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Gateway To Puerto Rico: First Cruiseship Departures Help Jacksonville To Diversify
November 21, 2003
JACKSONVILLE has long been known as the gateway to Puerto Rico, and understandably so with more 70% of the US-Puerto Rico trade funneled through the northeast Florida port.
But, although all that business has been a boon, it has also had drawbacks. Puerto Rico may be Jacksonvilles life blood, but such dependence on a single trade is dangerous in the extreme.
By the same token, the widespread perception of Jacksonville as the Puerto Rico hub complicates its efforts to expand into other trades and so spread the risk through diversification.
Difficult as it may be, executives at the Jacksonville Port Authority, known as Jaxport, along with local government officials are doing their utmost to spread the ports wings.
Over the past year, its free trade zone has been expanded from the city to an area covering northeast Florida and a big marketing push has been launched to draw new distribution centres to the area, as well as a leading or Asian carrier.
Efforts are also under way to improve the ports infrastructure.
This year, Jacksonville completed the deepening of its main channel from 38 to 40 ft with the eventual aim of taking it to 45 ft. It is also continuing to develop the Dames Point Marine Terminal on a 580-acre greenfield site and working to lure users to the facility.
Though it did bring Frontier Line to the port, offering services to the Dominican Republic and Colombia, its efforts on the cargo side are still a work in progress and the big breakthrough the port seeks remains elusive.
All the same, though containerised volumes have remained relatively steady in tonnage terms N at 3.75m tons in the year to September 30 N at least the distribution of those volumes is becoming more even.
Therefore, while Puerto Rico took the lions share as usual, the 2.53m tons in Puerto Rican trade handled over the period was 5% down on the previous year.
South American business, meanwhile, rose 10% to 761,780 tons and,while Mexican and Caribbean trade fell, the other category more than doubled to 240,550 tons.
The ports blossoming motor business also registered a solid 11% gain to 1.15m vehicles.
Jacksonvilles real success of late, however, has been on the cruise side of the business.
This year, profiting from the emergence of a new drive-to-cruise market following the terrorist attacks of 2001, Jaxport lured regular cruise services to Jacksonville for the first time, with both Celebrity and Carnival committing to the port.
Jacksonvilles inaugural cruise season kicked off with the sailing of Celebritys 1,374-passenger Zenith on October 27 on a 13-night cruise.
Celebrity has committed to five cruises out of Jacksonville this year, 13 in 2004 and eight the following year.
Carnival, meanwhile, will begin in February with 12 cruises aboard the Miracle, and then provide year-round service by the Holiday with 78 cruises annually.
Jacksonville spent $5.5m on a 63,000 sq ft temporary cruise terminal with 1,200 feet of berth and 20 acres of parking space to host the new services, and it has plans to build a permanent facility.
It anticipates handling 150,000 passengers a year solely from the existing commitments from Celebrity and Carnival.
True to its mission as an engine of economic growth for northeast Florida, it also anticipates that the cruise industrys presence at the port will generate more than 700 new jobs and $36.4m a year in economic impact N including $2.5m a year in new port N by 2005.
While pumping time and resources into expanding its cruise and cargo base, however, Jaxport is increasingly aware that it must not lose sight of its core Puerto Rico business.
The extent of its dependence on Puerto Rico is impressive. Last year 81.8% of Jacksonvilles containerised exports, or 346,485 teu,went to Puerto Rico and 71.4% of its containerised imports, or 84,441 teu, derived from the island territory.
In tonnage terms, Puerto Rico accounted for 73.6% of exports, or 2.6m tons, and 6.4% of imports, or 539,048 tons.
This core market is now under threat, however, as Jacksonville contemplates the planned elimination in 2005 of a tax incentive to encourage US companies to invest in Puerto Rico which is at the very heart of the island economy.
In August, the port hosted a conference to discuss the issue and create momentum for efforts in Congress to secure new fiscal incentives to replace the old.
As Raul Alonso, Jacksonvilles port director for Latin America, puts it: "The economic impact it has on our community is so much that we cannot afford to lose Rico."