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Economic Benefits

The main positive economic impacts of sustainable (coastal) tourism relate to foreign exchange earnings, contributions to government revenues, generation of employment and business opportunities. Some of the most important economic benefits that sustainable tourism brings along are mentioned here. Further information on economic contributions of tourism can be found on the website of the World Travel and Tourism Council.


 

Foreign exchange earnings

Tourism expenditures, the export and import of related goods and services generate income to the host economy. Tourism is a main source of foreign exchange earnings for at least 38 % of all countries (World Tourism Organisation).

Contribution to government revenues

Government revenues from the tourism sector can be categorised as direct and indirect contributions. Direct contributions are generated by taxes on incomes from tourism employment, tourism businesses and by direct charges on tourists such as ecotax or departure taxes. Indirect contributions derive from taxes and duties on goods and services supplied to tourists, for example, taxes on souvenirs, alcohol, restaurants, etc.

Employment generation

The rapid expansion of international tourism has led to significant employment creation. According to the World Travel & Toursim Council in 2011 travel and tourism contributed 9% of the global GDP and supported 260 million jobs worldwide. Tourism can generate jobs directly through hotels, restaurants, taxis, souvenir sales and indirectly through the supply of goods and services needed by tourism-related businesses.


Stimulation of infrastructure investment

Tourism can induce the local government to improve the infrastructure by creating better water and sewage systems, roads, electricity, telephone and public transport networks. All this can improve the quality of life for residents as well as facilitate tourism.

See Slovenian coast case study

 



Contribution to local economies

Tourism can be a significant or even an essential part of the local economy. Because environment is a basic component of the tourism industry’s assets, tourism revenues are often used to measure the economic value of protected areas. There are other local revenues that are not easily quantified, as not all tourist expenditures are formally registered in the macro-economic statistics. Part of the tourism income comes from informal employment, such as street vendors and informal guides. The positive side of informal or unreported employment is that the money is returned to the local economy and has a great multiplier effect as it is spent over and over again. The World Travel and Tourism Council estimates that tourism generates an indirect contribution equal to 100 % of direct tourism expenditures.

Direct financial contributions to nature protection

Tourism can contribute directly to the conservation of sensitive areas and habitats. Revenue from park-entrance fees and similar sources can be allocated specifically to pay for the protection and management of environmentally sensitive areas. Some governments collect money in more far-reaching and indirect ways that are not linked to specific parks or conservation areas. User fees, income taxes, taxes on sales or rental of recreation equipment and license fees for activities such as hunting and fishing can provide governments with the funds needed to manage natural resources.

Competitive advantage

More and more tour operators take an active approach towards sustainability. Not only because consumers expect them to do so but also because they are aware that intact destinations are essential for the long term survival of the tourism industry. More and more tour operators prefer to work with suppliers who act in a sustainable manner, e.g. saving water and energy, respecting the local culture and supporting the well being of local communities.

The Tour Operators initiative for Sustainable Tourism (TOI www.toinitiative.org ) unites tourism stakeholders from around the world to promote the development, operation and marketing of tourism in a sustainable way. The Initiative has the full support of the the World Tourism Organization (UNWTO), currently hosting the TOI Secretariat, the United Nations Environment Programme (UNEP) and the United Nations Educational, Scientific and Cultural Organization (UNESCO).