Caribbean Tourism and Hospitality Trends 2025: Record Arrivals, Cruise Investment, Hotel Pipelines, and the Sustainable Growth Imperative

The Caribbean tourism industry recorded approximately 34.2 million international overnight visitor arrivals in 2024, a 6.1% increase over 2023 and 6.9% above pre-pandemic 2019 levels, marking the first time the region has decisively surpassed its pre-pandemic baseline on a broad multi-destination basis (CTO, 2024). The cruise sector delivered 33.7 million visits, a 10.3% increase that placed it 10.9% above its own pre-pandemic record. Caribbean hotel Average Daily Rate reached USD 437.02, a 4.2% increase from the prior year, with regional occupancy at 66.6%. Jamaica posted its most commercially significant year on record: USD 4.3 billion in tourism earnings from approximately 4.3 million visitors, supported by a USD 2.5 billion hotel development pipeline of nine projects spanning Sandals, Hardrock, Princess, and other global brands (Jamaica Tourist Board, 2025; Jamaica Gleaner, 2024). The Bahamas attracted 11.2 million visitors in 2024, a 17% increase over 2023, with the cruise sector alone contributing USD 1 billion in direct expenditure, while more than USD 11 billion in new foreign direct investment entered the archipelago over the preceding three years. These figures reflect a Caribbean tourism economy that is not simply recovering but structurally expanding, driven by new cruise infrastructure, a hotel development wave, the private island investment model pioneered by Royal Caribbean and followed by every major cruise operator, and a growing emphasis on sustainability as both regulatory imperative and competitive differentiator.

Caribbean Tourism in 2024: Record Performance Across Multiple Metrics

The Caribbean Tourism Organization's 2024 performance data confirms that the region has entered a new growth phase that is structurally distinct from post-pandemic recovery. Total overnight arrivals of 34.2 million represent not a bounce from a pandemic trough but a sustained expansion that is 6.9% above the 2019 baseline that previously defined the industry's ceiling. The United States remained the dominant source market with 16.8 million arrivals, a 3.5% increase from 2023 and 7.9% above pre-pandemic levels. Canadian arrivals reached 3.3 million, a 4.0% increase, though still slightly below 2019 volumes, while European arrivals grew 1.4% to 5.3 million. Intra-Caribbean travel showed growth as improved air connectivity and regional economic conditions supported more movement among Caribbean residents (CTO, 2024).

The strongest relative growth was concentrated in smaller destinations that are expanding their infrastructure and airlift from a lower base. Montserrat recorded the highest year-over-year arrival growth at 29.4%. St Vincent and the Grenadines surpassed 100,000 stayover arrivals for the first time, growing 25.6% year-on-year and 39% above 2019, attributed to four new carriers added in Q4 2024 and the opening of Sandals Saint Vincent and the Grenadines. The British Virgin Islands reached 1.09 million total visitors in 2024, surpassing the 1 million threshold for the first time since the 2017 hurricane season (Travel Agent Central, 2025). These smaller-market breakthroughs reflect a regional pattern where investment in airlift and accommodation supply directly converts into measurable arrival growth.

At the destination level, the Dominican Republic retained its position as the Caribbean's most visited market with 8.5 million tourist arrivals. Jamaica welcomed approximately 4.3 million visitors when combining stayover and cruise arrivals, generating USD 4.3 billion in tourism earnings, representing a 5.3% increase in arrivals and a 3.3% increase in earnings from 2023. Jamaica's Minister of Tourism Edmund Bartlett characterised the 2024 performance as achieved despite challenges including travel advisories, severe weather from Hurricane Beryl, and airlift restrictions over two quarters, underscoring the resilience of the market's structural demand drivers (Ministry of Tourism Jamaica, 2025).

The Cruise Sector: Private Islands, Mega-Ships, and the Redefinition of Caribbean Tourism

The Caribbean cruise industry is being transformed by two simultaneous and interconnected forces: the deployment of increasingly large ships with higher passenger capacities, and the systematic development of private island and beach club destinations that keep passenger spending within the cruise operator's ecosystem rather than distributing it to independent port destinations and local businesses.

