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Sailing into a rosy future: the Mexican Caribbean stars in the world’s US$15 billion cruise industry.

    By Kastelein, Barbara
    Publication: Business Mexico
    Date: Thursday, December 1 2005

    Cruises are tearing through the Caribbean’s clear waters at an ever-increasing clip. North American cruise lines boast that they have transported and entertained more than 90 million people, while a 2004 study sponsored by Cruise Lines International found that nearly 30 million Americans are likely to cruise within the next three years. It has not been smooth sailing: The industry has recently come under fire for environmental abuse and disregard for local economies. Still, the ships are not slowing down.

    The figures are phenomenal: The world’s US$15 billion cruise industry has sustained an average yearly growth rate of 8.4 percent per year for the last two decades. Cruise Lines International Association (CLIA), based in New York, confidently calls the industry “the brightest star on the vacation travel stage, not to mention one of the great success stories of any business.”

    And the star casts considerable light on Mexico. In the last four years Cozumel, according to port authorities in this country, has grown to become not only the busiest cruise port in Mexico, but also the number one port in the world. Even Hurricane Wilma, the category five storm that tore through the region in mid-October, only momentarily paused cruising in the area. The amount of traffic attracted to the small island off the Quintana Roo coast is just one example of the important role Mexico is playing within the prosperous business of cruising.


    While Mediterranean cruises are also coveted, the Caribbean is the world’s preferred destination for its crystal waters. Home to almost half of the world’s cruise voyages, the Caribbean offers an association with glamour, rock and Hollywood star vacations and celebrity weddings.

    The Mexican Caribbean–534 miles (860 km) of coastline–includes part of the Great Maya reef (also known as the Mesoamerican reef), the second largest coral reef in the world. Cozumel is this region’s biggest island, and its original claim to fame was for the variety of marine life combined with clear waters, making it the top scuba-diving location in the western hemisphere and one of the top five in the world.

    However, Cozumel’s current raison d’etre is furnished by the floating hotels. The island began to receive cruises over three decades ago, on the initiative of local entrepreneur from Merida, Javier Medina, says Oscar Amable, general director of Agencia Consignatoria del Sureste, the port agency on Cozumel. Now cruising is its livelihood.

    “It generates everything, basically,” Amable says. The ships normally come in at 7 or 8 am and disgorge thousands of passengers on to the 30- by 10-mile island, departing again at around 6 pm.

    November saw the arrival of 14 cruises in Cozumel. Cozumelenos are hard working people, accustomed to cyclones, and the island has been among the fastest to recover in the country. Cultural programs currently scheduled feature mariachis, folkloric ballets and musical groups. Such bait intends to lure passengers back to the island with entertainment and the insistence that things are getting back to normal.

    “You have to remember that our economy here in Quintana Roo state is different from that of agricultural states like Chiapas, and here on Cozumel island we have young and dynamic governors who like to get things done fast,” said Ernesto Diaz, of Coumel’s beachfront restaurant La Veranda, about post-Wilma recovery. Diaz–30 percent of whose clients come from the cruise ships–opened his restaurant on the fourth day after the hurricane left the island.

    Although Cozumel’s piers were destroyed by Wilma, ships can anchor off shore and send guests in on tenders. Consequently, the return of business is not dependent upon reconstruction of the port facilities so much as local business’ ability to receive them. And if the programmed events are any indication, they are bouncing back rosily.

    Carnival, the world’s largest cruise line, has Cozumel up high on its 2005 itinerary, despite the cancellations in the choppy wake of Wilma. Fifty percent of the cruises on the Disney Magic also visit Cozumel.

    “All of the ports we’ve visited in Mexico have been popular, but the one that is a regular port for us is Cozumel,” says Disney spokeswoman Rena Langley.


    Cozumel seems to magnetically attract cruise ships, thanks to a convergence of the primary factors that appeal to potential passengers.

    “First, the geographical situation. Here in Cozumel we are in the middle of everything: Florida and the Caribbean,” says Amable. “Second, security and the warmth of people. The port recommends itself with it good police and the high quality of services on the island.”

    He mentions the second largest reef in the world too, but safety and “closeness to home” are key. Tellingly, Cozumel has been the busiest cruise port since 2001, “the year of the towers” as Amable refers to it.

    Before that year, the cruise season saw slightly over 800 arrivals (868 ships in 2000, with 1,473,880 passengers, and 600,356 crew members). In a dramatic upswing, the year following 9/11 brought Cozumel an increase of 42 percent from one year to the next, with 1,164 arrivals. Amable credits the surge to the travel climate following the terrorist attacks: “the most insecure means of transport was considered to be the plane.”

    Until 2001, Cozumel saw an increase of passenger visits of about 100,000 every year. In 2002, the amount jumped over 500,000 to reach 2 million passengers. Numbers continued to rise, with 1,319 arrivals in 2003. The cruise industry was quick to realize its advantage and now markets itself as “the safest way to travel.” A cruise ship is comparable to a secure building with a 24-hour security guard, proclaims the Cruise Lines international Association (CLIA).

    Mexico’s draw is not limited to Cozumel, either. Late September marked the beginning of the cruise season, and other ports have spruced up their images and revised their attractions to invite guests to dry land. The main ports, according to Roberto Maciel, operations manager at Acapulco’s Port Administration, are Cozumel, Acapulco, Puerto Vallarta, Mazatlan, Manzanillo, Ensenada, Huatulco, Ixtapa, Los Cabos and, in the last two years, the Sea of Cortes.

    Such ports reap the benefits of a burgeoning industry as well. Acapulco’s cruise terminal, for example, has seen an increase of a little over 50 percent between 2003 and 2004, says Maciel, from 97 ships in 2003 to 145 the following year. Numbers are going to go up again this year, according to Guerrero state tourism minister, Ernesto Rodriguez.


