By Emily Bailey
At the annual ATN25 Conference earlier this year in February the topics of economic leakage and community tourism were both discussed in the panel session - "Can tourism have a positive impact?"
Image Credit - ATN24 Conference; Holly Tuppen, Alex Narracott & Meera Dattani
A recently released World Bank document reported that ‘to generate USD 10,000 in the local economy, it takes four adventure travellers, nine overnight package tourists, and 108 cruise tourists.' *
What does economic leakage mean? Simply put, it is tourism spend that flows out of the destination. The percentage of tourism leakage varies based on the destination and type of tourism. Encouragingly, 65% of what an adventure tourist spends remains within the country, compared to just 20% for mass tourism**.
How do we reduce economic leakage?
Choose small, responsible DMCs and suppliers
Partnering with responsible DMCs and suppliers offers growth opportunities for businesses that need to compete with larger operators. Tourism leakage includes the UK tour operator's international profits and operating costs. However, tour operators hold the key to unlocking global markets that small operators and accommodation providers may otherwise not have access to.
By partnering with small niche local operators, tour operators can incorporate unique, culturally immersive experiences, ensuring the money spent stays within the community that delivers the experience.
Support local employment
Working with suppliers that commit to employing local people ensures money stays in the community and has a multiplier effect. Hotels and lodges often import staff, particularly at the managerial level. Ask the suppliers you work with how they support local people's career progression.
Use local guides. Often, groups are led by one leader across the country (or a leader is flown in from the country of origin). In addition to your leader, use guides from the locality. This will enhance the experiences by educating and inspiring your clients about local cultures.
Support community tourism initiatives
Integrate community tourism initiatives into your itineraries. Engage with your DMC and the DMO to identify community tourism initiatives. You can gain invaluable insights into how they are managed and who benefits. Ask how they are measured and who manages them.
There are examples where the community impacts are closely measured. The Community Homestay Network in Nepal is a great example of understanding impact:
How to measure economic leakage:
Currently, there is no agreed methodology for measuring tourism leakage, which should not be a barrier to understanding how to minimise it. The measurements don’t all have to be numbers; understanding the social value of tourism is also important, which often can’t be measured in a number.
As Alex Narracot, co-founder of Much Better Adventures said, ‘We need to ask the difficult questions’. Transparency is essential in sustainability, so asking your suppliers who they are owned by, where the money goes, and who benefits will ensure you select the right partners."
By asking those difficult questions, Much Better Adventures has calculated that $78 for every $100 spent stays locally.
What methods can we use to measure?
Start by defining ‘local’; even small DMCs have international ownership but are residents of the country in which they operate.
Understand the ownership structure of your DMCs and suppliers
Ensure community tourism is managed by the community
Ask your DMCs if they measure economic and social impact
Carefully communicate positive impact - the term economic leakage will probably not appeal to customers.
What are the benefits of stemming the leak?
Immersive experiential products make for a better customer experience
Empowering communities creates long-term positive social and economic impact
Protects nature and biodiversity - communities are custodians of their land
Reduces overtourism with visits to lesser-known areas
Longer stays - more immersive experiences mean staying in one location longer.
**According to UNWTO Volume Nine – Global Report on Adventure Tourism, 2014
-Ends-
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About the Author
Emily Bailey is the face behind Just Tourism, a consultancy creating bespoke sustainable tourism plans with achievable goals for adventure and niche tour operators.
Emily is passionate about adventure travel and ensuring tourism experiences have a positive impact on the planet and its people.
She supports ATN and ensures everything on the technical side of the virtual supplier/buyer marketplace is in place, prior to the event. She also adds insight into the panel sessions, particularly related to sustainable tourism.
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