Lessons from Tourism Economies Serving the Community, Hospitality News, ET HospitalityWorld

Lessons from tourism economies that serve the community
Tourism revenue does not always benefit the local population and the economy. It’s time to change that.

Tourism seems to be making a strong comeback this year. International arrivals will reach around 70 per cent of their pre-pandemic level and some places are even struggling with increased demand. But it was not long ago that global organizations advocated financial support and suggested that the crisis was an opportunity to rethink tourism, to make the industry stronger, more sustainable and more resilient afterwards.

As tourism emerges from the pandemic, we must reconsider how to make the sector more responsible to the people it affects. Rampant tourism development and overtourism are likely to return to pre-pandemic levels unless regulations are put in place.

If tourism wants to develop in a way that gives back to the community, the lessons are already available in many places around the world. Applying a tourist tax is just one of several ways to rebuild the industry for the better.

For example, Bhutan’s “High Value, Low Volume” tourism development strategy required tourists to fork out at least $200 per day through its Minimum Daily Package Fee prior to the pandemic. Of that sum, USD 65 was for a sustainable development fee, while the rest was for services provided by the tour operator, including accommodation and meals.

The industry is now going through a “reset” as it emerges from the pandemic. The sustainable development fee is now USD 200 and the daily package fee has been abolished. Visitors will still need to use the services of a tour operator to enter the country, but these operators can now decide how much to charge for their services, in addition to accommodation, meals, and administration. Revenue from the fees will be used to care for the environment, improve infrastructure, provide training for industry employees, and improve services.

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In Singapore, the tourism board is supported by the government, but its main source of funding is a 3 percent tax charged directly to guests staying at hotels. Being well funded, the tourism board not only works to attract visitors, but also oversees the development of attractions, infrastructure, and services. All of which also serve the community and not just tourists. These include festive lighting in popular tourist spots, as well as rebranding and marketing of local neighborhoods.

Many tourism products often support nation-building messages, contribute to local cultural development, and engage with community groups. For example, the tourism board was central to the renewal of Singapore’s ethnic enclaves: Chinatown, Little India, and Geylang Serai. As a result, these places became accepted as authentically Singaporean by residents, in accordance with the government’s multicultural social engineering program. While there is criticism of Singapore’s touristification, in terms of its culture and heritage, tourism itself has now become part of Singapore’s culture.

In many countries, the attempt to find balanced tourism development for residents and travelers is frustrated by different stakeholders and their vested interests.

For example, a city and a town should have different tourism development strategies due to their different demographics and interests. Developments that attract a larger interest group can destroy the character and structure of the destination. This can be seen in ‘overdeveloped’ places like Kuta Beach in Bali, Indonesia, or Las Vegas, USA, where local community members are often not consulted.

Many residents who do not work in the industry may not feel that they benefit from the visitor economy. They may also experience inconvenience and become an unwitting part of the destination’s product, suffering from overcrowding, inflation, and less affordable housing. For example, on the island of Lombok, Indonesia, many residents have less access to water, sanitation and hygiene than tourists.

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Tourism development plans should assess new attractions and consider whether they are something the community needs first. The community is the host of the visitors, they are part of the tourist experience. This is why it is crucial to consult them and get their support to make the industry socially sustainable. Today, it is more common for community groups to approach tourism businesses for support. This can lead to local groups lacking bargaining power and being disenfranchised. Protesting residents will not make visitors feel welcome, for example.

Many large hotels, as part of their corporate social responsibility, voluntarily contribute to community projects, such as sponsoring events at a local sports club. The challenge is corporate social responsibility laundering: good deeds used to enhance reputation for marketing purposes rather than altruistically serving the community.

But demands for community service can be placed on large tourism projects when there is political will. For the Olympics, for example, the bid cities must demonstrate that their games will leave a lasting legacy for the community. Games shouldn’t just be a for-profit vanity project.

Tourism developments, such as mega-malls and large resorts, may be forced to provide permanent art spaces for local artists, take responsibility for maintaining a nature park, or support the operation of a cultural institution. In this way, it can be shown that these tourism companies are contributing directly to the community. Larger developments must not only consider the community, but will contribute directly to society, despite the additional costs that might be incurred.

At the height of the pandemic, tourism-dependent communities rallied around local tourism and hospitality businesses. But such strong community support for the industry is not unlimited. Therefore, post-pandemic tourism must aim to be sustainable for host communities. As society changes, so can an industry. And there is no better time to start.

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