Mediterranean Cruise Industry

Floating in Turbulent Water

Cruise tourism is one of the fastest-growing sectors in the worldwide holiday industry, and Europe has not been sidelined from this boom. But there are some clouds on Europe’s cruise industry’s horizons that might force cruise lines to look elsewhere for growth.

The Mediterranean was the world’s second largest cruising zone after the Caribbean, Malta’s former Tourism Minister Karmenu Vella highlighted.“It has 64 companies with more than 200 ships carrying 3 million cruise passengers on 100 different cruise routes.” And even though the sector had been negatively hit by the world economic crisis, by technical problems, by fuel price hikes and accidents, cruise companies were still introducing new models of ships, he added.

However, Kerry Anastassiadis, CEO of Louis Cruises said the industry was facing challenges in the European market, pointing to difficulties in obtaining multiple entry visas that can act as a deterrent for tourists from outside Europe. Countries also needed to step up their investment in tourism infrastructure, as the sale of excursions was an important revenue stream. There were also worries that stricter EU environmental regulations could have an impact on ship calls. Cruise liner companies were interested in their ships’ competitiveness and would move them away from Europe if the EU’s “green credentials” become a threat to profitability, Anastassiadis said. For a prosperous future of the Mediterranean as a top cruise destination, he urged the EU “to consider really working in partnership with stakeholders and operators.”

“It is now more than ever the competitiveness and profitability which will be the main factors driving change,” Dario Rustico, Costa Cruises’ Sales and Marketing Director for Central Europe, Africa, Middle East and India, agreed. In particular, the rapidly growing Asian market could cause a constant realignment of ships and cruise strategies, with companies moving more of their ships into Asian ports, Mr Rustico highlighted. He said Europeans also had a taste for cruising, with 30 per cent of worldwide passengers being Europeans. In fact, his company saw passengers growing in France, Spain, Germany, Italy, the UK and also in Malta. But as Asian travellers were taking to the seas in rising numbers, cruise companies were facing capacity challenges, he said. Mr Rustico added that more ships were being constructed but it took at least three years for a new vessel to be completed, leaving companies with no choice but to decide where to set sail. A loss of business could have a significant impact on Mediterranean economies, he warned, as the cruise industry contributed some €38 billion to Europe’s economy and generated over 325,000 jobs in Europe.

With cruise lines bulking up their presence in Asia, Malta’s status as a top Mediterranean cruise port was anything but guaranteed, said Gavin Gulia, Chairman of the Malta Tourism Authority. He therefore highlighted the need to stop viewing land-based and cruise tourism as two mutually exclusive sectors. He urged cruise companies to evolve their business from short excursions lasting a few hours to longer stays of two days to allow for enhanced economic activity. “I think that the cruise industry needs to strike a fair balance between the experience it offers on board the ship and the experience it offers in the destination itself, thus giving the industry more added value.”