U.S.-Cuba tourism could help the region

For years, I have thought that Mexico and most Caribbean countries want Cuba to remain a dictatorship subject to U.S. travel sanctions for as long as possible, because an eventual opening of U.S. travel to Cuba would badly hurt their own tourism industries.

But now, I’m beginning to wonder whether that’s true for all of Cuba’s competitors.

After reading a new study by the International Monetary Fund, I can’t help but conclude that Mexico would stand to lose a lot by an opening of U.S. tourism to Cuba, but many Caribbean islands would not suffer at all. On the contrary, the study says overall tourism to the Caribbean would increase by up to 11 percent.

The study, “Vacation Over: Implications for the Caribbean of Opening U.S. Cuban Tourism,” was published by the IMF as a “working paper” by its economist, Rafael Romeu.

It comes at a time when an opening of U.S. travel to Cuba looks increasingly plausible in the near future. Democratic U.S. presidential candidate Barack Obama is vowing to relax U.S. travel restrictions on Cuban Americans if he is elected. And, independently of U.S. policy, Cuba’s ruling gerontocracy is not likely to be able to maintain the status quo for many years — if anything else because President Raul Castro is 76, and his No. 2, Jose Ramon Machado Ventura, is 77.

According to the IMF study, “an opening of Cuba to U.S. tourism would represent a seismic shift in the Caribbean’s tourism industry,” and would “increase overall arrivals to the Caribbean.”

Regional benefit

This is because there would be a massive surge in U.S. tourism to Cuba, which would overwhelm Cuba’s hotel room capacity and drive Canadian and European tourism currently vacationing in Cuba to be redirected to neighboring countries.

As a result, “the region would enjoy a period of sustained demand,” it says. “In the wake of this change, some countries would potentially stand to lose U.S. tourists but would gain new non-U.S. tourists.”

Currently, the biggest tourism destinations in the Caribbean, in addition to Puerto Rico, are the Dominican Republic, with 2.2 million foreign visitors a year; Mexico’s resort of Cancun, with nearly 2 million tourists; the Bahamas, with 1.4 million tourists; Cuba, with 1.3 million, and Jamaica, with 1.2 million. The figures reflect annual arrivals between 2000 and 2004, and have since gone up somewhat, Romeu says.

But an opening of U.S. tourism to Cuba would shake this mix immediately, because an estimated 3 million to 3.5 million American tourists would flock to Cuba, the study says.

Much of it would be because traveling to Cuba — in addition to being a novelty — would become substantially cheaper. Currently, the cost of traveling from the U.S. to Cuba for Cuban Americans and others exempted from travel restrictions is equivalent to that of traveling to Australia.

According to the study, there would be winners and losers from an opening of U.S. tourism to Cuba:

Mexico’s resort of Cancun, which relies heavily on U.S. tourists, would be a net loser. It would lose 614,000 American tourists, while it would gain only 93,000 non-U.S. tourists.

The Bahamas, which also relies heavily on U.S. tourists, would lose 499,000 U.S. tourists, while gaining 36,000 non-U.S. tourists.

Net winner

The Dominican Republic, which has a highly diversified tourism base, would be a net winner. It would lose 318,000 American tourists, while gaining nearly 400,000 non-U.S. tourists.

Smaller islands such as Martinique, Montserrat, Antigua and Barbuda, Barbados and other countries with strong ties to European countries would also be net winners.

My opinion: Interesting stuff. I don’t know whether Mexico — the biggest loser in an eventual opening of U.S. tourism to Cuba — is currently cozying up with Cuba’s dictatorship because it wants to maintain the status quo for as long as possible.

But I wouldn’t be surprised if there is a link between tourism and politics in the Caribbean — which would explain a lot of things that sometimes seem hard to understand.

X Andres Oppenheimer is a Latin America correspondent for the Miami Herald. Distributed by McClatchy-Tribune.