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Tourism Investment Report 2020

In association with fdi intelligence from the financial times.

For the third year in a row, the UNWTO has partnered with the fDi intelligence from the Financial Times to develop a joint publication on Tourism Foreign Direct Investments (FDI) analyzing data on Greenfield investments trends. The relevance of this report is pivotal to governments and investors because it exposed data on flows of capital, and destinations for investments providing insight on market trends for the tourism recovery.

In times of uncertainty, expertise and trusted information is more important than ever. This report provides investment and market data that both investors and stakeholders will need to maximize their impact of the sector in terms of economic growth, job creation and sustainability. Especially when around 100-120 million direct tourism jobs are at risk, which threatens to roll back the progress we have made in establishing tourism as a driver towards achieving the Sustainable Development Goals (SDGs). For this edition, the UNWTO’ Innovation, Digital Transformation and Investments department has developed an interactive report using data (2015-2019) from the fDi Intelligence on Tourism FDI.

The COVID-19 pandemic has hit the tourism sector hard; the data suggests that global FDI into tourism plummeted by 73.2% in the first half of 2020, compared with a year earlier. This put an end to the sector’s record high years. This data has a close relationship with the UNWTO’ scenarios for international tourist numbers decline, which could fall between 60 and 80% this year depending on the speed with which travel restrictions are lifted. This could translate into a loss of 850 million to 1.1 billion international tourist arrivals and a fall of $910 billion to $1.2 trillion in export revenues.

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Although, the investment cycle remained strong throughout 2019, with tourism mobilizing $61.8bn in global FDI, which, in turn, created more than 135,000 jobs. The trend appeared particularly consistent in Latin America and the Caribbean, where FDI reached new record levels. For example it created more than 56.000 jobs in Mexico from 2015 – 2019. Tourism FDI was also strong in the Middle East and Africa, where it rose to the highest level in a decade. However, almost half of all tourism investments globally (46.51%) are made at top 10 countries. From which around 30% of projects are concentrated in five countries: United Kingdom, United States, Germany, China, and Spain. It is important to notice that more than 30% of projects and of capital investment announced in the tourism cluster between 2015 and 2019 occurred in 2019.

The major sub sector that has led tourism investments are consider traditional investments, with construction as the main driver for around 57% of total Greenfield investments from 2015 to 2019. As such, the trends in accommodation are around
the sustainability where multinational companies are investing in green, and clean energy matrix of their operations. According to the fDi intelligence of the Financial Times, investors are paying increasing attention to the social and environmental footprint
of the projects they assess in tourism. They seem willing to prioritize developments that lift communities and preserve ecosystems, as long as financial sustainability is also taken into account.

Finally, there is also an increasing number of non-traditional investments related to services around software technologies that include: Travel arrangement & reservation services, Internet publishing, web search among other, which represent around 32% of total investments considering investments between 2015 - 2019. This data invites to research more about investments in technology as a source of FDI in the tourism sector. The Travel Tech startups have been introducing innovations in the tourism ecosystem, and they are constantly changing business models attracting more investors.

The COVID-19 pandemic has made clear that sustainable tourism requires that sustainable investments are at the center of new solutions, and not just of traditional investments that promote and underpin economic growth and productivity. It has also highlighted the importance of non-traditional investments that enhance innovation through the creation and diffusion of new solutions to decarbonize the sector. To harness the advantages of investments, it is critical that governments promote policies as well as new investment vehicles to recover, retain and attract foreign direct investments. Only this way can we reimagine tourism and enhance the sector’s positive impact on people and planet as we accelerate the achievement of SDGs.

The UNWTO is developing a series of investment guidelines to understand and generate sustainable investments and promote innovations in the tourism ecosystem. If you are interested in the UNWTO’ reports and guidelines to understand, enable and mobilize tourism investments , we invite you to register to receive the our investment updates.

Please feel free to download the full report:

TOURISM INVESTMENT 2020  

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ICCS 2020: Comprehensible Science pp 70–80 Cite as

Financial Instruments for Tourism Development: Challenges and Opportunities

• Aleksandr Gudkov   ORCID: orcid.org/0000-0002-4006-4522 10 ,
• Elena Dedkova   ORCID: orcid.org/0000-0003-3392-2952 10 &
• Elena Rozhdestvenskaia   ORCID: orcid.org/0000-0001-8235-0060 10  
• Conference paper
• First Online: 19 January 2021

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Part of the book series: Lecture Notes in Networks and Systems ((LNNS,volume 186))

Currently, the development of tourism faces many challenges that make this industry extremely unstable due to political, medical and economic fluctuations. All the ups and downs are usually outside the control of tourism. One of the most important economic problems associated with tourism is the lack of investment and financing. This is a serious problem, considering that tourism is one of the largest employers of labor in the world, and its development has huge benefits for the economy. The purpose of this article is to consider the problems and opportunities in the field of tourism financing. For the purposes of the study, we have achieved a substantial and relevant analysis and research on the main areas of financial support of tourism.

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Gudkov, A., Dedkova, E., Rozhdestvenskaia, E. (2021). Financial Instruments for Tourism Development: Challenges and Opportunities. In: Antipova, T. (eds) Comprehensible Science. ICCS 2020. Lecture Notes in Networks and Systems, vol 186. Springer, Cham. https://doi.org/10.1007/978-3-030-66093-2_7

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Reimagining the $9 trillion tourism economy—what will it take?

Tourism made up 10 percent of global GDP in 2019 and was worth almost $9 trillion, 1 See “Economic impact reports,” World Travel & Tourism Council (WTTC), wttc.org. making the sector nearly three times larger than agriculture. However, the tourism value chain of suppliers and intermediaries has always been fragmented, with limited coordination among the small and medium-size enterprises (SMEs) that make up a large portion of the sector. Governments have generally played a limited role in the industry, with partial oversight and light-touch management.

COVID-19 has caused an unprecedented crisis for the tourism industry. International tourist arrivals are projected to plunge by 60 to 80 percent in 2020, and tourism spending is not likely to return to precrisis levels until 2024. This puts as many as 120 million jobs at risk. 2 “International tourist numbers could fall 60-80% in 2020, UNWTO reports,” World Tourism Organization, May 7, 2020, unwto.org.

Reopening tourism-related businesses and managing their recovery in a way that is safe, attractive for tourists, and economically viable will require coordination at a level not seen before. The public sector may be best placed to oversee this process in the context of the fragmented SME ecosystem, large state-owned enterprises controlling entry points, and the increasing impact of health-related agencies. As borders start reopening and interest in leisure rebounds in some regions , governments could take the opportunity to rethink their role within tourism, thereby potentially both assisting in the sector’s recovery and strengthening it in the long term.

In this article, we suggest four ways in which governments can reimagine their role in the tourism sector in the context of COVID-19.

1. Streamlining public–private interfaces through a tourism nerve center

Before COVID-19, most tourism ministries and authorities focused on destination marketing, industry promotions, and research. Many are now dealing with a raft of new regulations, stimulus programs, and protocols. They are also dealing with uncertainty around demand forecasting, and the decisions they make around which assets—such as airports—to reopen will have a major impact on the safety of tourists and sector employees.

Coordination between the public and private sectors in tourism was already complex prior to COVID-19. In the United Kingdom, for example, tourism falls within the remit of two departments—the Department for Business, Energy, and Industrial Strategy (BEIS) and the Department for Digital, Culture, Media & Sport (DCMS)—which interact with other government agencies and the private sector at several points. Complex coordination structures often make clarity and consistency difficult. These issues are exacerbated by the degree of coordination that will be required by the tourism sector in the aftermath of the crisis, both across government agencies (for example, between the ministries responsible for transport, tourism, and health), and between the government and private-sector players (such as for implementing protocols, syncing financial aid, and reopening assets).

Concentrating crucial leadership into a central nerve center  is a crisis management response many organizations have deployed in similar situations. Tourism nerve centers, which bring together public, private, and semi-private players into project teams to address five themes, could provide an active collaboration framework that is particularly suited to the diverse stakeholders within the tourism sector (Exhibit 1).

We analyzed stimulus packages across 24 economies, 3 Australia, Bahrain, Belgium, Canada, Egypt, Finland, France, Germany, Hong Kong, Indonesia, Israel, Italy, Kenya, Malaysia, New Zealand, Peru, Philippines, Singapore, South Africa, South Korea, Spain, Switzerland, Thailand, and the United Kingdom. which totaled nearly $100 billion in funds dedicated directly to the tourism sector, and close to $300 billion including cross-sector packages with a heavy tourism footprint. This stimulus was generally provided by multiple entities and government departments, and few countries had a single integrated view on beneficiaries and losers. We conducted surveys on how effective the public-sector response has been and found that two-thirds of tourism players were either unaware of the measures taken by government or felt they did not have sufficient impact. Given uncertainty about the timing and speed of the tourism recovery, obtaining quick feedback and redeploying funds will be critical to ensuring that stimulus packages have maximum impact.

2. Experimenting with new financing mechanisms

Most of the $100 billion stimulus that we analyzed was structured as grants, debt relief, and aid to SMEs and airlines. New Zealand has offered an NZ $15,000 (US $10,000) grant per SME to cover wages, for example, while Singapore has instituted an 8 percent cash grant on the gross monthly wages of local employees. Japan has waived the debt of small companies where income dropped more than 20 percent. In Germany, companies can use state-sponsored work-sharing schemes for up to six months, and the government provides an income replacement rate of 60 percent.

Our forecasts indicate that it will take four to seven years for tourism demand to return to 2019 levels, which means that overcapacity will be the new normal in the medium term. This prolonged period of low demand means that the way tourism is financed needs to change. The aforementioned types of policies are expensive and will be difficult for governments to sustain over multiple years. They also might not go far enough. A recent Organisation for Economic Co-operation and Development (OECD) survey of SMEs in the tourism sector suggested more than half would not survive the next few months, and the failure of businesses on anything like this scale would put the recovery far behind even the most conservative forecasts. 4 See Tourism policy responses to the coronavirus (COVID-19), OECD, June 2020, oecd.org. Governments and the private sector should be investigating new, innovative financing measures.

Revenue-pooling structures for hotels

One option would be the creation of revenue-pooling structures, which could help asset owners and operators, especially SMEs, to manage variable costs and losses moving forward. Hotels competing for the same segment in the same district, such as a beach strip, could have an incentive to pool revenues and losses while operating at reduced capacity. Instead of having all hotels operating at 20 to 40 percent occupancy, a subset of hotels could operate at a higher occupancy rate and share the revenue with the remainder. This would allow hotels to optimize variable costs and reduce the need for government stimulus. Non-operating hotels could channel stimulus funds into refurbishments or other investment, which would boost the destination’s attractiveness. Governments will need to be the intermediary between businesses through auditing or escrow accounts in this model.

