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Leaders Discuss Role of Tourism in Asia and Pacific’s Development Future

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Tourism has significant potential to contribute to Asia and the Pacific’s long-term growth prospects through infrastructure development and job creation. But governments should work to ensure the industry grows in a socially and environmentally sustainable way, according to participants at a high-level Asian Development Bank (ADB) seminar.

The Governors’ Seminar, titled “The Role of Tourism for Sustainable Development,” at the 52nd Annual Meeting of ADB’s Board of Governors in Nadi, Fiji, featured as panelists Japan Deputy Prime Minister and Finance Minister Mr. Taro Aso; Indonesia Finance Minister Ms. Sri Mulyani Indrawati; Fiji Attorney-General and Minister for Economy, Civil Service, and Communications Mr. Aiyaz Sayed-Khaiyum; Italy’s Director-General for International Financial Relations, Ministry of Economy and Finance Ms. Gelsomina Vigliotti; and ADB President Mr. Takehiko Nakao.

In 2018, 343 million international tourist arrivals and $390 billion in international tourist spending went to Asia and the Pacific. International visitors to Asia have risen by 65% between 2010 and 2018 with key Asian destinations being the People’s Republic of China; Thailand; Japan; Hong Kong, China; and Malaysia. Asian tourists are also an increasing driver of global tourism with higher incomes and a rapidly growing middle class seeking experiences abroad. Globally, international tourist arrivals are expected to reach 2.44 billion by 2030, a 75% increase over 2018, with Asia and the Pacific projected to account for a third of this number.

Tourism plays a large role in the Asian economy. Spending on hotels and airline tickets was $92 billion in 2018 with an estimated 78 million new jobs created. The indirect impact such as through tourism-related investment on new hotels or airplane purchases was larger at $2.94 trillion, creating an estimated 180 million jobs. In Fiji, tourism contributed 14% of the local economy with the indirect impacts accounting for 40% of gross domestic product.

Seminar discussions highlighted several points. Tourism should be encouraged as a key contributor to investment, employment, and tax revenues through investment in both infrastructure and people. For example, world-class airports and airport staff in Bangkok and Kuala Lumpur contribute to the vitality of tourism in Thailand and Malaysia. With land being a key component of sustainable tourism, clear and effective sustainable land use regulations are needed.

Tourism creates millions of jobs, notably for women, young people, and those in remote rural areas. However, workers in tourism need the right skills and good working conditions. The Indian state of Kerala, for example, has a program that has trained some 650 residents of poor communities for jobs in local hotels.

Tourism can damage the environment which, over time, reduces visitors and revenues. Governments and the tourism industry can work together to avoid this. In Fiji, the government imposes a 10% tax on tourism-related businesses which funds climate change mitigation projects.

Similarly, cultural heritage needs protection, which could include controlling numbers of visitors to monuments or creating fiscal incentives for businesses to restore historical buildings. To protect the Angkor Wat temple, the Cambodian government created a dedicated authority to better manage the site and maximize the benefit to the local community.

Last, tourism should foster mutual understanding, peace, and safety among people of different backgrounds. Smart travel practices including data sharing is one way to do this. Currently, 16 Asian countries participate in an electronic visa scheme that has increased efficiency at border controls and boosted security. 

At the seminar, Mr. Sayed-Khaiyum stressed the importance of ensuring resilience to both natural hazards and the longer-term issue of climate change. “The infrastructure that goes to the hotels—the electricity cables, the water, the sewers, etc.—the government needs to build resilience on that. The other aspect of the environment and climate change is to do with the oceans … all countries need to make a consolidated effort in respect of climate change.” He also pointed to the need to ensure that as much of the value of the tourist spending as possible is retained within the host country by using local products and services.

Ms. Indrawati addressed the issue of ensuring that local culture and heritage are protected as tourist destinations attract visitors from other countries with different attitudes and mores. “This is exactly always the tradeoff between, on the one hand, to be a global player, in global supply chains, and how you are going to maintain the authenticity as well as the participation of your locals,” she said. Work to develop local skills to ensure tourism-inspired jobs are high quality is also key.

Panelists raised the importance of good infrastructure to support tourists and, through improved water and wastewater systems, for example, to protect the environment. “There should be development of tourist infrastructure both in quantity and quality,” said Mr. Aso. Such infrastructure needs to be disaster-resilient so that when disasters strike, countries do not lose out twice—from missing out on tourism income and having to rebuild their infrastructure and economies.

Ms. Vigliotti noted the common challenges faced by tourist destinations, whether in Europe or Asia and the Pacific. “The challenges for all the tourist destinations … are the same. You need connectivity, you need good infrastructure, and you need good maintenance.” She also stressed the importance of governance and a policy center that defines and implements a strategy.

