Cruise tourism: tendencies of the industry development in the period of uncertainty

The current state of the cruise tourism market and its development prospects. Advantages of cruises compared to other types of recreation. The impact of cruise tourism on the economy of countries. Development of maritime tourism in the Black Sea region.

Рубрика Менеджмент и трудовые отношения
Вид статья
Язык английский
Дата добавления 04.12.2023
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Kherson state agrarian and economic university

Cruise tourism: tendencies of the industry development in the period of uncertainty

Boiko V., C. Econ. Sci., Ass. Professor

Kherson / Kropyvnytskyi

Annotation

The modern cruise industry is a dynamic industry globally integrated into the world economy that is continuously developing. Cruise tours become more and more popular among tourists. Before the beginning of the COVID-19 pandemic, cruise tourism was highly developed and was one of the most rapidly growing industries of the global tourism. The full-scale Russian invasion of Ukraine has affected the cruise industry, especially in the Black Sea region. Tourism operators have started changing routes, there has been a fall in the demand for such recreation, economic restrictions and safety have become key factors which should be considered in this period. The study examines advantages of cruise tourism in comparison with other types of recreation. It analyzes the impact of tourism industry on the economies of the countries where it is developing. The research indicates negative processes of recession and cessation of the development of sea tourism in Ukraine caused by the full-scale attack of Russia. The study makes a conclusion that the Black Sea region can definitely become an independent cruise direction in a mid-term perspective, the home port for liners, independent routes will be available and motor ships of different classes will sail in it.

Key words: cruise tourism, hospitality industry, tour operator, journey, liner, the Black Sea region.

Анотація

Круїзний туризм: тенденції розвитку галузі у період невизначеності

Бойко В.О., Херсонський державний аграрно-економічний університет, м. Херсон, м. Кропивницький

Сучасна круїзна індустрія - це динамічна та глобально інтегрована до світової економіки галузь що постійно розвивається. Круїзні подорожі стають все популярнішими серед туристів. Багато людей обирають круїзи як зручний спосіб відпочинку, оскільки вони пропонують комфортне проживання, різноманітні розваги та можливість відвідати кілька місць за короткий період часу на борту сучасних круїзних суден. Круїзні судна стають все більшими та розкішними. Нові судна мають вражаючі розміри, включаючи кілька палуб, басейни, ресторани, спа-центри, казино та інші розваги. Круїзні компанії постійно конкурують між собою, пропонуючи пасажирам максимальний комфорт та розкіш, також звертають увагу на нові ринки такі як Азія та Африка, щоб розширити свою присутність і у цих регіонах. До початку пандемії COVID-19 круїзний туризм мав значний розвиток і був однією з найшвидше зростаючих галузей глобального туризму. Російське вторгнення в Україну вплинуло на круїзну індустрію, особливо у Чорноморському регіоні. Туристичні оператори почали змінювати маршрути, зменшився попит на такий відпочинок, економічні обмеження та безпека стали ключовими факторами які необхідно враховувати у цей період. Круїзні компанії повинні адаптуватися до нових умов та реагувати на зміни для забезпечення безпеки та задоволення пасажирів.

Мета статті: дослідити сучасний стан ринку круїзного туризму та визначити перспективи його розвитку. У статті відображено переваги круїзного туризму у порівнянні з іншими видами відпочинку. Проаналізовано вплив круїзного туризму на економіку країн у яких він має розвиток. Вказано на негативні процеси занепаду та призупинення розвитку морського туризму в Україні у зв'язку з воєнним станом. Зроблено висновки, що Чорноморський регіон у середній перспективі цілком може стати самостійним (більше того - самодостатнім) круїзним напрямом, у портах якого базуватимуться лайнери, діятимуть самостійні маршрути та курсуватимуть теплоходи різних класів та призначення аж до спеціалізованих, на кшталт MICE-лайнерів чи плавучих казино.

