• 2015 November 10

    Cruise prospects

    One of the major problems of cruise tourism is the lack of stability in the industry as well as its sensitivity to external influence like weather conditions or geopolitical situation. Russian regions face both common and specific challenges. 

    North-West

    The largest passenger terminal in the North-West region of Russia and in the entire country is Passenger Port of Saint-Petersburg “Marine Façade” which has serviced 491,822 passengers in 2015 having exceeded the result of the previous year by 2%. The port is going to service 1-2% more passengers in 2016.

    The Company’s strategic plan through 2020 implies the development of the Marine Façade terminal as a departure port which is to be a step towards obtaining of the cruise homeport status.

    This would double the passenger flow via the port and triple the income of the city from tourists (whose stay in Saint-Petersburg would be two times longer), explains Aleksei Panfillov, Commercial Director of Passenger Port of Saint-Petersburg “Marine Façade”. According to him, Passenger Port of Saint-Petersburg has received a number of proposals from some cruise lines on making it the homeport for some of their ships.

    However, to implement this plan it is necessary to introduce certain amendments into the federal legislation in the part of visa regime for foreign tourists.  In particular, 72-hour visa-free regime is to be applicable to all types of transport. As of today, it is only applicable to tourists arriving by cruise ships and ferries.

    Saint-Petersburg Government supports the port’s initiative. “The flow of cruise passengers via Saint-Petersburg will multiply if the 72-hour visa-free regime is expanded for tourists coming by air, railway, motor and river transport,” forecasts Inna Shalyto, Chairwoman of the Saint-Petersburg Government’s Committee for Tourism Development. According to her, Saint-Petersburg will become more attractive for tourists if it obtains the status of the port of departure and return.

    The issue of changing the legal framework related to visa regime has been included into the resolution of the Water Tourism forum held in Saint-Petersburg on October 29-30, 2015 under the United Russia party project “Saint-Petersburg – the sea capital of Russia”. This makes the stakeholders expect the required order form the Government.

    Marine Façade is also going to develop infrastructure and port territory. The year of 2016 will particularly see the beginning of works on designing of additional mooring facilities at berth No 7 in order to extend the waterfront and to allow for simultaneous mooring of two 330-meter long ships at berths No 6 and No 7. This work is to be completed by the navigation season of 2017.

    Cruise shipping is also to be developed in the Murmansk Region. The regional government and FSUE Rosmorport are implementing the Arctic Harbour project.

    Under the project, a pier for long-distance lines was opened at the port of Murmansk in January 2015. The reconstruction of the pier commenced in 2012. The work implied the extension of the pier dimensions, dredging and bank protection operations within the passenger district. The length of the pier was increased from 147 to 206.6 m, width – from 13.96 to 19.6 m. The project also provides for the reconstruction of the passenger terminal and opening of the offshore post to cross the RF border. Total financing under the project is estimated at RUB 1.159 bln.

    Throughput project implementation is supposed to let Murmansk boost the number of foreign cruise ships’ calls from 6 to 70 and service annually up to 70,000 passengers in the future.

    Far East

    Meanwhile, the Far East of Russia is also focused on building up the flow of cruise passengers.

    “The flow of cruise passengers via the port of Petropavlovsk-Kamchatsky can exceed 300,000 persons by 2025 if principal barriers are eliminated,” says Nikolai Pegin, Advisor to the Kamchatka Territory Governor on attraction of investments.

    According to him, the Territory is annually visited by 9,500 cruise tourists today with more than 20 cruise ships calling to Kamchatka ports.

    Among the barriers hindering the development of cruise tourism Pegin named insufficient development of ports’ transport infrastructure, absence of up-to time berths with sufficient waterfront and depth as well as absence of an adequate passenger terminal with a high capacity.

    Besides, he says cruise ship’s waste treatment is not possible, related infrastructure is poor and well developed land tours are not available. There is also a problem of approving the routes for foreign cruise tourists.

    Therefore, to use the cruise potential of the region it is necessary to develop port infrastructure, improve legislation and comply with standards essential for cruise companies selecting the ports of call, the Governor’s Advisor says.

    According to him, the work on eliminating the above barriers is at full swing today. “RF Government approved “Kamchatka” area of advanced social and economic development in late August of the current year. The Area’s key specialization is tourism and port related industry with the seaport being a basic platform,” Pegin reminds.  

    South

    It should be acknowledged that the Krasnodar Territory, the area with one of the most favorable climate, faces the hardest situation.

    “There is a cruise potential but it is not fully achieved due to both objective and subjective reasons,” says Aleksandr Frolov, Head of Passenger Service at Commercial Seaport of Sochi.

    According to him, one of the key barriers in the development of cruise tourism and transportation of passengers by sea transport in the Azov-Black Sea Basin is the absence of shipping companies operating their own fleet at the routes. The situation is typical for the recent 10-15 years.

    “The attempts to launch Black Sea cruise lines with the ships chartered in the global market (Adriana and Izabella2) saw no success in 2013 – 2014,” he reminds.

    First of all, it is the impact of the considerable fall of rouble.  To charter a ship in the global market, you should pay in foreign currency and rouble prices have сeased to be attractive for the bulk of potential passengers, Frolov explains. “Besides, it is the flag state that decides upon the calls of cruise ships and foreign vessels chartered by Russian companies could not call the ports of Crimea due to the flag state’s position,” he says.

    Therefore, Frolov thinks the Russian Federation requires its own cruise shipping companies with the ships flying the flag of Russia, a national operator.

    Meanwhile, the development of cruise tourism in the region can be facilitated with the revival of freight-and-passenger service at Sochi (Russia) - Trabzon (Turkey) line. The initiative of Commercial Seaport of Sochi was backed by RF Ministry of Transport. Yet, the Ministry demands settling of several issues including the reconstruction of border check point at the seaport of Sochi and approval of the motor transport traffic towards the port by the city authorities.

    Backed by Rostourim

    Perhaps, the above challenges will be faced with the support of the Federal Agency for Tourism (Rostourism).

    The Agency’s Deputy Head Sergei Korneyev says the Agency has revealed a number of problems related to the economic aspects of ports’ activities.

    “There are different positions on port charges in general, therefore it is difficult to walk a thin line between the loading of infrastructure and making it profitable,” Korneyev explains.

    The sector also depends on foreign cruise companies which can come and leave the Russian market under the influence of the political situation, he says.

    According to Korneyev, establishment of an expert council and an inter-agency working group on water tourism is under discussion at the Agency.

    He also says the Federal Agency for Tourism will develop a package of measures on the development of river/sea cruise tourism by December 1, 2015. The document is to be submitted to the Government and the President of the Russian Federation. The package of measures will consist of three blocks: river cruise tourism, sea cruise tourism and yacht/boat tourism. Each block will, in its turn, be divided into measures focused on the development of infrastructure, renovations and creation of new water transport (sea and river cruise ships flying the flag of Russia), inter-agency coordination of activities, improvement of regulatory framework, marketing (promotion and providing information about Russian tourism products).

    The prospects of water tourism were discussed at the meeting of the State Council Presidium held on August 17, 2015. Following the meeting, RF President Vladimir Putin ordered the related ministries and agencies develop a package of measures aimed at the development of cruise tourism by December 1, 2015.

    Margarita Babkova