Tourism, globalisation and sustainable development

Tourism is one of the fastest growing sectors of the global economy and developing countries are attempting to cash in on this expanding industry in an attempt to boost foreign investment and financial reserves. While conceding that the uncontrolled growth of this industry can result in serious environmental and social problems, the United Nations contends that such negative effects can be controlled and reduced. Arguing that 'tourism needs to be more sustainable', the world body is organising a 'dialogue' this April in the UN Commission on Sustainable Development to bring together national and local governments, the tourism industry, trade unions and activist groups to realise this goal. In the following article, Anita Pleumarom considers whether the global tourism industry can really be propelled towards sustainability under the current international and political regime that underpins the drive towards globalisation.

BEFORE getting into the cold facts of global economics, let me begin with another story to warm up. I was perplexed when I recently read in the newspaper that Thailand's forestry chief had said: 'Humans can't live in the forest because human beings aren't animals. Unlike us, animals can adapt themselves to the wild or any environment naturally.' This was to legitimatise the government's plan to remove hundreds of thousands of rural and hill tribe people from protected areas.

This man, who is in charge of conserving the forests, is at the same time very strongly pushing to open up the country's 81 national parks to outside investors and visitors in the name of 'eco-tourism'. Can we conclude, then, that the forestry chief considers developers and tourists as animals that know how to adapt to the forest and behave in the wild naturally?

While authorities want to stop the access to forest lands and natural resources of village people, another group of people - namely tourism developers and tourists with lots of money to spend - are set to gain access to the area. While authorities believe that local people, who have often lived in the area for generations, are not capable of managing and conserving their land and natural resources - under a community forestry scheme for example - they believe they themselves in cooperation with the tourist industry can properly manage and conserve 'nature' under a national eco-tourism plan. Taking the above quote seriously, cynics may be tempted to say there is obviously a gap between 'human rights' and 'animal rights'.

How is this story linked to globalisation? First of all, that humans cannot live in the forest is - of course - not a Thai concept. It is a notion of Western conservation ideology - an outcome of the globalisation of ideas and perceptions. Likewise, that eco-tourism under a 'good management' system is beneficial to local people and nature is also a Western concept that is being globalised. In fact, Thailand's forestry chief thinks globally and acts locally. A lesson that can be learned from this is that the slogan 'Think Globally, Act Locally' that the environmental movements have promoted all the years, has not necessarily served to preserve the environment and safeguard local communities' rights, but has been co-opted and distorted by official agencies and private industries for profit-making purposes. The tourism industry is demonstrating this all too well.

Many developing countries, facing debt burdens and worsening trade terms, have turned to tourism promotion in the hope that it brings foreign exchange and investment. Simultaneously, leading international agencies such as the World Bank, United Nations agencies and business organisations like the World Travel & Tourism Council (WTTC) have been substantially involved to make tourism a truly global industry.

However, tourism in developing countries is often viewed by critics as an extension of former colonial conditions because from the very beginning, it has benefited from international economic relationships that structurally favour the advanced capitalist countries in the North. Unequal trading relationships, dependence on foreign interests, and the division of labour have relegated poor countries in the South to becoming tourism recipients and affluent countries in the North to the position of tourism generators, with the latter enjoying the freedom from having to pay the price for the meanwhile well-known negative impacts in destinations.

Transnational corporations

Travel and tourism has emerged as one of the world's most centralised and competitive industries, and hardly any other economic sector illustrates so clearly the global reach of transnational corporations (TNCs). Over recent years, the industry has increasingly pressured governments around the world to liberalise trade and investment in services and is likely to benefit tremendously from the General Agreement on Trade in Services - a multilateral agreement under the World Trade Organisation (WTO).

GATS aims to abolish restrictions on foreign ownership and other measures which have so far protected the services sector in individual countries. For the hotel sector, for example, GATS facilitates franchising, management contracts and licensing. Moreover, foreign tourism companies will be entitled to the same benefits as local companies in addition to being allowed to move staff across borders as they wish, open branch offices in foreign countries, and make international payments without restrictive regulations.