Ключові слова: круїзний туризм, індустрія гостинності, туроператор, подорож, лайнер, Чорноморський регіон.

Formulation of the problem

The year 2022 was marked by opening borders, cancelling the COVID restrictions and by the splash of journeys in the entire world. Continuation of the development of these tendencies is expected in 2023. The countries connected by the water area of seas or oceans are able to restore cruise tourism which combines all the known forms of hospitality industry, various types of recreation services. However, the development of this form of tourism has considerable differences in different countries of the world, and its role and contribution to countries' economies are also different. It is undeniable that cruise navigation mostly plays a favorable role, since direct and indirect contributions of tourism to the global economy make over 10 % of the GDP. In a long-term perspective, the global cruise industry should be continuously improved, and modern studies are necessary for its sustainable development which will allow tour operators to be aware of possible changes in demand for this product in the market of hospitality industry and adapt to such changes properly and on time.

Analysis of recent research and publications. The prospects and problems of the development of the global and domestic cruise tourism have been examined by many scientists. Namely, Zatsepina N.O. analyzes the development of cruise tourism in the world as a promising type of recreation and emphasizes that currently the desire to have a rest at sea in a comfortable setting, see new cities, visit museums, cultic buildings, monasteries, churches and other historical monuments are the motives for travelling by sea [1]. Kornilova V.V. and Kornilova N.V. consider the modern tendencies for the development of the global cruise market which has been rapidly growing for the latest decades and demonstrating a steady increase [2]. Antonenko I. and Melnyk І. establish that, in spite of the development of inbound cruise tourism in Ukraine, the park of passenger ships is not competitive, and its modernization and updating cruise infrastructure require large inputs. However, cruise tourism has considerable potential for development, international cruise operators are willing to cooperate and invest money in its development, but imperfection of the Ukrainian legislation, a lack of various forms of public-private partnership, the present government's unawareness of the prospects that tourism industry can give on the whole, make companies, providing services in cruise tourism, not compete but survive [3].

Nezdoiminov S.H. and Andrieieva N.M. pose burning issues of the processes of realization of the Marine Doctrine of Ukraine in the area of marine cruise tourism and characterize the main problems of development of the market of cruise services which require searching for new forms of integration of financial, industrial and intellectual capital of public and private enterprises concerning the formation of significant competitive advantages of the functioning of marine economy of Ukraine in the area of marine cruise tourism [4]. Dobrianska N. A. and others prove that it is necessary to increase the importance of the government in establishing cruise navigation for social-economic development of the entire Black Sea region [5]. Boiko V.O. and a number of other scientists aimed their studies at determining directions of a high priority in transformation of the activity of cruise companies under conditions of the current movement restrictions related to the past COVID-19 pandemic [6-8].

Formulation of the purpose of the article. To study the current state of the market of cruise tourism and establish the prospects of its development.

Presentation of the main material

Over the past years, cruise tours have become more available in terms of finance, and, consequently, more popular. Each cruise has its advantages. Firstly, it is an optimal combination of the price and quality of the services offered. The cost of a standard cruise includes the price of a journey by cruise ship, accommodation in a cabin, three meals, entertainment programs and evening performances on board, using a swimming pool, sauna and gym. Modern cruise ships can be compared not only to a five star hotel, but also to a resort with well-developed infrastructure, where all conditions are available for active recreation, new acquaintances and relaxation.

Additional advantages of cruises are a possibility to visit different cities and other countries, and also get acquainted with a huge number of people. A lack of necessity to pack and unpack suitcases continuously, availability of cafes, bars, clubs, casinos on board, a rich evening program, and also different excursions and sightseeing tours in each place of a ship's stay and around-the-clock services make recreation on a cruise unforgettable and interesting [9].

The segment of cruise navigation suffered seriously during the pandemic and the war in Ukraine and recovered its work partially one of the last in tourism industry. At present cruises in the entire world, apart from the Black Sea region, enjoy enormous popularity, probably, because currently it is one of the most relaxed leisure. Experts state that the current year 2023 is a transitional period, highlighting that the number of passengers travelling by cruise ships equals approximately 70%-80% of the total ship capacity.