Joint equity funds for small and medium-size enterprises

Government-backed equity funds could also be used to deploy private capital to help ensure that tourism-related SMEs survive the crisis (Exhibit 2). This principle underpins the European Commission’s temporary framework for recapitalization of state-aided enterprises, which provided an estimated €1.9 trillion in aid to the EU economy between March and May 2020. 5 See “State aid: Commission expands temporary framework to recapitalisation and subordinated debt measures to further support the economy in the context of the coronavirus outbreak,” European Commission, May 8, 2020, ec.europa.eu. Applying such a mechanism to SMEs would require creating an appropriate equity-holding structure, or securitizing equity stakes in multiple SMEs at once, reducing the overall risk profile for the investor. In addition, developing a standardized valuation methodology would avoid lengthy due diligence processes on each asset. Governments that do not have the resources to co-invest could limit their role to setting up those structures and opening them to potential private investors.

3. Ensuring transparent, consistent communication on protocols

The return of tourism demand requires that travelers and tourism-sector employees feel—and are—safe. Although international organizations such as the International Air Transport Association (IATA), and the World Travel & Tourism Council (WTTC) have developed a set of guidelines to serve as a baseline, local regulators are layering additional measures on top. This leads to low levels of harmonization regarding regulations imposed by local governments.

Our surveys of traveler confidence in the United States  suggests anxiety remains high, and authorities and destination managers must work to ensure travelers know about, and feel reassured by, protocols put in place for their protection. Our latest survey of traveler sentiment in China  suggests a significant gap between how confident travelers would like to feel and how confident they actually feel; actual confidence in safety is much lower than the expected level asked a month before.

One reason for this low level of confidence is confusion over the safety measures that are currently in place. Communication is therefore key to bolstering demand. Experience in Europe indicates that prompt, transparent, consistent communications from public agencies have had a similar impact on traveler demand as CEO announcements have on stock prices. Clear, credible announcements regarding the removal of travel restrictions have already led to increased air-travel searches and bookings. In the week that governments announced the removal of travel bans to a number of European summer destinations, for example, outbound air travel web search volumes recently exceeded precrisis levels by more than 20 percent in some countries.

The case of Greece helps illustrate the importance of clear and consistent communication. Greece was one of the first EU countries to announce the date of, and conditions and protocols for, border reopening. Since that announcement, Greece’s disease incidence has remained steady and there have been no changes to the announced protocols. The result: our joint research with trivago shows that Greece is now among the top five summer destinations for German travelers for the first time. In July and August, Greece will reach inbound airline ticketing levels that are approximately 50 percent of that achieved in the same period last year. This exceeds the rate in most other European summer destinations, including Croatia (35 percent), Portugal (around 30 percent), and Spain (around 40 percent). 6 Based on IATA Air Travel Pulse by McKinsey. In contrast, some destinations that have had inconsistent communications around the time frame of reopening have shown net cancellations of flights for June and July. Even for the high seasons toward the end of the year, inbound air travel ticketing barely reaches 30 percent of 2019 volumes.

Digital solutions can be an effective tool to bridge communication and to create consistency on protocols between governments and the private sector. In China, the health QR code system, which reflects past travel history and contact with infected people, is being widely used during the reopening stage. Travelers have to show their green, government-issued QR code before entering airports, hotels, and attractions. The code is also required for preflight check-in and, at certain destination airports, after landing.

4. Enabling a digital and analytics transformation within the tourism sector

Data sources and forecasts have shifted, and proliferated, in the crisis. Last year’s demand prediction models are no longer relevant, leaving many destinations struggling to understand how demand will evolve, and therefore how to manage supply. Uncertainty over the speed and shape of the recovery means that segmentation and marketing budgets, historically reassessed every few years, now need to be updated every few months. The tourism sector needs to undergo an analytics transformation to enable the coordination of marketing budgets, sector promotions, and calendars of events, and to ensure that products are marketed to the right population segment at the right time.

Governments have an opportunity to reimagine their roles in providing data infrastructure and capabilities to the tourism sector, and to investigate new and innovative operating models. This was already underway in some destinations before COVID-19. Singapore, for example, made heavy investments in its data and analytics stack over the past decade through the Singapore Tourism Analytics Network (STAN), which provided tourism players with visitor arrival statistics, passenger profiling, spending data, revenue data, and extensive customer-experience surveys. During the COVID-19 pandemic, real-time data on leading travel indicators and “nowcasts” (forecasts for the coming weeks and months) could be invaluable to inform the decisions of both public-sector and private-sector entities.

This analytics transformation will also help to address the digital gap that was evident in tourism even before the crisis. Digital services are vital for travelers: in 2019, more than 40 percent of US travelers used mobile devices to book their trips. 7 Global Digital Traveler Research 2019, Travelport, marketing.cloud.travelport.com; “Mobile travel trends 2019 in the words of industry experts,” blog entry by David MacHale, December 11, 2018, blog.digital.travelport.com. In Europe and the United States, as many as 60 percent of travel bookings are digital, and online travel agents can have a market share as high as 50 percent, particularly for smaller independent hotels. 8 Sean O’Neill, “Coronavirus upheaval prompts independent hotels to look at management company startups,” Skift, May 11, 2020, skift.com. COVID-19 is likely to accelerate the shift to digital as travelers look for flexibility and booking lead times shorten: more than 90 percent of recent trips in China  were booked within seven days of the trip itself. Many tourism businesses have struggled to keep pace with changing consumer preferences around digital. In particular, many tourism SMEs have not been fully able to integrate new digital capabilities in the way that larger businesses have, with barriers including language issues, and low levels of digital fluency. The commission rates on existing platforms, which range from 10 percent for larger hotel brands to 25 percent for independent hotels, also make it difficult for SMEs to compete in the digital space.

Governments are well-positioned to overcome the digital gap within the sector and to level the playing field for SMEs. The Tourism Exchange Australia (TXA) platform, which was created by the Australian government, is an example of enabling at scale. It acts as a matchmaker, connecting suppliers with distributors and intermediaries to create packages attractive to a specific segment of tourists, then uses tourist engagement to provide further analytical insights to travel intermediaries (Exhibit 3). This mechanism allows online travel agents to diversify their offerings by providing more experiences away from the beaten track, which both adds to Australia’s destination attractiveness, and gives small suppliers better access to customers.

Governments that seize the opportunity to reimagine tourism operations and oversight will be well positioned to steer their national tourism industries safely into—and set them up to thrive within—the next normal.

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Margaux Constantin is an associate partner in McKinsey’s Dubai office, Steve Saxon is a partner in the Shanghai office, and Jackey Yu  is an associate partner in the Hong Kong office.

The authors wish to thank Hugo Espirito Santo, Urs Binggeli, Jonathan Steinbach, Yassir Zouaoui, Rebecca Stone, and Ninan Chacko for their contributions to this article.

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International tourist arrivals fell to levels not seen since 1990. Image:  Lukas Souza on Unsplash

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Stay up to date:.

• With vaccination advancing in most developed economies, we would have expected the tourism situation today to be significantly better than this time last year. Sadly, it is not.
• Less than 10 years away from our global goal of ensuring shared prosperity by 2030, we need to kickstart tourism’s recovery for the millions who have been left struggling.
• We must look beyond the immediate restart of tourism – this crisis is an opportunity to rethink tourism policies and management.

This should be the time of year when people are packing suitcases and travel documents for their summer holidays – at least in the northern hemisphere. For many economies, these months are critical, and millions of businesses and workers are eager for tourists to return, especially given how badly the sector has already been hit.

Last year was catastrophic for tourism and the millions of people who depend on it. After six decades of extraordinary growth, the sector was brought to a near-complete standstill by the COVID-19 pandemic.

International tourist arrivals fell to levels not seen since 1990. We estimate that the crisis has cost the world about $4 trillion and placed over 100 million direct tourism jobs at risk. The impact is so big because of the numerous suppliers and businesses that are linked to the core sector. To put these numbers into perspective, the impact is almost equivalent to the GDP of France.

Slow progress

With vaccinations being rolled out in most developed economies, we would have expected the situation today to be significantly better than this time last year. Unfortunately, it is not.

So, what has happened? On the one hand, relatively slow progress in vaccination puts many tourism workers at risk, thus affecting the supply side. Tourism workers in developing economies, including destinations such as small island developing states, where tourism is a lifeline and a key driver of development, are particularly at risk.

On the other hand, travellers’ confidence is affected by the ever-changing travel restrictions that cannot be eased or lifted right now, particularly in light of new variants of the virus emerging and in the absence of sufficient roll-out of vaccinations.

Added to that, we have the costs of tests, a lack of coordination and clarity over regulations in place at destinations, limited international cooperation, the cancellation or rescheduling of flights, and general uncertainty about the evolution of the virus. It is small wonder so many people remain wary of travelling.

Have you read?

4 ways nature tourism can help drive a green covid-19 recovery, international tourism is set to plunge by 80% this year – but some regions could recover more quickly, tourism industry experts fear long road to recovery.

But tourists – and their money – are so needed right now. International tourism is a vital source of income for many countries. The foreign exchange earned through tourism is in many places a critical source for funds to finance public spending, investment for much-needed payment of relief and recovery measures, and for servicing debt repayments that have been piling up.

Tourism’s impact goes beyond economics. The sector is a key pillar of the 2030 Agenda for Sustainable Development, with a unique ability to contribute to most – if not all – of the 17 Sustainable Development Goals, including through providing opportunities for youth and women, and helping preserve and promote natural and cultural heritage.

Kickstarting the recovery

We are now less than 10 years away from our global goal of ensuring shared prosperity by 2030. The pandemic has put our joint progress on hold. We thus need urgent action. We need to kickstart tourism’s recovery for the millions who, for more than a year now, have been left struggling.

First and foremost, we need to collectively ensure that vaccination is equitably available across the world. One key concern is that developing countries, many of which are highly dependent on international tourism, are bearing the heaviest brunt of the uneven vaccination roll-out. Addressing this will require unprecedented levels of cooperation. However, while leaders have pledged their commitment to international solidarity, their words are yet to be backed up by actions.

On our side, the UN Conference on Trade and Development and the UN World Tourism Organization are leading the way in providing clear, updated and trusted data and analysis used by governments and businesses to inform recovery policies and decision-making.

Countries should also ensure that their tourism businesses of all sizes can survive the current crisis so that the power of the sector can be tapped when tourists return. This requires measures such as credit lines for tourism businesses and the provision of social protection for tourism workers.

In addition, digital technologies need to be used to increase security and boost travellers’ confidence. It is also time to step up digitalization among companies and the tourism workforce, upskilling the sector to become more resilient.

As other sectors proceed to decarbonize, the aviation sector could account for a much higher share of global greenhouse gas emissions by mid-century than its 2%-3% share today.

Sustainable aviation fuels (SAF) can reduce the life-cycle carbon footprint of aviation fuel by up to 80%, but they currently make up less than 0.1% of total aviation fuel consumption. Enabling a shift from fossil fuels to SAFs will require a significant increase in production, which is a costly investment.

The Forum’s Clean Skies for Tomorrow (CST) Coalition is a global initiative driving the transition to sustainable aviation fuels as part of the aviation industry’s ambitious efforts to achieve carbon-neutral flying.

The coalition brings together government leaders, climate experts and CEOs from aviation, energy, finance and other sectors who agree on the urgent need to help the aviation industry reach net-zero carbon emissions by 2050.

