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New tourism study shows need to prepare for future headwinds, as sector shows signs of recovery

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The World Economic Forum released today its latest travel and tourism study, revealing that the sector is showing signs of recovery in many parts of the world after being hard-hit by the COVID-19 pandemic. Japan, the United States, Spain, France and Germany are at the top of the list.

The Travel & Tourism Development Index 2021: Rebuilding for a Sustainable and Resilient Future, ranks 117 economies on a range of factors that are crucial to the development, sustainability and resiliency of their travel and tourism industry, which in turn contributes to economic and social development.

“COVID shutdowns have re-emphasized the important contribution travel and tourism makes to many economies around the world,” said Lauren Uppink, Head of Aviation, Travel and Tourism at the World Economic Forum. “As the world emerges from the pandemic, economies must invest in building a strong and resilient environment to deliver the travel and tourism experience and services for many decades to come.”

While overall international tourism and business travel is still below pre-pandemic levels, the sector recovery has been bolstered by greater vaccination rates, return to more open travel, and growing demand for domestic and nature-based tourism. Many businesses and destinations have adapted to these shifting demand dynamics. According the UNWTO, the difference in international tourist arrivals between just January 2021 and January 2022 is greater than arrivals growth in all of 2021.

As the sector slowly recovers from the global health crisis – especially as vaccines become more available and health restrictions lifted – it will be important for the travel and tourism sector to take steps that embed long-term inclusivity, sustainability and resilience as it continues to face evolving challenges and risks.

Despite positive trends, the travel and tourism sector is still facing many hurdles with its recovery. This includes uneven vaccine distribution, capacity constraints, labour shortages, supply chain disruptions and more.

“Government, business and civil society leaders can address barriers to recovery by looking at the different factors that can support the long-term development and resiliency of their respective travel and tourism economies,” added Uppink. “This will require decision-makers to restore consumer confidence and international openness by prioritizing such things as enhanced health and security measures, encouraging inclusive labour practices, improving environmental sustainability and investing in digital technology.”

Travel and Tourism Development Index 2021 results

In this year’s index, Japan takes the top spot followed by the United States, Spain, France and Germany rounding out the top five.

Other than the US, the top-10 scoring economies are high-income economies in Europe or Asia-Pacific. After top-ranking Japan, regional economies Australia and Singapore come in seventh and ninth, respectively. Italy joined the top 10 (up from 12th in 2019) in 2021, while Canada slid from 10th to 13th

Viet Nam experienced the greatest improvement in score (from 60th to 52nd) on the overall index, while Indonesia (44th to 32nd) and Saudi Arabia (43rd to 33rd) had the greatest improvement in rank.

While Europe, Eurasia and Asia-Pacific dominate the 2021 rankings, Europe is the only region to have decreased its average score since 2019, slightly eroding its considerable lead. Sub-Saharan Africa had the greatest improvement in performance, but far more needs to be done for economies in the region to catch up with the global average.

In other regions, Dominican Republic saw the greatest improvement in North and Central America (72nd – 69th) while Uruguay saw the biggest jump in South America (61st to 55th).

The Travel and Tourism Development Index 2021 is a direct evolution of the Travel & Tourism Competitiveness Index, which has been published biennially for the past 15 years. The change reflects the new index’s enhanced focus on the sector’s overall role in economic and social development and the greater need for stakeholder collaboration and development strategies. Based on an altered framework, methodology and other differences, the 2021 index should not be compared to the one published in 2019. To help address this, the 2019 results were recalculated using the new framework, methodology and indicators; all comparisons in score and rankings throughout the new report are between the 2019 results and the 2021 results of the Travel and Tourism Development Index.

Rebuilding for a sustainable and resilient future

Given the travel and tourism sector’s important role in global economic and social prosperity, investing in the drivers of its development will be crucial in the coming years, according to the publication. As economies look to rebuild their travel and tourism sectors, they should focus on making their travel sectors more inclusive, sustainable and resilient to future risks.

To achieve this, one top enabling factor that should be prioritized is restoring and accelerating international openness and consumer confidence by improving, for example, health and security. This could include more investments into healthcare infrastructure and personnel and greater distribution of COVID-19 vaccinations in lower-income economies.

“Efforts to build favourable and inclusive labour practices, improve environmental sustainability and strengthening the management of tourism demand and impact will help economies ensure strong development of their travel destinations,” said Uppink. For example, sustainable environmental policies that can help protect natural resources have become even more vital as consumer preference for sustainable travel options and nature-based travel grows.

Digital technology will also be vital to achieving all of this. New digital tools can be used to manage tourism flows, optimize visitors’ experiences and reduce overcrowding. Addressing issues such as the digital divide, skills gaps and fully including small and medium-sized enterprises (SMEs) in digitalization efforts will be critical to fully leveraging digital technology to improve the tourism sector as a whole.

