ahead through the establishment of, for example, Virtual Offices in the United States of America.

We seek to carve a niche for St. Lucia, whereby we can maintain our competitiveness not only on beauty and price, but equally important, on quality information access and value for money.

We are in the process of creating a new interactive web site. While we recognize the importance of the travel agent in the decision making process of the consumer, we also recognize the growing number of holiday makers that first consult the Internet for information on their possible destination options.

As a strategy, therefore, St. Lucia needs to be up there with the best, in terms of providing good quality information; that is easily accessible, as quickly as possible, so that St. Lucia may remain a viable holiday option with the consumer.

Added to this is the provision of intranet and extranet services, whereby our sales personnel can have real time direct communications with potential customers and others in the marketplace as well as with head office here in St. Lucia.

Our goal of providing a safe and welcoming environment for visitors is being undermined by unsatisfactory high levels of harassment and the perception of increased criminal activity.

While the official figures suggest otherwise, the Ministry is concerned that a perceived rise in visitor harassment could have a long-term deleterious impact on the overall industry and the country.

We empathize with those directly involved in the sector, primarily hoteliers, who are understandably anxious to guarantee and provide customers a safe haven of rest, business and relaxation.

This ministry has taken the initiative of expanding the range and scope of services offered by the National Conservation Authority and has in the process effected a new plan of action by the Rangers Unit.

There are now 48 rangers with the expressed mandate of ensuring the general safety of declared protected areas. We intend to increase this number to 75 as well as review the number of designated protected areas, with a view to encompassing all the so-called trouble spots.

The Ministry has also prevailed upon the Royal St. Lucia Police Force the need for an increase in the number of foot and motorized patrols in tourism areas as well as the creation of a rapid response team dedicated to serving the tourism sector.

There is, of course, continuous dialogue with the social partners on this vexing issue and we are confident that with the cooperation of all relevant agencies and the public at large, this problem will be contained and minimized.

Visitor harassment is a nagging problem that is also occupying the attention of ministry officials. In many instances this stems from inadequate training of vendors, taxi drivers and other providers of products and services. The Ministry has embarked upon a series of initiatives geared at setting new operating standards for ancillary service providers.

Growth and development in the tourism sector is expected to continue apace in the months ahead, with several developers already committing to starting and accelerating the upgrade and construction of new hotel and resort properties.

Currently under construction is the Troumasse Hotel Resort Project in Micoud. This is a three phase operation which, when completed, will provide an additional 463 rooms and an 18 hole-golf course to the tourism plant. Phase One which started three months ago, already employs some 60 persons and another 140 St. Lucians will find work on this project in the months ahead. The first phase, consisting of an 83-room clinic and health spa, should be completed by the end of this year. This first phase will cost US$35 million or approximately EC$100 million.

The Sandals Chain continues to display its confidence in the local economy and tourism sector and is set to commence construction of an additional 100 rooms at Sandals Halcyon.

Thirty two million EC dollars has been budgeted for a new 55-room boutique style luxury resort in the Marigot Bay area. The resort will boast a health spa and conference facilities, and negotiations are in progress for management by Elegant Resorts Limited, which has a chain of luxury properties in the Caribbean.

The Islander Development is on stream for commencement of construction by the middle of this year. This will be a 280 room luxury resort operating under the Crown Plaza flag, which is a brand name belonging to Holiday Inns. Again this project is estimated to cost in the region of EC$100 million.

When these two developments are completed St. Lucia will be home to eight international hotel chains; namely Club Med, Sandals, Hilton International, Hyatt, Wyndham, Crown Plaza and Elegant Resorts. This will be a great boost for marketing St. Lucia as a quality, world rated destination.

Not only have we secured and facilitated the development of large resorts, but several small properties are also down for construction and or renovation and expansion.

These include Ti Kaye Village in the Anse la Raye community, which will comprise 33 cottages. Partial opening is expected by March of this year.

Other new establishments are to be located at Marigot Bay, Gros Islet and Soufriere and will inject another 10.5 million investment dollars into the local economy.

To support such development requires an increase in airlift, especially out of major gateways like Miami, New York and London.

To this end, the Chairman of the Tourist Board and myself will shortly embark upon a series of direct consultations with major airlines to see how best traffic into St. Lucia can be enhanced and sustained.

Official statistics show that cruise arrivals for 2000 increased by 26.3 per cent to 443, 551, representing the third successive year in which arrivals have increased by double digit figures.

This growth is significant as it far surpasses the Caribbean average of six per cent up to the end of September 2000.

In recent studies conducted locally on the cruise industry, it was determined that 80 per cent of cruise passengers actually disembark at the St. Lucia port. Of that total at least 35 per cent take organized tours, leading to approximately $10 million worth of business to local site and attraction owners and providers of transportation.

The average daily expenditure for cruise passengers is estimated at US$52 per person, up from US$42 five years ago.

Several months of negotiations have resulted in St. Lucia securing firm commitments for a continuing increase in the number of cruise ship calls.

The St. Lucia Air and Sea Ports Authority has been told by Royal Caribbean Cruise Lines to make way for the arrival, in the 2001/2002 season, of the awesome Adventure of the Seas and Radiance of the Seas.

Together these two mega ships have a capacity of just under 6000 passengers and some 2000 crew. Radiance of the Sea will actually make its inaugural call in November of this year. This will provide a weekly service to St. Lucia.

Celebrity Cruises will be bringing two new ships during the winter months of 2001/2002. They are Infinity and Millennium. Passenger capacity is over 2000 on each.

The good news also is that the Galaxy will be coming during the summer months, with a capacity of 1800 passengers per call. This development will greatly improve this traditionally lean period. Additionally, Princess Cruises will also be positioning two new ships during the winter months.

There are several other smaller ships making regular calls in the up coming season.

The Ministry of Tourism is encouraged by the continuous growth in the yachting sector. An unprecedented 215 vessels arrived in the recently concluded ARC and we are already planning for major improvements to help realize the enormous potential of this sector. For example SLASPA has already undertaken complete dredging of the Rodney Bay Marina and substantial repairs to the entrance of the marina.

Projections for the 2001 Jazz Festival point to yet another phenomenal growth performance, with bookings already reflecting a continuous growth in regional and international awareness and interest in this activity.

We take great comfort in the continued support of this venture, through sponsorship, by our private sector partners.

This weekend’s Ste Lisi Par Excellence Awards provides an excellent opportunity for us to stop and say thanks to the hundreds of workers in the tourism sector who have excelled, in the national effort to maintain St. Lucia as a simply beautiful experience.

We remain committed to facilitating the expansion and growth of training and empowerment of our dynamic workforce.

The inspiring performance of the tourism sector during the rather challenging year just gone, has laid the foundation for consolidation and a sustained environment of growth and prosperity in the years ahead.

With all major sub-sectors recording and projecting improvements, the Ministry of Tourism and Civil Aviation looks forward very much to presiding over the very exciting and dynamic period that lies ahead.