According to experts' forecasts, the number of cruise passengers in the entire world will increase to 26.5 million passengers in 2023, to 29.8 million passengers - in 2024, and to 31.5 million passengers in 2025. In the future, over the period of 2024, cruise industry will return to the index, which is more than the one in 2019. It is known that the total number of cruise ships in the entire world was 350 ships in 2022, 279 of which belonged to the Cruise Lines International Association (CLIA), making 92.5% of the global tonnage. The sector indexes for Greece are very optimistic, since, according to the information of the Hellenic Ports Association, the number of contract carriers in the country reached 4939 cruise ships in 2023.

According to the information of ЕЛЙМЕ, 2064 cruise ships with 1 418 315 passengers entered Greek ports in 2021, in comparison with 3979 cruise liners with 5 552 384 passengers in 2019, when there were no severe global restrictions because of the pandemic. At present, according to the plan of cruise routes, the top-10 directions by the amount of profit of cruise ships includes the Port of Piraeus with 739 entrances, Santorini - with 741 entrances, Mikonos - with 692 entrances, Rodeos - with 440 entrances, Corfu - with 414 entrances, Iraklion - with 213 entrances, Katakolo - with 197 entrances, Kefalonia - with 155 entrances and Chania - with 119 entrances. Profits of Greece from "cruise tourists" in 2019, when there were no restrictions because of the pandemic, equaled EUR 457 million in comparison with EUR 433 million in 2018, having increased by 5.7% [10].

According to the latest information of the CLIA - Associaзгo Internacional de Cruzeiros, given to the public at the European Summit in 2023, the cruise sector generated over EUR 40 billion in terms of economic impact in Europe in 2021. The sector also increased the amount of its workforce, creating 315 000 jobs in Europe in that period. sea cruise tourism economy black sea region ukraine

According to the report of Publituris, the impact of cruise tourism on Portuguese economy, according to the latest data of the CLIA, is "considerable". According to experts' evaluations, cruise tourism of this country has made a total income of EUR 487 million, including purchases of EUR 70 million made by cruise companies in local suppliers, EUR 121 million investments in shipbuilding and about EUR 24.8 million as wages for 7 900 persons, who immediately work in this sector in Portugese.

The data also testify that over 93% of cruise companies in the world are provided by European ship-building yards, including Portuguese ones, and construction of cruise ships makes 80% of the orders of ship-building yards. With 66 cruise ships, ordered by potential clients in the following five years, it means that direct investments of over EUR 40 billion will be directed towards Europe [11].

The international cruise company Life at Sea Cruises offered tourists, first of all, digital nomads, the world's first cruise lasting 3 years. As the Independent says, the tour will cover 375 ports in 135 countries in the world on seven continents. Tourists will also be able to see 13 out of 14 wonders of the world. Travelers will spend approximately a third of nights at hotels on shore during the ships' stays in ports for 2-3 days. The cost of this pleasure will be $29,999 per year and more, i.e. a three-year tour will cost a client about $90 thousand. The cruise will be provided by the ship MV Gemini, which has 400 cabins and can accommodate 1074 passengers on board. The ship will start its voyage in Istanbul, on November, 2023, with additional passenger boarding in Barcelona and Maiami.

The organizers of this cruise are sure that the tour will become ideal for digital nomads, which will have "a unique possibility" to travel around the world and work simultaneously, paying "rent" only a bit more than $80 per day, "that is cheaper than to rent an office on shore". It is highlighted that the tour cost includes access to all the eateries and alcohol at dinner time, an ultra-modern health center, a sunny terrace and swimming pool, high speed Internet, entertainments, "enrichment seminars" and cleaning services. An around-the-clock hospital will also be available on board with free visits to a doctor. Moreover, participants of the tour will have access to a board business-center, including rooms for negotiations, 14 offices, a lounge zone and business-library.

