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What is travel and tourism’s role in future global prosperity?

The travel and tourism sector faces many challenges in a disrupted world, from geopolitical tensions to climate change. Image:  Unsplash.

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• The travel and tourism sector faces many challenges in a disrupted world, from geopolitical tensions to climate change.
• The sector can be a powerful driver of sustainable economic prosperity – supporting people and places.
• The latest Travel and Tourism Development Index benchmarks the factors and policies that enable resilient and sustainable development.

With 2023 at an end, the Travel and Tourism (T&T) sector is finally positioned to move past the impact of the pandemic, with international tourist arrivals anticipated to reach levels reminiscent of the pre-pandemic era . However T&T sector stakeholders and destinations are navigating a complex terrain marked by external challenges such as geopolitical and economic uncertainty, inflation and dangers from the proliferation of extreme weather events like wildfires.

Many of these issues represent broader ongoing and longer-term economic, environmental, societal, geopolitical and technological trends. Within this context, consumers, policy-makers and advocates have expressed growing apprehension about the sector’s record on sustainability and its role in issues such as climate change, overcrowding, and overall impact on local communities.

Against this dynamic backdrop, it becomes imperative for the leaders and visionaries of the T&T industry to not only comprehend the impending trends but also acknowledge the sector's potential to tackle global challenges. When managed thoughtfully, travel and tourism emerge as potent drivers of resilient and sustainable development, contributing to the collective well-being of our planet.

The TTDI benchmarks and measures “the set of factors and policies that enable the sustainable and resilient development of the T&T sector, which in turn contributes to the development of a country”. The TTDI is a direct evolution of the long-running Travel and Tourism Competitiveness Index (TTCI), with the change reflecting the index’s increased coverage of T&T development concepts, including sustainability and resilience impact on T&T growth and is designed to highlight the sector’s role in broader economic and social development as well as the need for T&T stakeholder collaboration to mitigate the impact of the pandemic, bolster the recovery and deal with future challenges and risks. Some of the most notable framework and methodology differences between the TTCI and TTDI include the additions of new pillars, including Non-Leisure Resources, Socioeconomic Resilience and Conditions, and T&T Demand Pressure and Impact. Please see the Technical notes and methodology. section to learn more about the index and the differences between the TTCI and TTDI.

Why travel and tourism have a role to play in future global prosperity

The recently released World Economic Forum’s Global Risk Report 2024 sheds light on the short- and long-term risks that the world faces. According to the report’s survey results, economic and societal risks, such as inequality, inflation, migration, and economic downturns, take center stage in the next two years, while environmental concerns, including extreme weather events and biodiversity loss, dominate the global risks for the next decade.

Given that T&T accounts for 7.6% of global GDP and close to 300 million jobs , the sector plays a critical role in addressing societal and economic challenges. The sector's significance magnifies as it empowers small- and medium-sized enterprises, with over 80% of T&T businesses falling under this category. It also plays a pivotal role in employing women, youth, migrants, and informal workers, thereby contributing significantly to economic opportunities .

T&T is also a major driver of global connectivity at a time when geopolitical tensions and conflict are on the rise, while globalization seems to be slowing. In the coming decade, T&T’s role in mitigating socioeconomic risks will only climb, with the World Travel and Tourism Council forecasting T&T sector GDP to grow at nearly double the rate of the broader global economy in the 10 years to 2033, thereby adding more than 100 million new jobs.

On an environmental level, T&T is a key stakeholder in addressing climate change and protecting the environment. The sector is not only affected by these challenges but also contributes to climate change with around 8% of global anthropogenic greenhouse gas emissions stemming from tourism activities. Therefore, actions in the sector, especially in hard-to-abate segments like aviation, are important to helping meet global climate change targets. Moreover, many destinations' dependence on nature-based attractions makes T&T a means to generate economic value for protecting nature.

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To unlock the full potential of T&T as a tool for addressing many of the world’s ongoing and future challenges, sector leaders must prioritize sustainability and resilience in their development strategies.

The Global Future Council on Sustainable Tourism emphasizes the importance of creating standards and metrics for sustainability, cultivating a well-trained and inclusive workforce, prioritizing and engaging with local communities, aligning visitors with destinations carrying capacity and making appropriate investments in relevant infrastructure .

Achieving these goals necessitates a high degree of collaboration among sector and non-sector businesses, employees, and government actors at national and local levels, including tourism and environmental agencies, civil society, and international organizations.

In the coming months, the Forum, in collaboration with the University of Surrey, will unveil the latest edition of the Travel and Tourism Development Index (TTDI). This index promises to provide a comprehensive understanding of the factors and policies that enable the sustainable and resilient development of the T&T sector.

Drawing on the latest data encompassing environmental and social impacts of T&T, labour markets, infrastructure, natural and cultural resources, and demand sustainability, the TTDI offers insights into the challenges ahead, the sector's readiness for risks and opportunities, and how it can be leveraged to address global issues. The importance of T&T for global prosperity will only grow in the years, creating new opportunities for shared commitment to a sustainable and inclusive future.

