When tourists arrive, so does money. But it comes with heavy baggage and the impact on the destination, both economic and environmental, and must be carefully planned and managed

With encouragement from international organisations and NGOs, tourism is being thrust forward as a lucrative key to alleviating poverty, boosting developing countries’ economies and meeting some of the UN’s Millennium Development Goals.

In 2010, tourism generated an estimated $919bn, according to the UN World Tourism Organisation’s World Tourism Barometer. With international arrivals up 7% from 2009, the industry showed a healthy rebound from the economic downturn.

Of that growth, emerging economies did disproportionately well. According to the World Tourism Barometer, emerging economies experienced an 8% growth in international arrivals over the year, compared with the 5% growth of advanced economies. In 2010, emerging and developing countries received 47% of the world’s international tourist arrivals, according to UNWTO.

Many developing countries have the unique resources necessary to meet the rising demands for nature and culture-based tourism, according to Ronald Sanabria, vice-president for sustainable tourism at the Rainforest Alliance. “People are looking for something more than just lying on a beach,” Sanabria says.

Experts predict that the industry will continue to thrive, with UNWTO expecting international tourist arrivals to increase by 4-5% in 2011 and the World Travel and Tourism Council expecting tourism to directly and indirectly support 260 million jobs.

UNWTO says international tourism’s quick recovery from the economic crisis proves the industry’s resilience and role as a “key driver of growth and much needed employment in a changing economic setting”.

Poverty reduction 

Tourism stands out as an industry with potential to alleviate poverty. Its unique qualities include the fact that it is “consumed at the point of production”, it is labour intensive, and it creates opportunities for many small and micro entrepreneurs, according to the UNWTO’s publication Tourism and Poverty Alleviation: Recommendations for Action.

Tourism directly creates jobs and income for local people in a variety of fields, including accommodation, restaurants and excursion guiding, says Jonathan Mitchell of the Overseas Development Institute, a UK thinktank. Indirectly, tourism increases commerce for local businesses that support travel and tourists, including the farmers who provide food for the hotels and restaurants and the construction companies that build the hotels. And tourism generates revenue for the host country through taxes, provides skills training for employees and often leads to improved infrastructure.

International tourism can also help alleviate poverty by bringing corporate philanthropy, says Rob Bailes, a project co-ordinator for the Monteverde Institute in Costa Rica.

Emerging benefits

According to Mitchell, practical results prove that tourism’s potential is more than just a theory. “Only three ‘least developed countries’ have ever graduated to middle income status. For Cape Verde [given middle income status in 2008] and Maldives [2011] this was almost entirely due to tourist development,” he says.

“Managed well, overseas tourism can be a force for good in lifting people out of poverty,” says Georgina Davies, public relations manager for the Travel Foundation, a charity that works to enhance sustainability within the industry.

Currently, UNWTO is striving to implement sustainable tourism as a means to accomplish several United Nations Millennium Development Goals, particularly the goal to eradicate extreme poverty by 2015.

Fulfilling tourism’s full potential involves more than attracting tourists (and their money) to an international destination. Tourism must be developed sustainably and balance the needs of tourists and businesses with those of the local community.

“Unplanned and poorly managed tourism development often leads to unequal forms of development, cultural homogenisation and environmental destruction,” cautions Bailes.

In order to develop a sustainable tourism industry, destinations must keep a watchful eye on protecting the environmental, economic, and cultural resources that support the destination and enable tourism in the first place. Careful planning is necessary when building or increasing a destination’s tourism capacity.

Sustainable practices involve everything from hiring local employees to reducing water usage and protecting nature reserves, all of which requires careful planning when developing tourism. Particularly when it comes to using tourism to eradicate poverty, one of greatest challenges is ensuring that the economic benefits are local and do not leak out of the destination country.

Tourism is like any other form of global trade, in that its benefits are often not shared equally among the international operations, and as such tourism “often increases inequality”, according to Rachel Noble, the campaigns and press manager for the UK charity Tourism Concern.

Profit bypass 

Leakages occur in the tourism industry in a variety of ways, including when food and other supplies for tourists are imported from outside the host country. When tourism businesses are owned by foreign companies, profits bypass the destination country and are sent to the head offices in wealthy countries. Attracting tourism businesses with tax breaks reduces revenue that would otherwise go to local governments for the purposes of supporting local people, Noble adds.