The coalition aims to advance the commercial scale of viable production of sustainable low-carbon aviation fuels (bio and synthetic) for broad adoption in the industry by 2030. Initiatives include a mechanism for aggregating demand for carbon-neutral flying, a co-investment vehicle and geographically specific value-chain industry blueprints.

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At the same time, we must look beyond the immediate restart of tourism. This crisis is an opportunity to rethink tourism. For instance, so-called “overtourism” had been a concern in many places prior to the pandemic.

Now is the moment to redesign and adjust tourism policies and management, including through greater diversification, more innovative products and the revitalisation of rural areas. Across the world, people have started to rediscover their own countries through domestic tourism and this offers an opportunity to spread the sector’s benefits more widely.

As we enter another peak travel season with the COVID-19 pandemic ongoing, we need to face up to the fact that the crisis confronting tourism is far from over.

Last year, we set out three possible scenarios for the pandemic’s expected impact on the sector. The worst-case scenario turned out to be too optimistic. And this year, even in the most optimistic scenario, we will still be 60% below the levels of 2019.

But again, this should be seized as an opportunity to realign the sector towards greater sustainability and inclusivity rather than simply going back to the way we were before. Tourism is the sector with the broadest economic value chain and the deepest social footprint. Herein lies the opportunity to rethink, restart and to grow back better. But first, we need to restart tourism.

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Does Health Crises Effect Tourism: Role of Financial Inclusion for Green Financial Development

1 Faculty of Economics and Management, East China Normal University, Shanghai, China

2 School of Finance, Shanghai Lixin University of Accounting and Finance, Shanghai, China

Bakhtawer Ayub

3 School of Mathematics, Institute of Southern Punjab, Multan, Pakistan

Mumtaz Hussain

4 Center for Economic Research, Shandong University, Jinan, China

Associated Data

Publicly available datasets were analyzed in this study. This data can be found here: WDI.

Tourism is impacted by all types of crises, no matter how big or small. Even though many studies have examined tourism crises, most focus on the number of tourists arriving and departing. As a result of this lack of information, The adaptive differences in tourist behavior caused by various crises are not well understood. When it comes to inbound tourism, the financial and health-related crisis can significantly impact the tourist profile of the country and its visitors' spending habits. The findings show that the health crisis has a significant positive impact on tourism. Moreover, COVID_deaths and COVID_confirm_cases decrease the international tourism in developed and developing countries. According to the study's findings, tourists' sensitivity to crises varies between short- and long-haul markets. The evidence shows that financial inclusion has a significant positive impact on various aspects of tourism development in China. Hence, this article offers numerous policy and practical suggestions for sustainable tourism management.

Introduction

It's no secret that the tourism industry is highly susceptible to and affected by various external and internal factors. Tourism demand and travel company performance can be adversely affected by an unpredicted disaster (e.g., natural, financial, and health). Pandemics and disease outbreaks may be the most significant because of their impact on social and economic change. Travel and tourism are more susceptible to disasters and crises than other industries ( 1 ). Strategies and measures for health communication (e.g., social distancing, travel and mobility bans, community lockdowns, stay-at-home campaigns, self- or mandatory quarantine, and crowding restrictions) have effectively halted international travel, tourism, and leisure ( 2 – 4 ). As a highly vulnerable industry to a wide range of environmental, political, and socio-economic risks, tourism is accustomed to and has become resilient in bouncing back (from various crises and outbreaks) from these risks (e.g., terrorism, earthquakes, Ebola, etc. SARS, Zika). However, the nature, the unprecedented circumstances, and the impacts of the COVID-19 show signs that this crisis is not only different, but it also has the potential to have profound and long-term structural and transformational changes to tourism as a socio-economic activity and industry, as well as to other industries. Indeed, the global and massive pandemic scale and the multidimensional and interconnected impacts that challenge current values and systems and lead to a worldwide recession and depression are the most distinguishing characteristics of this outbreak.

International tourist arrivals are expected to decline by 78 %, resulting in a loss of US$ 1.2 trillion in tourism-related export revenues and the elimination of 120 million direct tourism jobs, which is seven times the impact of September 11 and the largest decline in tourism employment ever recorded. Tourism and COVID-19 are at the epicenter of all international discussions and economies because they are among the most important global employers and major contributors to the GDP of several countries ( 5 – 7 ). There is a unanimous call to see and use the pandemic as a transformative opportunity in the burgeoning industry discussions and research about tourism and COVID-19. Likewise, the industry should not only recover but also reimagine and reform the next normal and economic order, and researchers should not solely use COVID-19 as a context in which to replicate existing knowledge for measuring and predicting tourism effects. Although such studies are critical for managing the pandemic, they do not advance understanding or guide the industry to a higher level of performance. Furthermore, because of the interconnected socio-cultural, economic, psychological, and political impacts of COVID-19 of this magnitude, it is expected that unexpected trajectories rather than historical trends will emerge, and the predictive power of 'old' explanatory models may be rendered ineffective. Furthermore, there is sufficient evidence to assert that both the tourism industry and research have matured significantly, resulting in insufficient knowledge about studying and conducting research efficiently. We still don't know how health crises can spur industry change, how companies can turn crisis disruption into transformative innovation, or how to conduct research that can help us think about and reset our expectations about what is normal for the future.

The tourism industry has yet to experience a major crisis that could serve as a catalyst for change. Crises have also been used to keep the status quo in place while limiting the scope for mass mobilization as a political tool. A crisis-driven transformation's nature and degree are dependent on how and whether these stakeholders are affected by and respond to crises, as well as how they recover and reflect after crises because change can be selective and optional for tourism stakeholders (such as tourists, operators, destination organizations) Consequently, tourism COVID-19 research needs to examine and understand more deeply the drivers, actions, and reactions of tourism stakeholders (behavioral, cognitive, emotional and even ideological) to COVID-19 impacts.

Next financial inclusion refers to all people and businesses should have access to financial services. In order to achieve the 17 United Nations Sustainable Development Goals (SDGs), the World Bank recognized the importance of this principle ( 8 ). Financial inclusion could theoretically have both a positive and a negative impact on the environment. Increasing financial inclusion could lead to a rise in energy-intensive appliances like refrigerators, televisions, and air conditioners, which would increase overall energy consumption and pollution, and carbon emissions ( 9 ). Improved financial inclusion can help farmers in poor communities instead of burning coal; consider switching to cleaner energy sources (such as microgrids of solar panels) ( 10 ). On the other hand, financial inclusion could boost innovation and technological progress in the tourism industry, reducing energy consumption and emissions ( 11 ). In addition, greater financial inclusion may make it easier for tourists to participate in high-pollution tourism, which could lead to fewer health crises and a reduction in CO 2 emissions. For energy exploration and development to be successful, substantial funding may be required, which can be improved by ensuring more people access financial services ( 12 ).

Therefore, this study aims to investigate the impact of health crises on tourism. Another objective is to examine the role of financial inclusion in achieving the goal of environmentally friendly finance in tourism and crisis management literature by integrating an evolutionary approach. It is possible that financial inclusion could indirectly impact the tourism industry. As far as we know, no research has financial inclusion, and the tourism industry was examined. Regions differ significantly in emissions and financial inclusion, making regional differences in the impact of financial inclusion on the tourism industry and green financial development. However, very few studies have examined regional differences and mediation impact mechanisms. Thus, this study examines the impact of financial inclusion on tourism and green financial development and the emergence of health crises, using balanced panel data from 2000 to 2020. Researchers in health crisis management and tourism will benefit from this study's theoretical and practical contributions, showing how financial inclusion affects tourism and health. To put the findings of this research into practice, tourism professionals and policymakers should consider the type of crisis and the long-term effects on tourist spending and behavior.

The remainder of the article is structured as follows: Section Literature Review provides a literature review of current empirical research; Section Data and Methodology presents a case study. The technique and data are explained in part 3, and the empirical findings are discussed in depth in Section Results and Discussion. Finally, part 5 clarifies the study by outlining some policy suggestions based on the research's empirical findings.

Literature Review

Tourism crisis studies in the past have focused primarily on the impact of a single crisis on tourist volume. Much less thought was given to how crisis types differed from one another and how tourists reacted during and after the crisis as patterns of change evolved. While researching the uncertainty avoidance approach, traveling through a crisis impacts tourists' behavior ( 13 ). An investigation by Aghaei et al. ( 14 ) based on the exploratory approach revealed that returning more experienced visitors are aware of the health and financial risks than first-time visitors. Because of this, it is critical to have a firm grasp on how tourists behave during various types of crises. As a result, tourism crisis research has a significant gap in understanding how the crisis affects tourist behavior and outcomes.

According to Lee and Brahmasrene ( 15 ), tourism in Greece, Italy, and Austria is hampered by health crises. There are “spillover effects” to health crises, and an outbreak in one country can affect tourism in neighboring countries. After the COVID outbreak, there was a decrease in the utilization of labor and capital. In Tunisia ( 16 ) study the impact of the COVID outbreak and financial inclusion on tourism. In Tunisia, they used both internal and external shocks to demonstrate that internal shocks have a greater impact on tourism activity. There was a significant drop in international tourist arrivals and spending in October and November of 2017 in Catalonia as a result of the political instability in the region. They conclude that Catalonia's tourist arrivals and spending decreased due to political events in the final three months of 2017. According to their findings, political flux has negative effects, even in the most stable countries. Research by Anup ( 17 ) examines how governance quality and political uncertainty affect tourist requirements. They used a gravity model to examine 131 countries as tourist origins and 34 countries as tourist destinations between 2005 and 2014. They discover that tourist traffic is greatly influenced by the quality of an area's institutions and the absence of political strife. Travel and tourism are harmed by institutional corruption, according to Woon Leong and Bee Lian ( 18 ), Karimi ( 19 ), and Wang and Wang ( 20 ) (tourist inflows, tourism competitiveness). It has been shown that corruption to combat bureaucracy can increase demand for tourism, as demonstrated by Gössling et al. ( 21 ) and Khanal ( 22 ).

Italy's domestic tourism flows are influenced by the environmental quality, according to Xiangyu et al. ( 23 ). Their study ( 24 ) found a two-way connection between environmental sustainability and tourism growth. According to these findings, changes in environmental sustainability policies and regulations can influence tourism growth. According to Jalil et al. ( 25 ), climate change has an impact on tourism, and countries that rely heavily on tourism are more vulnerable to the effects of climate change. According to Suhel and Bashir ( 26 ), poor air quality significantly impacts travel to five different European countries for pleasure or business (Austria, Switzerland, Cyprus, Great Britain, and Italy). Tourism and air quality appear to persuade each other, with poor air quality reducing tourism and poor air quality reducing tourism.

