Jamaica Ready to Cut Deal with Two Major Cruise Companies

The government and two cruise corporations –Royal Caribbean Cruises Limited and Carnival Corp- are in negotiations to extend a more than $34 million guarantee from both lines to land passengers into the island.

It is the opposite of the American Airlines deal, where the government pays the airline for missed passenger targets. Instead, these two cruise corporations, the biggest in the world (controlling 80 per cent of cruise travel), will pay government for missed passenger targets.

“We are now wrapping up these negotiations,” William Tatham, head of cruise shipping at the Port Authority of Jamaica (PAJ), told the Business Observer in an interview. “We are following the same format of guarantees as before.”

Under that agreement, Carnival must bring in at least 500,000 passengers and Royal Caribbean 430,000 annually.

The negotiations with Royal Caribbean are now in the final stages, and discussions with Carnival, whose contract ends later this year, are underway. Royal Caribbean’s contract actually ends next year but due to a joint venture to build a new cruise port in Falmouth, negotiations were brought forward.

The government had never had to call on the guarantee, as the ships have achieved targets. However, last year was worrying, as there were some ships that were diverted to the Mediterranean, which led to a fall in cruise arrivals from 2006’s record.