“The key is to ensure that tourism wealth and income remain within the local economy and directly benefit the local communities where tourism takes place,” Bailes. “This means effective tourism planning and management, particularly on a local level where resources are often scarce and local governmental institutions lack the capacity to develop and manage integrated tourism development strategies. Tourism planning must be bottom-up as well as top-down, sensitive to local communities and their cultural and environmental needs.”

In addition to ensuring that the financial benefits from tourism remain in the destination country, balancing the needs of the tourists with those of the community is essential to sustainable tourism planning.

With the exception of extreme adventure expeditions, the basic needs of international tourists must be met by the destination, specifically those pertaining to health, safety and accessibility. Yet these needs must be balanced with those of the local community.

Tourism safety has, of course, become big news internationally, following high-profile murders and kidnappings, including the kidnap of a tourist staying at an exclusive Kenyan beach resort this year.

“Most people put safety and security as their top priorities when they choose their destinations, plan their trips and decide where to stay,” says Ayako Ezaki, director of communications for the International Ecotourism Society.

In addition to ensuring health and safety, a destination country must also supply adequate infrastructure to ensure that tourists can access all of the accommodations and attractions.

“If infrastructure and safety are compromised it will limit the type and volume of tourism that a country can attract and in turn the potential total contribution to the country’s economy,” says the Travel Foundation’s Georgina Davies. “If a country offers a significant draw that will attract visitors despite the challenges, it is more likely to be small scale, specialist tourism, which, despite the smaller volumes, may attract higher-spending tourists. An example of this might be gorilla watching, where visitors are willing to pay a premium and put up with a level of discomfort for a rare experience. But the small numbers will ultimately limit the total benefit to the country’s economy.”

Local participation in tourism planning and development is critical, according to Ezaki. “In some cases, local community members may lack proper understanding of the realistic expectations that visitors have; some may under- or over-estimate visitors’ needs and desires for amenities, comfort, etc, which would lead to unsatisfying tourism experience for both sides,” he says.

While tourism often necessitates increased infrastructure at destinations in order to attract international tourists, the economic promise of tourism can be used to incentivise governments to invest in that infrastructure – to the ultimate benefit of the local community.

“Tourism, and the potential of attracting tourism, sometimes positively impact local governments’ willingness to invest in much-needed infrastructure that in turn positively impact the well-being of local people,” Ezaki says.

The over-development problem

Conversely, the demands of large-scale tourism can also harm the host communities, through over-development or the hoarding of resources needed by local communities.

“Tourism can also negatively impact local communities by necessitating infrastructure which would otherwise not be developed that may have adverse effects on local environments and resources, and in the long term, negatively impact the very assets – natural beauty, clean water, etc – that tourism depends on,” says Ezaki.

According to Noble, the tourism industry is “almost always” able to have its infrastructural needs fulfilled yet in many cases the needs of host communities are neglected, and despite tourism’s presence local people often continue to struggle to gain access to resources such as adequate water. It is therefore essential for businesses and policymakers to consult local people when planning tourism development.

Over-dependence on tourism is also a major risk for developing countries, according to Noble. Given that tourists or tour operators can suddenly abandon a destination for myriad reasons – from the threat of natural disasters to terrorist attacks – she warns that relying too heavily on tourism can be “very dangerous”.

Despite the challenges of achieving such a delicate balance, the success of small-scale, sustainably planned destinations offer glimpses of the potential of sustainably planned and managed tourism. 

In the small town of Monteverde in northern Costa Rica, Bailes has witnessed just such a success. The local economy has been boosted by a successful conservation programme, led by residents and international scientists in the 1980s and 1990s, and the resulting network of private nature reserves. The town of about 7,000 people attracts up to 210,000 tourist visits a year, making it the fifth biggest tourism destination in Costa Rica.

According to Bailes, because tourism development in Costa Rica has boosted income and brought other positive changes throughout the country, the industry is referred to locally as the “goose that lays the golden eggs”.

But while the results in Monteverde and other small developments are encouraging, great care is always needed if tourism is to help achieve the high-reaching Millennium Development Goals.

So while the lure of eradicating poverty and vitalising developing countries’ economies through tourism is enthralling, success depends upon thoroughly planned and sustainable development.