Royal Caribbean's Perfect Day at CocoCay is the model that all major operators are now following or adapting. The private island welcomes approximately 2.5 million guests annually, generating both premium pricing and captive on-island spending that Royal Caribbean credits as a material driver of its financial performance. The Hideaway Beach adults-only expansion, opened in January 2024, added a DJ venue, infinity pools, and premium cabanas to the island's offering, targeting the higher-spending adult travel segment that seeks a more exclusive experience within the same destination footprint. Royal Caribbean is developing a Nassau Beach Club near Paradise Island, expected to open in 2025, creating a second private destination in the Bahamas that can service its largest ships on multi-day itineraries (Royal Caribbean, 2025).

Carnival Corporation opened Celebration Key on Grand Bahama Island in summer 2025, a USD 600 million development with four berths capable of simultaneously hosting Carnival's Excel-class ships, targeting at least 2 million guests annually from opening and 4 million by 2028. Carnival's Chief Financial Officer David Bernstein indicated that the return on investment for private destinations is in the "high teens" with a three to four year payback period, a financial profile that explains why virtually every major cruise operator is actively developing new private destinations (The Edge, 2024). Norwegian Cruise Line is investing USD 150 million in Great Stirrup Cay pier expansion, allowing two large ships to dock simultaneously. MSC Cruises operates Ocean Cay MSC Marine Reserve and is investing further in enhancements, while Royal Caribbean and MSC have jointly entered a Grand Bahama Shipyard expansion alongside Carnival to support cruise ship maintenance infrastructure.

The private island model creates a strategic tension for Caribbean destination governments. The Bahamas cruise arrival growth of 55% in 2024 was directly correlated with private destination investment, with Bahamas cruise sector direct expenditure reaching USD 1 billion. However, cruise passengers spending time at private destinations rather than in local port communities and commercial zones redirects that expenditure away from independent businesses, restaurants, artisan vendors, and cultural attractions. Destination governments are responding by developing their own complementary authentic product experiences and port commercial infrastructure that competes effectively even when passengers have already visited a private island on the same itinerary. The Cayman Islands saw a 36% decline in cruise visits from the first half of 2024 compared to 2019, partly attributed to the diversion of cruise capacity to Bahamas private destinations, highlighting the direct competitive impact on traditional port-of-call destinations (The Edge, 2024).

The mega-ship dimension of Caribbean cruise growth operates as a capacity multiplier for the private destination model. Royal Caribbean's Icon of the Seas, launched in January 2024 and carrying up to 7,600 passengers, uses Perfect Day at CocoCay as its primary Caribbean destination stop. Its sister ship Star of the Seas, launched in August 2025, follows the same deployment model. MSC has two additional World Class ships in its pipeline for 2026 and 2027 delivery, both Caribbean-capable. Carnival has announced ships with maximum capacity of nearly 8,000 guests for 2029 delivery. This capacity expansion means that private island infrastructure must scale continuously to match ship size growth, driving the capital investment cycle that is reshaping the physical landscape of the Bahamas and other destination jurisdictions.

Hotel Development: A USD 2.5 Billion Jamaica Pipeline and a Region-Wide Supply Wave

The Caribbean hotel development pipeline reflects the confidence of international operators and investors in the region's long-term demand trajectory. Jamaica has the Caribbean's most clearly documented near-term pipeline, with USD 2.5 billion in projects representing nine new properties and approximately 8,700 new rooms scheduled for delivery between 2024 and 2028. The pipeline is anchored by the Hardrock Hotel and Casino at USD 800 million, the Princess Resort with casino at USD 500 million, Viva Wyndham at USD 300 million, Sandals Dunn's River Golf Resort and Spa phases one and two at USD 280 million, Secrets Resorts at USD 210 million, Amaterra Resort development at Stewart Castle Trelawny at USD 200 million, and RIU at USD 100 million (Jamaica Gleaner, 2024). The planned Pinnacle luxury residential resort near Rose Hall, comprising four 28-story towers including a dedicated hotel, is expected to open in 2028 and represents a different category of supply: branded residences integrated with hotel amenity infrastructure.

