CHAPTER 1.

Strengthening the Travel & Tourism Competitiveness Index

GEOFFREY LIPMAN JOHN KESTER United Nations World Travel Organization (UNWTO)

Once again we offer our views on the application of the Travel & Tourism Competitiveness Index (TTCI) in the spirit of collaboration that has prevailed since this work has been initiated.We congratulate our partners in the World Economic Forum for their commitment to this program. We will step up our contribution to that partnership by not only providing data and analysis but acting to better incorporate the views of the sector itself. This time, moreover, the unprecedented economic conditions, market shifts, and evolving policy response are determining factors in which to consider the Index. This raises the central question of its relevance in a world of short-term stimulus actions and parallel, longer-term shift to a green economy, coherent with global development and climate imperatives. Our comments are therefore focused only on actions needed to strengthen the use of the Index for the tourism & travel sector in this underlying context. Summarizing our past views on the Index and the changes in this edition, we strongly welcome the initiatives to improve and broaden the base data and particularly to incorporate new environmental criteria and information. We also welcome the new emphasis on presentation of data by regions, which we have long argued is more relevant than a global listing with its massive unfair presentational differential between rich and poor.We continue to assert that presentation by gross domestic product (GDP) clusters and by region will be a more valid presentation because the competitive gap between rich and poor nations often reflects their place in the development cycle, their inherent infrastructure, and their resource differences as well as their capacity to allocate funds to change tourism competitiveness. Similarly mature markets have had the time to put in place the infrastructure and legal frameworks that are other key components of the TTCI. In fact, this disparity does make the Index a useful tool for development agencies looking to enhance the tourism competitiveness of poor and emerging markets. Looking at current global realities, we believe a major new factor in tourism competitiveness will be the way in which countries place tourism in their strategic economic repositioning. Stimulation programs seek to create jobs and reignite growth.Tourism has more capacity for job creation and economic regeneration than virtually any other sector.Tourism and travel is one of the largest employment sectors in most countries and a fast entry vehicle into the workforce for young people and women.

The Travel & Tourism Competitiveness Report 2009 2009 World Economic Forum

1.9: Strengthening the Travel & Tourism Competitiveness Index

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1.9: Strengthening the Travel & Tourism Competitiveness Index

Encouraging travel boosts consumer and business confidence, it strengthens two-way trade, and it promotes export income for the poorest countries with few similar alternatives. So countries mainstreaming tourism squarely in their stimulation priorities will be enhancing their socioeconomic competitiveness generally and in the sector specifically. In regard to the parallel shift to a green economy on the one hand, tourism transformation can be of immense overall economic value in its own right, given that the sector produces some 58 percent of GDP directly and indirectly as well as one in every 12 to 15 jobs. On the other hand, given that tourismbusiness and leisureaccounts for some 5 percent of carbon emissions, we must play our part in the global response to climate change. In addition our role is highly significant, given the catalytic effect of the sector in other areas of the economy and our strong consumer communications activity. Moreover, the value of ecotourism has long been recognized as a beacon for environmental change, and it is one where poor countries have a comparative advantage because of their nature, culture, and very lack of intensive development. Similarly, with the exception of the newly emerging industrialized economies, the poorest play a negligible role in greenhouse gas emissions. But ecotourism, as well as green tourism generally, also offers massive potential for industrialized states competitivenessparticularly in regard to rural transformation and sustainable urban mobility. Better conservation strategies offer massive energy savings. Reduction in congestion in the air and on the ground, for example, is a major factor in intelligent energy use. At the same time, the next generation of green energy, climate-proofing of buildings and other infrastructure, retraining, and education are areas where all states can gain competitive enhancement in their tourism sector.The use of solar or wind power and clean biofuels are obvious strategic possibilities for hotels and transport companies.

While serious consideration of these elements suggests a major new thrust for the TTCI, we believe that it is actually in keeping with the evolution of the Index to reflect the realities of government, industry, and market shifts. In order to better ensure that the sectors views on these matters are better reflected in future issues of the Index UNWTO will hold an open global discussion forum on these matters in the second half of 2009.

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The Travel & Tourism Competitiveness Report 2009 2009 World Economic Forum