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Tourism: sustainability is the trend of 2023

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Sustainability is a more topical issue than ever and people are increasingly adopting habits and lifestyles aimed at limiting their impact on the environment. The tourism industry also fits into this context: in fact, an increasingly growing number of travellers choose to spend their holidays according to principles of sustainability and respect for the territories.

This trend is reflected in the numbers: according to the latest data of the Swg observatory released in March of this year, four Italians out of five would be willing to experience sustainable tourism, thus preferring to stay in a certified environmentally-friendly structure at the same cost. As far as the environmental protection initiatives are concerned, almost 70% of the sample respondents are in favour of limited access and traffic restrictions and 73% would be ready to do without their cars and to use public transport or ecological vehicles.

The trend is also confirmed by the results of the study on the impact of sustainability on the Italian tourism supply chain conducted by Deloitte in partnership with AICEO. According to the data gathered from this research, 64% of respondents stated that the effects of climate change have led them to consider travelling in a more sustainable way: a percentage which reaches 71% among those under 25 years of age. The will to shift towards sustainable tourism is especially driven by the desire to protect the territory (60%) and reduce environmental impact through ecological means of transport (52%). The growing attention towards sustainability is also reflected in the strong recovery of train travel, which recorded over 1 million passengers a day in 2022. As clearly emerged at the BIT 2023, the International Tourism Exchange, Italy is a particularly popular destination for foreign tourists, whose purchases of Trenitalia products have increased by 25% in 2022 compared to the pre-Covid period.

The possibility to move quickly from one major city to another thanks to High-Speed transport and the vast offer of regional and Intercity trains precisely responds to the demand for a more sustainable tourism that is attentive to the environment, territories and communities.

Such attention is also shared by True Italian Experience, a digital hub whose goal is to promote, diffuse and develop the Italian tourism market: a tourism consisting of unique experiences built around the passions and interests of travellers, always in full respect of sustainability and social responsibility principles. Maurizio Rota, CEO of True Italian Experience, confirms such commitment:

“More and more tourists are attentive to the sustainability issue. As a result, True Italian Experience offers travel packages designed to interconnect the various Italian locations using the railway system. True Italian Experience provides packages aimed at discovering the territory and which can be combined with sectors such as cycle tourism and electric mobility to ensure intermodal solutions in line with the principles of sustainability and social respect.

In fact, True Italian Experience believes sustainability concerns both the environment and social responsibility. As a result, our travel packages favour the young start-ups scattered over small towns nationwide and which foster and develop tourism from a digital perspective that would not otherwise have a preferential access to the market. In particular, we value the tourism businesses, cooperatives and start-ups present throughout remote areas of our Country and which thus focus on the development of a sustainable and gentle type of tourism.”

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UN Unanimously Approves Jamaica’s Resolution for Global Tourism Resilience Day

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After months of advocacy, high level discussions and partnerships, Jamaica has been successful in receiving the necessary support to have 17th February officially declared Global Tourism Resilience Day. The United Nations General Assembly (UNGA) adopted the resolution today with the support of over ninety countries. 

This is the first ever Global Tourism Resilience Day which will now be recognised every year on 17th February. 

Following a presentation at the UNGA’s 58th Plenary meeting in New York today, Minister Bartlett highlighted the importance of the declaration: “Today’s announcement will in fact signal to the world to put aside one day, 17th February, every year to not just observe but to create a greater level of consciousness around resilience. The pandemic has shown us that global disruptions will continue, so there will be more epidemics, pandemics and earthquakes like the one in Turkey today. The importance of this day is therefore to encourage capacity building for the world to be better able to respond to these global disruptions and recovery quickly.” 

Tourism is one of the world’s major economic sectors and in 2019 accounted for 7% of global trade and one in ten jobs. However, tourism also remains one of the most vulnerable industries and this has been evident over the years with the negative impact of climatic events like hurricanes and earthquakes, pandemics and economic recessions. 

“If we are to future proof the sustainability of tourism, now is the time to give greater consideration for building resilience and it is especially more critical for tourism dependent countries like Jamaica, whose economic livelihood rests on the survival of this industry. This is indeed a huge step in coalescing global support every year on this important matter and I thank all our stakeholders and partners who worked to make this happen,” added Minister Bartlett. 

The Global Tourism Resilience Centre (GTRCMC), headquartered in Kingston, has been a major driver in calls for capacity building in tourism resilience. Born out of the Montego Bay Declaration, the GTRCMC was established to address these inevitable disruptions through preparedness, management and recovery strategies. 

“The GTRCMC has been the unwavering global voice for tourism resilience and to have achieved a day focused on bolstering our efforts, will encourage more partnerships among countries to build capacity through research and the coming together of the best minds” said Professor Lloyd Waller, Executive Director of the GTRCMC. 