Foreign investment will also be increasingly deregulated under the GATT/WTO system. According to the Agreement on Trade-Related Investment Measures (TRIMs), foreign companies will no longer be obliged to use local input. The Multilateral Agreement on Investment (MAI) proposed by Organisation for Economic Cooperation and Development (OECD) countries goes even further, calling for unrestricted entry and establishment of foreign firms, national treatment, repatriation of profits, technology transfer, etc.

Accordingly, the WTTC has recently presented its 'Millennium Vision' on travel and tourism, including the following key areas:

  • Get governments to accept travel and tourism as a strategic economic development and employment priority;

  • Move towards open and competitive markets by supporting the implementation of GATS, liberalise air transport and deregulate telecommunications in international markets;

  • Eliminate barriers to tourism growth, which involves the expansion and improvement of infrastructure - e.g. the increase of airport capacity, construction and modernisation of airports, roads and tourist facilities.

On a tour through South-East Asian countries in February 1998, WTTC president Geoffrey Lipman also strongly supported the privatisation of state enterprises, particularly airlines and airports. His visit in Thailand, for example, coincided with the announcement of British Airways - a prominent member of the WTTC - that it was interested in taking over 25% of Thai Airways International. And the British Airport Authority promptly followed up by proposing to buy a major equity share in the provincial airports of Chiang Mai, Phuket and Hat Yai, which are all located at popular tourist spots. However, the selling out of state companies to foreigners has been facing growing public opposition in Thailand so that privatisation is not progressing as planned.

Meanwhile, even the voices of the tourism industry in Asia are urging a cautious approach towards globalisation. Imtiaz Muqbil, a renowned tourism analyst based in Bangkok, warned: 'The independence of thousands of small and medium size enterprises, including hotels and tour operators, is at risk.' This is because most local enterprises will hardly be able to compete with foreign companies. Moreover, Muqbil suggested that as an outcome of globalisation, Asian countries may face 'the prospects of huge growth in leakage of foreign exchange earnings.' In conclusion, he said, 'The radical restructuring of travel and tourism ... could strike at the heart of national economies.'

It is already a well-established fact that in some developing countries, more than two-thirds of the revenue from international tourism never reaches the local economy because of the high foreign exchange leakages. Now, as the new free trade and investment policies are being implemented, their balance sheets may even worsen because the profits and other income repatriated by foreign companies is likely to grow larger than the inflow of capital. That means, the claims that globalisation and liberalisation of tourism will bring wealth, progress, social achievements and improved environmental standards to developing countries need to be seriously questioned.

A recently published document by the UN Conference on Trade and Development (UNCTAD) states that Asia-Pacific countries urgently need to bolster their bargaining positions in the field of tourism services and negotiate better terms in exchange for opening their markets. However, governments have barely had time to examine the potential impacts of globalisation, and many local tourism-related companies are already in financial trouble due to the economic crisis. So it is very unlikely that they can strengthen their negotiating power. Even major Asian airlines can hardly survive in this crisis-hit business environment; the recent temporary closure of Philippine Airlines is an illustrative example.

Economic globalisation has also generated considerable criticism because it comes along with the erosion of power of governments. Opponents argue that local and national institutions will no longer be able to properly fulfil their responsibilities such as providing social services, preserving the environment, and implementing sustainable development programmes.

Indeed, the multilateral agreements facilitating globalisation have shown little, if any, concern for social and ecological issues. On the environment front, the WTO has discussed proposals to introduce 'environmental standards' and 'eco-labels' developed by international setting bodies.

Critics say this move is likely to be dominated by TNC interests, which attempt to appropriate the environmental agenda and push for self-regulation. Meanwhile, existing national environmental policies and laws adopted by democratically elected governments will be undermined.

