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Mackenzie Leahy
Pr. Hayes-Bohanan
Economy
29 July 2014

Reliance on Air-Arrival Tourism to Increase Revenue in USVI

With splendid variety of islands and cays, tranquil bays and colorful reefs, [and] some of
the finest marine recreation resources in the world1 its not hard to see why tourism accounts for
a large percentage of the United States Virgin Islands economy. Reliance on tourism has its own
dangers for the islands, but seems to be the only method that could offer an economic resolution.
Following Hurricane Hugo in 1989, about 90 percent of the buildings were damaged and more
than 20,000 people were left homeless.2 However, following the closing of the HOVENSA oil
refinery, the largest refinery in the USVI, a -$1.3 billion loss within three cycles, the loss of over
1,000 jobs, and the loss of $92 million in annual tax revenue has already occurred.3 While
natural disasters and commodity production have failed the islands, the natural beauty of the
beaches, clear water, parks, hotels, casinos, locally owned stores, and recreation provide an
alternate method in which the USVI can thrive. Tourism, if advertised the right way, could
particularly spark interest for United States residents. As the New York Times describes in
Affordable Caribbean: U.S. Virgin Islands,

1 Quinn, Norman J., and Strickland, Richard S.. "Ecotourism in a Tourist-based Caribbean Economy." North-South:
Magazine of the Americas Sept.-Oct. 1994: 42-48. Web.

2 Navarro, Mireya. "St. Croix Hopes Gambling Will Bring Back Tourists." New York Times 4 Jan.
1999. Global Issues In Context. Web.
3 "Labor Economic Impact Analysis 2012 (HOVENSA Plant Closure)." Virgin Islands Department of
Labor Bureau of Labor Statistics, 2011. Web.

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Picking the United States Virgin Islands is a cost-cutting measure in itself. No passport? No
worries if you're an American citizen, so you've just saved $75. Need a cellphone? No roaming
charges with major carriers, like AT&T. What else? No plug adapters, no sales tax and no currency
exchange fees. And though you're technically on American soil, [the Virgin Islands] have all the
trademarks of an exotic Caribbean getaway.4

Though the New York Times article only offers the viewpoint for a U.S. tourist, the
USVI still offers great attractions similar to neighboring islands for non-U.S. tourists.
At the time that Mireya Navarro wrote the article St. Croix Hopes Gambling Will Bring
Back Tourists in 1999, tourism accounted for two-thirds of the economy in the United States
Virgin Islands, the Caribbean [was] full of islands with casinos, but the United States Virgin
Islandshas resisted starting their own. In a 1992 referendum, both St. Croix and St. Thomas
voted the idea down, concerned by the unsavory aspects of gambling.5 Constructing casinos on
the Virgin Islands is an important debate because they do not solely encourage gambling; the
construction of casinos call for the construction of partnering hotels, further encouraging an
economic chain reaction: more hotels mean more tax dollars to promote tourism, which would in
turn lead to more visitors, more airline flights from the mainland, where most visitors to the
islands come from, and, it is hoped, lower fares.6
According to the USVI Bureau of Economic Research, the USVI recorded a 5.2 percent
growth in overall visitor arrivals in May 2010 for a total of 150,702 visitors, but a a 2.6 percent
4 Allan, David G. "Affordable Caribbean: U.S. Virgin Islands." New York Times 25 Jan. 2009: 1. Web.
5 Navarro, Mireya. "St. Croix Hopes Gambling Will Bring Back Tourists." New York Times 4 Jan.
1999. Global Issues In Context. Web.
6 I.B.I.D.

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decline in air visitors, down to 44,585 from 45,773 last May.7 As of May 2011, total visitor
arrivals increased by 18.6 percent, while air arrivals to the St. Thomas/St. John district totaled
255,056 a 5.8 percent drop, and St. Croix had 63,261 air visitors or a 5.1 percent decline.8
Though this only accounts for one month of tourism on the island, the statistics for the rest of the
year follow the same trend. In 2010 there was a total of 2,550.5 thousand visitors589.8
thousand tourists, 1,960.7 thousand excursionists, and 691.6 air visitors.9 By 2011 there was a
5.4 increase in visitors totaling 2,688.0 thousand, but a 1.8 percent decrease in air visitors
totaling 679.0 thousand.10 Although all methods of attracting tourism to the islands are essential
to their development, air visitors are particularly important. Noel Loftus, the president of the St.
Croix Chamber of Commerce stated, Cruise ships are really not doing itCruise ships are
getting larger and have their own stores. Passengers are spending less and less money.11
Because passengers are spending more money to have all their needs met on cruise ships, they
spend little amounts whiling touring the islands. Air visitors, on the other hand, are immersed in
the culture of the islands and may spend time touring and learning about the history of the
islands. By learning about the islands, visitors may become more interested in spending money
7 "U.S. Virgin Islands May 2010 Tourism Indicators." United States Virgin Islands Bureau of Economic
Research, July 2010. Web.
8 U.S. Virgin Islands May 2011 Tourism Indicators." United States Virgin Islands Bureau of Economic
Research, May 2011. Web.
9 "U.S. Virgin Islands Annual Tourism Indicators." BUREAU OF ECONOMIC RESEARCH - OFFICE
OF THE GOVERNOR, 2011. Web.
10 I.B.I.D.
11 Navarro, Mireya. "St. Croix Hopes Gambling Will Bring Back Tourists." New York Times 4 Jan.
1999. Global Issues In Context. Web.

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on items that hold some sort of value in terms of originality, history, or something that they know
they may only be able to find on the islandscruise liners may pass up on these local and one of
a kind items.
Along with hotels, casinos, and local stores, the natural landscape offers many things to
do for a new age of tourism, known as ecotourism. Ecotourism encourages responsible travel to
natural areas that conserves the environment and improves the well-being of local people.12 In
1976 Stanley Selengut, a New York developer, created a cluster of modest tent-cottages to help
launch the ecotourism movement on the island.13 This type establishment proves that
development can be sustainable and entertaining; over a million visitors have enjoyed their stay
in the tents along Maho Bay on St. John without affecting the surrounding environment.14
Ecotourism succeeds where other tourist attractions may notit not only immerses tourists in
the island completely. Whereas other tourist attractions still have some connection to the modern
world, ecotourism leaves tourists in touch with nature. Tourists can enjoy a relaxing vacation all
while appreciating nature, not just traveling through it. This sustainable tourism draws attention
to natural attractions such as the coral reef snorkeling, kayaking, hiking and much more.
The United States Virgin Islands could increase their revenue by focusing on what the
islands have to offer in terms of beauty, relaxation, unique history, and unique local goods. The
Virgin Islands need to look outside of exports and production for revenue. By managing
construction of casinos and hotels, the USVI can attract air-travelers, offering similar comforts to
12 "What Is Ecotourism?" International Ecotourism Society. 2009. Web.
13 Little, Jane B. "An Experiment in Ecotourism Thrives on St. John." Audubon Magazine Nov.-Dec.
2007: n. pag. Web.
14 I.B.I.D.

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local U.S. travel, but by focusing on what is already a part of the islands, they can exploit the
islands without taking advantage of them; this could increase revenue to get back the islands
back on their feet after natural disasters and commodity production left them in crisis.