Tourism needs to move up the political agenda rapidly The View from Europe
by David Jessop
Stabroek News
June 20, 2004

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"There is still insufficient awareness and understanding of the [tourism] industry's contribution - how it permeates the depth and breadth of the general economy and the overall fabric of Caribbean society."

So begins the World Travel and Tourism Council's (WTTC) just published report for the Caribbean Hotel Asso-ciation (CHA) on the true value of tourism to the Caribbean.

Very rarely do studies and papers present information that has the power to change thinking about the future direction of a whole region, but this report does. In a clear and accessible format, the authors use a new analytical framework that brings together for the first time, information on why tourism and its many allied industries represents the future economy of much of the region.

Crucially, the authors of the study suggest that at present, public sector analysis overlooks or understates the true impact of the industry by dealing only with its individual components. What is needed, they suggest, is the adoption of a new model that factors in through what is known as satellite accounting, information gathered on a consistent basis across the full tourism product service chain.

Such an approach sets out to understand the linkages between travel and tourism and other sectors of the economy, including agriculture and manufacturing. It takes in the effect that the industry has on stimulating domestic production, employment, human resource development and a wide range of other economic factors including trade balances and infrastructure deve-lopment. In short, it seeks to suggest that most Caribbean development models have been severely lacking because of their incapacity to recognise that tourism has become the driver for many aspects of Caribbean economies.

The study undertaken by the WTTC and its research partner Oxford Economic Forecasting, contains often startling information on just how important tourism has become, in this light, to individual Caribbean economies. In the case of the British Virgin Islands and Antigua, more than 75 per cent of their economy is now dependent on travel and tourism. In another four countries, the report notes, the industry generates between 50 per cent and 75 per cent of economic activity. Using the satellite accounting model, only four Caribbean economies: Martinique, Curacao, Puerto Rico and Haiti now owe less than ten per cent of their economy to travel and tourism.

Despite this, the report points to the apparent indifference of governments to spending time understanding the policy agenda of the industry and the promise it holds for future economic development and employment creation.

The report makes clear also that travel and tourism has become unquestionably the foremost export sector in the Caribbean and when well managed, possesses an inherent ability to diversify the Caribbean economy, stimulate entrepreneurship, capitalise investment, create large numbers of sustainable jobs and help social development and local communities. Because of this, the report proposes that governments and regional organisations need to develop throughout the region a campaign that ensures that all stakeholders recognise the full impact of the industry across the national economy and the way that it now touches livelihoods of almost every single citizen in the whole region. It also suggests the need for long-term strategic planning for the industry. Relying on a spontaneous or passive response to tourism development is, it suggests, no longer an option.

The report suggests also that there are many strategic decisions the region now needs to take about managing tourism's future and incorporating an understanding of this in all decision-making. This is essential, the report suggests, as when the industry is looked at in a broader context, it becomes clear that it now directly and indirectly accounts for 15.5 per cent of total employment; 14.8 per cent of total GDP; 18.4 per cent of total exports; a staggering 21.7 per cent of total investment; and an 8.2 per cent of government expenditure. Each of these measurements it notes, shows also the industry growing year on year far into the future.

The study makes many practical proposals, including the need for well-funded and effective marketing campaigns; the need to develop a coherent planning and management structure in relation to the environment; the importance of safety, security and health provisions for the region's population and visitors alike; and the creation of linkages that alleviate poverty and sustain communities. It also comments on many contentious issues such as taxation, airlift and cruise tourism, making clear that these need to be integrated into all future planning by governments and the industry in a coherent manner.

The report, which hopefully is the first of many that look at the industry within this new framework, should provide much-needed food for thought. This is especially the case in Europe where development agencies and the European Commission are still struggling with issues of diversification out of agricultural industries based on preferential trade arrangements. The report suggests that diversification into tourism is already well underway and in a manner that is helping float all economies and can be significantly enhanced if its development is fully integrated into all policy towards the region.

Despite this it is very easy to find in Brussels and in many other European capitals prejudiced policy makers who do not like tourism or want to turn their backs on its value to overall economic development.

In part this view prevails because many Caribbean governments do not put tourism in a policy framework in their external dialogue with governments or multilateral institutions. As the WTTC report for CHA illustrates, the broader impact that the industry has is still not factored into political exchanges on development. Thus the region sometimes gives the impression that it is holding on to the past, that the numbers of voters in primary agriculture outweigh those in tourism and that there are few future options.

This is of course not to argue for anything other than well-delivered restructuring programmes for bananas, rice and sugar delivered over time - tourism also needs the stability this will provide - but to suggest that tourism needs to move up the regional political agenda very rapidly. The WTTC report indicates that it is now the principal economic activity to which most of the region is in transition.