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Travel Will Inject a Record $11 Trillion Into the Global Economy This Year: Report

Tourism is expected to become a $16 trillion industry by 2034, the world travel & tourism council says., rachel cormack.

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All your jet-setting and hotel-hopping is having a significant effect on the global economy.

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The 14-figure sums can be broken down into three types of travel transactions, Bloomberg notes. Direct travel spending includes things like hotels, tours, and transportation, as well as public investment in these types of services. Indirect travel spending covers the expenses of those businesses, such as sheets and towels or the ingredients for the breakfast buffet. Finally, induced spending accounts for the trickle-down effects of hospitality employees.

In total, 142 out of the 185 surveyed countries are expected to exceed their 2019 tourism performance levels in 2024. Almost all nations are expected to see year-over-year growth, too. As a result, records are likely to be broken on a local level as well as a global.

Rachel Cormack is a digital editor at Robb Report. She cut her teeth writing for HuffPost, Concrete Playground, and several other online publications in Australia, before moving to New York at the…

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World Economic Impact Report

Discover the direct and total economic contribution that the Travel & Tourism sector brings to the World economy in this comprehensive report.

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This latest report reveals the importance of Travel & Tourism to the World economy in granular detail across many metrics. The report’s features include:

• Absolute and relative contributions of Travel & Tourism to GDP and employment, international and domestic spending

• Data on leisure and business spending, capital investment, government spending and outbound spending

• Charts comparing data across every year from 2014 to 2024

• Detailed data tables for the years 2018-2023 plus forecasts for 2024 and the decade to 2034

Purchase of this report also provides access to two supporting papers: Methodology and Data Sources and Estimation Techniques.

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Travel Industry Takes Crucial First Step Toward Combating Climate Change

More than 300 travel companies, tourism boards and countries have signed the Glasgow Declaration on Climate Action in Tourism, the first step for a shared road map to cut carbon emissions.

By Ceylan Yeginsu

The travel industry has reached a turning point.

As thousands of scientists, government officials and business leaders met in Glasgow over the past two weeks for the pivotal United Nations climate conference , hundreds of members of the trillion-dollar tourism industry came together and made the first commitment toward a shared road map to cut carbon emissions in half by 2030 and reach “net zero” by 2050.

More than 300 global travel stakeholders, including tour operators, tourism boards and hotel chains, have signed the Glasgow Declaration on Climate Action in Tourism, requiring them to submit a concrete and transparent plan within 12 months. While the details have yet to be put forward, the companies and countries that signed on, from Germany railway company Deutsche Bahn AG to the country of Panama, will be expected to disclose their carbon emissions and offer clear strategies for how to reduce them. The process is being spearheaded by the U.N. World Tourism Organization and the World Travel & Tourism Council, two industry bodies that have previously sparred on climate matters.

“This is undoubtedly the biggest climate commitment our industry has come together for,” said Jeremy Smith, the co-founder of Tourism Declares a Climate Emergency , an initiative that supports climate action and provided the framework for the Glasgow Declaration.

“Our initiative launched two years ago because the industry had no collective plan, and we did well getting over 400 tourism organizations on board without funding,” he said. “But the Glasgow Declaration builds on our work. It’s the coming together of major players in our sector and it’s owned by everyone who has signed it, establishing collective responsibility.”

The travel industry is a large contributor to global carbon emissions, with a footprint estimated between 8 and 11 percent of total greenhouse gases, according to the World Travel & Tourism Council, or W.T.T.C . Aviation alone represents around 17 percent of total travel carbon emissions. Each year, a growing number of destinations and communities heavily dependent on tourism — countries like Thailand, India and Madagascar — are hit hard by the impacts of climate change, in the form of rising sea levels, drought, wildfires, deforestation and biodiversity loss.

The pandemic spotlighted the adverse impact of industry growth and overtourism on Venice, Bali and other popular destinations, forcing some places to take stock and pivot toward more sustainable and environmentally friendly business models. Yet with most operators and destinations reeling from the industry shutdown last year, it is unclear how many of those plans will be prioritized over the need for fast recovery.

“We need a cultural change and we need to move beyond the traditional growth-oriented mind-sets to see a more sustainable, responsible and climate-neutral tourism ecosystem,” said Patrick Child, deputy director general of environment at the European Commission.

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‘A lot of apathy’

The declaration has four main targets: measurement, requiring companies to disclose all travel- and tourism-related emissions; decarbonization, by setting targets aligned with climate science; regeneration, to restore and protect natural ecosystems; and collaboration, to ensure best practices are shared and financing is available to follow through.

A recent analysis by the W.T.T.C. of 250 travel businesses found that only 42 percent had publicly announced climate targets and many of them were not based on the latest science. The council last week published a road map for different industries within travel, providing concrete guidance on how to reach “net zero” targets by 2050.