The WTTC, for example, vows to 'promote sustainability in travel and tourism' through its Green Globe programme, but - as its 'Millennium Vision' document states - 'strongly believes that the environmental policy agenda should focus on (the industry's) self-improvement, incentives, and light-handed regulation as the preferred approach'.


The increasing influence of private sector interests on international forums negotiating the environmental agenda has reinforced concerns that genuine efforts to set up a more stringent framework for the tourism industry may be jeopardised. In this context it is important to note that the seventh session of the UN Commission on Sustainable Development (CSD) this year will include important discussions on the issues of sustainable tourism.

So far, the UN General Assembly has adopted a resolution on 'Sustainable Tourism' as part of its 'Programme for the further implementation of Agenda 21', the action programme adopted at the Rio Earth Summit. This resolution acknowledges the need to consider further the importance of tourism in the context of Agenda 21. Among other things, it states: 'For sustainable patterns of consumption and production in the tourism sector, it is essential to strengthen national policy development and enhance capacity in the areas of physical planning, impact assessment, and the use of economic and regulatory instruments, as well as in the areas of information, education and marketing.' Furthermore, the resolution calls for participation of all concerned parties in policy development and implementation of sustainable tourism programmes.

What is important to keep in mind is that this UN resolution stresses the need for a democratic regulation of tourism development, which is in stark contradiction to the lobbying efforts by the agents of tourism globalisation towards deregulation and an industry-led and self-regulated scenario.

This conflict featured prominently at the fourth Conference of Parties to the UN Convention on Biological Diversity (COP4) in Bratislava, Slovakia, last May, which included discussions on the integration of biodiversity into sectoral activities such as tourism. Many government delegates there resisted attempts by the German government to get approval from the Ministerial Roundtable at COP4 for a programme to develop global guidelines on biodiversity and sustainable tourism. Observers noted that the increased promotion of interests of the powerful German tourism industry at the UN level by the German government has been conspicuous over recent years.

Official and NGO representatives were surprised by the insistence of the Germans to work on global guidelines and to seek endorsement for this programme from the CSD. The delegate from Samoa, for example, reiterated that sustainable tourism is a complicated issue that will be dealt with by the CSD next year and complained: 'We are not in favour of some of the top-down approaches we have seen here (at COP4).' Other delegates expressed concern over the relevance, objectives and funding of the proposed programme.

Significantly, critical observers warned that an ill-advised proposal on global guidelines under the Convention could have devastating consequences for local and indigenous communities - socially, culturally and ecologically. 'The tourism industry's propensity towards unrestricted growth and its commoditisation of indigenous cultures must be recognised as clearly unsustainable,' commented an NGO representative during the Bratislava Conference.

Meanwhile, there are justifiable fears that under the new economic globalisation schemes, sustainable and eco-tourism activities will even further enable TNCs to gain commercial access to ecologically sensitive areas and biological resources and accelerate the privatisation of biodiversity, all to the detriment of local communities' land and resource rights and the natural environment. As the Austrian environment minister told delegates at COP4, 'Sustainable tourism offers new market opportunities.'

Vague, with buzzwords

Indeed, the debate on tourism principles and guidelines is a tricky one - not only because it is heavily overshadowed by politics of global players. Another point of concern is that guidelines and programmes, as discussed and adopted by advocates of sustainable tourism at the international level, naturally remain very vague. Usually, they are also overly euphemistic, with buzzwords abounding: e.g. empowerment of local communities; local participation and control; equitable income distribution; benefits to nature conservation and biodiversity protection; etc.

A tourism researcher from the University of British Columbia, Nick Kontogeorgopoulos, suggested that attempts to implement tourism projects based on such guidelines are bound to fail altogether because it is simply impossible to apply them to highly disparate and heterogeneous destinations. He says, 'While these altruistic principles are laudable in theory, the absence of place-specific context strips them of empirical evidence.' In conclusion: Not the global game, but local circumstances and conditions represent the essential determinant of success for sustainable development.