    For all its ability to cater to the concerns and tastes of the modern-day American tourist, the cruise ship industry has sustained considerable criticism in recent years. The first of these is for environmental reasons, but also–a related concern–for “robbing” tourism profits from local communities, straining services and facilities, without paying its “fair share.”

    One of the most polemical stances can be found in Ross A. Klein’s 2002 book, Cruise Ship Blues: The Underside of the Cruise Industry, which criticizes the industry’s profit-driven corner-cutting, deplorable environmental track record, exploitative labor conditions and questionable safety standards. Even the industry’s staunchest defendants have had to recognize that these mega-ships often carrying over 4000 people (including crew)–which are allowed to dump sewage at sea and dispose of garbage in some ports–are contributing to pollution, erosion of reefs, degradation of coastal areas and marine life.

    Earthjustice and Alaska activist Gershon Cohen says that cruise ships dump about 300,000 tons of trash at sea every year. Every day, one ship produces about 270,000 gallons of graywater (sink, shower, laundry, galley water), 30,000 gallons of blackwater (sewage), 1,000 pounds of sewage sludge a day and 7,000 gallons of oily bilge water. A single cruise ship, he says, can also release more air pollution every day than 12,000 automobiles.

    And it does not stop there. According to the Smithsonian Institute’s ocean Planet website, coral reefs in 90 of 109 countries are being damaged by cruise-ship anchors and sewage, as well as by tourists breaking off chunks of coral, and by sales of coral to tourists. Other concerns include coral-killing photo-developing chemicals and silver by products that might be in ship discharges.

    Alaska has been most effective on combating pollution, passing a law in 2001 that regulates cruise ship and ferry wastewater discharges in the state’s marine waters. Ships installed new wastewater treatment systems that initial studies found were successful in filtering pollutants.

    In the Caribbean–including Mexico–it has been harder to convince legislators that the ships pose a threat to reefs. One reason is that the towns’ own sewage (such as the hundreds of hotels on the Riviera Maya) can be blamed for any detectable damage to marine life.

    Another is competition. Economic growth for the Caribbean region depends on the continued success of the tourism industry. This weakens the area’s negotiating power against a U.S.-driven industry that generates hundreds of millions of dollars in profits every year. Recent history has revealed willingness by some local governments to compete with others by agreeing to terms with the cruise ship operators that were rejected by their competitors. To compete, many Caribbean nations and coastal towns are pressured into spending considerable money to attract and accommodate more and larger cruise ships. But, as Quintana Roo’s Hotel Association points out, cruise ships do not make a commitment to local communities, unlike hotels, which buy local supplies and employ local staff.

    Ronald Sanders, a former Caribbean diplomat, points out that, “our countries and our people are almost incidental to the enterprise of profits for the operators and tax revenues for their home countries.”

    It makes sense, then, that protests in Hawaii and the Caribbean have revolved around ships’ effects on communities and local economies.

    In 2003 Playa del Carmen, the Caribbean beach town opposite Cozumel island, became one of the first ports in the region to reject a cruise ship dock unless the industry paid a fee for local development. The mayor wanted to impose a head tax of US$30 for each passenger who used the proposed dock to come ashore at the nearby adventure and nature park of Xcaret, but Carnival Cruise Lines, a partner in the Xcaret dock project, said the town’s demands were too high, arguing that they already pay a significant amount in local service charges.

    Sanders’ argument is that cruise ships ply their trade in Caribbean territory and should, therefore, be subject to rules created by local governments. Experts on the topic and the region conclude that the dilemma of increased cruise ship revenues and increased pollution problems can be characterized as an issue of incentives, social controls, and the ability to handle complex economic restructuring.

    Wide-range commitments to control cruise ship pollution and maintain water quality must be agreed upon by countries in the region, including Mexico, and supported by the United States as well as the European Community–registered homes of the world’s major cruise lines.

    There is still another important impetus for improvement, however: customer awareness. Passengers are rightly disgusted on discovering that their vacation voyage entails dumping waste into the ocean and distressed to think they are contributing to the destruction of the world’s vulnerable reef systems. Ten years ago, a suit against Princess Cruises of Great Britain resulted in a US$250,000 award to cruise passengers who witnessed and videotaped a trail of plastic garbage bags dumped into the sea. It was hoped then that this would put pressure on the cruise ship industry to improve its waste management standards.

    Nowadays industry associations publish statements to the effect that cruise lines are committed to preserving and the environment that is, after all, essential to their success. The onus is on cruise lines to prove these are not glib comments.

    This is likely to be an important route ahead for an industry that shows no sign of slowing down in the near future. Cruise lines built 68 new ships between 2000 and 2005, and there are 14 more planned through 2007. With nearly 70 million Americans hoping to take a cruise in the next five years, the potential cruise vacation market is estimated at a minimum of US$57 billion and as much as US$85 billion. It is up to industry leaders to continue cleaning the image of an industry whose bright star is not scheduled to fall anytime soon.

    Last year, Mexico’s government was considering charging the country’s first per-passenger cruise tax, noting that the number of cruise passengers has tripled here in the last decade. The Tourism Ministry submitted a proposal on July 28 to charge between US$5 and US$10 for each of the more than 5 million cruise passengers who visit Mexico annually.

    But it hasn’t happened yet and those in the industry don’t think it will. Roberto Maciel, operations manager at Acapulco’s Port Administration, notes that passengers already pay for their package, including their cabin, food, gratuities, port dues, amenities and tours, and local taxes if there are any. “An extra US$10 on top of this every time they land … I don’t think it will fly,” he said.