This paper examines how health is a major determinant of tourism. We investigate the significance of improved health care for a growing international travel market. There are a number of ways in which health can have an impact on the economy, as we explain below. Economic growth benefits from a healthy population have been documented in academic studies ( 27 – 29 ). According to Perles-Ribes et al. ( 30 ), human capital quality includes physical and mental wellbeing. In a sample of 100 countries, he shows that an increase in labor productivity correlates with an increase in life expectancy. In low-income countries ( 31 ), found changes in the overall survival of youths are linked to the rise in GDP growth. According to De Vita and Kyaw ( 32 ) health affects aggregate supply in a positive and statistically significant way. This is supported by Ohlan ( 33 ), that the average lifespan in Sub-Saharan Africa has a significant effect on economic growth. They've also found that health has a bigger impact on economic development than education. To better understand the impact of health investment on tourism and green financial development, Dogan and Aslan ( 34 ) conducted research. They found that green financial development is linked to both the growth rate in health and the level of health. Each country's medical status is measured using a standard and reliable method. Habibi et al. ( 35 ) investigate the relationship between tourism and health crises using life expectancy.

Health affects tourism in numerous ways. Note that infectious diseases (both pandemics and epidemics) have been thoroughly studied to see how they affect tourism ( 36 , 37 ). They explore the challenges of organizing, replying, and restoring from a pandemic in a developing nation beyond the instant adverse effects of a pandemic on tourism in a small developing country. According to Narayan et al. ( 38 ), the pandemic effect of COVID-19 is compared to other epidemics and pandemics to see if the economy and tourism are affected. They demonstrate how tourism is sensitive to measures designed to limit its spread, such as mobility restrictions. The pandemic has had a devastating impact on the economy and tourism. Final thoughts: The COVID-19 pandemic should prompt a rethink of how tourism is grown globally, taking into account climate change and its dangers. A study by Blake ( 39 ) calculates the impact on Asian countries of two infectious diseases (Avian Flu and Severe Acute Respiratory Syndrome, SARS). They concluded that SARS had a more significant impact on Asian tourism than the Avian Flu has. Compared to the Avian Flu, SARS was more infectious. These results are logical. The 2019 covid-19 pandemic has decimated the tourism sector in every country, according to the UNWTO ( 40 ). Each country— Small Island asserts, then the least developed countries, and too many African states—has been devastated by the global financial crisis. The pandemic of covid-19 has slowed progress toward the UN's 17 long-term development goals (SDGs). The literature has extensively studied the impact of health crises on tourism.

Global Recession, Epidemics and Tourist Trends

In and around destinations, shock and stress are felt during a crisis regardless of the event's type, probability, or magnitude. Studies have shown how the crisis affects the destination, awareness, feedback and adaptations to the crisis, and spending patterns ( 41 – 43 ). Tourism crisis research has primarily focused on monetary and health issues. The financial crisis has gotten more academic attention for the first time because it is linked to socioeconomic issues such as unemployment ( 44 , 45 ). As a result, job insecurity and the resulting decrease in available spending power heavily influence people's travel decisions. The tourism industry has been the focus of previous studies on SARS. SARS or the avian flu may threaten people's health, safety, and wellbeing, but it also poses difficulties for the travel industry, particularly inbound travelers. In this sense, it is comparable to a financial meltdown.

Tourists' travel plans and activities are influenced by a crisis in numerous ways, from before, during, and after the crisis. According to Wang and Wang ( 20 ), tourists prefer to stay in low-cost hotels and rooms during economic uncertainty. When it comes to tourist demand in a recession, income and personal economic situation have little or no effect, according to Robaina-Alves et al. ( 46 ). They also noted that the European financial crisis did not deter Europeans from taking vacations. Middle-aged and experienced travelers, according to Zhang and Zhang ( 47 ), are less sensitive to a crisis than younger and less experienced travelers. No current evidence explains why tourists react differently when confronted with a crisis. However, the impact of a crisis on tourism varies depending on the type of visitor and their goals. According to Ming Cheng et al. ( 48 ), health crises (such as food security) are more important to first-time visitors than repeat visitors' financial risks, indicating a motivational divide between the two groups. According to Wieczorek-Kosmala ( 49 ), women are more concerned about their health and nutrition than men are. It has become more common for people to spend their vacations at home rather than going out to eat more often, buy more private labels, and entertain at home more often. According to Luo and Deng and Ramukumba ( 42 , 44 ). From a broader perspective, the current state of the economy restricts tourists' ability to travel further.

These previous tourism crisis studies, on the other hand, neglected to take into account how crises evolve. In most studies, only the time of the crisis is examined, ignoring changes before, after, and during the disaster. Instead, they concentrate with respect to just one instance and how it affects the number of tourists. Crisis type, tourist profile, purpose, and pattern all play a role in how it affects tourist behavior. So, more research is needed to look at the impact of health crises and changes from a tourist's point of view.

Crisis in Tourism

In contrast to disaster, which is the result of action outside of the body that may have an immediate effect, “crisis” refers to incidents that are more closely tied to the company's environment ( 41 ). The tourism crisis is deeply rooted in economics, sociology, the environment, and politics. Both crises and disasters significantly impact the tourism industry regarding reduced tourist flow, travel plans by tourists, unemployment, and investment by businesses. Luo and Deng ( 42 ) also points out that a crisis occurs as a result of a failure to respond to a disaster. There has been a lot of attention paid to disasters and crises in tourism studies, but few studies have focused on the economic crisis. For example, a theoretical model that examines the connections between health crises ( 41 ), tourism competitiveness, and green financial development was developed recently ( 43 , 50 ). It has been shown that tourism competitiveness is influenced by the health crisis when an economic crisis occurs in Spain ( 51 , 52 ). No one knows much about the impact of disaster and crisis on tourism, particularly the evolutionary differences in tourist behavior caused by different crises, despite findings published by Korstanje and Tarlow ( 53 ).

Because of the uncertainty, disruption, and risk accompanying health crises ( 54 ), health crises alter behavior and normal tourism trends. With the recent Arab uprisings, tourism in the Middle East and North Africa was put at risk and negatively impacted tourism development. Arab uprising effects vary even among Mediterranean countries, as revealed by Atan and Arslanturk ( 55 ) in their study Puri et al. ( 56 ). There has been a significant reduction in tourism to the Middle East and North Africa as a result of the ongoing Syrian conflict ( 57 ). The crisis has a greater impact on inbound tourism than outbound tourism ( 58 ). For example, incoming tourism to the Middle East is still at risk due to the high probability of terrorist attacks. A crisis can significantly impact declining tourist numbers, the use of facilities at tourist destinations, and an imbalance between supply and demand.

Financial Inclusion, Green Financial Development, and Tourism

For example, according to a study conducted in Turkey by Chen et al. ( 59 ), the growth of financial markets has a significant impact on tourism development and expansion. According to their empirical analysis, foreign direct investment and trade play a mediating role in the underlying connection between the tourism industry and economic growth, spanning 1960 to 2015. Also, in Malaysia, Lei et al. ( 60 ) found that tourism demand increased as a result of improvements in financial development while taking into account the country's structural data breaks. Çaglayan et al. ( 11 ) report mixed effects of China's economic development on the country's tourism growth in a study looking at how it affects both the sector's positive and negative outcomes. They found that financial development causes tourism growth. In contrast, Abdullah et al. ( 61 ) green tourism is directly linked to financial development and vice versa, based on data collected from 2000 to 2016.

A lack of research has examined how regional tourism demand has been affected by financial development, which includes several countries beyond the country level. For example, according to Feng et al. and Lv et al. ( 62 , 95 ), the long-term demand for tourism to Japan, South Korea, and Singapore will be increased by green economic literacy, especially in the short term. Nabeeh et al. ( 63 ) Research has found a causal connection only in high-income countries in the United States but not Europe or Asia. The link is established between international tourism to financial services.

Finally, Punzi ( 64 ) observed the link between tourism specialization and economic expansion in one of the few reported studies that performed a panel analysis for a larger number of nations (129) over the timeframe 1995–2011. Their research examines whether this relationship is linked to a host country's financial development. As it turns out, green financial development lessens the link between tourism dependence and public health crises. Still, the benefits are diminishing in those countries with high levels of financial development, and a heavy reliance on tourism tends to suffer economic setbacks.

To the best of our knowledge, no studies have empirically examined the impact of financial inclusion on tourism development despite the body of literature on the topic expanding rapidly. As we mentioned in the introduction ( 65 , 66 ), are the sole notable exception. Due to its similarity to our work, this paper deserves further discussion. At least two distinct dimensions must be considered when assessing financial sector development: financial sector depth and financial inclusion. A plethora of literature has already established this point. The former typically refers to a country's overall development in banking, equity, and bond markets. In contrast, the latter refers to the provision of access to and use of financial services. The failure of a Debrah et al. and Wang et al. ( 67 , 68 ) to distinguish between these two dimensions implies that their results cannot differentiate between the effects of financial inclusion and the impact of the depth and efficiency of the green financial market.

This ambiguity necessitates establishing a link between economic growth and tourism demand can be seen. Academic studies have discovered a substantial change in macroeconomic and development outcomes between financial inclusion and depth or efficiency. This is important in light of these findings ( 69 ). Since there is still a significant gap in the literature on whether financial inclusion's unique effects influence tourism demand, it is important to address this issue in tourism development.

Data and Methodology

Empirical model.

For this purpose, the following instrumental variable econometric model is used to analyze the health crisis's effect on tourism. The system GMM model is used to estimate our model. Unobserved nation impact, the endogeneity of control variables, the correlation between independent variables and past or possible current error realizations, and heteroskedasticity and autocorrelation within individuals are addressed by this assessor ( 70 ).

Estimates for international tourism receipts are made using the following model specification:

The dependent variable yit is a measure of the revenue received from tourists from outside the country; the lagged variable y (it-1) represents the lagged dependent variable; the vector zit contains control variables; the vector xit contains explanatory variables; and the error term, u it, includes the variables I and _it; random disturbance term _it; unobserved country-specific effects or fixed effects where is correlated with y (it-1). A first difference transformation of Equation ( 1 ) by Tolkach ( 71 ) eliminated the unobserved effects:

Taking the first Difference in Equation 2 involves:

The first operator of Difference is. There is a new bias that the differenced error term can be correlated with the lagged dependent variable after the first differencing. The system GMM estimator was proposed by Danish & Wang ( 72 ) and Phoochinda ( 73 ). In this system, A lagged first difference is used to instrument the explanatory variables and a level of one in between each of those variables, using two equations, one first-differenced and one in groups. For the system estimator to work, variables in levels and differences are both instrumented with the lags of their levels and vice versa. Level moment conditions in System GMM supplement the first differenced moment conditions of Difference GMM, as noted by Arzhang and Hamidi ( 74 ), for improved estimation efficiency. The System GMM estimation has two diagnostic tests to ensure its accuracy. There are two ways to test the validity of the instrument set: the Sargan test for over-identification and the Arellano–Bond (AR2) autocorrelation, both of which were proposed by Korstanje and Tarlow ( 53 ). Stata 16's System GMM estimation can be performed with the xtabond2 command Santana-Talavera and Fernandez-Betancort ( 75 ).

Data, Variable and Descriptive Statistics

The empirical analysis is based on a cross-sectional dataset containing data from 97 developed and developing countries. The availability of data dictates the countries that are considered. This study incorporates data from a variety of sources, including the World Development Indicators (WDI), the World Travel and Tourism Council (WTTC) (WTTC, 2020), and the F.M. Global and Associates (F.M. Global and Associates, 2019) (2020).

