December 13 2020
Rod Oram imagines how we could reinvent tourism so that, instead of depleting and damaging our natural assets, it becomes an activity that generates ecological and economic, social and cultural benefits.
Tourism is one of humankind’s great achievements in modern times. Yet the benefits it brings us often come with negative consequences. Profits for hosts and fulfilment for tourists, for example, can strain communities and degrade ecosystems.
Sometimes we suffer a double-whammy. We escape our stressful lives for fleeting holiday encounters with things we’ve lost, such as peace, freedom and natural beauty; yet too much tourism in one place can spoil the very things we yearn for.
But what if we reinvented tourism so it becomes an exemplar of wholesome humanity? An activity that generates common wealth in all senses of the word – ecological and economic, social and cultural? Those four capitals are the basis of the Government’s Living Standards Framework and the wellbeing focus of its Budget-making process. Rightly so, since the quality of our personal and collective lives depends on them. By enhancing these four capitals, tourism would increase its contribution to Aotearoa and encourage other sectors and other segments of society to grow anew too.
Tourism is well suited for the task. It touches so many aspects of our lives, from the experiences we seek to the technology and resources we use to realise them. Most of us are tourists, at least at home if not abroad; and most of us are hosts, at least to family and friends, and sometimes in our brief encounters with tourists seeking directions or advice.
Making wise tourism choices worldwide will help speed up the transformation to deeply sustainable economies and societies over the next few decades. Crucially, that is all the time humanity has left to avert a climate catastrophe, and to ensure 10 billion people, the likely population in 30 years’ time, can live reasonably well on this planet.
We’re only 5 million people here in Aotearoa. But some of our distinctive attributes give us opportunities to offer our own particular take on the reinvention of tourism, as well as a great responsibility to do so.
Ours was the last large land mass to be settled by humans, beginning barely 800 years ago. Then these lands, waters and surrounding oceans were astoundingly diverse and rich in indigenous flora and fauna. Today, because of our exploitation, these once fecund ecosystems are greatly depleted and despoiled, with a high degree of indigenous species loss too.
Yet, we still have the largest stock of natural capital per person after oil- and gas-producing countries, analysis by the World Bank shows. We are responsible, for example, for the ninth largest Exclusive Economic Zone in the world’s oceans, one which still has a high level of indigenous species. And we have big ambitions on land too, such as eradicating introduced species of mammalian predators that have decimated native forests and birds. The Predator Free 2050 movement is spurring communities to action around the country. We can become world leaders in restoring ecosystems and embedding our built environments deeply in nature.
For many visitors, Aotearoa is the ultimate long-distance destination. How can they journey in climate-compatible ways to help us develop a zero-emissions transport system? How can their enjoyment of our unique landscapes, ecosystems and species help us restore them? How can their engagement in our towns and cities help us express our own attractive styles of urban life? Above all, how can we enliven them and strengthen our identity and society by sharing with visitors our indigenous Māori world view that we are inherently one with nature?
Defining tourism's value
Tourism and travel are global agents of change because of their contributions to economies. In 2019, their combined sector grew by 3.5 percent to contribute 10.3 percent of global GDP, and they contributed 330 million jobs, one-tenth of all jobs, according to the World Travel and Tourism Council’s 2020 report.
Last year was the ninth in a row it had grown markedly faster than the global economy as a whole. Only two sectors grew faster: information and communications at 4.8 percent, and financial services at 3.7 percent. Among slower sectors, agriculture grew by 2.3 percent and manufacturing by 1.7 percent.
While domestic tourism has been a feature of societies for generations, international tourism is a phenomenon of prosperity and globalization in the decades since the Second World War. In 1950, only 25 million tourists crossed international borders, according to data from the United Nations World Tourism Organisation. In 2018, 1.46 billion did so, a 58-fold increase.
