Opportunities for Sustainable
Investment and Financing in
Tourism:
The SIFT Network
Erica Allis
United Nations Environment Programme
Eleventh Caribbean Conference on Sustainable Tourism Development
May 9th-13th St. Michael, Barbados
How investment is often done
So they build this
People want this
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Two Faces of Tourism
When well managed, can be very, very, good
• Profitability, local jobs, foreign exchange,
infrastructure development, and cultural exchange.
• Natural and cultural attractions enhanced.
• Sustained return on investment.
When mismanaged it can be horrid!
• Local poverty, pollution, declining destination.
• Natural and cultural attractions damaged.
• ROI declines in the long-term.
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Sustainability and investment
Sustainability
• applies to all forms of tourism, at all scales,
everywhere.
• means that natural and cultural resources,
the fabric of society, and the generation of
wealth can continue indefinitely.
Unsustainable
• Impacts of investment and finance decline
steadily over-time
• Destinations may ultimately no longer
attract targeted consumers.
Tourism is a key sector for
the shift to a Green Economy
GDP
Contribution
Trade
Investment
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• >5% of GDP of all countries
• 2-12% in Advanced Diversified Economies
• up to 40% in Small Island Economies and
Developing Economies
• (UNCTAD, 2010)
• 33% of global “trade in services”
• Virtually all LDCs are tourism net
exporters
• Unusual in trade in services - the
consumer comes to the supplier
• (WTO, 2010)
• Caribbean tourism was 22% of total
investment for the region (WTTC, 2009)
Why most tourism investment is
not sustainable
Short-term
vision
• Short-term investment does not look
at financial impact of unsustainable
practices.
Business
case
• Investors and developers are unclear
about the return on investment (ROI)
from sustainable tourism.
Lack of
incentives
• Lack of policy framework to provide
incentives.
The Sustainable Investment and Finance in Tourism (SIFT)
Network is intended to resolve these problems
Investment and finance challenges
on sustainability
Public Sector
Private Sector
Lack of awareness and capacity
Integrating sustainability as a relevant
factor for tourism investors
Difficulties in integrating environmental,
social, and governance issues
Delivering projects and investments on
smaller scales
Challenges in driving innovation
Demonstrating of positive influence of
sustainability on tourism ROI
Lack of policies and guidelines
Lack of transparency in claimed
sustainable development
Lack of information
Availability, knowledge, and acceptance of
standard criteria or guidelines
Fragmentation of the tourism industry
Developers lack incentives to adopt
sustainable criteria
Lack of inter-donor coordination
Investment focus on established
companies, developers, and providers
The Sustainable Investment and
Finance in Tourism (SIFT) Network
• To become the leading
creator and facilitator of
Vision
investments in
sustainable tourism
development
Sustainable Investment and Finance in
Tourism (SIFT) Network
• SIFT aims to become
the leading creator and
facilitator of
investments in
sustainable tourism
development.
Investment
Impact
• Tourism investment can be an
effective tool for
 generating sustainable
economic returns,
conserving natural areas
and its biodiversity,
 creating employment
opportunities for local
communities.
What is SIFT?
• A network to enable investors, financiers,
and destinations to share knowledge and
encourage investments in tourism
development that is financially,
environmentally, and socially sustainable.
What will SIFT do?
• Match sustainable projects in developing
Facilitate
Facilitate
countries with existing funds.
sustainable
sustainable
investments
investments • Pilot projects
• Benchmarking environmental and social
Tools to
impacts of investment
mainstream
Sustainability • Voluntary initiatives to screen investments
for sustainability
Disseminate
information
• Practical research, training, publications
• Business opportunity forums, joint
venture workshops
SIFT Stakeholders
Governments
NGOs
Local
communities
• Information on opportunities for sustainable investment and
finance.
• Capacity building for sustainable investment policy.
• Securing investment for sustainable destinations.
• Platform to engage like-minded organizations and countries in
joint project activities.
• Learning network – dissemination of best practices and lessons
learned.
• Strengthening living cultures and conserving biodiversity.
• Increase local jobs and local revenues.
• Poverty alleviation.
SIFT Stakeholders
Multilateral
financial
institutions
Private sector
companies
Private
investors &
banks
• Tools for screening projects for sustainability before financing
• Platform to enable development organizations to identify and
support projects that maintain natural and cultural capital.
• Performance benchmarking, including social and environmental
cost and benefits
• Environmental and social management planning
• Identifying existing sources of sustainable financing
• Benchmarking financial returns on investment
• The business case for financing sustainable projects
• Identifying sustainable destinations and projects
SIFT Network
Planned three steps:
Step 1
Step 2
Step 3
• Bring
institutions
together
• Select
common
standards
• Match
investors
with
investment
Roadmap for SIFT
Concept paper &
business plan
(2009-2010)
Launch
(2010)
Incubation (20102012)
Operations (2012 - )
• Investment tool to pilot phase
• Scorecard to be adapted and tested
• Database of finance and investment organizations and companies
• Public launch & formal establishment
• Bring in private sector banks and investors
• Staffing
• Fundraising
• Housed in UNEP for 18-24 months,
• Aligned with GSTC as part of the Partnership
• Establishing platform to profile tools, lessons learned
• Functioning network for information exchange
• Pilot projects
• TSC can be used to identify sustainable enterprises and products
• Capacity building & promoting sustainability standards
• Research & tools development
• Expanding and maintaining connections between financial
institutions, governments, developers and tourism operators
SIFT and the Global Sustainable
Tourism Partnership
Tourism
Sustainability
Council (TSC)
Criteria and
standards
United
Nations
agencies
and
programs
Policies
Projects
Products
Informed
consumers
Specialized
knowledge
Private sector
buy-in
Global
Partnership
for
Sustainable
Tourism
Local knowledge
Regional
Networks
$$
Projects
Sustainable
Investment
and Finance
in Tourism
(SIFT)
Network
First tools for SIFT
UNEP-WWF
Investment Tool
Global Sustainable
Tourism Criteria (GSTC)
• Destination scale
• Calculates social and
environmental return on
investment (ROI)
• Benchmarks individual
enterprises and
destinations
• Enterprise scale (hotels
and tour operators)
• Unites all existing
sustainable tourism
criteria
• Widely accepted and
adopted by governments
& financial institutions
worldwide since 2008
• Framework for SIFT
investment criteria
IDB Tourism
Sustainability
Scorecard
• Based on the GSTC
• Project scale
• Central tool for financial
institutions to screen
projects
• To be adapted for use
worldwide by other
financial institutions
UNEP-WWF investment tool
Fig. 1: Schematic Diagram of Proposed
Model
Guidelines and sustainability checklist
Input
Tourist arrivals, expenditure
data, employment data
Investment
Appraisal
Input
Expenditure and sales
data
1
Private
Sector
Businesses
Input-Output
Model
Environmenta
l Matrix
2
Forecastin
g
Module
3
Socio-economic Module
Output
Benchmarking
and forecasts
Output
Economic, environmental and
socio-economic impact
results
Public
Sector
UNEP-WWF investment tool
UNEP-WWF investment tool
UNEP-WWF investment tool
UNEP-WWF Investment tool
• Final stages of development
• Looking for countries/destinations to pilot
the model
Thank you!
Erica Allis
erica.allis@unep.org
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