Tourism: A country's tourism industry can be gauged using five different metrics: the amount of money spent on leisure travel, the amount spent on business travel, the amount of money spent on travel and tourism that goes directly into GDP, and the number of tourists who cross the country's borders (in millions). For the purpose of capturing the tourism variable, we use the international tourism receipts in US dollars expressed in current prices. based on the World Development Indicators published by the World Bank (WDI). Health crises measures: In this study, the outbreak of COVID-19 and previous non-COVID health crises are used to define health crises in a tourist destination country. WDI indicators are also used. This is in addition to OECD (2011) using COVID-based and non-COVID-based diseases to define a country's health crisis. Green financial development: Green financial development is also linked with better health conditions in any country. Green financial development means the inflow of investment to reduce the CO 2 emission in the environment. Financial wellbeing is necessary for businesses and health institutions to combat the COVID and non-COVID health crises for good health conditions. The number of COVID-19 deaths and cases that have been confirmed reveals the severity of the health crisis. Financial inclusion: It is possible to construct the financial inclusion (FI) index using information about the depth, accessibility, and efficiency of financial institutions and financial markets. In addition, the study takes into consideration three other important determinants of tourism development, including GDP; trade openness, which is measured using information on total trade in goods and services, and trading partners' diversity (exports and imports).

Results and Discussion

This research investigates how health crises affect the tourism industry and the role of financial inclusion in green financial development for developing and developed countries. Throughout the study period, the descriptive statistics for the sample variables in developing and developed countries can be found in Table 1 . The tourism has a standard deviation of 28.693 in sample countries, while the COVID-deaths and COVID-confirm cases variable has a standard deviation of 0.1182 and 0.8147 in these countries. The mean of the trade variable is 74.2827. According to the descriptive statistics, the standard deviation of the trade variable is 35.7528. The mean for trade is also the highest, coming in at 100.9534 points.

Descriptive statistics.

Discussion of Empirical Results

The System GMM estimation results of developing and developed countries are presented in Tables 2 , ​ ,3. 3 . Each panel of developing and developed countries is subjected to six regression analyses, separately using the health feature variables. We also examine the impact of international tourism revenue on the rising quality of health in developed countries. Lagged variable for international tourism is positive and significant. International tourism have an important impact on achieving more international tourism. The findings of the study are in line with Su ( 76 ). Strongly positive and significant are the results of the variable. This implies that international tourism could rise as a consequence of a rising average lifespan or that an increase in life expectancy is correlated with an increase in revenue from international tourism. For developing countries, the findings shows that an increase in COVID_confirm_cases of 1 % will result in an decrease of 0.427 % in international tourism, while for developed countries, 0.406 % decrease in international tourist receipts. According to Pulicherla et al. ( 77 ), for medium and low-income countries, a country's average lifespan is an essential element of its safety.

Effects of Health crises on tourism in developed countries.

***1% significance level .

Effects of Health crises on tourism in developing countries.

This study found that a 1% decrease in COVID_deaths results in a 0.271% decrease in international tourism, while, the association among COVID_deaths and tourism is negative and statistically significant, a 1% increase in COVID_deaths, results in a 0.257% decrease in tourism in the developing countries. It shows the average lifespan is a significant and strong negative. International tourism revenue could be advanced in countries with a low mortality rate if they focus their hard work on reducing the death rate.

International tourism receipts are positively affected by the non-COVID variable. The risk of maternal death negatively impacts global tourism receipts over the course of one's life. Development countries' international tourism revenue will drop by 0.427%. Domestic government health expenditures have tourism revenues in emerging regions have a positive but not statistically significant influence. The government's spending on health care in developed countries has a considerable impact on the amount of money from international tourism. As a result, developed countries' high public health expenditures and high tourism revenues go hand in hand. Cui et al. ( 78 ) support this conclusion. For developing countries, the emission of CO 2 is a highly negative and significant variable. In other words, as the prevalence of malnutrition rises, international tourism revenue may fall. To attract more tourists and raise their income, developing countries must reduce the number of people living in poverty.

As a result, the health quality variable in developing countries is marginally negative but significant. In other words, a high death toll from tuberculosis hurts the country's ability to attract tourists from around the world. If the death toll from tuberculosis rises by 1%, international tourism revenues will fall by 0.0295%. The death toll from tuberculosis has a downbeat blow on international tourism revenue, but this is not statistically significant when comparing developed and developing nations. Negative and significant health quality components are the most important. This suggests that a decrease in international tourism receipts is linked to the decline in the quality of health in both developed and developing countries. Moreover, GDP, financial inclusion and financial development in most developed and developing countries have positive and significant on tourism. According to numerous studies, real GDP per capita has a positive impact on international tourism receipts ( 79 ).

Revenues from travel and tourism abroad in developing countries are positively impacted by trade openness, although in a small but meaningful way. International tourism receipts are expected to rise as a result of more significant free trade. Trade openness has a small but positive impact on international tourism receipts in developed countries, but it is still statistically significant. However, this is consistent with the findings of Feng et al., Ohajionu et al., and Rowan and Galanakis ( 62 , 80 , 81 ).

The relationship between worldwide trade and tourism revenues is weak but not important, as has been constantly observed by many previous studies. Lv et al. ( 96 ) and Sarangi ( 82 ) have found similar results. As a result of the perceived effect of exchange rates on tourism industry revenues, we expect to increase international tourism revenue. The supply chain of the “tourist destination” region is enhanced by a reduction in trade terms. Wage growth has a small but noticeable effect on foreign tourism revenue in developed and emerging economies. It's safe to say that the financial risk factor is both present and significant. As a result, developing and developed countries will see an increase in their revenue from international tourism when financial risk is lower. Because of this, reduced financial exposure should be a priority for all countries, developing and developed alike. Incorporating the 2008–2009 global economic crises as a model variable resulted in interesting empirical findings. The financial crisis dummy variable negatively impacts tourism receipts. So, it's safe to say that the recent global financial crisis has had an effect on travel to emerging markets. Research by Cui et al. and Wang and Zhi ( 78 , 83 ) supports this.

Robustness Test

Additionally, as a robustness check, we also examine the effect of additional control variables on our results. Our re-estimation of the main model takes into account the proportion of the population over 65, the log of population density, and the log of the urban population as a % age of the total population. The total number of confirmed deaths and cases was used instead of the fatality rate as an additional explanatory variable. Table 4 summarizes the findings from this experiment. The key explanatory variables show no significant shifts in their signs or significance. With the proportion of people over 65 and confirmed deaths, tourism has a positive and significant correlation ( 84 ).

Robustness test.

Errors in parentheses of a robust standard .

*** p < 0.01 ,

** p < 0.05 ,

* p < 0.1 .

It's also possible to make the case that a relative rather than an absolute indicator of the health of the tourism industry is preferable to look at. We double-checked using the ratio of tourists visiting a country i to the total number of tourists visiting all of our sample countries or the ratio of visitors to the country i to total tourists visiting by region for all the countries included in the sample robustness of our estimates. Logically, a country's tourism sector is more significant if the value of these ratios is > 0. Table 4 displays the exercise's outcomes. When it comes to signs and magnitudes, consistent with initial estimates, the variables of interest's limits are generally estimated in the same way.

Changes in Tourist Behavior Patterns

Among the immediate concerns is the effect of COVID-19 on the geographic distance of travel. More than 70% of those polled said they wanted to travel more within the United States. Only a sliver of those surveyed said they wanted to travel more internationally. According to the research, 23.1% of people are increasingly interested in traveling alone, with women showing a slightly higher interest (25.0%) than men (20.8%). At the same time, most respondents (68.7 %) will use tourist intermediaries as before. Only 19.8 % and 11.5 % plan to decrease or increase their use in planning their trip.

Of those polled, 47% stated that they would continue to contract the same type of insurance before COVID-19, but 34.4 % stated their insurance needs had increased rather than decreased, while just 17% stated the opposite. It's also worth noting that women (38.0 %) have a higher proclivity than men (35.0 %) to obtain additional insurance (31.6 % ).

While most respondents (71.4 %) expect their vacations to be the same length as last year, a sizable minority (27.0 %) intend to cut back on their time away. As a result, 38.3% of respondents plan to alter their usual travel schedules. According to the gender of the respondents, there were significant differences in the results. 42.5 % of women would change their dates, compared to 33.0 % of men, in this situation. According to these findings, those willing to change their travel dates are remarkably similar in age and sex (2 = 11.904; p = 0.018) (see Table 2 ).

Public Social Welfare

Pandemics have a negative impact on tourist arrivals in 97 countries. Only low-income countries are affected by this effect. Traveler arrivals are expected to fall by 2.1% for every 10% increase in the discussion about the pandemics index. When the pandemic is active, the index value rises dramatically, and countries that experience a drop in visitor numbers suffer economically. In addition, the impact of pandemics on fast and slow-growing tourism destinations will be different.

Because the world has never seen a pandemic of this magnitude, it is difficult to predict how COVID-19 will affect it. The governments are implementing travel restrictions and border closures. As a result, our findings from previous pandemics will only have limited utility in predicting the potential effects of COVID-19 on tourism. Using data from a single country or a group of countries on a quarterly/yearly basis, Tourist arrivals can be studied in future studies using the autoregressive distributed lag model to examine the short and long-term effects of pandemic outbreaks ( 85 ).

A statistically significant and positive effect on tourism arrivals is found, indicating that inbound tourism is persistent at a high level. In columns 7–9, the estimates are based on various income levels. The negative impact of pandemics on tourist arrivals disappears for emerging and advanced economies, and it remains only for low-income economies. There may be fewer tourists visiting low-income countries because of the lack of openness and inadequate health care facilities. The previous pandemics in recent history were confined to a small geographic area and caused far fewer deaths and illnesses than the coronavirus. As a result, the health systems of advanced and emerging economies could handle the pandemics. Travel bans and curfew restrictions were not widely implemented. On the other hand, Viruses have become more global in scope as a result of increased globalization. COVID-19-related deaths and infections are rising, and countries worldwide are enacting travel restrictions, quarantines, and curfews to stem the tide. A flattening of the COVID-19 curve is needed because the health care systems in nearly every country are on their way to failure. Because of this, Kleih et al. ( 86 ) argue that the impact of COVID-19 will be unique, making it difficult to extrapolate from previous experiences.

Tourist arrivals are positively correlated with GDP per capita in all estimations. Tourist arrivals increase as GDP per capita rises. Tourist arrivals increase when the exchange rate is favorable. The findings are consistent with previous research ( 85 ). Trade openness positively impacts tourist arrivals, implying that countries that integrate with the rest of the world are more likely to attract tourists. It is shown in Table 3 that pandemics have a long-term impact on tourism. For all estimates, there is no evidence of a lag effect. There were no long-term effects of the previous pandemics on tourist arrivals because they were short-lived.