Sandals Resorts International deserves specific attention as the Caribbean's most strategically significant homegrown hospitality operator. Jamaica's Minister of Tourism described Sandals as "an integral part of our national identity" and "a phenomenal home-grown multi-national corporation," reflecting the brand's role not just as a room supplier but as an active driver of airlift, regional brand equity, and tourism sector employment. Sandals' expansion into new Caribbean markets, including the 2024 Sandals Saint Vincent and the Grenadines opening that was directly credited with contributing to the destination's 25.6% arrival growth, demonstrates the leveraged impact that a single anchor operator can have on the destination's entire supply chain including agriculture, manufacturing, and service employment.

Aruba demonstrated the accelerated supply-demand cycle in 2025, opening three new resorts in January: JOIA Iberostar with 240 rooms, St Regis Aruba with 252 rooms, and Secrets Baby Beach Aruba with 300 rooms. The combination of new supply and a modest reduction in JetBlue seat capacity produced an unexpected September 2025 occupancy decline from 70.2% to 63.3%, illustrating how airlift and accommodation supply must be managed in tandem to maintain performance (Tourism Analytics, 2025). St Lucia has a hotel pipeline representing more than 29% of its existing total room stock, signalling an aggressive supply expansion that will test demand capacity in one of the Caribbean's most consistently performing luxury destinations.

Caribbean hotel investment has been materially supported by tax incentive programmes. A Caribbean Hotels and Tourism Association industry survey found that 32% of operators had received tax breaks in recent years, with 59% using those incentives to upgrade existing properties and 24% to develop new properties. Crucially, more than half of survey respondents indicated that the investments and upgrades would not have occurred without tax concession support, confirming that government incentive design is a direct variable in hotel supply creation (CHTA, 2025). This creates both a policy opportunity and a dependency risk: markets that withdraw or reduce incentive programmes risk losing development pipeline projects to competing jurisdictions.

Jamaica Hotel Development Pipeline 2024 to 2028

Source Markets: US Dominance, Canadian Recovery, and Diaspora Travel Growth

The United States accounts for approximately half of all Caribbean overnight visitor arrivals, with 16.8 million US arrivals in 2024 representing 7.9% above pre-pandemic levels and establishing a new record. The strength of US demand is driven by proximity, airlift density, the Caribbean's position as the most accessible warm-weather leisure market for US travellers, and the concentrated marketing investment of Caribbean destination marketing organisations in North American cities with large Caribbean diaspora populations. Jamaica's Minister of Tourism noted that the US market holds a 71% share of Jamaica stayover arrivals, making US economic conditions and airlift capacity the primary determinant of Jamaica's tourism revenue trajectory (Travelweek, 2025).

Canada represents the second most important source market for most English-speaking Caribbean destinations, with 3.3 million arrivals region-wide and a 4.0% increase in 2024. For Jamaica, Canadian arrivals were up 6.2% in 2024, holding a 13.8% market share. Canadian demand is particularly important because Canadian visitors tend to travel during the Caribbean winter high season that coincides with Canada's harshest weather months, providing high-season occupancy support for all-inclusive properties. The European market grew 1.4% to 5.3 million arrivals but remains 10.6% below pre-pandemic levels, with recovery slowed by higher trans-Atlantic airfare costs and the competitive pressure of stronger European domestic and Mediterranean leisure markets.

Jamaica's 2024 data reveals significant growth from non-traditional source markets: UK arrivals were up 11%, Latin American arrivals up 13%, intra-Caribbean arrivals up 25%, and Asian arrivals up 27% (Travelweek, 2025). While these markets hold smaller absolute volumes than the US and Canada, their growth rates reflect the early-stage development of new source market relationships that will compound over time. Emirates and Saudi Airlines airline partnerships announced in 2024 to introduce direct routes from major US, UK, Canadian, and Indian cities position Jamaica to capture India-origin travel demand at scale for the first time, consistent with the growing global pattern of Indian outbound tourism expanding beyond traditional destinations.