“Asia and the Pacific has some of the world’s most beautiful natural landscapes and unique cultural monuments,” Mr. Nakao said. “As tourism continues to expand rapidly, it will be important to pursue sustainable tourism that protects the environment such as forests and coral reefs, preserves local cultures, and benefits local communities.”

ADB has supported the development of sustainable tourism in the region through financing for infrastructure, regional connectivity, and environmental protection. In the Association of Southeast Asian Nations region, ADB has provided assistance for transport, waste management, and skills training and planning, which have improved access and environments in secondary tourism destinations. Elsewhere, ADB has, for example, helped protect natural lakes and local livelihoods in the Kyrgyz Republic and Mongolia, supported tourism planning in the Federated States of Micronesia and Myanmar, and worked to improve transport, infrastructure, and utilities to ensure sustainable tourism in Bhutan and India.

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Walvis Bay to net more tourists, thanks to upgraded port

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With its sand dunes and abundant birdlife, Walvis Bay is already an important centre of tourism activity in Namibia. The bay is a safe haven for sea vessels because of its natural deep-water harbour, protected by a sandspit, being the only natural harbour along the country’s coast.

 The municipality of 110,000 people on the Namibian coast, draws large numbers of southern right whales to its waters, in this town whose name means “Whale Bay”. Immanuel Wilfried has been the proud mayor since 2016.

“Of all the towns, we probably have the biggest potential to add more value to our national tourism industry, thanks to the variety of opportunities. A waterfront of international standard is on the cards and we are getting ready to accommodate the foreseen increased number of tourists. The demand from various companies to purchase land is very high. Land for the construction of an oil refinery has just been allocated,” he said.

The growing interest in the city is largely due to the expansion of Walvis Bay port. Wilfried is looking forward to its inauguration and anticipates “not only jobs to be created and business to be boosted but also people to move and settle in town. The expansion of the port will benefit everyone: Walvis Bay, Namibia and all the landlocked countries.”

With a greater number of tourists, eating out places will be in demand and Walvis Bay has seen an upstart in new ventures, including a sushi restaurant – the first on the coast.

 “Currently we have seasonal tourists, mostly pre-booked by travel agencies who just pass by. With the new infrastructure, tourists will now stop. I believe in this strongly. Therefore, I have invested in a restaurant: the first sushi lounge on the coast,” said David Hamupembe, a middle-aged instructor at the maritime school of Walvis Bay.

After learning about the future capacity of the port to host cruise ships and the construction of the waterfront and marina, Hamupembe opened his restaurant in May 2019 and employs 3 staff.

On 2 August, the Government of Namibia and the Namibian Ports Authority (Namport) inaugurated the new Container Terminal of the Walvis Port with a capacity to handle 750,000 twenty-foot equivalent unit (TEUs) and its four ship-to-shore cranes with 65-ton capacity. This key milestone was realized with support and funding from the African Development Bank, amounting to $200 million, to Namport in 2013. The expanded port of Walvis Bay aims to be the preferred African west coast port for southern and central African logistics operations. Botswana, Zambia and Zimbabwe already have their dry inland ports.

With the expansion of the port, a special wharf was constructed to accommodate cruise ships. Direct access to the future waterfront will be key to attract more tourists.

Opposite the main gate of the port, the Mission to Seafarers, a Christian charity, has been serving merchant crews arriving in Walvis Bay since 1957. Gail Wearne has been working at the mission for 20 years, mostly as the manager. She hopes the expansion will bring more vessels and seafarers.

“It can only do us good. We used to have about 2,000 seafarers per month. Over the past two years it dropped and today we only receive approximately 1,300 people.”

This drop is due to different factors, mostly the reduced amount of time spent in port by the crews.

“With the expansion, there will be more ships and more people. The more people we get, the happier we are.”

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Supporting Women in Tourism to Gain More Digital Skills Makes Business Sense

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In cities and towns across Malaysia, blink and you may miss one of the country’s most promising sources of income.

Among the most successful hosts for accommodation provider Airbnb in Malaysia are women, who in 2018 earned USD 39 million from welcoming visitors to stay with their families.

New Opportunities for Women

These women-run businesses may reflect the future of tourism. Digital technology can enhance opportunities in this rapidly expanding sector whose labor force is more than 50 per cent female. With more digital skills, women entrepreneurs can tap larger markets and boost their incomes.

There is a catch, though. Digital skills can be elusive for many women.

“Women have less access to technology,” said Jane Stacey, Head of Tourism at the Organization for Economic Cooperation and Development, or OECD, at an APEC conference of tourism experts. For example, over 300 million fewer women have access to mobile internet, she explained.