Conclusion and Policy Recommendations

The spread of the COVID-19 pandemic has necessitated implementing physical distance measures and mobility restrictions, including international travel bans, in many countries. These restrictions have slowed economic activity around the world and affected millions. Economic stimulus packages were implemented in both developing and developed countries in order to counteract the negative effects of the economic impact of the pandemic. Economies that rely heavily on physical interaction and flexibility are the worst hit. The COVID-19 pandemic has had a devastating effect on the tourism industry. Pandemic effects on economies worldwide would be devastating, most notably in tourist-dependent nations to create jobs, generate revenue, earn foreign trade, and stimulate financial expansion ( 87 – 89 ).

Because the COVID-19 pandemic has ravaged the tourism industry, we believe that economic stimulus packages in countries that rely heavily on tourism are more likely to be large than those that don't. However, Economic stimulus responses will be moderated by the degree of country resilience, better prepared for disasters than less resilient countries than low-resilient ones to respond to and recover from shocks, such as the COVID-19 eruption. Because COVID-19 has a more significant impact on tourism businesses in high-resiliency countries, governments will need to provide less financial assistance to them.

As a result of the COVID-19 pandemic, countries with a higher economic resilience introduced smaller stimulus packages. As a result of these findings, countries that are more resilient overall, heavily reliant on smaller economic stimuli, and less reliant on tourism packages are more likely to be implemented in tourist countries than countries with a lower resilience index. As a result, countries with high economic resilience that are also heavily dependent on the tourism sector have lower economic stimulus packages than those not highly reliant on the tourism sector. Tourism-dependent economies introduced smaller stimulus packages than those without such high-risk qualities, further reducing their reliance on the tourism sector.

High-resilience countries are better prepared to deal with shocks like the COVID-19 pandemic. Tourism businesses in countries with a high level of flexibility were enhanced to deal with the COVID-19 pandemic and thus required less government support than those with lower levels of resilience. Compared to the tourism industry in countries with a lower level of stability, those in highly resilient nations are less reliant on government incentive packages because Worthwhile human wealth and a more strong labor market make them better able to access financial markets and banks ( 90 ).

According to the study, tourism businesses can better respond and recover from the COVID-19 pandemic, for example, if the country's buoyancy is strengthened. Improved health crisis management and a conducive political, corporate, and economic environment can help countries become more resilient to natural disasters and improve their tourism industries' ability to withstand them.

Lastly, when dealing with the COVID-19 pandemic, researchers are debating whether or not a radical shift toward sustainability is necessary. This study's findings add to that discussion ( 91 – 93 ). According to Işik et al. ( 94 ), resilience is essential for long-term viability. We found that country-level stability can help governments protect tourism businesses from the COVID-19 pandemic at a lower cost, which is reliable with this notion. Due to smaller economic stimulus packages being introduced, tourism companies with high adaptability may be better able to withstand disruptive events, such as the COVID-19 pandemic. Therefore, High-resilience tourist destinations' tourism industries may be more long-term than those in countries with a lower level of resilience; therefore, further research should focus on the supporting policy responses that support tourism's sustainable transformation in the role of country-level strength.

Data Availability Statement

Author contributions.

All authors listed have made a substantial, direct, and intellectual contribution to the work and approved it for publication.

Conflict of Interest

The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

Publisher's Note

All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article, or claim that may be made by its manufacturer, is not guaranteed or endorsed by the publisher.

Sustainability Leaders United

Achieving sustainable tourism: these are the key challenges.

The tourism industry has witnessed a sea of change in the past three years due to the pandemic and travel restrictions. While many of us hoped for a shift toward sustainable tourism on a massive scale, the industry continues to be plagued by problems. What are those challenges? How can destinations and businesses overcome them?

For those who are earnestly looking to start or transition into running a sustainable form of tourism, our panel of sustainable tourism specialists provides an excellent breakdown of the problems  and what can be done to overcome them to achieve sustainability. Below are the answers (highlighted respondents are available as consultants or speakers ).

Some key takeaways of main challenges :

• Failing to acknowledge that every destination is different, with its own specific circumstances and priorities.
• Working in silos. Not understanding that sustainability is a collective journey that requires collaboration.  
• Lack of political will – the switch to sustainability is not easy and even more difficult if local or regional public policy doesn’t support it.
• Using inadequate measures of success, such as merely the number of arrivals (which can lead to overconsumption).
• Not involving employees and supply chain adequately.
• Consequences of the Pandemic, especially the focus on quick earnings over a slow and sustainable tourism.
• A missing sense of urgency – e.g., while the climate has begun changing considerable, action is slow.
• No adequate measures in place to manage overcrowding now that tourism will bounce back.
• Greenwashing – not finding the right balance between touting one’s green credentials and exaggerating claims of sustainability.
• Lack of awareness – insufficient awareness among the tourism industry of the Sustainable Development Goals.

Brian Mullis

This topic is already well covered. In short, we need more purpose-driven businesses that are directly or indirectly involved in the visitor economy by applying commercial strategies to deliver tangible social and environmental impact. And we need more governments working across ministries and with all of the players in the tourism value chain (e.g., private sector, NGOs, communities, etc.) to unlock systems value.

Fiona Jeffery

It’s a vast subject, that’s often overwhelming with a lack of understood practical steps. Also, no environment is necessarily the same, so you are always trying, shaping and developing relevant and local solutions to ensure the right impacts.

Jonathon Day

Sustainability is a complex activity. It requires keeping many plates spinning at once. It is a commitment to a way of doing business – not just an easy add-on.

Kelly Bricker

• various demands by tourists (think supply chain)
• transportation-related issues
• organizational constraints (chains)
• human and financial resources
• growing population and number of travellers, overwhelming some systems

Vicky Smith

• Egos and associated values
• The pursuit of profit at the expense of others
• Want and greed over need
• A superiority to assume better
• An unwillingness to listen and learn from others
• An unwillingness to change because it’s harder work
• An inability to face harsh truths
• Self-interest

The human condition takes the path of least resistance (like other animals) and doesn’t want to be made to feel bad. 

Aivar Ruukel

I think the main problem is the same old mindset and way of doing things. It is not helping if you pick new and better tools, but still have old aims, which are most often so simplistic as “more tourists, more turnover, more profit”. The challenge is to give up on the idea of endless growth within a limited planet. All tourism professionals should understand that tourism is not an industry but a living system. When changing the way we see ourselves and our sector, we can change everything else too.

Alexandra Pastollnigg

Black-and-white thinking; focusing on narrow KPIs without an appreciation of sustainability as a holistic concept and 2nd/3rd order consequences; conflicts of interest in senior business and political decision making/system failures; ego.

Ally Dragozet

A lack of local policies supporting sustainability, and the unavailability of sustainable products or services.

Amine Ahlafi

First, the mentality of managers and human resources in charge of the management of tourism activities and who should have updated training in sustainable development and its impact on business and on ecosystems. Secondly, the segmented approach of some decision-makers who have an interest in adopting a global vision and a holistic and sustainable approach.

The main challenges, therefore, remain awareness-raising, training and policies in favour of sustainability.

Anna Spenceley

I think a great deal of the challenges relates to a lack of awareness of what needs to be done to become more sustainable. This is further compounded when there is a need for skills, resources and effort.

A presentation I gave on this topic at a “Sustainable Tourism Training for Tomorrow”’ event, along with other contributions from notable speakers on the same topic, can be found here .

I’ve been privileged to work over the past 20 years with tourism businesses and destinations at the forefront of sustainability (see for example the book co-written with Sue Snyman ‘ Private sector tourism in conservation areas in Africa ‘)

Recognising the information challenges that are faced, I recently published a book that aims to help transfer more knowledge to tourism businesses and destinations, and help improve their successes: the “Handbook for Sustainable Tourism Practitioners: The Essential Toolbox”.

The handbook is divided into four main parts that address different elements of sustainable tourism planning, operation and evaluation. It contains 27 chapters providing insightful detail into key sustainable tourism issues.  The authors share step-by-step approaches to practical problems – such as how to write bankable financial proposals – how to consult with stakeholders – and how to manage visitors.

The book transfers knowledge from the academic realm, and from extensive practitioner experience, into one essential 550-page volume.  It’s available in e-book and hardback here .

Anne de Jong

When they do it because they feel it will make more money or if they feel it’s something they need to do because it’s the right thing. And even though the latter is important, in the end, they do have a business to run. So, they need to find a way where sustainability fits into their business and actually makes them better. Creating a situation where sustainability is fully integrated into the business and not something on the side.

Antonio Abreu

Lack of vision and weak understanding of the role that sustainability should play in the business. Too often see the action without a solid background, which leads to a certain agitation without effective change. We often listen to people saying that they know, do, and they are champions, but, in reality, they have no clue about it.

The tourism sector is very resistant to accepting the need to include other professionals and other skills. This is the case when it comes to environmental issues. Hotel managers, for instance, tend to consider that anyone in the organisation is able to assume professional and technical roles instead of recruiting qualified people. For the restaurant, they want the best chef, but for handling environmental issues, anyone can do it. It is a basic mistake that we see every day everywhere.

Antonis Petropoulos

In terms of businesses, lack of real commitment to sustainable principles (such as the SDGs ) on the part of management and employees along with a lack of training. Destinations will fail to reach sustainability goals if they:

• lack a critical mass of sustainable tourism businesses
• if they do not have a competent DMO that can coordinate these businesses and
• if public tourism policy is only paying lip service to sustainability, permanently fixated on arrival numbers and expenditure per head

Audrey Scott

Sustainability should be thought of as a long journey that will likely last forever. New approaches, technologies and ecological realities are ever-changing. However, many tourism businesses/destinations won’t know where to actually start and they can get overwhelmed by the complexity of criteria/certifications and feel that sustainability is “all or nothing.” Many businesses think that it’s too expensive and still too niche to be profitable.

Beatriz Barreal

At least in Latin America, the main pitfalls are corruption, greenwashing, and short-term vision. The main challenge is in raising the awareness and the lack of action towards the sustainability of this world, which affects all of us, where we live and where we travel to.

Christian Baumgartner

Convincing the decision-makers involved to think regionally instead of operationally, long-term instead of in terms of investment periods, and complex instead of one-dimensional – and then to act accordingly. Not to shift the responsibility and wait for consumers to express the desire for more sustainability.

Christof Burgbacher

Too often it is decided from top to bottom what the sustainable orientation of a company or destination should look like. However, the participation of employees, the local population, guests and other partners is crucial, as they ultimately have to accept and implement the measures. If a participation process is designed correctly, it can also generate many ideas and creative approaches.

Darrell Wade

Self-interest is the primary one. People consider their own needs, but don’t recognise those of others or the impacts of their own actions. By not considering externalities you are inherently creating a short-term business that will not have sustainability in any sense.

Elisa Spampinato

The main pitfalls that can prevent tourism businesses from success are forgetting that sustainability is a collective journey and, therefore, separating the actions of the actors involved.

Another big pitfall is considering the different dimensions of sustainability as disconnected areas that need segmented interventions and focuses.

They should be highlighted and understood as different areas of intervention, however, on the practical level they should be unified, and a specific effort should be made, at the destination level, to create solutions that can include more than one dimension. And above all, the local communities should be active in the process.