Drivers of the spectacular growth included the phenomenal increase in aircraft efficiency and thus plunging travel costs, particularly in the jet age; rising incomes; the opening of borders; heavy investment in promotion and infrastructures; and the sharing of stories, experiences and adventures through mass and, latterly, social media. In many ways, the rise of tourism is evidence of the postwar gains in economic wealth, political freedom, social progress and technological sophistication.
... there were 134 citizens for every international tourist in 1950, but only 1.3 for every tourist in 2019. In other words, international tourists grew 100 times faster than citizens.
Here in Aotearoa, we’ve experienced an even more remarkable surge in tourism. In 1950, only 14,176 overseas tourists arrived here, according to Statistics New Zealand. In 2019, we hosted 3,864,018 of them, a 273-fold increase. That was a rate of growth almost five times faster than the global sector’s rapid expansion.
Our international arrivals averaged barely 40 per day in 1950 but 10,600 a day in 2019, with the summer peak far higher and the winter trough much lower. Meanwhile, over those seven decades our population grew from 1.9 million to 5 million. This meant there were 134 citizens for every international tourist in 1950, but only 1.3 for every tourist in 2019. In other words, international tourists grew 100 times faster than citizens.
By meeting the needs of overseas visitors, we gain many benefits for ourselves. These include greater air connectivity and capacity which makes it easier, and possibly cheaper, for us to travel overseas and at home at least out of season; a wider range of customers, attractions, accommodation, restaurants, bars, entertainment, business services, jobs and other economic activities; and the opportunities for visitors to get to know us and our country, and we them and theirs.
The economic equation is complicated, though. The headline facts are clear. In the year to March 2019, Statistics New Zealand data show domestic tourists generated $23.7 billion of expenditure (with $17.9 billion coming from households and the balance from business), and international tourists $17.2 billion. The sector employed 229,566 people, a mix of full time, part time and seasonal. Total tourism generated a direct contribution to GDP of $16.2 billion, or 5.8 percent of GDP, and an indirect contribution of $11.2 billion, or 4 percent of GDP. The combined GDP share is similar to the global average, though, so our economy is not as “tourism heavy” as it is often perceived to be.
In addition to its low labour productivity, tourism demonstrates low capital productivity.
While there’s no doubting the volume of tourism activity, judging its value is harder. The main measure is the economic value added by each full-time equivalent employee (FTE). Value added is the “value” businesses add to the goods and services they purchase and use in producing their own outputs.
But 2014 was the last time the Statistics NZ’s Tourism Satellite Account calculated tourism employment on the full-time equivalent basis necessary for comparing the value generation of sectors. That data showed 166,800 FTE direct and indirect employees, who generated 8.3 percent of GDP. Their contribution per employee to GDP was $88,612 for direct employees and $89,567 for indirect employees. By comparison across the whole economy, the average contribution was 16 percent greater, at $106,155 per FTE. This was consistent with a pattern identified by Lincoln University’s 2006 analysis of the Tourism Satellite Account dating back some years.
In addition to its low labour productivity, tourism demonstrates low capital productivity. In the year to March 2019, the sector’s net capital stock for all tourism (direct and indirect) was $106.69 billion, or 12.6 percent of the $842.66 billion total for all industry. Yet, the sector’s contribution to GDP was disproportionately lower at 9.8 percent.
Tackling tourism's challenges
While tourism creates substantial gains, it also generates significant externalities – costs which are not included in calculations of its overall net economic benefit. These include the damage tourism does to climate, ecosystems, and social and amenity values, plus the burden of infrastructure costs borne by government or other parties.
The sector’s brisk growth over the past decade has prompted it to work diligently on these economic, environmental and social challenges. For example, Tourism Industry Aotearoa released its Tourism 2025 and Beyond Growth Framework in 2014, and updated it in 2019 as its Sustainable Growth Framework. Its “Top 10 Actions” are: Embed sustainability; Managing destinations; Growing and shaping demand; Embracing Tikanga Māori; Living Tiaki [protection, guardianship]; Engaging the community; Measuring and managing industry carbon use; Investing in infrastructure and amenities; Fostering domestic tourism; Investing to deliver quality tourism data and research.