In Asia, social and environmental activists argue that the inflationary tourism policies in the context of globalisation have greatly contributed to the present economic crisis. During the era of the so-called bubble economy, indiscriminate and unsustainable investments led to the rapid conversion of lands into massive tourism complexes, including luxury hotels, golf courses and casinos, and related infrastructure such as airports, highways, and dams to generate electricity. With economic liberalisation, the tourism, real estate and construction industries boomed, backed by local banks and global speculative capital. An essay written by renowned tourism critic and media activist Ing. K. reflects the anger of many Thais about the developments that have led to the country's bankruptcy. She presents the hard facts as follows:

'Land speculation became a national pastime, permeating every beautiful village, however remote. Land prices skyrocketed. Villagers sold agriculturally productive land to speculators. Practically overnight, fertile land became construction sites. The plague kept spreading; corruption got out of control. National parks and forest reserves were encroached upon by golf courses and resorts ...

'Many instant millionaires were made, but much of this new rich money was not wisely invested in productive ventures. Instead, most of it was spent on luxury "dream" products and services, in pursuit of the consumer lifestyle.

'Many of these people were merely imitating tourists and were influenced by the prevailing free-spending frenzy. Greed and consumerism devastated whole communities all over Thailand, raising the temperature even higher, on every level of society...

'In the end, we have nothing to show for it but whole graveyards of unsold high-rise condominiums, shophouses, golf course and resort developments and housing estates.'

Now, all discussions and work programmes relating to the implementation of global and local Agendas 21 and sustainable development appear - more than ever - removed from reality in view of the unfolding Asian crisis - a human disaster with millions of unemployed and landless people falling below the poverty line. According to the latest figures from UN agencies, more than 100 million people in the region are newly impoverished. And there are growing fears that the machinations of unregulated global speculative capital now threaten to ruin not only Asian economies but the rest of the world as well.

A major question that needs to be addressed in this context: Where will all the money come from for sustainable development and tourism projects? In Thailand, for example, the World Bank and the Japanese OECF have agreed to provide loans to improve and expand tourism as part of a social investment programme (SIP) aimed at tackling the problems of unemployment and loss of income arising from the economic crisis. It has been stressed that tourism development is crucial for the country's economic recovery, and 'community participation' and 'sustainability' are mentioned as major components in projects. But critics have warned that firstly, tourism is not a quick commodity that can pull the country out of its economic pains. And secondly, much of the borrowed money will be used for new developments in national parks and biodiversity-rich areas in the drive to promote 'eco-tourism'.

Let me confront you with a provocative idea now. It is not the longstanding efforts by the many experts promoting and working on the implementation of global and local Agendas that bring us closer to sustainable tourism. Ironically, it is rather the current all-embracing crisis which may eventually make tourism more sustainable - at least in environmental terms. Why?

First of all, a basic problem of sustainable tourism has been the rapidly expanding numbers of travellers. But as a result of the crisis, tourism growth has come to a standstill. Due to currency devaluation, increasing unemployment, declining income and deflation, Asian markets are collapsing. Even the numbers of Japanese going abroad for holidays are now declining for the first time in 18 years. European and American holidaymakers have also shunned South-East Asian countries because of 1997's smog disaster, caused by forest fires in Indonesia, and political turmoil in the region - e.g. in Burma, Cambodia and - more recently - Indonesia.

As the economic contagion is spreading, the travel fever that had gripped Russia and other East European countries after the fall of the Soviet Union is also on the wane, as the Russian currency, the rouble, has plummeted dramatically and the economy slumps. Moreover, amid the decline of business activities in Asia, stockmarket slumps and fears of a global recession, nervous companies around the world are limiting corporate travel spending. The WTTC, which had earlier in 1998 forecast growth averaging 7% a year throughout 2008, now expects the global tourism market to remain flat in the next years. This may be bad in terms of economics but, unquestionably, the environment will benefit from stagnating or even decreasing tourist numbers.