Alcinda Trawen, Chair of APEC’s Tourism Working Group, confirms tourism’s digital gap. “One of the biggest challenges that the tourism industry faces and one that everyone else faces across APEC is the digital divide,” said Trawen.

Currently, the APEC Tourism Working Group looks at policies that can help the sector achieve better results, such as targeting more women for digital skills training. Narrowing the digital gap aligns with two of the priorities set by APEC 2019 host economy Chile: boosting women’s economic empowerment as well as the digital economy.

Tourism Continues to Grow

Women traditionally dominate the tourism industry, where they have more opportunities to advance. According to a report by the World Travel and Tourism Council, economies who enjoy strong growth of tourism, such as APEC economies Indonesia and Mexico, also see more jobs and higher incomes for women.

The expansion of global tourism looks set to continue. Air travel is expected to double in twenty years. Tourism already created 1 out of 5 new jobs in the last five years. The so-called ‘experience economy’, favored by younger generations for its ‘authentic’ offerings, may enjoy particularly high growth. 

‘Experience economy’ experts say that women can catch up on digital skills. According to Nayana RenuKumar, Public Policy Lead for Airbnb Experiences in the Americas and Asia Pacific region, women account for more than half of Airbnb hosts. Supporting women entrepreneurs makes business sense. 

“If we are not helping women and SMEs, we are losing out on 50 per cent of the population. It is our loss,” said RenuKumar. 

Comprehensive Support for Digital World Success

Bringing women into the digital economy can be a long process. In the early days of training women hosts in rural areas, Airbnb realized that many newly trained hosts struggled to come online. The reason? A lack of bank accounts.

Indeed, the preliminary findings of APEC’s upcoming Women and the Economy Dashboard show that while 58.6 per cent of women across the region are economically active, only 33.8 per cent of women have savings at financial institutions.

The experience presented a key lesson about economic empowerment. If you are on the margins of the economy, you need comprehensive support to succeed in the digital world. The US-based firm has responded by offering their partners access to targeted promotional support, professional photography, and a broader network of institutions.

Policymakers can help too. Digital literacy programs that work closely with industry, colleges, and training institutes can help small businesses keep up with evolving technology. Any skills-training initiative must have more women in the mix, advised OECD’s Stacey.

“Both governments and industry have a role to play in helping women and small businesses have access to digital tools and infrastructure,” said Stacey.

Efforts are underway. The APEC Policy Partnership for Women and the Economy, for example, is preparing a roadmap on how to strengthen women’s economic empowerment in the region.

Already an important driver of tourism growth, with more tools and support women entrepreneurs can bring even more prosperity to APEC economies.

APEC Tourism Working Group

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WTO Leads Discussion on “Tourism Financing for the 2030 Agenda”

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Tourism’s unique potential as a tool for driving the global sustainable development agenda has taken center stage at a special event hosted by the World Tourism Organization (UNWTO) in Geneva, Switzerland.

The session, entitled “Tourism Financing for the 2030 Agenda” was held during the 2019 Global Review of Aid for Trade at the headquarters of the World Trade Organization (WTO). UNWTO Secretary-General Zurab Pololikashvili began the discussions by highlighting the key role that the global tourism sector plays in economic growth and job creation.

Ministers, development partners and financing institutions need to better understand and recognize how tourism can contribute to the 2030 Sustainable Agenda. Tourism is explicitly mentioned as a target in three of the 17 Sustainable Development Goals (8, 12 and 14), though, as speakers at the Geneva session noted, for the sector to really realize its enormous potential, the amount of aid and development financing directed towards tourism needs to be increased significantly. Unlocking Tourism’s potential for realizing the 2030 Agenda requires a combination of effective and robust policy frameworks, enhanced private sector action, and an innovative approach to partnerships for development cooperation.

“This is an important time for both the tourism and the international development sectors,” said Mr. Pololikashvili.
“Strengthening and unlocking aid flows for tourism will help the sector be a driver of job creation, as well as of social and economic development and economic diversity. UNWTO welcomes the opportunity to join ministers, tourism leaders and our partners for these important talks here in Geneva. Working together we can harness the power of the new aid architecture and ensure that nobody gets left behind as tourism transforms lives around the world.”

Also joining Mr Pololikashvili for the session were Ms. Arancha González, Executive Director, International Trade Centre (ITC), H.E Dr. Rania Al- Mashat, Minister of Tourism, The Arab Republic of Egypt, Mr. Toshiyuki Nakamura, Director General, Japan International Cooperation Agency (JICA), and Ms. Caroline Freund, Director of Trade, Regional Integration and Investment Climate, World Bank.

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