The sector’s analysis was more sophisticated than its past efforts, and its proposed actions have merits. But the sector’s strategy was still business as usual: further brisk growth (from revenues of $39 billion in 2018 to $50 billion in 2025) while trying to cope better with the negative consequences.
This failed to convince Simon Upton, the Parliamentary Commissioner for the Environment. Seven months later he produced his report Pristine, Popular . . . Imperilled? The Environmental Consequences of Projected Tourism Growth. He concluded:
"Twenty years ago, one of my predecessors, Dr Morgan Williams, issued a report entitled 'Management of the environmental effects associated with the tourism sector. I deliberately didn't read it until we had completed our own research to avoid approaching the topic with preconceptions. When I finally came to do so, I was struck by how little has changed. Numbers have grown, compensatory investments have been made and some genuinely impressive initiatives have been taken by some players. But the essential challenges remain clearly recognizable, although now on a much-enlarged scale. Despite many soothing words about sustainability over the two intervening decades, we haven't significantly shifted an extractive path dependency."
Just three months later, life as we knew it – in its entirety, not just tourism – was upended by the rapidly accelerating global Covid-19 pandemic. In response, on 19 March 2020 our Government closed the border to all but returning New Zealand citizens and permanent residents.
Of the extensive economic consequences, the tourism sector has suffered the greatest shock. Its total loss of international tourism revenues, with no hope of more than a trickle of people across the border until well into 2021, is devastating for its people and companies. Admirably, though, they are remaking their businesses in highly creative and innovative ways. Their pivot to domestic tourism has been particularly effective, with an eager response from New Zealanders missing their overseas travels.
But to absolutely thrive, the tourism sector needs to radically rethink its role in our natural environment, society and economy. Its greatest opportunities lie in tackling its greatest liabilities. Then it will become a trailblazer for all New Zealanders on their journey to deeply sustainable relationships with the natural world – literally our life-support system – and with each other in our social and economic structures.
The biggest liability is carbon emissions generated by tourists flying here, with cruise ships compounding the problem. Even the most efficient of these ships emit three to four times more carbon dioxide per passenger-mile than a jet, according to research by Bryan Comer at the International Council on Clean Transportation in Washington DC.
We could ignore this, given it is a global issue and we’re small. Between 2009 and 2013, global tourism emissions increased from 3.9 to 4.5 billion tonnes of CO2 equivalent (four times more than previously estimated), and accounted for about 8 percent of global greenhouse gas emissions, according to research published in Nature Climate Change.
“The majority of this footprint is exerted by and in high-income countries. The rapid increase in tourism demand is effectively outstripping the decarbonisation of tourism-related technology. We project that, due to its high carbon intensity and continuing growth, tourism will constitute a growing part of the world’s greenhouse gas emissions,” the authors wrote.
Or we could be a leader, making carbon-neutral tourism a defining goal of our ambitious new strategy. There are pathways for decarbonising travel. Some technologies are here, such as electric cars; others are near, such as electric campervans with adequate range. Others are medium term, such as jet engines running on sustainable fuels; and some long term, such as hybrid and electric aircraft.
But tourists, domestic and international, can go carbon neutral right now by offsetting their greenhouse gas emissions. Some people consider offsets are greenwash, a way to salve consciences while avoiding the crucial need to cut emissions or not generate them at all.
They are, though, a legitimate way to help fast-forward the changes we must make in our behaviours and technologies. Thus, the real issue is the integrity of the offsets chosen. For example, the United Nations’ Carbon Offset Platform says the UN’s portfolio of Clean Development Mechanisms have replaced fossil fuels with renewable energy, reduced energy consumption, and removed atmospheric carbon through reforestation and ecosystem regeneration projects. To date, “CDM projects have been responsible for avoiding more than 1.8 billion tonnes of GHG emissions.”
