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We Need More Rooms


March 10, 2005
Copyright © 2005 CARIBBEAN BUSINESS. All Rights Reserved.

Thirty-five years ago, Dominican Republic President Joaquín Balaguer asked Puerto Rico Governor Luis A. Ferré to help them develop a tourism industry. Ferré sent our then Fomento administrator, who was also the chairman of the board of the Puerto Rico Tourism Co., to help with some ideas. The Dominican Republic at the time had fewer hotel rooms than Puerto Rico. More than three decades later, it is the Dominican Republic who can give Puerto Rico lessons on tourism development.

Although Puerto Rico’s tourism industry is one of the most promising sectors for employment and economic growth, it has gone virtually nowhere over the past 30 years. Today, Puerto Rico has just over 12,800 hotel rooms, a far cry from the more than 57,000 in the Dominican Republic with another 3,000 under development, 26,000 in Cancun, and more than 42,000 in Cuba. Three decades ago, all of these destinations had fewer hotel rooms than Puerto Rico. These destinations have become major competitors in the Caribbean for global tourists by offering a wide-range of tourism products and properties.

Puerto Rico has the largest international airport in the Caribbean region and a close relationship with American Airlines, which operates its Caribbean regional hub from Luis Muñoz Marín International Airport in San Juan. American, the largest airline in the world, has the passenger service and ties with travel wholesalers and retail travel agencies to bring more traffic into Puerto Rico. Greater traffic translates into more jobs and revenues for Puerto Rico’s economy since tourism is a major source of external income for any destination. Yet, as airline officials have informed CARIBBEAN BUSINESS and the governor of Puerto Rico, Aníbal Acevedo Vilá, there are not sufficient hotel rooms in Puerto Rico to accommodate them.

It’s a shame that while other destinations in the region have grown substantially, Puerto Rico has not taken advantage of its great air access, exceptional year-round climate, natural beauty and resources, and the security provided under the U.S. flag to expand its tourism industry.

For decades, Puerto Rico’s tourism developers have had to battle with bureaucratic delays, an extensive permitting process, disputes over ground transportation, and extreme environmentalists, in many cases with special agendas, in order to build hotels. It often takes longer for a hotel developer to obtain all the necessary permits to begin building a hotel or resort in Puerto Rico than the time it takes to completely construct the project in another destination. While all of this is going on, the island continues to lose manufacturing jobs and the public sector continues to expand its payroll, neglecting what could possibly be the most important industry for Puerto Rico’s future growth. An industry that offers our best natural resources, a great easy-to-reach location in the warm Caribbean, plenty of labor, and, to top it off, tourism is one of the cleanest industries we have.

Tourism is a labor-intensive industry that generates employment not only in hotels and airlines, but also contributes to jobs in restaurants, retail, commerce, ground transportation including taxis and tour buses, construction, and the financial sector, among others. The jobs created on the island to provide services to visitors cannot be outsourced. Yet, this sector has not received half as much support through the years from the local government as manufacturing has, for example. It’s not that we shouldn’t continue to support manufacturing, but we can’t deny the fact that these jobs for the last few decades are continuously being outsourced to countries with cheaper labor costs such as Mexico, Costa Rica, Malaysia, India, and China. Puerto Rico can’t compete with the operating costs in these developing countries.

What Puerto Rico’s tourism industry needs beyond the support of the government is a master development plan, similar to the Fonatur model in Mexico, where the necessary infrastructure is provided on selected sites throughout the island and hotel developers just have to come in and build the properties. Puerto Rico also needs to provide security, maintenance, and conservation of the island’s natural attractions and resources, clean public areas and beaches, and reliable transportation systems so that not only can visitors get around, but also the industry’s employees.

This Caribbean Business article appears courtesy of Casiano Communications.
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