OVER the past 2 years or so, Tourism has been on the defensive, by virtue of a swathe of anti-Tourism protests, in several European cities. In 2023, protestors in Amsterdam, (The Netherlands) launched a “Stay Away” campaign, warning male visitors between the ages of 18 and 35 about the consequences of anti-social behavior. In April 2024, Venice introduced a temporary entrance fee to regulate the number of visitors to its already “sinking city.” When the fee was discontinued on July 14, it had generated over US$2.6 million, suggesting that it may not have had the desired deterrent effect. In Barcelona, thousands of citizens who are members of the “Neighborhood Assembly for Tourist Degrowth,” literally took matters into their own hands. As they marched through the streets voicing outrage over mass tourism, they used water guns to spray visitors.
Irony
The intriguing irony in these stories is that Tourism is inarguably the lifeblood of these cities. The Tourism Observatory of Barcelona estimates that last year, 26 million visitors spent about US$10.4 billion in the Barcelona area. The city earned another US$108 million from its cruise tourism tax, which ranks as its third-largest source of funding. While Amsterdam’s annual income from tourism is hotly disputed, it is estimated to range between US$2.1 billion by Amsterdam’s Statistical office and US$11.1 billion by Amsterdam Economic Board (AEB). In 2022, Venice which has an area of 160 square miles and a population of 50,000 people, received about 30 MILLION stay over and cruise tourists, and earned US$1.73 from tourism. If Venice’s tourism earnings appear to be low compared to Amsterdam and Barcelona, it is because many of its visitors are described as “hit-and-run tourists” mainly cruise visitors who come in large numbers but spend little. The main beef of anti-tourism protestors in Barcelona is the rising price of housing and the displacement of long-term residents. Rent has risen nearly 70% over the past decade, due mainly to the growth of Air BNB.
Roots of Discontent
The story is the same in most, if not all tourism-dependent countries. Despite the Caribbean’s heavy dependency on the national income, foreign exchange and the jobs that tourism generates, the general sentiment among citizens is that they are not benefiting sufficiently from the industry. Moreover, many feel that the sector is generating negative, social and environmental impacts.
In my view, much of the anti-tourism sentiment in the Caribbean countries has three main causes. First, I feel there is a general lack of understanding about the way tourism works. Second, while many national tourism policies aspire to increase the participation of locals in the ownership, and management of tourism-related establishments, and ensure that more locals enjoy the benefits of tourism, the implementation of strategies to achieve these objectives has been weak and ineffective, Third, the dominant model of tourism in the Caribbean is extractive and does not do enough to build the sustainability and resilience of host destinations.
Understanding Tourism
Unlike other industries, which sell locally produced goods and services in external markets, tourism brings the market (visitors) to the product (destination). Consequently, Governments and owners and operators of tourism establishments, must spend heavily in overseas markets to attract visitors to a destination. Given the competitive nature of tourism, and the maturity and diversity of tourism products in the USA and Europe, it is not easy to entice a visitor to ignore cheaper, staycation options in their own backyards and choose instead to visit the Caribbean. Hotels also spend heavily on furniture, fittings and equipment (FF&E), much of which is imported. This expenditure is invisible to the local populace. Moreover, except in cases where a hotelier borrows from a bank in a destination—which is not allowed in some countries-locals tend to be unaware of the exorbitant cost of borrowing to build a resort in the Caribbean.
I believe the general lack of understanding of these unique, inherent, features and realities of the tourism industry, is feeding the perception among critics of the industry, that foreign tourism investors are extracting far more in financial and non-financial incentives from governments, and from returns on their investment, than they are putting into a destination. For example, some who complain that too much of the profits of foreign tourism investors are repatriated overseas are unaware of the heavy, external capital and operational costs of owning and running a tourism establishment. Thus, if a hotel investor is indebted to an overseas lender, and/or supplier of FF&E, part of the earnings of that investor will be repatriated to, or retained in the country where these debts are incurred.
The Prism of Agriculture
The social and social impact of Tourism is often assessed through the prism of agriculture. Hence, the common argument that agriculture has a stronger social and economic impact than tourism. The earnings of tourism industry workers move through the economy in much the same way and with the same vigour as those of farm workers. Moreover, the average farm does not have the same capital and/or operating costs as the average hotel. The local expenses of a tourism establishment—wages, salaries, utilities, brokerage services, property taxes, insurance, entertainment, wedding services providers, ground transportation, food and beverage etc. —are not insignificant. Typically, at least 25% of a hotel’s operating budget goes towards labour costs. Another 4-5% is devoted to marketing, while utilities can consume as much as 5% of a hotel’s budget. Further, some critics lose sight of the significant risks that hotel investors assume in an industry that is as vulnerable to external shocks as tourism. The still-birth of El Paradis on Saint Lucia’s east coast bears testimony to this fact. One minute, the financing was there; the next minute it had vanished with the winds of mayhem, generated by the 2008 global financial crisis. Many planned tourism investments in the region were delayed or canceled due to the COVID-19 pandemic. Also, tourism is very price sensitive. It is a mystery to me that visitors continue to ignore the steadily rising cost of airfares and accommodation to come to the Caribbean.
No Argument
Nothing stated above invalidates the argument that the level of local participation in the tourism industry is far from satisfactory. But who bears fault for this?
It is not unnatural for any hotel or business to endeavour to limit its operating costs and to capture as many of the economic spin-offs as possible. I would argue that it is squarely the responsibility of Governments to design and diligently implement robust policies and strategies that: (1) curb the innate desires of tourism establishments to maximize profit to the detriment of workers and destinations; (2) maximize the benefits that locals receive from tourism; (3) ensure that tourism establishments operate fairly and in accordance with national labour and environmental laws; and (4) ensure that investors are committed to sustainable tourism development and are seized of the corporate conduct and values that are acceptable to host destinations.
