Tourism as a source of vulnerabilities ?
The role of Islands ‘Heritage
Vincent Geronimi, Christine Le Gargasson,
Natalia Zugravu, Jessy Tsang King Sang
Colloque « Spécialisation touristique et vulnérabilité : Réalités et enjeux
pour le développement soutenable des petits territoires insulaires »,
CEMOI, 4-6 décembre 2014, Université de la Réunion.
Introduction
Under which conditions a tourism specialization can be sustainable for Small Island
Economies ?
• Ambiguous results on the connections between growth and tourism
specialisation:
• Engine of growth (Lanza & Pigliaru, 2000 ; Pablo-Romero & Molina, 2013), and more
specifically for small islands economic development (Hampton & Jeyacheya, 2013 ; Seetanah,
2010)…
• …Though with a decreasing marginal impact on economic development (Holzner, 2011 ;
Adamou & Clerides, 2010).
• Our own results exhibit a non-linear connection between tourism specialisation
and vulnerability (Economic Vulnerability Index, EVI):
• Tourism specialisation increases economic vulnerability using a large sample of countries.
• We also find that for limited and strong tourism specialisation, tourism specialisation
increases economic vulnerability, though intermediate tourism specialisation does not impact
vulnerability, for SIDS and non-SIDS as well.
Tourism contribution to Vulnerability
lnK
lnLabor
Results from a panel regression with random
effects
lnVoice&Account
lnOpen
lnFDI
lnEducation
List of variables
lnNatResRent
EVI
SIDS x lnNatResRent
GDPcap
K
Retrospectif EVI according to the 2012 definition
lnTourGDP
GDP per capita (constant 2005 US$) [NY.GDP.PCAP.KD]
Gross fixed capital formation (constant 2000 US$)
(lnTourGDP)2
Labor force, total
SIDS x (lnTourGDP)2
Voice&Account
Voice and Accountability: Estimate
(lnTourGDP)3
Open
Trade (% of GDP) [NE.TRD.GNFS.ZS]
SIDS x (lnTourGDP)3
FDI
Foreign direct investment, net inflows (BoP, current US$)
[BX.KLT.DINV.CD.WD]
lnTourGDP x lnNatResRent
Education
Labor force with tertiary education (% of total)
TourGDP
(2)
lnEVI
only SIDS
0.025
(0.105)
-0.096
(0.159)
-0.897
(0.547)
0.012
(0.237)
-0.001
(0.034)
-0.289*
(0.080)
(3)
lnEVI
SIDS vs all
-0.092*
(0.030)
0.018
(0.035)
-0.217*
(0.077)
0.088+
(0.046)
-0.016*
(0.008)
-0.070*
(0.020)
0.214 +
(0.127)
-6.421
(4.453)
-0.119
(0.087)
2.991
(2.094)
0.013
(0.019)
-0.440
(0.317)
0.254 +
(0.132)
-2.833
(2.134)
-0.247 *
(0.117)
1.283
(1.008)
0.068 +
(0.036)
-0.215
(0.154)
SIDS x lnTourGDP
Labor
NatResRent
(1)
lnEVI
All
-0.080*
(0.030)
-0.013
(0.031)
-0.272*
(0.074)
0.129*
(0.044)
-0.016*
(0.008)
-0.062*
(0.019)
SIDS x lnTourGDP x lnNatResRent
SIDS
total natural resources rents of gdp
Tourism contribution to GDP_% share
latitude
Latitude in degrees
SIDS
=1 if SIDS, 0 - otherwise
latitude
_cons
N
r2_w
r2_b
r2_o
-0.004*
(0.002)
5.183*
(0.532)
214.000
0.327
0.489
0.558
0.009
(0.006)
11.521*
(3.662)
38.000
0.354
0.793
0.695
2.430+
(1.451)
-0.004*
(0.002)
5.355*
(0.565)
214.000
0.355
0.531
0.603
(4)
lnEVI
SIDS vs all
-0.056+
(0.030)
-0.005
(0.040)
-0.228*
(0.067)
0.095+
(0.049)
-0.015*
(0.007)
-0.044*
(0.020)
-0.025
(0.028)
-0.536*
(0.134)
0.006
(0.082)
-1.066 *
(0.214)
-0.001
(0.015)
0.162 *
(0.072)
3.094*
(0.518)
-0.003+
(0.002)
4.832*
(0.628)
172.000
0.627
0.454
0.448
Introduction
• Thus thresholds affect the relationship between tourism, growth and
vulnerability
• Considering vulnerability as a risk of non-sustainability, we propose here an
analysis of these thresholds using a sustainability and total wealth
approach (Hamilton 2006, Couharde et al.2010).