The organizers will allow tourists missing their homes to meet their friends and relatives on board free of charge. As the UIIA informed, earlier the American cruise company "Royal Caribbean" made an advertisement of the cruise ship "Icon of Seas" that must be the largest one in the world. It is planned that it will take this title from another ship of the company "Wonder of the Seas" [12].

Another innovative cruise, represented by MSC Eurabbie with a zero-balance of emissions, will apply bio-LNG with using the system of mass balance that is the most environmentally friendly technique for applying advantages of biogas which is renewed. The ship supply chain will comply with the Renewable Energy Directive of the European Union (RED II), and the total bio-LNG produced, is certified by the International Sustainability and Carbon Certification (ISCC).

The cruise with a zero-level of emissions received support of the Scandinavian biogas company Gasum. Additionally, the speed and route of the first navigation of MSC Euribia were developed on purpose to minimize fuel expenses. Professionals in energy efficiency from MSC Cruises та Chantiers de L'Atlantique will work on board during its zero navigation [13].

Ukraine has many tour operators which offer river or sea cruises, but the range of cruise routes is still not wide. It is impossible to dream of a regular schedule of such cruises in the near future because of the war, since the starting point for such sea cruises is the port of Odesa. Generally, the main reason which hinders the development of cruise tourism in our country is a lack of a modern well-developed infrastructure.

It seems that such a large maritime country as Ukraine should attract different foreign cruise companies which could use our ports for their cruise routes. However, the situation was directly opposite: the number of entrances of foreign liners to Ukrainian ports decreased annually before the war. In addition, in Ukraine there are no large cruise companies which possess modern comfortable ships suitable for sea cruises and well-trained staff. Therefore, a large portion of cruises belonged to foreign companies. Over the past three years, because of the global COVID-19 pandemic and the beginning of a full-scale war with Russia, and also because of the aggressor's blocking the Black Sea water area, cruise ships have not entered Ukrainian ports. Currently there are no foreign tourists who would like to visit our country by sea and this will last indefinitely [14-18].

Negative processes of recession and cessation of the marine tourism development in Ukraine started in 2014 with Russia's annexation of Crimea, since the largest portion of ports suitable for developing cruise navigation is located in its territory. Consequently, the cruise ships of the companies "Oceania Cruises", "Azamara", "Windstar Cruises", "Regent Seven Seas Cruises" have not collaborated with Ukraine since May, 2014.

According to the conclusions of the leading world professionals, in the near four years the leading companies (Carnival Сorporation, Royal Caribbean Cruises, MSC Cruises, Norvegian Cruise Line) will control over 83.8% of the cruise market in the world. But Ukrainians hope that, after the victory of Ukraine in the war and liberation of the territories temporally occupied by Russia, the Black Sea region and Crimean Peninsula will have excellent prospects for the functioning of cruise tourism.

In the near future the cities in the Black Sea region - the heroes Kherson, Mykolaiv and Odessa together with the cities of Crimea can become objects of interest of not only Ukrainians, but also foreign tourists. The entire world will be willing to give credit to the residents of these cities who struggled for independence of their country valiantly, bravely and devotedly.

Conclusions

First of all, the war in Ukraine should be stopped as soon as possible for further successful development of the global cruise industry in the Black Sea region; at the next stage it is necessary to demine the water areas of the sea ports and territories, and also ensure safety of civil navigation; it is important to restore and rebuild the destroyed transport and tourism infrastructure; support of foreign partners should be received and a great number of investors interested in developing the global cruise industry should be involved for realization of the planned actions.