Drain
For all the foreign exchange that tourism generates for Caribbean destinations, some regional economists argue, not unreasonably, that the sector is a net drain on foreign exchange. Writing in the journal “Medium,” economist, Marla Dukharan cites foreign exchange controls in Barbados and the Bahamas, “…which incentivize earners of US currency to hold their revenue overseas, and only bring onshore that which they need to convert to pay local bills.” That may be so. But focusing on “local bills” I would argue that the reason for this disposition is because hotel investors are not being incentivized by Caribbean governments to spend more in their countries.
Remedies
Most, if not all national tourism policies and strategies aim to strengthen backward and forward linkages between tourism and other sectors of the economy, such as agriculture, manufacturing and services. Attempts that I consider all too sporadic have been made to encourage hotels to buy more locally produced food, fish, beverages and to source various products through local suppliers. Barbados, and more recently Saint Lucia, have tied the fiscal incentives they give to tourism investors, to the amount of “local spend” by tourism establishments. That’s all well and good! However, here, challenges abound, including the means of verifying “local spend “by tourism establishments, and ensuring that local suppliers of tourism-related, products and services can meet the quantity, quality standards and frequency requirements of tourism establishments. For example, in an ideal scenario, Sandals properties in the region would not be importing bread, eggs, fish, flowers and so on. However, given the minuscule markets in Caribbean countries, it’s not easy for farmers, bakers, fishers in Saint Lucia to scale-up production to meet the needs of one Sandals property, while also supplying local supermarkets.
It’s no surprise that Jamaica has made the greatest strides on the linkages front. I attribute this to the work of a Tourism Linkages Council (TLC) and a Tourism Linkages Network (TLN) both of which were established in June 2013. The TLC, which is comprised of key public and private sector partners, oversees the coordination and implementation of strategies that strengthen and facilitate linkages, while the TLN works to increase the consumption of goods and services that can be competitively sourced locally, and to create employment while generating and retaining the country’s foreign exchange earning potential. About 2 decades ago, Oxfam worked with farmers in Saint Lucia to boost their capacity to supply tourism. Work on the ground sought to address the supply, demand and marketing by focusing on quality production by farmers; increasing demand for local products by hotels and visitors; creating a marketing company to act as a broker; and to facilitate purchase and supply. There is little evidence that these efforts have been sustained.
Commanding Heights
More success has been achieved in increasing the number of locals that occupy managerial and supervisory positions in foreign-owned hotels, than in increasing the number of locals who own hotels. In Saint Lucia, fewer work permits are now being issued for foreign managers and supervisors, compared to 2 decades ago, which has helped to reduce the leakage of foreign exchange. However, while the growth of the Air BnB sector and small hotels, is slowly changing the ratio of foreign to local investors in tourism, (in terms of rooms), only a handful of owners of mid-size hotels exist, with Bay Gardens, Jade/Anse Chastanet, and Fond Doux Plantation being among the more prominent among them.
From a psychological standpoint, I feel it’s important for Saint Lucians to see more locals occupying the “commanding heights” of the tourism industry. Typically, locally owned and managed hotels have a stronger attachment to the local economy and society and tend to have a more reliable network of local suppliers. Here, I must share my deep disappointment at the failure of a unique experiment that was attempted in the early 1990s. The idea was to establish a locally owned, 250-room hotel in Vieux-fort with 5 hotel investors, each owning blocks of 50 rooms and with the Government providing central facilities, such as restaurant, swimming pool, and conference facilities. Initially, the concept engendered strong interest from a cadre of local investors, with whom several meetings were held. Land was reserved at Black Bay and money was allocated for a feasibility study. However, for reasons that I have not been able to glean, that idea floundered, and a supermarket emerged on the site that was earmarked for this hotel.
Social and Environmental Responsibility
Over the past decade, community-based tourism (CBT) has emerged as a model that could support the attainment of sustainable and resilient tourism. True to this model, during the COVID 19 crisis, many hotels rolled out income support programmes for their workers. In Saint Lucia, thanks to a Tourism Enhancement Fund (TEF), financed almost exclusively from contributions from visitors, and managed by the local Hotels and Tourism Association, investments have been made in community engagement projects, such as renovations to homes in vulnerable communities in Castries and in the south of the island, community based training, and the promotion and implementation of violence interruption strategies. However, public and private tourism actors will need to adopt a more comprehensive, genuine, consistent and sustained effort towards empowering communities to give visitors a positive and memorable experience while ensuring that these communities receive a fair share of the economic benefits of tourism. Restricting public access to beaches is inconsistent with the tenets of CBT and will continue to feed anti-tourism sentiment. Here, Governments MUST ensure that local laws are observed. Recently, I was greeted at the gate of a hotel on Saint Lucia’s west coast, by a security guard who cavalierly announced that if I and my family wished to eat at the property’s beachside restaurant, a US$20 per-person levy would be charged. Considering this a bizarre and ridiculous policy, I drove away in disgust and later reported the matter to the Ministry of Tourism. But it’s clear to me that such discriminatory policies and practices by some properties need to be frontally addressed as part of the SLHTA’s commitment to a CBT culture.
Based on the thoughts shared above, and my experience and insights gained while at the Ministry of Tourism, I consider that Tourism, especially land-based tourism has the potential to be a blessing the Caribbean. However, I readily acknowledge that a considerable amount of effort is needed on the part of all public and private Tourism actors to ensure that Tourism does not become a blight on the consciousness of the people of the Caribbean. In a future commentary, I will offer some views on cruise tourism.