THE GLOBAL financial meltdown has forced the Government to dial back on its contribution to the develop-ment of the cruise-ship port in Falmouth, Trelawny, forcing the project cost down by US$38 million to US$224 million ($17.2 billion).

Transport Minister Mike Henry said Jamaica's portion of the financing was cut from the original US$160 million to US$122 million owing to afford-ability of credit in capital markets still in turmoil.

And, not all the financing has been secured, Henry said.

The Port Authority of Jamaica will spend the US$122 million to develop the port infrastructure, while its partner on the project, Royal Caribbean Cruise Lines Limited, will invest US$102 million to build out structures on the landside, including retail shops, restaurants and entertain-ment facilities.

The project is to be completed before May 2010. Work is already under way.

"We are examining all the financing structures because of what is taking place. The Port Authority is moving to examine all the possibilities to see what is the best rate of interest they can get to support that commitment," said Henry.

The Port Authority has turned to the PetroCaribe Fund for a portion of the funds, but the Transport Minister also said Jamaica would be looking to commercial capital to plug the funding gap.

It was not immediately clear how much of the financing the PAJ has in hand, but Henry indicated that the prospects for raising the full US$122 million were good, saying the govern-ment was negotiating with a number of local financial institutions that, at least initially, wanted in on the project.

"A lot of banks showed an interest up to a point in time, (but) you know what the financial market is like, so we are looking at restructuring and reconfiguring everything," he said.

Port Authority president and chairman Noel Hylton did not, up to press time, reply to questions about how the deal, and ownership, of the port would be structures, nor how much funds his agency actually had in hand to meet its financing obligations.

Henry said government was looking "for the best mix" of financing proposals.

The port, dubbed 'Historic Falmouth', is being developed on the town's foreshore within the boundaries of the existing natural harbour.

The scope of works will encompass construction of a finger pier capable of accommodating two 'megaliner' cruise ships simultaneously. The port's commissioning is being timed to accommodate the world's largest cruise ship, Royal Caribbean's Oasis of the Seas, which has been scheduled to call there in 2010, and a Genesis ship, currently under development and scheduled for delivery in late 2009.

Adam Goldstein, president and CEO of Royal Caribbean, was in Jamaica last week for the signing of the contract cementing the cruise line's partnership with Jamaica.

This deal, Goldstein said, was the first for a cruise line company and the government of a destination.

He called it historic, but for Falmouth it was also past due.

The town has long seen promise in its historic Georgian architecture and, for years, had been a thorn in the side of government and its developmental agencies to declare the town protected, invest in its transformation into a walk-through attraction lined with a museum, cafes and refurbished historic buildings that include the Baptist Manse and a house once owned by English poet Elizabeth Barrett Browning.

Falmouth's leaders hope to replicate, in some measure, the success of Colonial Williamsburg in the United States, and indeed has had advice on its transformation plan from that town's guardians, as well as the Smithsonian on its hopes to develop a museum of African history here.

A cruise port would be a plus, bringing tourists and their pocketbooks directly to the town.

Prime Minister Bruce Golding, who signed the port agreement with Goldstein on November 7 in Kingston, said a broader plan was being crafted to redevelop Falmouth and to train locals how to interface with visitors.

"While land based visitors do spend more time and therefore do consume more food and do spend more money, the fact is that, if we are to engage and involve more ordinary Jamaican people in the industry, cruise shipping is an important part of that solution," he said.

Given the size and grandeur of the Oasis of the Seas, which has a capacity of 6,000 passengers and 2,000 crew, the prime minister is toying with the suggestion of revising upwards the 400,000-passenger intake guarantee by Royal Caribbean.

The Genesis class of ships will measure 1,180 feet long, 154 feet wide and 240 feet high. The ship is expected to bring an estimated 400,000 passengers to the island over the next 20 years.

Construction for the port has already started and is expected to be completed before May, 2010. The project is expected to create 700 jobs over the period of the port's development.

john.myers@gleanerjm.com