Moreover, it is necessary to remember about sea port dues and customs procedures which should comply with the existing European standards. According to professionals' evaluations, modernization of a port infrastructure will allow increasing the number of foreign ship entrances to Ukraine's ports by 10-15% annually and receive not less than 60 thousand tourists that will make it possible to create conditions for bringing money to local budgets throughout the year. In addition, it will not have a considerable impact on loading the land infrastructure of the Black Sea region. It will also help to level seasonality of jobs and involve other international cruise operators in cooperation in the Black Sea region.

References

1. Zatsepinaа N.О. (2012) Istoriia vynyknennia ta suchasnyi stan kruiznoho turyzmu v sviti [The origin and current state of cruise tourism in the world]. Naukovi pratsi istorychnoho fakultetu Zaporizkoho natsionalnoho universutetu [Scientific works of Zaporizhzhia National University], vol. XXXIV, pp. 232-234.

2. Kornilova V. and Kornilova N. (2018) The main trends of world cruise market development. Investytsiyi: praktyka ta dosvid, no. 5, pp. 20-25.

3. Antonenko І., Melnyk І. (2016) Kruiznyi turyzm v Ukraini: tendentsii ta perpektyvy rozvytku [Cruise tourism in Ukraine: tendencies and prospects for development]. Ekonomist, no. 3, pp. 3-8.

4. Nezdoiminov S.H., Andrieieva N.M. Kruizny turyzm v konteksti Morskoi doktryny Ukrainy [Cruise tourism in the context of the Maritime Doctrine of Ukraine].

5. Dobryanskaya N.A., Volodivschhuk A.S., Dobrianskyi R.A. (2019) The current state and development prospects of sea cruise tourism in the Odessa region. Economic journal Odesa polytechnic university, no. 4 (10), pp. 50-56.

6. Boiko V.О., Lohvynenko Yu.V. Kruizne sudnoplavstvo v umovakh karantynnykh obmezhen [Cruise navigation under conditions of quarantine restrictions]. The III International Scientific and Practical Conference «Society and science. Problems and prospects», (London, England, January 25-28, 2022), рp. 619-621.

7. Lyulyov O., Us Y., Pimonenko T., Kwilinski A., Vasylieva T., Dalevska N., Polcyn J., & Boiko V. (2020) The Link between Economic Growth and Tourism: COVID-19 Impact. Proceedings of the 36th International Business Information Management Association (IBIMA) (November 4-5, 2020) /

S. Khalid, S. Soliman (ed.). Granada: IBIMA Publishing, pp. 8070-8086.

8. Boiko N.О., Bohoslavets O.H. (2020) Kruiznyi turyzm v umovakh suchasnykh svitovykh vyklykiv [Cruise tourism under conditions of the current global challenges]. Naukovi perspektyvy, no. 5(5), pp. 293-303.

9. Kruizy z Odesy ta Chornomorska: shcho proponuit ukrainskym turystam? [Cruises from Odesa and Chornomorsk: what is offered to Ukrainian tourists?]

10. Kruiznyi turyzm vidnovliuietsia [Cruise tourism is being restored].

11. 487 mln yevro shchorichno vid kruiznoho turyzmu [EUR 487 million annually from cruise tourism].

12. Podorozh mrii: turystam zaproponuvaly pershyi u sviti tryrichnyi kruiz semy kontynentamy [The journey of dreams: tourists were offered the world' first cruise to seven continents].

13. Vzhe v chervni kruizy na naiekolohichnishomu laineri! [Cruises on the most environmentally friendly line are available in June!]

14. Boiko V., Liubynskyi O., Strikha L., Zarakhovskyi O.Y. & Neilenko S. (2021) Development of Culinary Tourism in European Countries. International Journal of Computer Science and Network Security, no. 21(4), pp. 167-177.

15. Boiko V. & Boiko L. (2022) Problems and Prospects for Innovation-Driven Development of the Tourism Industry in Ukraine. Science and Innovation, no. 18(5), pp. 26-37.

16. Kyrylov Y., Hranovska V., Boiko V., Kwilinski A. & Boiko L. (2020) International Tourism Development in the Context of Increasing Globalization Risks: On the Example of Ukraine's Integration into the Global Tourism Industry. Journal of Risk and Financial Management, no. 13(12), pp. 303.

