MSC Cruises pulls out of Abu Dhabi

The first cruise company to use Abu Dhabi as a home port is pulling out less than a year after it started sailing from the capital as the industry struggles in the wake of the Costa Concordia disaster.

Italy's MSC Cruises has scrapped plans to return to the emirate this year for the next season in a setback for the emirate's ambitions to become a cruise industry hub.

A variety of factors were behind its decision to withdraw, including commercial reasons, the limited facilities and range of cruise destinations in the region, and a preference to take the ship that was destined for Abu Dhabi to South Africa instead, the company said.

"There is no doubt that MSC Cruises' guests enjoyed the destination," MSC Cruises said. "However, for the long-term success of cruising in the [GCC] region, new ports of call need to be developed, terminal facilities must be upgraded and there must be increased focus on sourcing from local and regional markets."

Abu Dhabi has identified the cruise sector as an important pillar in its tourism ambitions as it aims to attract 2.3 million hotel guests by the end of this year.

In the longer term, it is hoping to attract 300 sailings a year and 600,000 passengers by 2030, including ships that sail out of Abu Dhabi and those that stop off in the capital as a port of call.

The first cruise ship to use Abu Dhabi as its base, the MSC Lirica, was estimated to have brought in about 40,000 visitors, with a direct economic impact of Dh80 million (US$21.7m) to the emirate, including money spent on flights, accommodation, retail, transport, food and beverage, according to projections from the emirate's tourism authority issued at the time of its launch.

The cruises sailed to Muscat, Fujairah, Khasab in Oman, and Dubai.

MSC Cruises had intended to bring a bigger ship to Abu Dhabi next season, carrying 54,000 passengers.

But that ship, MSC Opera, is now going to Durban in South Africa, where the company says it has made substantial investments.

There have been a spate of safety incidents in the sector recently, including the capsizing of the Costa Concordia off the coast of Italy, resulting in the loss of 30 lives.

"[We view] MSC Cruises' decision as a short-term tactical imperative, largely brought about by the commercial and operational challenges currently confronting the global cruise industry," the Abu Dhabi Tourism and Culture Authority said.

"Abu Dhabi's cruise tourism hub ambitions continue unabated. Growth prospects, for both fly-cruise and intra-regional cruises, remain fundamentally positive. We are confident that there will be at least one major cruise liner home-porting in Abu Dhabi in the 2013/14 season."

The tourism authority is striving to boost the industry

.

"To realize our cruise hub ambitions, the authority has established a number of strategic priorities," it said. "These include: the establishment of a dedicated cruise terminal at Mina Zayed within three years; the development of one of Abu Dhabi's many islands into a permanent cruise port-of-call; the enhancement of passenger and ship handling capabilities among Abu Dhabi stakeholders."

It also wants greater cooperation within the region to help to boost interest in taking cruises among the local and regional populations, including India, with the aim of growing "these bookings from their current level of 1 per cent of total passenger figures to at least 10 per cent within three years".

The authority also remains in contact with MSC Cruises "with a view to facilitating its return to Abu Dhabi in the near future", it said.

MSC Cruises also remains optimistic on the potential for the industry in the region.

"The United Arab Emirates has great potential in terms of travel and tourism, particularly as a destination for cruise calls," the operator said.

"The growth of the cruise industry seen in recent years combined with the region's commitment to encouraging future growth are significant evidence of such potential."