For instance, the air travel industry has been identified as one of the biggest environmental villains in tourism. With fewer people travelling, however, the Asia-Pacific aviation industry is now flying into a deep recession. Airlines are fighting for survival by closing or cutting unprofitable routes, selling aircraft and cancelling orders for new aircraft. Governments are forced to cut budgets for airport expansion and construction. Ultimately, that means less pollution and less environmentally damaging developments.

The real estate and construction industries, which are both inextricably linked to the tourism industry, were the first industries that crash-landed when the Asian bubble economy burst. As a result, many speculative and unsustainable hotel and resort development projects have been abandoned, and new construction is down to a trickle. An excellent example is golf, which became a symbol of globalised leisure and tourist lifestyle in Asian tiger societies. But as the frenzy to build luxurious golf course complexes - including hotels, housing estates and shopping centres - has almost stopped completely, and middle-class people affected by the crisis are turning away from the expensive sport of golf, environmentalists can be relieved: The malaise of rampant land grabs, national park encroachments, deforestation, etc. related to golf courses is no longer as threatening as it was a few years ago.

On the other hand, while many tourism-related companies may have scrapped or postponed potentially harmful projects, one needs to acknowledge that because of the financial crunch, public and private investments in environmental protection are also being cut. Moreover, there have been warnings that the crisis has resulted in an upsurge of crime, prostitution, drug abuse and other social vices related to tourism.


But most importantly, Asian societies are beginning to realise that the current global economic capitalist system has utterly failed to bring achievements in all terms. Now burdened with having to pay for the activities of unscrupulous speculators and additionally suffering from free-market-oriented structural adjustment programmes imposed by the International Monetary Fund (IMF), people are losing faith in a globalised economy. Some experts even go so far as to say that free trade and investment liberalisation is 'yesterday's story'. Malaysia in particular has recently taken decisive steps to shut itself off from global markets by strictly controlling foreign capital flows.

Asian governments are now likely to move towards greater self-reliance as they are pressured by people of all walks of life to look into economic strategies that are chiefly based on domestic financial resources and the domestic market. This involves the strengthening of the agricultural sector and local industries to protect people's livelihoods in the first place. Forces still seeking to further prop up economically risky service industries such as tourism are likely to be weakened.

Moreover, the crisis has also created considerable public debate about the impacts of global culture and lifestyle, including the issues of consumerism and the wasteful and unproductive use of resources. In several Asian countries - such as Korea, Thailand and Malaysia - outbound tourism is now being discouraged as it is seen as conspicuous consumption that has contributed to the negative balance of payments.

The issues of democracy and human rights are also gaining momentum in the region. As never before, people are making use of their civil rights and call for transparency and democratic procedures to phase out corruption and harmful government policies and development plans. The growing opposition of Thai environmentalists and villagers to the move of the government to open up protected areas for 'mass eco-tourism' is just one example.

All in all, I believe, the current Asian crisis, which is likely to become a global crisis, poses a fundamental challenge - and an important opportunity - to re-evaluate the issues of globalisation, sustainable development and tourism. As Asian societies begin to acknowledge that rapid economic growth under global regimes has devastating effects on people's lives and the environment, we may find that a stringent regulation of tourism, which involves a stricter limitation of tourist numbers and a halt to the unlimited spatial expansion of tourism, is better than further promoting tourism growth and hoping that this growth can be handled with 'good management', education of tourists, etc. What the current crisis really appears to confirm is - what many tourism critics have been saying all along - the global tourism industry just cannot be propelled towards sustainability under the conventional economic and political structures. That means, efforts to implement social and environmental agendas and sustainable tourism are unlikely to progress unless profound structural changes take place in the global system. (Third World Resurgence No. 103, March 1999)

Anita Pleumarom coordinates the Bangkok-based Tourism Investigation & Monitoring Team (t.i.m.-team) and publishes New Frontiers - a bimonthly newsletter on tourism, development and environment issues in the Mekong region - with support from TWN.