Also, I am among those people that think that we cannot work on environmental, social, economic, and cultural dimensions if we do not include an additional one to the equation: the political.

This means that the political institutions should continue the journey towards sustainability beyond the limitation of the mandate and the people that initiate those specific actions. Sustainability should be understood as a collective journey through generations, driven in a consistent way, whose direction should be dictated exclusively by the destination’s circumstances and contextual priorities.

Regarding challenges, there are big economic interests involved in the tourism business and a huge disparity of power in its management. In fact, most of the people that directly feel the impact of tourism has no part or voice in shaping the industry. 

However, there are encouraging examples of innovative government, like the municipality of Barcelona, which show that new solutions to the democratization of the process can be found. 

Seems that local governments are finding new ways to really listen and include the local community voices.

While the technology factor can be an important ally for the urban communities, a way is yet to be found to include the voices of the traditional, indigenous, and ancestral rural communities left out of the loop and mostly left alone to face the consequence of deregulated tourism activities and the effects of the climate change.

Therefore, the main challenges we face are changing the balance of power and opening up spaces to new stakeholders who could greatly contribute to sustainability if only they were given more space in the decision-making process.

Elizabeth Becker

Convincing governments at all levels to enact and enforce rules for sustainable tourism.

Erik van Dijk

Sustainable tourism is not expensive as people think. Bring the right balance between hospitality and sustainability.

Frankie Hobro

In the past, there hasn’t been much encouragement for tourism to be sustainable but fortunately, I think that is changing now with consumer pressure and expectations in an evolving market. And also with the new generation showing genuine concern over their future on our planet and how our everyday actions contribute to it.

I think many businesses are concerned about viability as a sustainable operation can require a lot of short-term investment with little immediate return and some businesses cannot survive long enough to benefit from the long-term gains when faced with non-sustainable competition. A lack of support for ‘green development’ and funding contributes to this problem as the sustainable option often costs more than the quickest and easiest option.

More successful sustainability trailblazers are needed to encourage and support those who want to follow suit, lead by example and show that it is worth taking the risks and that it can succeed.

Gianna Moscardo

Tourism has two features that make sustainability a challenge.

It occurs across so many different sectors and spaces that a lot of tourism is conducted without any one organization in charge of it. Let’s take the example of Stag parties in a European city with young drunk men behaving badly in public spaces and damaging those spaces – who is responsible for them?

• The places they stay (no because they have no control over the public spaces)
• The airlines that bring them to the city (again no)
• The bars that served them (maybe a little bit)
• The DMO who didn’t encourage them to come and often don’t know there is a problem until it is a major problem
• The international tour operator who has no connection to the destination but organises the package (maybe morally but legally none at all)

That latter example is the second sustainability challenge – a large chunk of tourism is organized by businesses who have no connection to, or interest (other than financial gain) in the destinations that they send tourists to and make money from. They have no incentives to behave well and bear very little in the way of negative consequences if they behave badly. Not all businesses in this sector behave badly but enough do to create problems.

Glenn Jampol

There is one overriding essential component to “sustainable tourism” and that is financial sustainability. Without a profit, your business cannot survive and therefore the possibility to do good is erased. So, all tourism businesses- whether regenerative or conventional -must first and foremost create viable and researched business platforms and seek to understand who their clients are and who they will be.

New small-scale tourism businesses usually function on a thread of support both financially and experientially and are often family-owned and operated. They frequently have little or no real experience in how to manage and grow a tourism company and usually spend too much time in the tourism world learning curve while sacrificing the opportunity to enjoy the best part of owning one of these businesses: the innovative idea-driven projects that not only help to create a fresh approach but also a niche for new and hopefully loyal clients.

Greg Bakunzi

One of the main challenges is the mindset of the community, where the tourism products are offered, the other one is the tourist visiting the area, without responsible, I mean respecting the culture and the people they are visiting.

James Crockett

Getting caught up in how to look good, virtue signalling and a desire to be seen to do good. The most important stuff happens behind the scenes with no one watching, yes there are some great inclusive components which need a song and dance to promote and spread the word to generate buy-in but it is not the starting point.

Joanna Van Gruisen

Competition and profit lead to overtourism. However sustainable the operation of a tourist company is, its very success can invite others who may not entirely share the same sustainable philosophy. Nothing can kill a destination faster than overtourism. Competition can lead to price wars too which can compromise sustainability. At a village level, this can be avoided by tourism operating with community, not individual, benefits, in a wider context, it is harder to avoid without government intervention and support/regulations.

Jonathan Tourtellot

Regarding destinations: 

Using wrong or incomplete measures of success, such as the number of arrivals; ignoring local opinions and desires (or heeding only local desires); inability to counter the power of large corporations (e.g. cruise lines); short-term government thinking and quick-buck solutions; proclivity of donor agencies to fund infrastructure over human capacity development; siloed thinking at the destination level.

Jorge Moller Rivas

Wrong public policy without involving the community.

Lisa Choegyal

Especially in the extreme economic and social suffering post-COVID in many destinations, when tourism returns it will be tempting to cut corners in the desperation to survive and succumb to market forces. We are already seeing this in unsustainable under-cutting and price slashing, for example. Many operations have been forced to lay off staff without pay, causing enormous hardship and threatening the quality of the product once visitors return. The challenge will be to stick to your sustainable tourism principles.

Mariana Madureira

Pitfall – being shallow, superficial or irrelevant. Eg. a hotel communicating not to wash towels frequently. 

Challenge – go deeper, and think of business as a tool to create value for society. Rethink business model and relation with stakeholders.

Marcus Cotton

Nothing can prevent individual businesses from doing more to be sustainable. Only it takes leadership by owners of the business to motivate and inspire change commitment among employees. Fear of failure is the biggest constraint coupled with the human approach of being comfortable with the status quo. Sustainability is a journey, not a destination (a glib definition!) and that ongoing process can put people off.

Marta Mills

The biggest challenges are:

• lack of understanding of what sustainable travel means and why it is important
• lack of awareness
• the short-sightedness of people who want a quick financial gain
• lack of political will, but that comes mostly from the lack of awareness and understanding

Megan Epler Wood

This is a very complex question, but I would say this – we need to change governance and decision-making procedures. Our leadership institutions are still mainly driven by growth.

Mike McHugo

Having a united vision and making sure investors (which one may or may not need) have the same vision.

Natalia Naranjo Ramos

Implementing sustainability requires a coordinated approach to face the challenges and the potential negative impacts of tourism activities.

Paul Peeters

The main pitfall is believing in ineffective ‘solutions’ like offsetting emissions, battery aircraft, and bio-fuels, trying to weigh economics and social aspects against existential issues like climate change and biodiversity. The latter is not possible and means that for relatively vague reasons (losing jobs, while there are many ways to generate labour) to lose the earth systems that are essential for the survival of humans.

Challenges are: get away from the over-valuation of distance, international travel, air travel and back to the essence of being from home even if a short distance. Also focusing on policy-making is essential to make all elements of tourism, but particularly flying, zero emissions by 2050. If that is technically unsuccessful, it should be clear that aviation will be reduced to a small sector.

Peter Richards

There are so many.

Internally: Greed, weak understanding of ‘why?’, weak leadership, lack of prioritising and giving time, lack of resourcing (either intentionally or unintentionally) lack of motivating and encouraging staff, lack of good management systems to systematise and scale-up impacts.

Externally: weak government support, corruption undermining competitive environments, weak demand by customers, lack of access to modern technologies at a reasonable price.

Rachel Dodds

There are many:

• the focus on numbers, rather than yield
• the fact our political cycles are often 3-5 years but real change takes 10-20
• that all stakeholders are not equal in terms of power
• the political will to change is lacking
• humans have short memories and so make the same mistakes over and over and those that want change are often not in control of the things that need to change

Rebecca Hawkins

Depends on the business/destination. Sometimes belief, passion, and the quest for growth at any cost. Very occasionally it is downright irresponsibility. More often than not it is a combination of conflicting priorities (e.g. between service standards and sustainability criteria), bonkers business models (that separate property ownership from management), perverse incentives (that reward consumption rather than conservation) and a firmly held belief that if the customer wants it we as a service industry have to provide it.

Digital marketing under the social influence has enormous potential to cause overtourism which can not be sustainable anymore. For instance, when destinations are using their unique mountain lake for a destination campaign, “Instagram” travellers perhaps flood the spot. Nature and locals have to pay the price for the mass invasion.

Richard Butler

The fact that the majority of tourists and many operators and governments are not prepared to adapt their behaviour/operation to the extent it would be needed to become truly sustainable.

Richard Hammond

Separating the green from the greenwash.

Shannon Guihan

Understanding. While we carry on debating the best term or definition to use, our industry, which is largely SMEs, must engage in action. However, the concept of ‘sustainability’ is daunting, and so many businesses remain uncertain about where to begin. This, in my opinion, is a massive issue. Those of us engaged must offer our resources and approaches – we must help businesses to determine the scope and supporting tactics, rather than intimidate them from joining the effort.

Shannon Stowell

Right now the economic realities of a recovering world will be a real setback for many. Some headway was being made with single-use plastics for instance and this area seems to be regressing because of COVID.

Also, there is no sense of real urgency for the environment or climate with the general public. Until the public understands and believes the seriousness of the situation, it feels like we’ll spin our wheels in many situations.

Shivya Nath

• Business models prioritize volume over all else, ignoring planetary boundaries.
• Sustainability as a niche, rather than a norm.
• Placing the burden of choosing sustainable travel on the consumer.

Sonja Gottlebe

Economic sustainability is essential to be able to lead activities. The pandemic has shown the limits and fragility of tourism all over the world. The wide supply chain is suffering from this crisis.

In poor countries like Madagascar, it’s impacting the well-being of communities directly, lemurs are hunted for meat, and forests are burnt down for charcoal! Without a vision for the future, without a vaccination plan, the biggest challenge will be for travel. to bounce back!

Willem Niemeijer

Greenwashing, even if it’s done unwittingly, needs to be rooted out. Third-party certification can help avoid this trap that gives the industry a bad name. Developing destinations also need to ensure that foreign investments benefit the local community while protecting the interests of the investor.

Xavier Font

The urgent get in the way of the important. We aim to reap short-term benefits without being aware of the long-term consequences of our actions. And too much selfishness.

More about the sustainable tourism expert panel here – including previous sessions and answers to some of the most pressing issues linked to making tourism more sustainable.

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Tens of thousands protest against Canary Islands’ ‘unsustainable’ tourism model

Organisers say 50,000 turn out to call for limit on tourist numbers, saying model makes life unaffordable and puts strain on resources

Tens of thousands of people are protesting across the Canary Islands to call for an urgent rethink of the Spanish archipelago’s tourism strategy and a freeze on visitor numbers, arguing that the decades-old model has made life unaffordable and environmentally unsustainable for residents.

The protests, which are taking place under the banner “Canarias tiene un límite” – The Canaries have a limit – are backed by environmental groups including Greenpeace, WWF, Ecologists in Action, Friends of the Earth and SEO/Birdlife.

