The importance of the yachting industry

Anita Sutton delivers the Economic Impact of Yachting on Grenada report to Tourism Minister, Alexandra Otway-Noel

Anita Sutton delivers the Economic Impact of Yachting on Grenada report to Tourism Minister, Alexandra Otway-Noel

The Yachting Industry contributes an estimated EC$130,382,053 to Grenada’s Gross Domestic Product (GDP).

This was the assessment made by President of the Marine and Yachting Association of Grenada (MAYAG), Anita Sutton during a ceremony held last week Wednesday at Port Louis for the official presentation of a study report on the industry to Tourism Minister, Alexandra Otway-Noel.

The study, conducted from May 2012 to April 2013, was prepared by Dr. Andre’ Vincent Henry of Trinidad and Tobago, and is geared at improving the business climate for the Sector.

According to the report, 750 jobs have been created directly from the yachting industry, with another 162 jobs indirectly making for a total impact on employment of 912 jobs.

The report noted that the tourism industry is a major contributor to the economy of Grenada with limited government investment and marketing and promotion.

It said the yachting industry in Grenada is better placed than any other country in the Caribbean to take advantage of the two major lines of business in the sector – cruising and services.

The report concluded that the most profitable segment in yacht tourism for Grenada is long-term stays.

It referred specifically to the sub-segment which appears to have the greatest potential in terms of ‘second homes’, where boat owners base and store their yachts in Grenada.

The report encouraged Grenada to take advantage of its position at the southern end of what it described as “the best cruising grounds” in the Caribbean, in order to significantly expand its share of the cruising segment.

Making note that much of the growth and development in the sector has been spontaneous, with the private sector leveraging the comparative advantages of Grenada, mainly location and topography, the Assessment recognises Government provision of a reasonable legislative framework with the enactment of the Yachting Act in 2000.

Stakeholders at the official Economic Impact of Yachting on Grenada presentation ceremony

Stakeholders at the official Economic Impact of Yachting on Grenada presentation ceremony

“At a strategic level, Government should give consideration to policies for business retention and business expansion in the sector. Efforts should be made to ensure that the plants (marinas/boatyards), and investment already on the ground are maximized, and that existing service providers are incentivized to expand and upgrade their facilities, train and up-skill their workers, and explore possibilities for improving their companies’ levels of productivity and competitiveness”, the study said.

The 72-page document outlines one of the key challenges for the Grenada yachting sector as converting the obvious comparative advantages into strategic competitive positioning.

It is estimated that Grenada loses out on an additional 8,000 to 10,000 yachts as a result of the hassles of checking in and out between the St. Vincent Grenadines islands and Grenada and its sister islands.

The study report is convinced that Grenada can better position itself to benefit from the long-term segment, especially second homes, through better marketing and promotion and building on yachting visitors overwhelmingly favourable assessment of the destination.

With regard to specific aspects of the yachting experience, visitors expressed concerns about the inconveniences and transaction costs that are associated with the clearing procedures at both Customs and Immigration.

The study recommendation is for Government to give consideration to increasing the targeted marketing and promotion of Grenada as a yachting destination, with particular emphasis as a home base for yachts.

It recommended among other things:-

*Establishing Grenada as a yacht registry;

*Urgently conclude arrangements with St. Vincent and the Grenadines for easier cruising in the Grenadines in the short term, with a view for the creation of a single yachting space in the longer term;

*Take steps to reduce the transaction and hassle costs related to checking in and checking out of Grenada;

*Ensure that existing provisions of policies, regulations and procedures are implemented transparently and evenly;

*Take steps to ensure that the future skills needs of the sector are provided, including providing incentives to the private sector to train and up-skill their employees;

*Specifically consider the needs of the yachting sector in providing airlift support.

According to the World Travel and Tourism Council (WTTC), while Grenada ranked 172 out of 181 countries in terms of the absolute size of its tourism industry, the country ranked 27th in terms of the relative contribution of tourism to the national economy.

The WTTC, in its 2012 economic impact assessment of the travel and tourism industry on the Grenadian economy, puts the direct contribution of the industry at $145 million for a 6.4 share of the country’s GDP.

When the indirect and induced contribution of the industry is added, WTTC estimated that the industry’s total contribution is almost 500 million XCD or 22% of GDP.

In 2011, the Government of Grenada identified tourism as one of the five transformational sectors of the economy and one that has the potential to propel the growth and development of the country.

Within the tourism industry in Grenada, the marine and yachting sector has been identified as “export-ready”; meaning that the physical, legislative, and regulatory infrastructure and other necessary conditions are in place for the development of an internationally competitive sector.

According to the report, the major challenge in understanding the economic impact assessment of this sector is the availability of reliable data.

“A more accurate assessment of the economic impact of Grenada’s yachting sector could not be arrived at due to serious data deficiencies,” the report said.

The ECLAC study built two models, using Government statistics and interviews with MAYAG members. A total of 232 customers responded to the survey.

Minister Otway-Noel pledged government’s support to the development of the industry and the creation of a single regional yachting space.

The five-month old Keith Mitchell-led New National Party (NNP) government in St. George’s sees an emerging yachting industry as crucial to its ambitions to build a new economy for the island.

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