Letters & Opinion

Tourism Not A Guessing Game

Image of Ronald Sanders

Ronald SandersThe performance of only five of the 14 independent Caribbean Community (CARICOM) countries are recorded in the 2015 Travel and Tourism Competitiveness Report published by the World Economic Forum.

Of the 144 countries measured by the Report, Barbados is the highest ranked CARICOM country at 46 with Trinidad and Tobago at 69 and Jamaica at 76. Guyana at 104 and Haiti at 133 are at the tail end of the index. The only other Caribbean country graded in the report is the Dominican Republic at 81.

Surprisingly, countries such as the Bahamas, Antigua and Barbuda, St Kitts-Nevis, St Vincent and the Grenadines and St Lucia, which have a heavy reliance on tourism for their economic growth, are not included in the Report’s measurement of competitiveness. The reason for the exclusion of the latter named countries lies in the Report’s statement that there was insufficient data from several countries.

It is regrettable that a large number of tourism-dependent CARICOM countries were not included in what the Report rightly describes as “a strategic tool for both businesses and governments” allowing for “cross-country comparison of the drivers of Travel and Tourism (TT) competitiveness, for benchmarking countries’ policy progress and for making investment decisions related to business and industry development”.

The Report’s methodology for measuring global competitiveness is based on 14 important pillars. They include: business environment, prioritization of travel and tourism, price competitiveness, tourist service infrastructure and cultural resources. Against these criteria, the top ten most competitive countries in global TT are in descending order: Spain, France, Germany, United States, United Kingdom, Switzerland, Australia, Italy, Japan and Canada. China has jumped 27 places to reach number 17 in the global rankings.

In the Caribbean, the Report observes that common TT issues include underdeveloped natural and cultural resources. Tellingly, the Competitive Index suggests that most Caribbean countries rely extensively on their beaches but do not seem to promote their cultural resources sufficiently. It is significant that China managed to advance to 17th place in the global rankings because Tourists are attracted to its cultural resources and its World Heritage natural sites that have been developed and made accessible. In 2013, China welcomed over 55 million visitors.

The TT industry is growing more quickly than the global economy as a whole, and so is related employment creation and higher paid jobs in the sectors that service it. These sectors are not limited to hotels, ground transportation, restaurants and shopping. They now include hospitals and other medical facilities; trained persons to maintain yachts; mechanical engineers for airplanes and ships; rental of properties and technologically-savvy persons capable of delivering services in a wide range of telecommunication areas. The TT sector, therefore, remains a thriving business from which Caribbean countries can benefit enormously if innovative measures are put in place.

Caribbean countries could learn lessons from the success of the nations that now top the TT league table. For instance, while France is ranked 2nd overall, it attracts the most tourists with over 84 million arrivals. This is because the government and the private sector give priority to the TT sector. They have invested in developing tourist facilities for leisure and conferences and have pro-actively built up their natural heritage resources and their historical sites. Throughout the Caribbean, there are many such resources and sites but they require private sector development within a government-private sector agreed plan.

Italy, which is ranked 8th in the overall rankings, manages only 127th position for business environment. The country has an inefficient legal framework, high taxation and regulations that are a disincentive to investment. Caribbean countries should be mindful of the importance of encouraging the private sector to share in the costs of developing the TT sector. After all, tourism is an export. Overtaxing hotels, airlines, and passenger tickets raises costs and renders the tourism product uncompetitive. Airline travel within and to the Caribbean suffers now, from high government taxes on tickets.

In South America, most countries have prioritised air transport, particularly with larger and newer airports and terminal buildings. Some of this is necessary, especially for countries whose tourism volume has outgrown the facilities their airports provide. However, ground transportation is underdeveloped, undermining the effects of investment in air transport infrastructure by limiting the ability to move within countries. A similar situation obtains in most Caribbean countries with Barbados being the most notable exception. While bus rides on that island can sometimes be hair-raising, for the most part they are safe, accessible and inexpensive. Other Caribbean countries should be mindful, as part of the development of the TT sector, that tourists do not travel to airports; they travel to countries. Airports are important to ease entry and exit and they should be as accommodating as possible, but visitors want to experience the country. Without good ground transportation, they are deprived of that opportunity.

Significantly, countries that maintain a competitive edge in TT are those that are alert to changing trends. For example, the number of people over 60 years of age is predicted to rise from 900 million in 2010 to almost 1.4 billion in 2030. These older travellers have larger budgets, and while they account for only 40 per cent of travellers, they represent 60 per cent of wealth and they travel all year round.

The Competitive Index report provides important data and analysis of the factors that make for success in TT as well as the issues that obstruct the industry’s development. It is regrettable that many Caribbean countries were excluded from the Index because of insufficient data by which to measure their strengths and weaknesses. Without information on how they perform against their competitors, Governments and the private sector will not be able to identify the requirements to do better.

Barbados deserves commendation not only for being the only CARICOM country in the top 50 most TT competitive countries, but also for maintaining the statistical information that permits it to measure itself against its competitors. The importance of good statistical information in all aspects of decision-making is often overlooked. Consequently, many governments and private sector organisations are forced to make crucial decisions on a guess rather than on sound evidence. Guesses are not a basis for successful planning or effective competition.

Responses and previous commentaries: www.sirronaldsanders.com

Leave a Reply

Your email address will not be published. Required fields are marked *

Send this to a friend