• Two proposals:
• Tourism impacts on growth are shaped by the kind of tourist services supplied.
• For Small islands with high costs of production (mainly due to remoteness and
limited size of markets), differentiated tourist services, based on heritage, are more
likely to support weak and strong sustainability.
Outline
• Assets, weak and strong sustainability
• The stakes of tourism for small islands sustainability
• Tourist services: price competition vs heritage based differenciation
• Conditions for the sustainability of tourism specialization.
Sustainability definition: an asset based approach
Weak and strong sustainability: New-Caledonia
Weak Sustainability:
• Genuine savings > 0
25%
Epargne véritable en pourcentage du RNDB
Tendance
22.5%
Strong Sustainability:
• Limited rural migration
(Pestana, 2012)
20%
17.5%
15%
12.5%
10%
7.5%
1970
1975
1980
1985
1990
1995
2000
2005
• Preserved social and human capital (IAC, 2013)
• Investment in economic and human capital
more than compensates the depreciation of
natural capital
• The question of public transfers (géo-strategic
capital ) ?
Weak sustainability vs vulnerability: the heterogeneity
of SIDS
La diversité des petites économies insulaires (PEI), et des Small Islands Development States
(SIDS) au regard des critères de soutenabilité et de vulnérabilité
Rents, assets and total wealth
• Following Hamilton (2006), the natural capital is valuated through rents (the difference between
price and costs of production).
• Intangible capital is the most important component of total wealth. It encompasses all
components that are not directly computed: human capital, social capital, cultural capital,…
• Each rents can be associated to a specific capital.
Total Wealth composition,
Average SIDS, 2012
Total Wealth composition,
Nouvelle-Calédonie, 2006
15%
15%
15%
27%
58%
70%
Capital naturel
Capital intangible
Capital physique
Capital naturel
Capital intangible
Capital physique
PEI: Assets, rents, risks and sustainability
Assets
Assets /
Heritage
Natural capital Natural capital
Intangible
capital
Human and social
capital
Geo-strategic
capital
Rents
Risks
Exports of primary
Fluctuation of
commodities
international prices
Migrations
Strong
sustainability
Simultaneaous
degradation of different
capitals: loss of human
capital and social capital
(e.g. rural emigration)
Loss of social and human
capital with decreasing
remittances
Closure of
boundaries and
"brain drain"
Military, nuclear or Volte-face and Decreasing geo-strategic
stakes
strategic and
decreasing transfers
administrative
Heritage based tourism and rents
• Tourist services non differentiated, competition through price (sea/beach/sun):
No rents and high costs (remotness,…)
• Differentiated tourist services (heritage based, on specific assets), sources of rents
Capital/ Heritage
Specific intangible capital; Human,
social and cultural
Outstanding natural capital
Rents
Non sustainability risks
Differentiation of tourist services:
Prices higher than average costs of
production
Loss of differentiation:
folklorisation, depreciation of social
capital and traditionnal sectors (ex.
Bali, île de Pâques)
Over-crowding, environmental
degradation
Typology of SIDS’ tourist services: competition through
prices or heritage mobilization
Tourism specialization
Average 1988-2013
Weak/ Limited
(<20%)
Medium/ Strong
(>20%)
Non differentiated Tourist Services
<0
Limited tourism
specialization
« Price » evolution
(Tourists
expenditures per
capita (19882013))
>0
Guinée Bissau, Guyane, Haïti,
Papouasie Nouvelle-Guinée,
Bahreïn, Seychelles, Singapour,
Trinidad et Tobago
Maurice, République dominicaine, Fidji,
Jamaïque, Sao Tome et Principe, Belize,
Cap-Vert
Differentiated tourist services
Tonga, Saint Kitts et Nevis, Antigua et
Barbuda, Grenades, Bahamas, Vanuatu,
Sainte Lucie, Dominique, Samoa, Saint
Vincent, Maldives
Perspectives
• Tourism and connections between different kind of capital. Some
preliminary results:
• Concerning the impact of tourism on the GDP per capita
• Substituability between tourism and economic / human capital for low level of the
latters, complementarity for high level of human and economic capital
• Complementarity between tourism and natural capital
• For SIDS, complementarity between tourism and natural capital
• Integration of heritage (e.g. Arezki et al., 2009, using World Heritage
List) in the analysis of the connection between tourism and economic
development. Measuring cultural capital.
Thank you !