17. Boiko V. & Dalevska N. (2022) Rozvytok turyzmu pislia zbroinykh konfliktiv u riznykh krainakh svitu [Tourism development after military conflicts in different countries of the world]. Change Management and Innovation, no. (3), pp. 5-10.

18. Boiko V. (2023) Istoriia rozvytku ta suchasni tendentsii kruiznoho turyzmu yak perspektyvnoho sehmentu industrii hostynnosti [History of the development and current trends of cruise tourism as a prospective segment of the hospitality industry]. Publishing House "Baltija Publishing".

Список використаних джерел

1. Зацепіна Н.О. Історія виникнення та сучасний стан круїзного туризму в світі. Наукові праці історичного факультету Запорізького національного університету. Вип. XXXIV. 2012. С. 232-234.

2. Корнілова В.В., Корнілова Н.В. Сучасні тенденції розвитку круїзного ринку світу. Інвестиції: практика та досвід. 2018. №5. С. 20-25.

3. Антоненко І., Мельник І. Круїзний туризм в Україні: тенденції та перспективи розвитку. Економiст. 2016. №3. С. 3-8.

4. Нездоймінов С.Г., Андрєєва Н.М. Круїзний туризм в контексті Морської доктрини України.

5. Добрянська Н.А., Володівщук А.С., Добрянський Р.А. Сучасний стан та перспективи розвитку морського круїзного туризму в Одеській області. Економічний журнал Одеського політехнічного університету. 2019. №4 (10). С. 50-56.

6. Бойко В.О., Логвиненко Ю.В. Круїзне судноплавство в умовах карантинних обмежень. The III International Scientific and Practical Conference «Society and science. Problems and prospects», (London, England January 25-28, 2022). P. 619-621.

7. Lyulyov O., Us Y., Pimonenko T., Kwilinski A., Vasylieva T., Dalevska N., Polcyn J., Boiko V. The Link between Economic Growth and Tourism: COVID-19 Impact. Proceedings of the 36th International Business Information Management Association (IBIMA) (November 4-5 2020) /

S. Khalid, S. Soliman (ed.). Granada: IBIMA Publishing, 2020. P. 8070-8086.

8. Бойко Н.О., Богославець О.Г. Круїзний туризм в умовах сучасних світових викликів. Наукові перспективи. №5(5). 2020. С. 293-303.

9. Круїзи з Одеси та Чорноморську: що пропонують українським туристам?

10. Круїзний туризм відновлюється. 487 млн євро щорічно від круїзного туризму.

11. Подорож мрії: туристам запропонували перший у світі трирічний круїз семи континентами.

12. Вже в червні круїзи на найекологічнішому лайнері!

13. Boiko V., Liubynskyi O., Strikha L., Zarakhovskyi O.Y., Neilenko S. Development of Culinary Tourism in European Countries. International Journal of Computer Science and Network Security. 2021. No. 21(4). Р. 167-177.

14. Boiko V., Boiko L. Problems and Prospects for Innovation-Driven Development of the Tourism Industry in Ukraine. Science and Innovation. 2022. Vol. 18(5). Р. 26-37.

15. Kyrylov Y., Hranovska V., Boiko V., Kwilinski A., Boiko L. International Tourism Development in the Context of Increasing Globalization Risks: On the Example of Ukraine's Integration into the Global Tourism Industry. Journal of Risk and Financial Management. 2020. Vol. 13(12). Р. 303.

16. Бойко В., Далевська Н. Розвиток туризму після збройних конфліктів у різних країнах світу. Управління змінами та інновації. 2022. №3. Р. 5-10.

17. Бойко В.О. Історія розвитку та сучасні тенденції круїзного туризму як перспективного сегменту індустрії гостинності. Publishing House «Baltija Publishing», 2023.

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