This is the second designation attributed to the efforts of Jamaica, since the designation of the International Year of Human Rights in 1968. The designation also comes ahead of the upcoming Global Tourism Resilience Conference which will be held at the University of the West Indies’ Regional Headquarters in Kingston from 15-17th February 2023. 

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Indonesian women entrepreneurs adapt to a changing world

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Yvonne Kubis, one of the microentrepreneurs in Marinsow, Indonesia. M. Gaspar / UNIC Jakarta

Sustainable tourism is proving to be a viable career option for women in the picturesque North Sulawesi region of Indonesia, where they are making the most of skills training provided by the UN.As the sun sets over the Celebes sea, and its orange glow turns the horizon gold, a couple of dozen tourists are on the pier at Budo, a village of 2400 perched on the ocean, 25 kilometres northeast of the regional capital Manado.

They snap photos and marvel at the view; a woman visiting from a nearby town exclaims that, even for the locals, the sun setting on the volcanoes is an extraordinary sight.

However, until a few years ago, the pier – about 300 meters long, crossing a mangrove forest to connect the village to the open sea – was dilapidated and used only by fishers heading out to sea.

But those were different times, explains Hani Lorens Singa, President of the Village Enterprise Association (BUMDES): back then there were far more fish, and no tourists.

Budo, like many coastal villages in North Sulawesi, in far northeastern Indonesia, has traditionally been dependent on small scale fishing, but fish stocks have shrunk, prompting a new focus on tourism as a way of creating livelihoods.

A programme set up by the International Labour Organization (ILO, a UN agency), is helping the rural community of Budo, and four other villages, to diversify into sustainable tourism, providing skills to local entrepreneurs, mostly women.

The pier has been renovated and painted, with support from the government, and benches and wooden huts have been added for the convenience of tourists, who pay an entrance fee of 10,000 Rupiahs ($0.65), to walk along it and enjoy the view.

Visitors can buy local delicacies and drinks at the ticket counter, and the orders are prepared and delivered to the pier by available members of the village association. “We share the work, we share the income – this is tourism at a human scale”, says Mr. Lorens Singa.

Since the renovation, a fifth of the visitors spend more, ordering local delicacies and drinks at the ticket counter with the occasional visitor also staying the night.

Thanks to support from ILO and its partners, Budo has increased its income from tourism fivefold and now appears on the tourist trail: the village was the winner of the digital marketing category at the Ministry of Tourism and Creative Economy’s Top 50 Village Tourism Award this year.

Despite the improvements, a lot still remains to be done, and Mr. Lorens Singa is not complacent. “We need to offer more reasons for people to stay for a meal or overnight,” he insists.

Homestays, hashtags, and home cooking

About an hour’s drive east of Budo, the inhabitants of Marinsow have taken a crash course in the bed and breakfast business, a steep learning curve for many of them.

“Many of the entrepreneurs we work with have never been tourists themselves, so without training, it is not obvious for them to know what tourists expect,” says Mary Kent, the ILO Chief Technical Adviser for the project.

Marinsow is in a mining region, several kilometres away from Indonesia’s pristine beaches, so tourists previously had no reason to stop by. But, since Marinsow was designated as a “priority tours destination” by the Government, the village has received a significant financial boost, aimed at diversifying the economy.

More than 50 villagers received small wooden bungalows on their plots to start bed and breakfast businesses, or homestays, as they are known in Indonesia. ILO, with local partners Klabat University and the Manado State Polytechnic, is helping to teach local people the skills needed to be a successful entrepreneur, such as bookkeeping, cost calculation and marketing, hospitality, and tourism.

“I was very surprised to learn that tourists prefer their sheet white and a diversity of meals,” says Yeni Alelo. Ms. Alelo and the other participants have also learned the importance of using hashtags in social media marketing posts, so that tourists looking for a place to stay in the area find them more easily.

“The women’s small businesses are financed through microfinance credits, and they have been able to make all the payments on time,” says Gabriel Tamasengge, the village’s mayor. “We are very proud of our women, of the business acumen we never knew they had.”

The investment in skills for marketing and quality control in these communities is paying off, with about half of the few hundred tourists spending the night in Marinsow last year coming from outside the province, including an increasing number from abroad.

Back in Budo, there is interest in building more homestays, and increasing overnight stays, perhaps by creating a marketing campaign to convince foreign tourists from nearby world-class diving destinations within the Bunaken Marine Park to hop over for an evening meal and make a visit to a typical village, rather than sticking to the usual mass tourism destinations. The Village Enterprise Association also plans to offer cooking and handicraft classes, as well as fishing trips.

“Our task now is to make sure that when the funding from ILO and the government stops, we will have a fully formed business that allows us to stand completely on our own feet,” says Mr. Lorens Singa. “We had the vision, and we have the commitment – I am confident we will succeed.

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