Sustainable Tourism: From Aspiration to Competitive Differentiator

The Caribbean tourism industry faces a fundamental tension between growth and sustainability. Every additional million arrivals adds foreign exchange earnings, employment, and government revenue, while also adding pressure to water resources, coastal ecosystems, solid waste management systems, and community infrastructure in destinations where these systems were not designed to support tourism at scale. The CTO and Caribbean Hotel and Tourism Association are increasingly positioning sustainable practices not as a constraint on growth but as a necessary condition for maintaining the destination quality that justifies Caribbean premium pricing relative to competing warm-weather destinations.

The private island model creates an environmentally complex calculus. MSC's Ocean Cay MSC Marine Reserve was developed with an explicit marine conservation framework, converting a former industrial sand mining site into a coral reef restoration project. The conservation credentials represent both genuine environmental investment and a marketing differentiation from competitors. Royal Caribbean has made commitments toward net-zero emissions by 2050, as have Carnival and Norwegian. However, the environmental debate around cruise tourism is not only about ship emissions: it encompasses the impact of large-volume guest arrivals on fragile island ecosystems, water use, food waste, and the diversion of development investment from authentic destination experiences toward cruise line-controlled infrastructure.

Jamaica's sustainable tourism development approach is being tested by its hotel pipeline scale. Jamaica is focusing on balancing economic growth with environmental preservation, a framing that acknowledges the tension between the USD 2.5 billion pipeline ambition and the environmental capacity of coastal zones. The opening of the Princess Grand Jamaica Resort has generated debates about the impact of large-scale development on protected natural areas, indicating that community and environmental stakeholder engagement is increasingly a factor in the political approval process for major resort projects (Caribbean World Real Estate, 2025).

Antigua and Barbuda's 2024 tourism performance includes an explicit government commitment to sustainable practices and enhancing infrastructure to accommodate growing visitor numbers while preserving the natural beauty and cultural heritage that make the destination attractive. This framing, common across Caribbean destination marketing communications, is beginning to be backed by measurable policy actions including renewable energy mandates for hotel developments, building code revisions that reduce climate vulnerability, and marine protected area enforcement that restricts the accommodation footprint in ecologically sensitive zones.

The 2025 tourism outlook reflects the CTO's measured caution about pace alongside structural confidence in direction. The organisation projects overnight arrivals will grow 2% to 5% in 2025, reaching approximately 35 million, with cruise arrivals approaching 36 million. The moderated growth projection relative to 2024's 6.1% stayover increase reflects economic uncertainties in source markets, particularly for the first quarter when US consumer confidence indicators were showing stress signals. However, the fundamental demand environment remains favourable: the US employment market for foreign-born workers that drives Caribbean remittance flows and leisure travel is resilient, airlift is expanding with new carrier relationships, and the hotel and cruise infrastructure pipeline is delivering new capacity that will generate its own demand (CTO, 2025).

HRG Research Capabilities in Caribbean Tourism and Hospitality

Hope Research Group has supported tourism authorities, hotel operators, destination management companies, development finance institutions, and government ministries with market research across Caribbean tourism markets for more than four decades. Our tourism research capabilities span the complete project lifecycle from pre-investment feasibility to ongoing performance measurement, with fieldwork capabilities across eleven-plus markets and access to established interviewing infrastructure in urban and resort destination zones.

For destination marketing organisations and tourism ministries, HRG delivers visitor expenditure surveys, visitor satisfaction tracking, source market profiling, and competitive positioning research. For hotel developers and operators, we provide demand feasibility studies, competitive set analysis, guest satisfaction measurement, and workforce profile studies that inform both investment decisions and operational strategy. For cruise sector clients including port authorities and shore excursion operators, our research maps visitor spending patterns, identifies experience product gaps, and evaluates the competitive positioning of port-of-call destinations against private island alternatives. Our community impact research documents the distribution of tourism economic benefits, informing both public policy and corporate social responsibility reporting.

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