Cruise Shutdown Takes Heavy Toll on Florida's Ports

9/25/2020
News article from The Maritime Executive magazine:
In a new report based on discussions with maritime stakeholders, Federal Maritime Commissioner Louis E. Sola has catalogued the economic impact of COVID-19 on Florida's cruise sector and its seaports. The effects of the cruise shutdown have been serious for cruise operators, but the collateral damage has also extended to port authorities and cities throughout the state.
BY THE MARITIME EXECUTIVE 


File photo from the Canaveral Port Authority

In a new report based on discussions with maritime stakeholders, Federal Maritime Commissioner Louis E. Sola has catalogued the economic impact of COVID-19 on Florida's cruise sector and its seaports. The effects of the cruise shutdown have been serious for cruise operators, but the collateral damage has also extended to port authorities and cities throughout the state.

“The interviews I have conducted with port directors, government officials, and business leaders all confirm the importance of the cruise industry to Florida’s economy and the urgent need for ships to start sailing again," said Sola. "The financial consequences of laid-up cruise ships are being seen in government coffers and the pockets of working men and women. Across Florida, people recognize the vital necessity of the cruise industry contributing to the economy again."

As part of his report, Commissioner Sola chronicled the steps each port is taking to resume operations, including measures to protect passengers, crews, longshoremen and others from exposure to COVID-19.

"Port authorities throughout the state are acting unilaterally and aggressively to establish protocols for safely handling passengers and vessel operations. Public and private interests at the local and state levels are united in establishing a responsible framework for safe resumption of operations," said Sola.

The shutdown has an impact on a wide swath of Florida's economy. People traveling to Florida to take a cruise also generate significant revenue for hotels, restaurants, bars, retailers and other enterprises. All told, the economic impact of the cruise industry in Florida in 2018 was roughly $8.5 billion in direct spending and $7.7 billion in wages.

“It is not just large companies that benefit from the cruise industry. Cruise customers begin and end their voyages by using taxis, eating in restaurants, visiting museums, and shopping in local businesses. These are small and medium sized businesses, many are independently or family owned. The cessation of cruise operations can affect them as much, or more, as it does the companies that operate the ships or the ports where the vessels call,” said Sola.

Many of Florida's ports are heavily dependent on the cruise industry, and they have felt the shutdown acutely. PortMiami alone expects to lose $55 million in revenue during its 2020 fiscal year due to the shutdown. Sola also noted the impact on ports that handle cargo, since falling consumer demand has hit the volume of containerized freight at Florida's container terminals. According to the Florida Ports Council, the combined impact will likely cost Florida a total of $22 billion in economic activity, $775 million in tax revenue and 170,000 jobs over the course of 2020. 

CLICK HERE to read the full report from the FEDERAL MARITIME COMMISSION