“There has been a lot of apathy, with some people not quite sure about what they need to do and how to do it, or some thinking they are not significant enough, and that’s why it’s really important for larger organizations to show the way,” said Darrell Wade, the co-founder and chairman of Intrepid Travel , the only global tour company with a climate target verified by the Science Based Targets initiative , which promotes best practices in emissions reductions in line with climate science.

Joining Deutsche Bahn and Panama in signing the Glasgow Declaration are big companies like Accor, Skyscanner, The Travel Corporation and Iberostar Group , as well as countries that are already affected by climate change, including Norway and Barbados. Signatories hope that more destinations will participate in the coming weeks.

Throughout his experience in the Tourism Declares a Climate Emergency initiative, Mr. Smith found it easier to get smaller, more agile companies and smaller countries involved. When it came to larger companies, there were more barriers and obstacles, he said.

“When you reach a destination, or even a city, it becomes even harder because there are multiple different players with different interests at the scale of a country,” he said. “It takes time.”

Panama, one of only three carbon-negative countries in the world (meaning that it absorbs more carbon emissions than it emits), has taken a lead role in establishing initiatives for economic growth in tourism, which also benefit and preserve local communities and resources.

“Our main plan for our sustainable tourism market is to empower local communities, particularly Indigenous people, so that they can generate an income through tourism that allows them to preserve their ancestral way of life, allowing them to sustainably manage their natural resources like forests and coral reefs,” said Ivan Eskildsen, Panama’s tourism minister.

He pointed to an example of a trail that was built in a national park that was designed to involve local communities in the active management of the area. “Over 30 percent of our land and sea are preserved national parks, so it’s humanly impossible to supervise all these areas,” he said. “The community can benefit economically from these areas and will also be prone to stay and take care of it instead of only coming there for short-term income.”

Visit Scotland, that country’s national tourism organization, which helped draft the declaration, has also taken a lead role. The organization has reduced its own carbon emission by 74 percent since 2008, and more than 850 local businesses have been given green tourism awards for their sustainability efforts.

Challenges persist

While the Glasgow Declaration has garnered great momentum and established common objectives, challenges lie ahead, especially when it comes to setting a global standard for reporting emissions figures for such a wide range of sectors within the industry, from tour operators to destinations, and airlines to cruise ships.

Signatories are expected to hold each other accountable and set common standards throughout international supply chains. Once action plans have been submitted within the next year, a reporting framework will be necessary. Anyone who fails to submit a road map within that time frame will be removed from the declaration.

“It is really important to bring value chains together,” said Catherine Dolton, the chief sustainability officer at IHG Hotels and Resorts. “Hotel developers, hotel owners, investors, franchisees, as well as the operators, are all impacting sustainability at different stages of the hotel life cycle.”

Visibly absent from the list of signatories were members of the cruise industry. The sector made a separate pledge to pursue carbon-neutral cruising by 2050 and reduce emissions 40 percent by 2030 in an annual environmental report, published last week by the industry trade group, Cruise Line International Association. While the report makes detailed commitments to reducing the cruise industry’s carbon footprint using new technology and alternative fuels, it does not address other environmental issues such as discharge of waste.

“Despite technical advances and some surveillance programs, cruising remains a major source of air, water (fresh and marine) and land pollution affecting fragile habitats, areas and species, and a potential source of physical and mental human health risks,” according to a recent report by the Marine Pollution Bulletin Journal.

Though there was some disappointment about the limited participation of some industries in the pledge, the overall sentiment was one of optimism and a belief that the declaration would lead to real change and less “greenwashing,” a term used to describe companies that try to portray themselves as more environmentally minded than they actually are.

“I’ve long been quite pessimistic about travel and tourism’s approach toward climate change,” said Mr. Wade of Intrepid Travel, which recently published a tool kit, available online, to help travel businesses measure and reduce their carbon emissions. “But now I’m really very optimistic because there is broad-level support from the industry to actually reduce emissions, and it’s the first time I’ve seen real concrete commitments from industry and governments.”

Follow New York Times Travel on Instagram , Twitter and Facebook . And sign up for our weekly Travel Dispatch newsletter to receive expert tips on traveling smarter and inspiration for your next vacation. Dreaming up a future getaway or just armchair traveling? Check out our 52 Places list for 2021 .

Ceylan Yeginsu is a London-based reporter. She joined The Times in 2013, and was previously a correspondent in Turkey covering politics, the migrant crisis, the Kurdish conflict, and the rise of Islamic State extremism in Syria and the region. More about Ceylan Yeginsu

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National Travel and Tourism Week (NTTW) is an annual celebration that underscores travel’s essential role in driving our nation's economy, cultivating vibrant communities and forging connections.

Established in 1983, NTTW has become a cherished tradition, celebrating the U.S. travel community and highlighting how travel stimulates economic growth, creates quality jobs, inspires new businesses and elevates the quality of life for Americans every day.

Get ready to celebrate NTTW from May 19-25, 2024.

While NTTW has historically been celebrated during the first full week of May, this year’s NTTW dates were shifted due to a conflict with U.S. Travel’s IPW.

View the toolkit resources. 

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