A growing number of New Zealand organisations are providing credible offsets with demonstrable benefits, with Toitū Envirocare (part of Landcare Research), the Crown Research Institute, and Ekos among the leaders.
Offsets are highly affordable. For example, for an economy-class round trip from the UK to New Zealand the price is $260–$300, based on a November 2020 cost of offsets of around $38 a tonne of CO2. The range reflects the differences in the way suppliers calculate the emissions generated. By comparison, the UK government’s departure tax for the out-bound flights is $160, while the New Zealand government charges a $35 International Visitor Conservation and Tourism Levy.
Starting as a volunteer programme, inbound tourists should be encouraged to be carbon-neutral travellers, not just for their international flights but for their carbon footprint from transport, accommodation, activities and other sources while they are here. Tourism and travel organisations could offer them easy-to-use calculators to do so, and show them where their offsets were being put to good use. Visiting those projects, such as regenerating native forests, would help them to deepen their knowledge of the country, to get to know us better and to enrich their visit to Aotearoa.
Developing such a programme first with domestic tourists would be a way for us to learn about the journey to a deeply sustainable country, thereby increasing tourism’s social and cultural value to society. It would also be an incentive for tourism and travel operators to invest in such a future for their businesses as they help to accelerate the shift to clean tech and energy, thereby increasing tourism’s economic and ecological value to society.
Such profound change is underway in many sectors. For example, the Primary Sector Council’s Fit for a Better World vision, mission and strategy document, released in July 2020, is based strongly on the concept of regenerative agriculture. This is given a unique and deeply New Zealand context through its embrace of Te Taiao, an expression of te ao Māori, the world view of humankind’s symbiotic relationship with nature. With the strategy document, the council released a companion document describing this. It is called Te Taiao Ora Tangata Ora – the Natural World and Our People Are Healthy.
The traditional view of sustainability is broadly about changing the way we do things to minimise the negative impact we have on ecosystems, people and society. The concept of regeneration, though, goes far further. It’s about redesigning everything we do so we help nature, people and society recover and flourish.
We could help nature rebuild its diversity and vitality, resilience and fecundity in all of Aotearoa’s land, waters, atmosphere and oceans. Ways to do so include eradicating predators from native bush; helping threatened species recover; making infrastructure compatible with natural environments; ensuring tourism and other human activities do not degrade pristine places; and using natural resources in ways that help renew and regenerate the ecosystems which provide them to us.
As a nation, we define ourselves in large part by our wild and rural places, even though a higher proportion of people live in towns and cities than in many countries in Europe and elsewhere. We could give expression to our distinctive style of urban life by bringing nature back into our towns and cities to make them healthier and more productive, in terms human and natural. Ways to do so include travelling less by relying more on virtual communications and on walking, cycling and public transport; by restoring urban rivers and coastal waters; and by bringing more of nature back into urban environments to help us feed ourselves and restore urban ecosystems.
Imagine just one example. We make Matariki a great midwinter festival, celebrating in places urban, rural and wild the turn in our seasons towards natural and human regrowth. Festivals of music, the arts, food, adventure, sport, science, innovation, industry and more would be a great draw for domestic tourists; and an even stronger one for visitors escaping ever hotter northern hemisphere summers for our mild winter days which are perfect for outdoor and indoor activities.
An enlivening logic runs through these great ambitions. We must learn how to work with nature, not against it. In all we do. This is the journey tourism reinvented can take us on. As we regenerate our ecological and economic, social and cultural capitals, we in turn will richly reward tourism.
Rod Oram contributed this essay to 100% Pure Future: New Zealand Tourism Renewed. It is a collection of pieces on the sector's future published by BWB Texts this week.
Jim Hepple is an Assistant Professor at the University of Aruba and is Managing Director of Tourism Analytics.