GEORGE TOWN, Cayman Islands (Reuters) - To coral reef-driven tourism industries like those of the Cayman Islands, there could be a greater cost in ignoring climate change than fighting it.

Ranked among the top 10 scuba diving destinations in the world, the reef system of the western Caribbean territory has lost 50 percent of its hard corals in the last 10 years in spite of strong environmental laws, scientists say.

"We are at a very critical time in the history of coral reefs," said Carrie Manfrino, president of the Central Caribbean Marine Institute on Little Cayman island.

"It is like working with a sick patient. How well we treat that patient will determine if that patient survives. We could potentially see the end of hard coral reefs in our lifetime."

The Caymans tourism industry, which represents about 50 percent of the colony's gross domestic product, was kick-started in 1957 when dive industry pioneer Bob Soto opened the first scuba diving operation in the Caribbean.

Fifty years later, about 2 million visitors arrive every year, with most either diving or snorkeling on famous sites like the North Wall or Stingray City.

The sport helped transform a sleepy territory of 8,500 people subsisting on fishing and seafaring into a luxury tourism destination and sophisticated offshore banking center whose 52,000 people have the highest per capita income in the region.

A U.N. panel - the Intergovernmental Panel on Climate Change - has warned that the world must make sweeping cuts in greenhouse gas emissions to avoid a rise in temperatures that could inundate islands and coastlines under rising seas, and kill off the world's temperature-sensitive coral reefs.

In a report issued on Friday, the IPCC said keeping the increase in temperatures within 2 degrees Celsius would only cost 0.12 percent of the world's annual gross domestic product.

To Cayman residents who depend on tourism, that would be a small investment if it were enough to save the coral reefs.

Global warming is heating sea water, which leads to coral bleaching, an ailment that causes normally colorful corals to turn white, and white plague, a disease sweeping and killing coral around the world.


Another threat in the Caymans comes from cruise ships, which have damaged large areas of living coral with their anchors and chains, said Gina Ebanks-Petrie, director of the Cayman Islands Department of the Environment.

Yet cruise ships are an important and growing part of the Caymans' tourism industry. Thirty-six percent of tourist revenue comes from 1.7 million cruise ship passengers who visit each year, and more ships are making the islands a port of call.

Even with a 50 percent decline in hard corals, Caymans' reefs are still considered among the healthiest in the Atlantic. Scientists say the islands are geographically isolated by surrounding water 6,000 feet deep, which minimizes the impact of pollution from other countries.

The Marine Conservation Law passed in 1986 established the marine park system and has played a key role in protecting Caymans' reefs. But Ebanks-Petrie said it has struggled to adapt to rapidly changing environmental conditions.

The dive industry worries that without a coral reef, the Cayman Islands will not have anything different to offer tourists than the rest of the Caribbean.

"If the coral reef dies, the algae will go, and the tropical fish will go. Then there will be nothing left to see," says Nancy Easterbrook, operator of Divetech.

Manfrino said hope is not lost.

"We can't give up," she said. "Science is always coming up with major discoveries, so we may find a way to save our reefs."