“We’ve reached the point where the balance between the use of resources and the welfare of the population here has broken down, especially over the past year,” said Víctor Martín, a spokesperson for the collective Canarias se Agota – The Canaries Have Had Enough – which helped to coordinate protests on Saturday across the eight islands.

Eleven members of Canarias se Agota have already been on hunger strike for a week to protest against the construction of two large luxury developments in southern Tenerife, which they describe as illegal and totally unnecessary.

Police said 20,000 people had turned out for the demonstrations, but organisers put the figure closer to 50,000, Spain’s TVE public television said.

“We are not against tourism,” Rosario Correo, one of the protesters, told TVE. “We’re asking that they change this model that allows for unlimited growth of tourism.”

Protesters also gathered in Madrid and Barcelona to show their support for the rallies in the Canary Islands, public television said.

Last year, 13.9 million people visited the islands, which have a population of 2.2 million. Tourism accounts for about 35% of the archipelago’s GDP – bringing in €16.9bn in 2022 alone – but local people say the industry is stressing natural resources and pricing them out of the rental market.

Figures from Spain’s National Statistics Institute show that 33.8% of people in the Canaries are at risk of poverty or social exclusion , the highest proportion for any region except Andalucía.

Martín said the regional government’s continuing focus on tourism at a time when the climate emergency was leading to cuts to water supplies made no sense. “Demand is rising in urban areas where there are more tourists,” he said. “We’ve had a very dry winter and a water emergency’s already been declared on Tenerife.

“There are going to be restrictions if there’s not more rain this month but it’s 36C here right now. This is all unsustainable and it means that we won’t even be able to keep normal levels of tourism going. And yet the authorities and the businesses here are trying to stick with this model.”

The housing situation in many parts of the archipelago was also dire because of high prices, low wages, a lack of public housing and the continuing cost of living crisis, Martín said. “I realised we’d reached the limit when I saw people who were working as hotel maids or waiters were living in shacks.

“Wages are so low that they don’t cover the basic costs of living, especially in the current crisis, which is global, but has been felt keenly in the Canaries because we have to import practically everything.”

He insisted the protest movement was not anti-tourist, pointing out that many people in the Canaries had known and liked generations of families from countries such as the UK and Germany.

“The problem isn’t the tourists,” he said. “It’s a model that was built around, and with the connivance of, a business class that doesn’t want to listen to what needs to be done, and with a political class that serves that business class instead of serving all the citizens.”

He said a complete rethink of the Canaries’ tourism model could not wait. “What we’re asking is very simple. Given that tourism is the main economic activity and the cause of all these problems, we want an immediate halt to these two mega-projects,” he said of the Tenerife developments.

“We also want a tourist moratorium that will lead to a study of the load each island can take and which will determine whether we’ve already passed the critical point. In areas where there’s an overload, we want to see a stage of degrowth of economic activity to benefit natural resources. Otherwise, you have an existing model that only benefits a very few people.”

Martín said a proper study of the problems the Canaries suffer from could have global repercussions. “This rethinking of the tourism model could put the Canaries on the map as an example of sustainable tourism development,” he said. “We could be known for something positive instead of something negative.”

Fernando Clavijo, the regional president of the Canary Islands, has said his administration is already taking action. “All the actions this government has taken have been based on a revision of this model,” he told reporters this week . “The Canaries tourist model has been a successful one, but obviously, as with anything, there are things that could be perfected.”

Over-tourism has become a major issue in many Spanish cities and regions , triggering protests and backlashes in Barcelona , and leading the authorities in Seville to consider charging visitors to explore the Andalucían city’s famous Plaza de España .

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Fisker plans more layoffs as cash dwindles and bankruptcy looms

Fisker says it’s planning more layoffs less than two months after cutting 15% of its workforce , as the EV startup scrambles to raise cash to stay alive. Fisker expects to seek bankruptcy protection within the next 30 days if it can’t come up with that money, according to a U.S. Securities and Exchange Commission regulatory filing.

The imperiled company said in the regulatory filing Tuesday it had just $54 million in cash and equivalents as of April 16, and another $11.2 million that can’t be immediately accessed. Fisker said in the filing that it’s currently trying to raise money to pay off a loan that it defaulted on in order to avoid bankruptcy. The outstanding balance as of mid-January was north of $300 million .

Fisker still employed 1,135 people globally as of April 19, according to the filing. That’s down from 1,560 at the end of 2022, and around 1,300 at the end of September 2023. The company also said Tuesday that it will be “reducing its physical footprint.”

This follows Fisker’s announcement Monday evening that a second member of its board of directors has left the company, with the first coming at the end of March. The company has also hired a chief restructuring officer who is now solely in charge of approving Fisker’s budget, as well as the decision-making process for any sale of Fisker’s business.

Fisker finds itself on the brink of bankruptcy following a troubled launch of its first electric vehicle, the Fisker Ocean SUV, that kicked off in June 2023.

The Ocean has been hampered by numerous problems, including buggy software, reports of sudden power loss and brake failure, and insufficient customer service, as TechCrunch reported in February . Fisker struggled to meet internal sales goals and lost track of millions of dollars of customer payments for some of the vehicles it did sell, triggering an internal audit that helped recover a majority of that money. It has spent the last few months attempting to pivot to a dealership model.

The Ocean is now subject to three separate federal investigations from the National Highway Traffic Safety Administration. The company has not issued any recalls, but has paused production of the SUV. In the meantime, it slashed prices on its existing inventory by as much as 39% in an attempt to generate short-term cash. The company has also been delisted from the New York Stock Exchange.

If Fisker ultimately seeks bankruptcy protection, it would be founder Henrik Fisker’s second automotive startup to do so. His previous effort, Fisker Automotive, filed for Chapter 11 bankruptcy protection in 2013.

BREAKING: Senate passes $95 billion package, including aid for Ukraine and a path to ban TikTok

WNBA players could earn more money, but it will take big changes to make that happen

It will take some time for the Caitlin Clark effect to be felt across the WNBA.

Clark enters the league as a budding superstar who is already widely recognized as having been the biggest figure in a sea change for women's basketball. Shortly after she helped the NCAA women's Final Four set broadcasting records, she went first overall in the WNBA draft, helping the event draw a bigger TV viewership than the most recent MLB and NHL drafts . Tickets for the Indiana Fever, who drafted Clark last weekend, are the hottest in the sport. Clark’s jersey has already sold out — though Dick's Sporting Goods intends to sell Clark name and number T-shirts in all 724 of its locations, according to a company spokesperson. Last year, it sold WNBA merch in only a fraction of its stores.

But even as women’s basketball surges broadly, Clark comes into a league that has faced steep financial shortcomings, leaving its players well short of being compensated at the levels of their male counterparts.

“It’s not good enough,” Nancy Lieberman, a Hall of Fame basketball player, Olympic gold medalist and NCAA champion, said in an interview. “It has to get better.”

It could take several years for all the crucial deals among players, the league, broadcast partners and other business interests to renegotiate the way money flows.

Right now, WNBA players remain locked into the collective bargaining agreement, or CBA, they signed in 2020, which dictates their overall pay terms.

Since the deal was signed, the revenue generated by the WNBA has grown — yet it still pales in comparison to those generated by the NBA.

Last year, a Bloomberg News report found the WNBA was projected to make $180 million to $200 million for the 2023 season.

A WNBA spokesperson declined to comment on the report, which NBC News hasn’t verified. The spokesperson also declined to discuss league financials.

The WNBA's revenue compares with about $10 billion for the NBA in the season ending in 2022, the most recent year for which data is available.

The WNBA’s lower revenue is a key reason for the pay disparity between the leagues that has now drawn national headlines, and it is why rookies, including Clark, will earn a base salary of just $76,000 this season.

Of course, Clark will earn much more than that through outside sponsorship deals. And she is eligible for a suite of performance-based bonuses and marketing arrangements with her team, the Fever, and the league itself that are worth at least $500,000.

But that would still most likely be less than the NBA’s current league minimum of about $1 million. Technically, NBA rookies make slightly more than that. Players in the NBA’s lower-level G League are the exception; they typically earn a season salary of about $40,000.

The gap between male and female basketball players isn’t only about the level of pay.

NBA players enjoy about a 50-50 split of so-called basketball-related revenues — like broadcast money and jersey sales — with owners.

The CBA that WNBA players signed allowed for revenue sharing only if certain revenue thresholds were met. And so far, they’ve fallen short, a WNBA spokesperson confirmed.

WNBA players can opt out of their CBA after this season — and it’s likely that they will, given the enormous growth the women’s game had been experiencing even before Clark captured America’s attention.

The hope is that with Clark and other young stars entering the league, there will soon be more money and better terms for its players.

In particular, the WNBA is poised to negotiate a new set of broadcasting rights that will increase the value of the league — enough to the point that the revenue sharing threshold would become moot, assuming the thresholds even remain.

Ironically, the fate of the WNBA remains in the hands of the NBA, which controls more than 40% of the women's league.

That's why Terri Carmichael Jackson, the Women’s National Basketball Players Association executive director, has called on the NBA to put the WNBA front and center.

"It’s time the NBA recognizes the indispensable role of WNBA players in shaping the league’s future success," Carmichael Jackson said in a statement to NBC News.

She continued: “They must acknowledge that valuing WNBA players and paying million-dollar salaries requires a stronger broadcast deal, one that absolutely necessitates players at the negotiating table to strengthen the business case and drive home their value."

Asked for comment, an NBA spokesperson referred NBC News to the WNBA.

In a statement, WNBA Commissioner Cathy Engelbert said: “We continue to find ways to return some of the growth we have been experiencing to the players beyond what the CBA requires," referring to the collective bargaining agreement.

We’re “increasing playoff bonuses by over 50% and providing a $4 million budgeted charter [flight] program for full playoffs, all back-to-backs requiring air travel, and the Commissioner Cup Championship Game,” Engelbert added.

WNBA players aren’t necessarily asking to be paid at the same levels as their NBA counterparts. Rather, as Las Vegas Aces star Kelsey Plum said on an episode of the Vegas-centric “ The Residency Podcast ,” “We’re asking to get paid the same percentage of revenue shared.”

Lieberman, the Hall of Famer, said there has been unwillingness to make the kinds of investments necessary to put the game front and center, on TV or elsewhere.

"Being the first, it can be very lonely," she said, adding that, in many cases, her success had come from decision-makers — mostly men — who had "taken a leap of faith."

Lieberman's comments echoed those of University of Connecticut women's coach Geno Auriemma, who was much more explicit in his criticism of the WNBA's growth efforts.

“The WNBA is going to have to do a great job of marketing these guys,” he said at a news conference this month, referring to players like Clark and Huskies star Paige Bueckers. “And the WNBA I don’t think has done a great job of marketing their individual stars.”

CORRECTION  (April 22, 2024, 9:54 a.m. ET) A previous version of this article misstated which Clark merchandise sold out at Dick’s Sporting Goods. They were T-shirts, not jerseys.

Rob Wile is a breaking business news reporter for NBC News Digital.

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